HC Deb 24 May 1976 vol 912 cc24-5
22. Mr. Molloy

asked the Secretary of State for Prices and Consumer Protection if she is satisfied with the current level of prices.

Mr. Maclennan

The current level of inflation represents a considerable improvement on the level a year ago, but I shall not be satisfied until our rate of inflation is brought down to the level of our competitors or even lower.

Mr. Molloy

Is my hon. Friend aware that in the successful battle which the Government are now waging to bring down the rate of inflation and in which they are hampered by the Conservative Opposition, who want to damage the pound, to hold down public spending and let private spending via prices go through the roof, the linchpin of the Government's agreement is the holding of prices, together with reducing unemployment?

Mr. Maclennan

I fully agree with my hon. Friend that the control of prices remains a vital part of the Government's battle against inflation and that this has been so throughout the first year of our counter-inflation policy. I am glad that the CBI and the TUC jointly recognise that that will remain true during the next year.

Sir John Hall

Would not the hon. Gentleman agree that, apart from the falling value of the pound, the forward cost of imported raw materials and semifinished goods into this country is increasing at a rate which will make it impossible to reduce the inflation rate to single figures by the end of the year? Does he believe that he will be able to do that even by the end of 1977?

Mr. Maclennan

I agree that there has been some hardening in commodity prices due to the upturn in world trade, but I do not believe that the Government's counter-inflation targets will not be reached.

Mr. Pavitt

Will my hon. Friend consider the rise in the price of a tin of skimmed milk from 25p to 45p in the last few months? As so much of this is given to cattle, is it not possible that those who wish to avoid cholesterol should pay a cheaper price for skimmed milk?

Mr. Maclennan

I shall be very willing to consider that.

Mr. Adley

Is not the hon. Gentleman aware that his remark about a considerable improvement in the rate of inflation is a diagnosis similar to that which would be given to a man who had been jumping from the thirtieth floor of a skyscraper every day and landing on his head but was now jumping from the fifteenth floor and still landing on his head?

Mr. Maclennan

I am at a loss to understand what object the hon. Gentleman thinks would be served by seeking to diminish the impact of the counter-inflation policy in which the country is engaged.