HC Deb 20 December 1976 vol 923 cc5-6
2. Mr. McCrindle

asked the Secretary of State for Prices and Consumer Protection if he is saisfied with the operation of the Price Code.

Mr. Hattersley

The Price Code has now been in operation for nearly four years. Despite amendment and revision, it grows increasingly difficult to judge commercial performance against the criteria stipulated in the code. However, I am broadly satisfied with the operation of the code as part of the current prices policy.

Mr. McCrindle

Still on the question of bread prices, does not the right hon. Gentleman concede that to have created such confusion in the minds of housewives and to have succeeded in interrupting supplies of bread over the weekend indicates the difficulty involved in any ministerial intervention in the operation of prices? Will he now make absolutely clear at what price the housewife can expect to purchase a large loaf in supermarkets in 1977?

Mr. Hattersley

Time does not allow me to explain the bread scheme to the hon. Gentleman, but let me at least tell him that what I decided last Monday was not further Government intervention in the bread market but a withdrawal of Government intervention. The complaint of many of the people who are complaining—notably the trade union, which I am sure will be grateful for the support of the hon. Gentleman and the hon. Member for Gloucester (Mrs. Oppenheim)—is that I am not intervening sufficiently. I have made it perfectly clear to the bread industry that if the industry as a whole wants it, nothing would give me greater pleasure than to withdraw altogether. The industry tells me that it does not want such a policy. As it is, I have improved the aspects of competition within the industry. I can only repeat that, as it is competition that will determine the price, it is not possible for me to predict what the price will be.

Mr. Molloy

Will my right hon. Friend bear in mind that in no circumstances should he accept advice from the Conservative Front Bench on possible future negotiations with the TUC on such questions, because when the Conservatives were in office their negotiations led to the three-day working week and the chaos that followed? If he took their advice, their next achievement would be to see that the nation was put on black bread. Will my right hon. Friend assure us that that will not happen?

Mr. Hattersley

I told the TUC, as I told other interested parties, what I proposed to do over bread prices. They agree with me—though the hon. Member for Gloucester does not, and is now on record that she does not—that it was intolerable for the Government to keep the price of bread artificially high. I am sure that I was right to stop doing that.

Mr. Giles Shaw

May I ask the right hon. Gentleman another question about the Price Code, concerning the announcement by the Chancellor of the Exchequer last week of a gas price increase from April 1977? I believe that that increase includes a repayment of capital, which is not allowable under the code. Does the Secretary of State intend to amend the code? If not, how else will he approve the increase?

Mr. Hattersley

I do not propose to amend the code. When the increase comes forward from the Gas Council on behalf of the boards, it will be submitted in the proper way to the Price Commission. If the Commission believes that the increase is not acceptable under the code, it will say so publicly. There is provision for the Government to proceed notwithstanding that decision, if necessary. But there will be no revision of the code, nor any subterfuge. The Commission will behave in the normal way.