§ Mr. Heffer
I beg to move Amendment No. 19, in page 2, line 17, leave out 'July' and insert 'January'.
The Temporary Chairman
With this we are to take the following amendments: No. 21, in page 2, line 20, leave out sub-section (3).
§ No. 22, in page 2, line 22, leave out '1977' and insert '1976'.
§ No. 23, in page 2, leave out lines 23 to 25.
§ No. 30, in page 2, line 37, leave out 'July' and insert 'January'.
§ Mr. Heffer
The purpose of Amendments Nos. 19, 22 and 30 is to bring forward by six months the date of expiration and renewal of the Bill. Instead of the Act, as it will be, ceasing to be in force on 31st July 1976, it would end on 31st January 1976. Then, if it were to be renewed, instead of being for one year, it would apply for only six months; namely, until July 1976, not July 1977 as is proposed in the Bill.
My hon. Friends and I recognise that the Government feel strongly that something must be done to tackle inflation and that the way to do it is by the £6 limit on wage increases. That is not our view. Nevertheless, we believe that our proposal could be a compromise. Let us give it a go for six months. In that time the Government could carry out some of the other measures which we believe are essential to deal with our serious economic problems, including the basic issue of inflation. We suggest that, having accepted that we must have this policy, let us have it for six months, not one year.
The Government's argument against that no doubt will be "If we do not have the policy for one year, we shall be going back on our word", and that six months is too short a period. However, I suggest that within six months we shall have a pretty clear indication whether the Government are right about this policy bringing down inflation. My view is that it will not.
I understand that the Government fear that, if they go back on their word of 1066 12 months ago, Arab money will be pulled out of this country. I understand that the real problem is that at any time the Arabs can withdraw their money, that the pound will collapse, and that we shall have a great crisis with not just 1 million unemployed—I find that scandalous—but 4 million or 5 million unemployed.
We do not like this policy, but we recognise that it will be put into effect because it is clear that the Front Benches on both sides of the Committee are basically in favour of it. Therefore, we suggest that this compromise could be accepted by the Government.
§ 6.30 a.m.
§ No concessions have been made so fat to Government supporters, apart from that made to my hon. Friend the Member for Bethnal Green and Bow (Mr. Mikardo). I stress that we are Government supporters. We were elected on the basis of the Labour Party manifesto, We believe that we have the right to make our voice heard and that the Government should take our views into consideration and make a concession to our point of view. This is the least concession which the Government can make in our direction. The Government should say "We shall enforce this provision for six months, but not for a year." If the Government are worried about Arab or other money flowing out of the country, the measure can, if necessary, be renewed for a further six months, so that it will apply for a total of one year.
§ We believe that this is a moderate and sensible series of amendments, which the Government can accept. The £6 policy can still be enforced for one year. This is a good compromise.
§ Mr. Ron Thomas
I support these amendments. I do so because they will inject flexibility into the legislation so that at the end of six months we may seriously reconsider it.
Collective bargaining concerns the defence against the erosion of living standards. However, in the past few years the trade unions have, through their collective bargaining machinery, been chasing prices. Yesterday The Times said:Further evidence that rising prices are now severely eroding the purchasing power of the pay packet is revealed in figures for consumer spending published yesterday by the Central Statistical Office.1067In the second quarter of this year consumer spending dropped to its lowest level for two years, excluding the exceptional circumstances of three-day working during the early months of 1974.I am concerned about those workers who secured pay increases at the beginning of the last so-called pay round. Their cases will presumably be reconsidered by means of collective bargaining at the beginning of the next pay round. The increases which they negotiated 12 months ago have been eroded by about 25 per cent. Presumably they will be lucky if they receive a further £6, less tax at 35 per cent., next August or September to cover a period of 23 months.
This policy will mean a savage cut in the living standards of these workers, and will result in injustice. Different groups of workers will find themselves in different situations depending on their position in the previous pay round. The shorter period which we suggest will enable us to look again at the situation. Equally, the previous debate showed that many anomalies and problems will arise under this legislation. So the Government will need to look at it again fairly soon.
The £6, or part of it, will be a supplement outside the basic rates. It will not count for overtime, holidays and so on but will stand on one side. Mention has been made of low-paid workers earning £30 a week. Where workers are paid for overtime at time and one-fifth it does not take a mathematician to work out that if they receive another £6 a week they will be paid more for working normal hours as they will for working overtime, or at least as much as, because the £6 is not included in the overtime calculation. Holiday pay will also be £6 less, and the £6 is not included for bonuses and so on. Many anomalies of that kind will be thrown up.
I appeal to the Government to think seriously about accepting the amendment so that in six months' time we can look at this matter again. I hope that by then we shall have sorted out policies which are in tune with the last Labour Party manifesto.
§ Mr. Michael Latham
I wish to refer to Amendments Nos. 21 and 23 which are grouped with Amendment No. 19 and deal with the expiry of the powers and the methods of prolonging their life if so desired.
1068 Subsections (2) and (3) are bizarre in their possible consequences. If they wish, Ministers have power by affirmative resolution to keep the Act going for one year beyond 31st July 1976. Under subsection (2), if they so wish, they can terminate Clause 1 of the Bill before 31st July 1976. Under subsection (3)(b), having terminated the operation of the Bill by order on 1st March 1976, if they decide that they have made a mistake they can bring it back again a few months later.
That is a bizarre series of powers. Ministers must make up their mind whether they want a counter-inflationary policy. If they do, let them have a terminal date for it and, if necessary, the right to have one year's extension. To suggest that they should be able to terminate the powers and then, if necessary, bring them back again is a ludicrous procedure, and I am glad that my hon. Friends put down the amendments to draw attention to it.
§ The Paymaster-General (Mr. Edmund Dell)
Clause 2 deals with the duration of Clause 1 and certain provisions of the Counter-Inflation Act 1973. My hon. Friends and certain Opposition Members wish to reduce the duration of the period during which these powers will be available.
I appreciate—how could one avoid it after the debates of the past 15 hours?—that there are many hon. Members who question the value of an incomes policy. The Government have decided that they need an incomes policy of this kind. We had a debate on the White Paper which the House accepted. The House gave the Bill a Second Reading, and the Committee has recently adopted Clause 1 without a Division. The question now is how we provide the powers that are necessary to conduct a policy for incomes as effectively as possible.
In that context we have to think of a whole wage round at least. It is in those terms that the TUC is thinking. It would seem to make nonsense of the policy if it ceased to be effective half way through the wage round, or if it were even thought that it might cease to be effective at that stage. After all, one of the guarantees which an effective and successful incomes policy must provide is that those who settle early in the round 1069 and those who settle later in the round will be governed by the same rules.
That assurance would be removed if my hon. Friend's amendment were adopted because it would no longer be certain that after the first period of six months the policy would continue. It might continue or it might not, but the certainty would not exist. Therefore, people who settled early would be settling under uncertainty. If the policy did not continue they would wish to benefit from any higher settlements that were made at a later stage. Consequently the suggestions of my hon. Friends would make it far more difficult to achieve the Government's objective—namely, to bring down the rate of inflation to 10 per cent. by the third quarter of 1976 and down to single figures by the end of 1976.
My hon. Friend the Member for Liverpool, Walton (Mr. Heffer) says that I am unable to accept the amendment because I fear that acceptance would lead to money that has been loaned to us floating away at considerable cost to the standard of living. It is true that people who have loaned us money are concerned about our current rate of inflation and want to see it reduced. If we do not take action to reduce it those people will have considerable doubts about whether they should continue to lend us money. They are concerned not with the precise ways of achieving a reduction in inflation but with the result—namely, a positive reduction.
It is the Government who have chosen their method in consultation with and in agreement with the TUC. My hon. Friend the Member for Walton appeals that I should accept the compromise that he offers. I should be only too delighted to accept a compromise if it were consistent with an effective policy, but for the reasons I have given I fear I cannot so regard it.
My hon. Friend's amendment would also have the effect of removing the option of continuing the policy for a further year by order, subject to the approval of the House, if the Government so wished. If we are to enter into a policy for reducing inflation it seems sensible that we should have the option of proceeding without further main legislation. An order would have to come before the House and it would have to be approved 1070 by the House, but I think that that option should be open. I do not see that our inflationary problems will be solved even in one year. Even if we reduce our rate of inflation to 10 per cent., as I am sure we can if we make the policy effective, by the third quarter of 1976 we shall still wish to bring it down below that level.
Particular reference has been made to Clause 2(3)(b). It is said that it is a curious provision in that it suggests that the policy might be allowed to lapse and then brought into force once more. I entirely agree that that is an unlikely eventuality. It is a safeguard in case, for some reason, the policy is allowed to lapse after one year after it has worked effectively and then as a result of further happenings, it is thought right to renew it. I agree that this is a very unlikely eventuality, but it is just possible and, therefore, just worth including a provision of that kind in the Bill.
§ Mr. Grimond
If by any chance—I agree that it is very unlikely—Clause 2(3)(b) were invoked, and the policy, having been stopped, were brought into force again, it would be highly likely, if this happened at all, that the Government would want to continue it beyond the minimum date. This is limited to 1977, and I understand that the Government can continue it until then without renewing it after the end of 1976.
§ 6.45 a.m.
§ Mr. Eldon Griffiths (Bury St. Edmunds)
I wish to intervene very briefly on the point raised by my hon. Friend the Member for Melton (Mr. Latham), and perhaps the right hon. Gentleman will answer my questions as briefly as I hope to put them to him.
The hon. Gentleman has said in regard to Clause 2(3)(b) that it is a safeguard in the almost hypothetical case of the policy lapsing and then, before 31st July 1977, Ministers wishing to put it into force again. If I understood his argument earlier, he said to his hon. Friends that the whole purpose of having a year at least, and possibly two years, was to give a measure of certainty—in other words, to say to those who settled early in a 1071 wages round that they could be reasonably sure that those who came later would not override the policy to which they themselves had been subjected.
I see the logic and force of what the hon. Gentleman said. But is he not contradicting the whole premise in achieving certainty when he provides to the Government a method whereby the policy could lapse, and there could be a period in which it was not applied, during which time inevitably wage increases would be pushed through, and the changes in prices and the rest of the policy would happen, and then he provides himself with the power to restore it again? That is the very opposite of the certainty which he put forward in his reply to the proposals of his hon. Friends.
I hope that the right hon. Gentleman will say how certainty can be achieved in the eyes of workers and of investors or anybody else it the Government equip themselves with the means for an in-and-out approach, which is the very opposite of the certainty he desires.
§ Mr. Dell
I think the answer is very simple. If the hon. Gentleman looks at Clause 2(1) he will see that in the ordinary course of events Section 1 is to expire on 31st July 1976—in other words, it is the one-year round in respect of which each time we wish to provide certainty. I entirely agree with him that Clause 2(3)(b) is unlikely to be used, but if, in the extremely hypothetical example which I gave, at the end of a year, when people have had the certainty of the operation of the policy for a whole wage round, it was allowed to lapse and it then was thought necessary to bring it back this would enable it so to be done. But the essential certainty of the policy for one year is there.
§ Mr. Mikardo
When my right hon. Friend rose to reply to the three speeches which had preceded his I listened very carefully in the hope that I should hear something from him that would persuade me and perhaps some of my hon. Friends not to press the amendment, but to my great regret, I heard nothing of the sort, and, indeed, if I may say so without being uncharitable—I would not wish to be—I thought his reply was rather perfunctory and superficial.
1072 May I first dispose of his argument that the effect of the amendment would be to remove the sense of security which otherwise would be felt by those settling early in an annual round that those coming later on would not leap over them? The hon. Member for Bury St. Edmunds (Mr. Griffiths) punched one little hole in that thesis. But there is a much bigger hole, and if my right hon. Friend the Paymaster-General had been here when we were discussing Amendment No. 101 and, therefore, Clause 1 (2), he would have realised that his argument in that regard held no water at all.
With the Bill as it stands, no one who settles early in the round will know what are the conditions under which the Bill will be applied to those who settle later in the round. Those who settle immediately will be settling within the limits laid down in the White Paper. But, under Clause 1 (2), the Secretary of State has the right to vary those limits, to change them or to substitute for them—whatever that may mean different from changing them—at any time. We could have a situation in which there were those limits for the first six months, and quite different limits—larger or smaller—for the following six months. Indeed, we would not have to wait six months. The limits could be changed at any time, as we calculated during our debate on Amendment No. 101, from 10th November onwards.
It is true that in the debate my right hon. Friend the Secretary of State made a concession. The situation now is that he could not sneak in a change and come to Parliament for endorsement afterwards. He has agreed to give up the power to sneak in one in the middle of a parliamentary recess, for instance. Even so, it is still possible for him at any time to make an amendment and come afterwards to Parliament for endorsement. My right hon. Friend can come to the House at any time and vary the limits. So long as the Government can carry a majority, there is a variation.
It will not do for my right hon. Friend the Paymaster-General to say that our amendment injects into the Bill an insecurity on the part of those who settle earlier that they may have done themselves in the eye by comparison with those who hold back. That insecurity is provided in full measure by Clause 1 1073 (2), which the Secretary of State defended to the hilt. That argument has gone.
Let us now consider substantive reasons why we ought to have a close look at the Bill after it has started operating—and not too long after—to see how it is getting on and how everyone is getting on under it.
My right hon. Friend referred to the 15 hours or so that we had spent discussing the Bill, and he drew one conclusion from the broad tone of the debates. But those who have sat through most, if not all, of them will know that what was apparent again and again from both sides of the Committee and from both Front Benches was that we were in a state about how the Bill would work. There are all sorts of contingencies that no one can foresee. Let me recall to the Committee a few of those—I am not making them up—which were mentioned during the course of the debate. I shall not be able to remember more than a few.
We do not know how the Secretary of State will cope with his obligation under Clause 1(5). We have no idea how many cases will be referred to him for determination. He has to exercise some jurisdiction and a subjective judgment in making definitions. My guess is that there will be a huge number of cases. We do not know how he will go about making what is, de facto, a lot of case law on this matter. We do not know what sort of difficulties he will experience in discriminating between one case and another. We do not know, because we do not know how large the volume of references will be, how quickly he will be able to make his determination.
One Conservative Member during the discussion on Clause 1(5) suggested, a little facetiously, that my right hon. Friend the Secretary of State would need a computer to cope. I do not think that a computer would help very much. My guess is that he will need a great many people, because any one who looks through the minutes of any executive committee meeting of a trade union and sees the number of different claims in different industries under different circumstances in different factories with different workshop level settlements, and so on, will know that the variety is so great and the definitions are so difficult that my right hon. Friend is bound to get a tremendous 1074 number of references. However, that is something we do not know.
There are other things we do not know. During the debate one of my hon. Friends said that he was supporting this measure as an act of faith. I can understand that, because there are so many indeterminate factors. At an earlier stage of the debate we were discussing the amendment put forward on behalf of the Liberal Party. We do not know whether it is a fact or not that the application of the £6 limit to those people who have to work overseas for long periods, sometimes in bad climates and difficult circumstances, will totally dry up the supply of those people. We do not know whether it will prevent people volunteering or being willing to go to those outstation posts in the way that they do now.
If the supply dries up, we shall be in a situation in which we shall lose a rich vein of British exports and an even potentially richer one. We do not know about that. That is something we shall know more about in a few months' time.
§ Mr. Michael Latham
The hon. Gentleman and I, together with a couple of other Members, specifically asked the Secretary of State in our speeches on the first amendments for an explanation of that point. It was most regrettable that he at no stage dealt with it in his one-hour long reply to that debate.
§ Mr. Mikardo
We just do not know. There is this act of faith, and perhaps it will work out. Perhaps people will be willing to go and work miles from anywhere—in an Arabian desert, an East European steppe or a tropical jungle downpour for only £6 a week more than they can get in Great Britain. My right hon. Friend may turn out to be right. We shall have to wait and see.
I shall take another example quoted during the same debate. We do not know what will happen about salesmen who are paid wholly or partially by commission. Will they stop work for the week when they have earned their £6 in commission, or will they be public spirited and go on and work the remaining three days for nothing at all? We may need to make some special provision, even though it has been said that there will be no special cases. I had better not use the word "special". My right hon. Friend may need to make, 1075 let us say, a different piece of case law in order to cope with things like that.
§ 7.0 a.m.
§ Although my right hon. Friend the Secretary of State was very helpful on another point, for which I am grateful to him, we really do not know in advance how these provisions will work out in relation to the operation of the fair wages resolution. They may inhibit that. We do not know fully how they will work out in relation to the Equal Pay Act. There are all sorts of imponderables.
§ I believe that to say that we have to have a year before we can fully know or do anything about it is giving a shade too much hostage to fortune. It is not so much an act of faith as an act of super-faith. It would be in the Government's own interest to have a look at the thing a bit earlier. My right hon. Friend says that is must last for a year. Even under our amendment it lasts for a year. As it is now, it lasts for two. My right hon. Friend has only got to use the power provided in the clause to make six months into a year. There is no question about that.
§ I am bound to say that my right hon. Friend has not answered the points or seriously dealt with the amendments. I cannot see anything in what he said to invalidate the arguments put forward in favour of the amendments or to induce us not to press them.
§ Mr. Anthony Fell (Yarmouth)
I want to support the amendment moved by the hon. Member for Liverpool, Walton (Mr. Heffer) and supported by the hon. Member for Bethnal Green and Bow (Mr. Mikardo). I support it because I am pretty frightened of this move by the present Government. I am pretty frightened that it will not work.
Funnily enough, I am in rather good company for once in my life. With respect, I do not refer to the two hon. Members whom I have just mentioned, although I support all that they have said in this debate, particularly the hon. Member for Bethnal Green and Bow. That applies especially to the enormous worry about just what will happen in the next six months. It really is worth while stopping to have a look at the matter in six months' time rather than in a year's 1076 time. We should at least have to stop and look at this matter.
I ought to explain the other company I mentioned, which I consider so good. The first of that company is my right hon. Friend the Member for Sidcup (Mr. Heath)—who sits in the seat just below the Gangway, as we heard on the radio the night before last. He gave the impression that he was so strongly for these measures. My view—and this is the only way that I can put it, on the best authority—is that he does not believe that these measures will work. I shall say no more than that about that matter. But that is not bad company.
The second part of my good company is my right hon. Friend the Leader of the Opposition, who said when interrupted by the Chancellor of the Exchequer during her speech the day before yesterday that she had no faith that the Government's moves would work.
The third is the right hon. Member for Down, South (Mr. Powell), who has taken a leading part in the discussions on the Bill and the Government's moves. He went further than either of my right hon. Friends, in that he said that he would vote against the moves.
§ Mr. Norman Buchan (Renfrewshire, West)
I am still puzzling over an earlier remark by the hon. Gentleman. Did he say that his right hon. Friend the Member for Sidcup (Mr. Heath) said that he was in favour of the measures, but that the right hon. Gentleman knew that they would not work?
§ Mr. Fell
The hon. Gentleman is a kindly man, and has a very good reputation in the House. I wonder whether he will allow me to leave it at that. I did indeed say precisely that. I have it on pretty good authority, which I will not disclose, that my right hon. Friend does not believe that they will work.
The Temporary Chairman
Order. I hope that the hon. Gentleman will help me by relating what he is saying to the amendment.
The Temporary Chairman
I am sure that the hon. Gentleman would not wish to criticise the Chair. All that I am asking is that he relates his remarks to the amendment.
§ Mr. Fell
I hope that you will acquit me of any desire to criticise the Chair, or even the customs of the House, Mr. Costain. I have said why I am raising the matter on the amendment. I am speaking specifically to the amendment. I fear that the Government's moves will be completely unsuccessful for the country, and cause us the sort of trouble that was caused by the last efforts of the Government, starting last February. Therefore, I want a stop to them six months earlier than the Bill provides, just as suggested by the amendment. I hope that that will be approved by the Chair, with which I do not want to cross swords.
The social contract never worked. It is a pity that there was no stop on that. The country has wasted 18 months in the belief that what was being done might work. It never achieved any purpose. That is why I so much want a stop on the present legislation. That is why I so strongly support the amendment. I do not believe that there is any more chance of this legislation working than did the social contract, which wasted 18 months of Britain's time and cost the nation thousands of millions of pounds. Still less do I believe that it has any chance of success when it is a voluntary statutory policy.
My hon. Friend the Member for Horsham and Crawley (Mr. Hordern) made a brilliant speech yesterday about what should be done, but I should be completely out of order if I referred to it, and it did not relate to this amendment. However, there must be other ways of saving the nation than living in a half-baked scheme of this sort in which nobody believes but which many pray might work.
I support the amendment moved by hon. Gentlemen opposite and will vote for it if there is a Division.
§ Mr, Eldon Griffiths
I apologise for keeping the Committee, but I wish to appeal to the Minister to take away this part of Clause 2(3)(b), or say that he will consider it again. I ask this of him 1078 because he is as concerned as I am that the Bill should be technically sound.
Like the right hon. Gentleman, I have had the doubtful privilege of getting through Committee a number of Bills, probably too many. One of the merits of the Committee stage here, particularly upstairs, is that we deal with the details and try to get them right. The Minister is aware that Clause 2(3)(b) is nonsense. I sympathise with him. I notice that he is passing notes to the Official Box, as I have done in the past. Frequently officials who draft Bills get the details wrong, and one great advantage of Parliament is that in Committee Ministers will listen to the arguments from both sides and go back to their Departments and set the officials on to put the details right. I am glad that the Minister has now got the note from the Official Box.
§ Mr. Griffiths
I hope that the Minister will amend the clause because he is in danger of making it nonsense. The clause says:Her Majesty may at any time by Order in Council terminate the period for which section 1 of this Act is in force.In other words, the Government can by order turn off the operation of this policy. I hope they are able to. If it is a success and inflation is brought under control they can, and they want that power but they also provide themselves with power to turn it on again, and to continue it, and that means it is not a success.
§ 7.15 a.m.
§ I wish to put the practical situation. Let us suppose that, having successfully operated the policy for a period of time, the Government decide that they will turn it off. At that point they confront all the problems of re-entry. We find wage increases going up again, inflation starting all over again, and at that point the Minister would have no option but to operate Clause 2 (3) (b) and turn the policy on again. What will happen to those trade unions, staff associations and those many other people who are in the process of negotiating pay increases?
§ I declare an interest, because I have negotiated many pay increase for the police. I know that pay increases do not 1079 happen overnight. They take many months to achieve. The right hon. Gentleman talks of achieving certainty for workers. The practical result of the clause is that we may well find, when the policy is turned off, that the power workers and the miners settle at very high figures. Suddenly the policy is turned on again, because of inflation or money pouring out of the country. Those who are on the wrong side of the line will be left out in the cold.
It is that kind of arrangement which generates not only uncertainty but differences between one set of workers at one stage in negotiations and other workers at a different stage. It is this which makes nonsense of what the right hon. Gentleman is genuinely trying to do. I do not ask him to drop the clause, simply to go back to his Department and think it over. Let him come back on Report, say that he has thought the matter through and will put things right. We shall then have achieved what a Committee stage is supposed to achieve—we shall have provided the opportunity for more careful examination and consultation.
§ Mr. Dell
My hon. Friend the Member for Bethnal Green and Bow (Mr. Mikardo) made three points, with which I shall try to deal. He said, first, that if we adopted the amendment we could expect the policy to last for a year. That is not the effect of the amendment. Its effect is to make the duration dependent upon an order after six months. It is that which creates uncertainty.
My hon. Friend said, secondly, that the argument against the amendment had been punched full of holes because of Clause 1 (2), which permits the Secretary of State, by order, to make a statutory instrument. Like my hon. Friend, I have been here for most of the night. I heard the discussion on this
|Division No. 302.]||AYES||[7.20 a.m.|
|Allaun, Frank||Budgen, Nick||Cryer, Bob|
|Atkins, Ronald (Preston N)||Callaghan, Jim (Middleton & P)||Emery, Peter|
|Bennett, Andrew (Stockport N)||Canavan, Dennis||Fell, Anthony|
|Buchan, Norman||Clark, William (Croydon S)||Flannery, Martin|
§ issue. I heard the Secretary of State for Employment indicate the limited circumstances in which he expected subsection (2) to be used during the first year. In any case, it would need the approval of the House. That approval is needed only if such an order is made. Under my hon. Friends' amendment an order would certainly be required after six months if the policy was to continue. There is, therefore, a considerable degree of uncertainty.
§ The third point made by my hon. Friend was that there was considerable doubt about the way the measure would operate and it was, therefore, necessary to have an early opportunity to consider it. Of course there is doubt about the way in which the measure will operate. Of course we shall learn its effectiveness as we go on. This does not seem to override the need to provide the certainty of at least one year's duration for the policy. During that year we shall learn and will be able to amend as necessary.
§ Doubts were expressed about Clause 2(3)(b), first on the ground of uncertainty and, second, on the ground of necessity. I cannot see that the subsection is in any way technically unsound. It performs a useful function in certain unlikely circumstances.
§ As both my hon. Friend the Member for Bethnal Green and Bow and the hon. Member for Bury St. Edmunds (Mr. Griffiths) have asked me to think again on this matter. I am prepared to do so, without commitment. Though the circumstances in which it would be used are unlikely to occur, my feeling is that it is of some possible use and should not be removed. However, I am prepared to think about the matter again.
§ Question put, That the amendment be made:—
§ The Committee divided: Ayes 33, Noes 229.
|Heffer, Eric S.||Mikardo, Ian||Selby, Harry|
|Hoyle, Doug (Nelson)||Morgan, Geraint||Skinner, Dennis|
|Hughes, Robert (Aberdeen N)||Newens, Stanley||Thorne, Stan (Preston South)|
|Lambie, David||Osborn, John||Wise, Mrs Audrey|
|Lee, John||Powell, Rt Hon J. Enoch|
|Litterick, Tom||Rees-Davies, W. R.||TELLERS FOR THE AYES:|
|Loyden, Eddie||Richardson, Miss Jo||Mr. Ron Thomas and|
|Madden, Max||Ridley, Hon Nicholas||Mr. Sydney Bidwell.|
|Anderson, Donald||Fletcher, Ted (Darlington)||Miller, Dr M. S. (E Kilbride)|
|Archer, Peter||Foot, Rt Hon Michael||Miller, Mrs Millie (Ilford N)|
|Armstrong, Ernest||Ford, Ben||Mitchell, R. C. (Soton, Itchen)|
|Ashton, Joe||Forrester, John||Molloy, William|
|Bagier, Gordon A. T.||Fowler, Gerald (The Wrekin)||Morris, Alfred (Wythenshawe)|
|Barnett, Guy (Greenwich)||Freser, John (Lambeth, N'w'd)||Morris, Charles R. (Openshaw)|
|Barnett, Ht Hon Joel (Heywood)||Freud, Clement||Morris, Rt Hon J. (Aberavon)|
|Bates, Alf||Garrett, John (Norwich S)||Mulley, Rt Hon Frederick|
|Bean, R. E.||Garrett, W. E. (Wallsend)||Murray, Rt Hon Ronald King|
|Benn, Rt Hon Anthony Wedgwood||George, Bruce||Noble, Mike|
|Bishop, E. S.||Gilbert, Dr John||Oakes, Gordon|
|Blenkinsop, Arthur||Ginsburg, David||O'Halloran, Michael|
|Boardman, H.||Golding, John||O'Malley, Rt Hon Brian|
|Booth, Albert||Gould, Bryan||Orme, Rt Hon Stanley|
|Boothroyd, Miss Betty||Gourlay, Harry||Ovenden, John|
|Boyden, James (Bish Auck)||Graham, Ted||Owen, Dr David|
|Bradley, Tom||Grant, George (Morpeth)||Padley, Walter|
|Brown, Hugh D. (Provan)||Grant, John (Islington C)||Palmer, Arthur|
|Brown, Robert C. (Newcastle W)||Grimond, Rt Hon J.||Pardoe, John|
|Brown, Ronald (Hackney S)||Grocott, Bruce||Park, George|
|Buchanan, Richard||Hamilton, James (Bothwell)||Parry, Robert|
|Butler, Mrs Joyce (Wood Green)||Hardy, Peter||Peart, Rt Hon Fred|
|Campbell, Ian||Harper, Joseph||Pendry, Tom|
|Cant, R. B.||Harrison, Walter (Wakefield)||Penhaligon David|
|Carmichael, Neil||Hatton, Frank||Phipps, Dr Colin|
|Carter, Ray||Hayman, Mrs Helene||Prescott, John|
|Carter-Jones, Lewis||Healey, Rt Hon Denis||Price, C. (Lewisham W)|
|Cartwright, John||Hooley, Frank||Price, William (Rugby)|
|Castle, Rt Hon Barbara||Horam, John||Radice, Giles|
|Clemitson, Ivor||Howell, Denis (B'ham Sm H)||Rees, Rt Hon Merlyn (Leeds S)|
|Cocks, Michael (Bristol S)||Huckfield, Les||Rees-Davies, W. R.|
|Cohen, Stanley||Hunter, Adam||Roberts, Albert (Normanton)|
|Coleman, Donald||Irving, Rt Hon S. (Dartford)||Roberts, Gwilym (Cannock)|
|Conlan, Bernard||Jackson, Colin(Brighouse)||Roderick, Caerwyn|
|Corbett, Robin||Jackson, Miss Margaret (Lincoln)||Rodgers, George (Chorley)|
|Cox, Thomas (Tooting)||Janner, Greville||Rodgers, William (Stockton)|
|Craigen, J. M. (Maryhill)||Jenkins, Hugh (Putney)||Roper, John|
|Crawshaw, Richard||Jenkins, Rt Hon Roy (Stechford)||Rose, Paul B.|
|Cronin, John||Johnson, James (Hull West)||Ross, Rt Hon W. (Kilmarnock)|
|Crosland, Rt Hon Anthony||Johnson, Walter (Derby S)||Ryman, John|
|Cunningham, G. (Islington S)||Jones, Alec (Rhondda)||Sandelson, Neville|
|Cunningham, Dr J. (Whiteh)||Jones, Barry (East Flint)||Shaw, Arnold (Ilford South)|
|Dalyell, Tam||Judd, Frank||Sheldon, Robert (Ashton-u-Lyne)|
|Davidson, Arthur||Kaufman, Gerald||Shore, Rt Hon Peter|
|Davies, Bryan (Enfield N)||Kelley, Richard||Short, Rt Hon E. (Newcastle C)|
|Davies, Denzil (Llanelli)||Kilroy-Silk, Robert||Short, Mrs Renée (Wolv NE)|
|Davies, Ifor (Gower)||Kinnock, Neil||Silkin, Rt Hon John (Deptford)|
|Davis, Clinton (Hackney C)||Lamborn, Harry||Small, William|
|Deakins, Eric||Lamond, James||Spearing, Nigel|
|Dean, Joseph (Leeds West)||Lestor, Miss Joan (Eton & Slough)||Spriggs, Leslie|
|de Freitas, Rt Hon Sir Geoffrey||Lewis, Ron (Carlisle)||Stallard, A. W.|
|Dell, Rt Hon Edmund||Luard, Evan||Stewart, Rt Hon M. (Fulham)|
|Dempsey, James||Lyon, Alexander (York)||Stoddart, David|
|Doig, Peter||Lyons, Edward (Bradford W)||Strang, Gavin|
|Dormand, J. D.||McCartney, Hugh||Summerskill, Hon Dr Shirley|
|Douglas-Mann, Bruce||McElhone, Frank||Taylor, Mrs Ann (Bolton W)|
|Duffy, A. E. P.||MacFarquhar, Roderick||Thomas, Mike (Newcastle E)|
|Dunnett, Jack||McGuire, Michael (Ince)||Tierney, Sydney|
|Dunwoody, Mrs Gwyneth||Mackenzie, Gregor||Tinn, James|
|Eadie, Alex||Maclennan, Robert||Tomlinson, John|
|Edge, Geoff||McNamara, Kevin||Torney, Tom|
|Edwards, Robert (Wolv SE)||Magee, Bryan||Urwin, T. W.|
|Ellis, John (Brigg & Scun)||Mahon, Simon||Varley, Rt Hon Eric G.|
|Ellis, Tom (Wrexham)||Mallalieu, J. P. W.||Wainwright, Edwin (Dearne V)|
|English, Michael||Marks, Kenneth||Walden, Brian (B'ham, L'dyw'd)|
|Ennals, David||Marquand, David||Walker, Harold (Doncaster)|
|Evans, Ioan (Aberdare)||Marshall, Dr Edmund (Goole)||Walker, Terry (Kingswood)|
|Evans, John (Newton)||Marshall, Jim (Leicester S)||Watkins, David|
|Ewing, Harry (Stirling)||Mason, Rt Hon Roy||Watkinson, John|
|Fernyhough, Rt Hon E.||Meacher, Michael||Weetch, Ken|
|Fitch, Alan (Wigan)||Mellish, Rt Hon Robert||Wellbeloved, James|
|Fletcher Raymond (Ilkeston)||Millan, Bruce||White, Frank R. (Bury)|
|White, James (Pollok)||Williams, Alan Lee (Hornch'ch)||Woof, Robert|
|Whitehead, Phillip||Williams, Rt Hon Shirley (Hertford)||Young, David (Bolton E)|
|Whitlock, William||Wilson, Alexander (Hamilton)|
|Willey, Rt Hon Frederick||Wilson, William (Coventry SE)||TELLERS FOR THE NOES:|
|Williams, Alan (Swansea W)||Woodall, Alec||Mr. James A' Dunn and|
|Mr. Laurie Pavi:t.|
§ Question accordingly negatived.
§ 7.30 a.m.
The Temporary Chairman
With this we are to discuss also the following amendments: No. 26, in page 2, line 29, leave out '6'.
No. 28, in page 2, line 29, leave out '9'.
No. 29, in page 2, line 29, leave out 'and 10'.
§ [Mr. W. T. WILLIAMS, in the Chair.]
§ Mr. Ridley
The amendment deals with the powers contained in the Counter-Inflation Act 1973 which are proposed to be prolonged. It is a little cavalier—[Interruption.]
The Temporary Chairman
Order. Will hon. Members who wish to leave the Chamber please do so quietly? Will hon. Members who remain please listen to the debate?
§ Mr. Ridley
It is a little cavalier to prolong these major powers when one remembers the history of that expiry. The entire Labour Party supported moves by myself and my hon. Friend the Member for Oswestry (Mr. Biffen) to bring the powers of that Act to a timely end. It was with their support that those powers were ended. It is funny that a row of dozy Ministers at 7.30 in the morning should be prepared to renew the powers without comment on or interest in their former and erstwhile hostility to them.
The first power is the power to contain prices, an economic weapon of such enormous importance that it requires a little comment. Hon. Members opposite, especially the Secretary of State for Energy, complain about the British investment record. It is certainly very bad, but the power to control prices is probably the biggest single contributory factor. If prices are to be controlled capriciously and at the Government's political whim, people undertaking long-term and 1084 serious investment will be very shy before doing so. This has proved to be the case.
The reason that people make investments is that they believe them to be a profitable employment of funds. If they are sure that the investment will not be allowed to be profitable because of price control, who can wonder that we have such a poor investment record?
I want to leave the Committee with one thought on this matter. I think that all hon. Members would acknowledge that the price controls that we have employed in this country for nearly three years now are largely cosmetic. They are largely to persuade trade unions that something is being done about prices so that it is fair to ask for restraint from them. If the price that we pay for that is to see industrial confidence and investment damaged and wages going up by 30 per cent., it may not be a very good bargain. Looking at the history of the power contained in Section 6 of the 1973 Act, the "bargain" has been that the rate of inflation has trebled and the casualty has been industrial confidence and investment.
We are declining as an industrial nation. It is not a three-day week which is reducing production, but a genuine shrinkage of industrial effort. The Committee should not leave price control without pondering once again whether we mean to do it.
I have always argued on prices and incomes policies that the effectiveness of price control is bound to be greater than the effectiveness of wage controls. That has proved to be the case. Price controls have had the effect of eroding industrial profitability, distorting and reducing investment and generally making our economy less efficient than it would other wise have been. In my opinion, we have not had the slightest effect upon wages.
I am against seeking to control wages, and for that matter prices, by these means. But those who are in favour and still have a shred of faith in this policy ought seriously to ask themselves whether this experiment has now been proved to have failed.
1085 For those hon. Gentlemen who believe that it is still right to seek to control wages by law, I have taken the liberty of putting down Amendment No. 27, which would have the effect of restoring the Pay Board's powers in order to improve upon the situation where prices are controlled and wages are not. Perhaps an ideal situation from the point of view of those who believe in this policy would be for wages, but not prices, to be controlled. I do not believe that we can afford to go on with the dangerous myth that price control in some way reduces the cost of living below what it would otherwise have been when the only effect is to take money out of savings and investment and put it into consumption, with disastrous results for the economy.
The purpose of Amendment No. 28 is to give power to control insurance premiums. Do we need to control insurance premiums? We know that we have a highly competitive situation in the insurance industry. I must declare an interest, because I have something to do with an insurance company. We do not need to seek to control by law that which can best be controlled by competition. The profits of our insurance companies as a whole are far below what they should be. This is a risk which exposes the policy holders to the collapse of their insurance company.
Will the Financial Secretary say whether there is any merit in controlling prices, insurance premiums or dividends? This is purely a cosmetic proposal. When the average trade unionist is told that the Government seek to control wages by means of statutory or voluntary controls his immediate reaction is to say "What about controlling dividends?" Why cannot we grow up and tell him that dividend controls help the shareholder, as if the profits are high and cannot be paid out there is a capital gain for the shareholder which is greater than the dividends on which income tax must be paid? Dividend restraint slightly damages the financial and investment mechanism. But if it is thought that those who draw dividends have an unfair advantage, the remedy is to increase the investment income surcharge. It is always better to tax the individual than to seek to distort the financial mechanism.
Amendments Nos. 26, 28 and 29 are purely cosmetic. The provisions which 1086 they seek to reactivate have not had the slightest effect on moderating pressure in the labour market. Yet we go on blindly and uncaringly saying "Let us distort these prices and market indicators as some trade unions might be restraining their wage demands as a result of this." Not one member of the Government believes that these controls have had any effect on wages. Not one Minister is prepared to say that these powers had the slightest effect in the intended direction. Surely we can do without them. We should be brave and grown up. We should say, "Let us pass Amendment No. 24 and not reactivate these powers in the Counter-Inflation Act, as they have done no good, and indeed have done harm." We know that these powers are not an effective public relations device. Let us start on the long haul back to reality. That might be the biggest contribution we can make towards countering inflation. If the investment mechanisms work again the economy will be increasingly able to earn and provide the funds, which the Government cannot find, to deal with the deficit.
We have debated this subject for four-and-a-half days, yet this is the first amendment to have the slightest bearing upon inflation. This amendment could make a small contribution to countering inflation. If the Committee is serious about inflation, and if it believes that tackling the problem of inflation is the priority, I ask hon. Members to vote for the amendment. Although it will make only a minuscule contribution to this cause, if we want to counter inflation this is the way to start.
§ 7.45 a.m.
§ The Financial Secretary to the Treasury (Mr. Robert Sheldon)
The hon. Member for Cirencester and Tewkesbury (Mr. Ridley) ended by saying that Amendment No. 24 would be a great help in countering inflation, and that it was the only amendment we had so far considered that would do that. That is a surprising claim for the hon. Gentleman to make.
The hon. Gentleman began by saying that it was wrong to prolong the powers under the Counter-Inflation Act 1973, and he drew the Committee's attention to what had been said in the past about them. I do not want to go into that. I should be glad to draw the Committee's 1087 attention to the errors made by the previous Conservative Government at great length, but this is not a suitable time to do so. We might spend our time more profitably by dealing with the amendments and seeing how far the control of prices which we are attempting to continue will lead to some of the disadvantages mentioned by the hon. Gentleman.
We are not concerned here with wrong attempts to control prices which may have led to bad investment records. There are many reasons for our appalling investment record over the years, and I suspect that the recent attempt to control prices had little to do with it, bearing in mind British industry's investment record before those measures were introduced.
We are concerned with continuing those powers for the much more limited purpose of trying to ensure that pay settlements do not result in excessive price increases. That is quite a different proposition from that which motivated the previous Government. Price control, which may have been a cosmetic in previous administrations, is far from being a cosmetic now. The object is to secure that settlements made in industry in excess of the arrangements outlined in the White Paper are not reflected in higher prices. I fail to see how a distortion of investment could arise from that. There have been many distortions of investment arising from a variety of causes, but I do not see this as one of them.
The effect of Amendment No. 28 would be that after 31st March 1976 the Secretary of State's power to restrict insurance premiums would lapse. That is not a major power, but it is a useful one which has a part to play. We are talking here mainly of motor insurance. Under the legislation the control of insurance would continue and any increase in premiums would have to be agreed by the Secretary of State. They obviously reflect increases in prices and charges made by motor repairers in the main and by others also. Although this is not a major part of the legislation now before us, I believe that it is a useful part, and as such should be retained.
§ Mr. Powell
We are accustomed in this place, each day that we sit, to hear 1088 recited the same psalm and to join in exactly the same prayers. It is not in any way observable that we are better as a result of that daily repetition. Nevertheless, it is part of our custom. As this is a new day that has dawned upon us, I will repeat as briefly as I can, though I am sure it will have equally little effect, the central reason why the policy behind the measures of the previous Conservative Government was inherently nonsensical and why the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) is moving that it should not be continued.
The policy rests upon one of the most simple but dangerous fallacies in this whole area—namely, the confusion of real prices with inflationary prices, the confusion of a price relative to another price with the price or value of money itself. That leads to the notion that inflation, the rise of all prices, is a kind of totting-up of individual price rises. It is nothing of the kind.
Individual price rises are either symptoms of an increase in money relative to what money buys, or else they are variations in real prices. When a real price rises, other real prices must automatically fall, as there is a change in relativities. No relative price change, even added to all the other relative price changes in the world, can cause inflation, because inflation is the upward movement of all prices and therefore cannot be brought about by anything which concerns relative prices.
We live a prey to the superstition that one real price change causes another real price change and that that chain or spiral in total is inflation. Consequently we attack individual price rises as if trying to paint over—and cosmetics have been referred to—the spots which are symptoms of a disease—though spots have more connection with a disease than individual price changes have with inflation. We have strengthened this superstition by the metaphorical use, which has now become permanent, in this context of the word "spiral". The term "wage price spiral" is used, for example, begetting the silly notion that an increase in wages causes an increase in prices. It does not, of course. It does so no more than the increase per se of one set of wages or prices causes all other wages or prices to increase. On the contrary, per se it causes them to diminish. The 1089 notion that there is something specific against inflation in preventing a price rise from following a wage rise is inherently nonsensical. It is pure superstition. It has no more to do with the cure of inflation than processions and Holy Water have do to do with the cure of typhoid. They are totally unconnected matters.
So I simply add my protest to that of the hon. Member against the proposal to maintain upon the statute book this brood of economically illiterate superstition which was spawned by the previous administration and, perhaps slightly less surprisingly, is to be maintained by the present one. I hope that the hon. Gentleman will carry this to a Division. It would be a pity not to be able to record in the Division Lobby one's disgust at the continuance of this disfigurement of the statute book.
§ Mr. Mikardo
I wonder whether the right hon. Member for Down, South (Mr. Powell) will allow me to say to him that the trouble with this House is not, as he said, that every day we sing the same psalm and pray the same prayers. There are very few of us who sing the same psalm or any psalms at all, and even fewer who say the same prayers or any prayers at all. The real trouble with this House is that the great majority of us do no more than intone the same responses.
§ Mr. Robert Edwards (Wolverhampton, South-East)
Far be it from me to enter this debate so early in the morning, but we have had a recital of orthodox capitalist economics from the right hon. Member for Down, South (Mr. Powell).
§ Mr. Edwards
I think that just occasionally the other view might be stated and, I hope, listened to as we listened to the right hon. Gentleman, who seems to get great amusement from the fact that somebody like myself wants to make a few modest remarks about his philosophy.
We are living in a different world from the one that the hon. Gentleman constantly envisages. We are living in a world of tremendous concentrated power. We are living in a world of multi-national companies, where this great concentration of power is able to 1090 force up prices artificially. That has nothing to do with the market to which the right hon. Gentleman constantly refers.
§ Mr. Powell
The point is that power can force up real prices, that is to say, it can cause some prices to be relatively higher, and therefore all other prices to be relatively lower; but that has nothing to do with inflation, inflation being the rise of all prices.
§ Mr. Edwards
I am contending—and I hope that the right hon. Gentleman will listen, just as we listened to his point of view—that this concentration of industrial power in fewer and fewer hands creates a situation in which countries and continents can be held to ransom through artificial scarcity, forcing high prices and creating inflation.
§ Mr. Edwards
Let me give a few examples. [Laughter.] I do not know why this is treated with frivolity. We are having a serious dialogue. There are seven huge oil companies that control the distilling and the distribution of the oil in the Western world. The price of oil in every country in the Western world is fixed at the high Texas production price. It is the cartel that creates this high price. If oil is dearer than it otherwise should be, all the chemicals, drugs, medicines, paints, varnish and fertilisers produced from oil are dearer than otherwise they would be—
§ 8.0 a.m.
§ Mr. Edwards
Out of oil come fertilisers. In the past five years the prices of two basic fertilisers have increased, in one case by 700 per cent., in the other by 400 per cent. That is why millions of people in the eastern parts of the world are starving now. They cannot afford fertilisers for their crops. This is why people are poor, and this is why food prices are high. That is just one example of a group of multinational companies 1091 which have moved in and cornered the market in oil refining and distribution.
I give another example which has nothing to do with the right hon. Gentleman's philosophy. The largest drug firm in the world is having to contest a case in every country in Europe because it has been accused of charging 1,000 per cent. profit on two tranquillisers alone. Wages have nothing to do with these high prices. These high prices come about because this one firm has an exclusive monopoly of these products, and it uses its monopoly to force up prices. As a consequence, it creates inflation in drugs.
§ Mr. Edwards
Of course it does. What does inflation mean? It means high prices. These are the basic causes of high prices.
I am sorry to intervene so early in the morning. I do not like doing it. I have been here all night. But this laissez-faire, capitalist idea has to be challenged by people who believe in Socialism.
Why do we believe in Socialism? The hon. Member for Cirencester and Tewkesbury (Mr. Ridley) argued that if we restricted dividends we militated against investment going into industry. But what is happening is that a company which limits dividends builds up a massive asset formation. With that great formation of capital, there should be real investment and modernisation. But where does the money go? The wealth produced by the toil and intelligence of workers and technicians is not going into dividends. It is going into property development, as the Chairman of the 1922 Committee knows to his sorrow.
This is why we Socialists insist that capital investment has to be directed. There is no mechanism within this system to direct investment once the distribution of dividends is curbed. This seems logical and sensible to me, and I hope that it is our reply to the arguments of the hon. Member for Cirencester and Tewkesbury.
I do not want to carry the debate any further. I hope that I shall be forgiven for intervening. I was provoked by these old-fashioned, laissez-faire, capitalist ideas which have no relation to the problems of our modern world.
§ Mr. Powell
As the hon. Member for Wolverhampton, South-East (Mr. Edwards) appears to be in great distress as a result of a misapprehension, I am persuaded to trespass for only a minute or two longer upon the patience of the Committee simply to assure him that in what I said, right or wrong, there was nothing specifically laissez-faire or capitalist or Socialist or Marxist.
My fault was and I confess it—and I have, perhaps, misled the hon. Member for Wolverhampton, South-East thereby—that for the sake of brevity I omitted the definition of inflation. Inflation, in the sense in which I happen to be using the term and in the sense in which I believe it is the scourge against which we are endeavouring to take measures, is not high prices. Inflation consists of an ongoing rise in all prices, as the sign of an ongoing fall in the value of money. It is dynamic; it is not static. It is a persistent and continuing loss of value of money.
That can have nothing to do with the rise in individual prices due to either artificial or real scarcity of particular goods or services; for, by definition, those increases in prices, being relative increases in value, must be offset by an exactly equal fall in the value of all other goods and services. That is axiomatic and not capitalist. It is as capitalist as it is Marxist. It is simply the way the world in which both Marxists and capitalists live is created.
I conclude by apologising to the hon. Gentleman for having failed to make clear the meaning of inflation, as I should have done at the first opportunity. To ignore that definition is one of the sources of those "mazy wanderings" in which we have been lost in this country and in this Chamber—one administration after another—for many years.
§ Mr. Ridley
The Committee has listened fascinated to this clash of these two great economists. The drama of this morning's debate will never be forgotten by any hon. Member who had the honour not to be in bed. Would that we still had the radio, would that the television cameras were in this Chamber, because what the country has missed is irreplaceable in terms of great ideological battles fought between champions of rival economic schools.
1093 I shall recommend to the Editor of The Times that he makes space available in his columns for each to put his point of view so that on the second round each can criticise the other.
I believe that we need a seminar in which these two rival philosophies can be tested to destruction. Hon. Members should not laugh, but they should realise that something has happened that is as important as the birth of Keynes or, perhaps, the arrival of the new Cambridge school on an otherwise troubled monetarist world. The columns of Hansard, which will enshrine the debate we have just had, should be framed and kept in every hon. Member's lavatory.
I want to return to the amendment, but, before doing so, I should like to make one remark about the speech of the Financial Secretary, because the right hon. Gentleman was in neither camp. Clearly he had understood neither the point of view expressed by the right hon. Member for Down, South (Mr. Powell), nor the point of view expressed by his hon. Friend the Member for Wolverhampton, South-East (Mr. Edwards). He contented himself by saying that under the Conservatives price control was merely a cosmetic, whereas under his Government it was real. If that is so, it must be doing damage, because the only hope for it is just as a cosmetic. I thought that that was an unsatisfactory part of his argument. He then went on to say that he thought that the control of insurance premiums was a useful weapon. But I would ask him why it is that his colleague the Secretary of State for Trade is busy trying as hard as he can to stop insurance companies going bankrupt, whereas he is busy trying as hard as he can to make them bankrupt. May I introduce the two Ministers? I should be delighted to arrange a souper intime, just as I would be delighted to arrange a seminar I never believed that this amendment would take us into such strange fields.
I end with this one regret. Where we come to a matter of real substance which is affecting the economy, no one else in the whole Committee can be found who is prepared to debate it seriously and to make a contribution—save for the right hon. Member for Down, South. It is a reflection upon all hon. Members that 1094 they are prepared to talk all through the night about matters which are related to the dogma of the times but are in no sense related to the battle against inflation, but on this first tiny point, which could have had some effect upon inflation, the debate has fallen flat—although that is not quite true; flat, were it not for the ideological debate to which we have just listened.
§ Amendment negatived.
The Temporary Chairman
The next amendment that has been chosen for debate is Amendment No. 31, in page 3, line 5, leave out subsection (7).
§ Mr. Mikardo
If I may say so without immodesty, I am normally not a bad hand at picking my way through the blasted, tortured and misshapen jargon which is the language of the Bill as it is before us. It is what I generally call Whitehall Chinese. Perhaps it would be more correct to call it Whitehall Mandarin. When I was reading subsection (7) the other day, I read it several times and could not make head or tail of it. Therefore, I tabled this amendment to delete it, as a probing amendment, to give me an excuse to ask one of my right hon. Friends to tell me what it meant.
However, it seems that for me, at any rate—and, I hope, for other hon. Members—staying up all night is a salutary exercise, because my mind is apparently working more sharply this morning. When I read this subsection five minutes ago, I understood what it meant. Understanding what it meant, I thought that it was all right—or, at least, no worse than the rest of this lousy Bill. On those grounds, I beg your leave, Mr. Williams, and that of the Committee, to withdraw the amendment.
The Temporary Chairman
The hon. Gentleman is not quite as bright as he normally is. The amendment has not yet been moved, so it cannot be withdrawn.
The amendment not having been moved, the next matter for the Committee's consideration is the Question "That the Clause stand part of the Bill".
§ Question put and agreed to.
§ Clause 2 ordered to stand part of the Bill.