Counter-Inflation Policy

HC Deb 28 July 1975 vol 896 cc1279-81

12. Mr. Tim Renton

asked the Secretary of State for Trade what rôle his Department will play in implementing the Government's counter-inflation policy.

20. Mr. Adley

asked the Secretary of State for Trade if he will make a statement on his Department's rôle in implementing the Government's incomes policy.

26. Mr. Peter Morrison

asked the Secretary of State for Trade if he will make a statement on the rôle of his Department in the Government's counter inflation policy.

Mr. Shore

As a Minister responsible for a Department whose interests cover exports and important industries in both the public and private sectors, I have been closely involved in the formulation of the policy. My function in implementing it will include the supervision of the nationalised and public bodies for which I am responsible and the control of increases in the scheduled rates of premium for certain insurance business.

Mr. Renton

Can the Secretary of State say what advice he is now giving to American companies seeking to make new investment in this country? Is he telling them that the Government's wage policy is voluntary on employer or statutory? If they should fail to understand his answer, will he then give them the details of the secret powers Bill so that they may know fully the Government's intentions?

Mr. Shore

I think that that was a little laboured. Any advice which I give to a company in this position is that, like anyone else, it will be expected to observe the agreed guidelines of Government policy.

Mr. Tomlinson

If there were any question of import controls on a generalised basis, would not they serve to damage the Government's counter-inflation policy by forcing up the cost of living in the short run?

Mr. Shore

Yes. The impact of import controls is not helpful to the cost of living, although, as my hon. Friend knows, that is not the only argument put forward by those who advocate import controls.

Mr. Adley

Is the right hon. Gentleman aware that in my constituency very many small traders and business men earnestly hope that the Government's counter-inflation policy will be successful? Is he aware, further, that some of them are particularly concerned about the variance between the Government's view and the TUC's view on the £6 limit? Will he give urgent consideration to clearing up this point, because none of his right hon. and hon. Friends has yet done so?

Mr. Shore

I was not aware that there was, after our recent debates, any serious doubt about the matter. If there are further points which need clarification, I have no doubt that my right hon. Friends principally responsible will see that the clarification is made.

Mr. Raphael Tuck

Will my right hon. Friend press the Secretary of State for Prices and Consumer Protection and the Chancellor of the Exchequer to consider seriously what is now being done in the Republic of Ireland, where large subsidies are being given for essential foods and for services like electricity and gas so that prices may be kept down, and where the Government recoup themselves by imposing a surcharge on income tax?

Mr. Shore

The policy of giving large subsidies through nationalised industry prices and directly in the form of food subsidies and rent subsidies has been practised by this country long in advance of the Irish Republic. I say additionally to my hon. Friend, whose deep concern I appreciate, that the success or otherwise of the latest Irish measures has yet to be demonstrated.

Mr. Morrison

What will be the right hon. Gentleman's attitude if firms with large order books from overseas are forced out of business by unions trying to breach the present counter-inflation policy?

Mr. Shore

I should be very upset about any such outcome to the Government's incomes and prices policy—of course I would. All those concerned have to weigh the consequences of their actions. This is one reason why it was so right to seek to get the maximum of agreement and understanding of all those concerned.

Mr. Thorne

Can my right hon. Friend say what effect import controls on television glass manufactures would have in relation to Japanese exports to Britain?

Mr. Shore

If we were to restrict Japanese exports to Britain in the industries mentioned by my hon. Friend—certainly in the case of television tubes—undoubtedly this would improve the British balance of trade. As my hon. Friend knows, however, there are many other factors to be taken into account before drawing too simple a conclusion from that proposition.