TUC

HC Deb 13 December 1977 vol 941 cc265-8

Q1. Mr. Ioan Evans

asked the Prime Minister when he next plans to meet the TUC.

The Prime Minister (Mr. James Callaghan)

I refer my hon. Friend to the reply which I gave to the hon. Member for Hazel Grove (Mr. Arnold) on 8th November.

Mr. Evans

Has my right hon. Friend read the Richard Dimbleby lecture, delivered by Jack Jones, on the human face of labour? Does he agree that the most important pact that the Government have is with the trade unions? Will he, therefore, seek to transform the social contract into a Socialist contract so that the workers who have been sacrificed in recent years can reap the benefits in the years ahead?

The Prime Minister

Yes, I have read a summary of that lecture. I thought that it was well worth while and I congratulate Mr. Jones on what he said. Of course, the foundation of any Government's success in this country—and, indeed, in other countries—is a good working relationship with the trade union movement. As I move among Prime Ministers and others from other countries, I find that the relationship established in this country is in some cases a source of envy to them.

Mrs. Thatcher

Will the Prime Minister take the opportunity to remind the TUC that the pay in the pocket of the average worker this Christmas will buy less than at any Christmas since 1969 and that that is the practical result of Socialism?

The Prime Minister

I shall check on the right hon. Lady's figures, because if, as I suspect, they come from the hon. Member for Chingford (Mr. Tebbit) I should not accept them without double checking.

As regards the general position, there has not been any attempt on the part of responsible people to deny that the result of the increases in oil prices, among other factors, meant a lowering of the standard of life of people in this and other countries. I am glad to say we are now recovering from that situation. The tax remissions that the Chancellor was able to give in the autumn and in the summer are helping. If we get reasonable settlements on pay during the next 12 months, there can be further tax remissions, and those, together with the fact that we are overcoming inflation, will result in a real and substantial increase in the standard of life of the people of this country in 1978.

Mr. Norman Atkinson

Will the Prime Minister reiterate the last statement that he has just made? Will he clear up any ambiguity that may exist among TUC people in the sense that he is now saying that there is no necessity for any worker to take a further reduction in his living standards this year? Indeed, he should go beyond that because, according to my right hon. Friend, workers can expect an increase in their living standards as we move towards the end of this financial year.

The Prime Minister

This will be a real increase. I gladly reiterate it if my hon. Friend did not comprehend what I was saying. A moderate increase in earnings, coupled with a reduction in taxation—which is possible next spring—together with the fact that we are overcoming inflation, which is expected to be in single figures next year, will lead to a substantial improvement in the standard of life for the first time for some years. That is worth working for. That is why I reiterate the necessity for moderate increases in earnings, not fantastic increases of 20 per cent. and 30 per cent. Such increases would mean that inflation would go up, that we could not make tax cuts and that there would be a general reduction rather than an improvement in standards.

Mr. Baker

Before the Prime Minister sees the TUC, will he have a word with the Secretary of State for Energy, who said last night that what Britain needs even more than more Labour Government is more Socialism? Does the Prime Minister agree with that sentiment, which was so well cheered from below the Gangway?

The Prime Minister

There are no differences between the Secretary of State for Energy and myself.

Mr. Pardoe

Will the Prime Minister accept that never mind increases in earnings of 20 per cent. or 30 per cent., the current spate of forecasts in the private sector is that earnings will average an increase of 17 per cent. during the period of the Government's guidelines? Does the Prime Minister recognise that these forecasts, coupled with leaks from the Treasury that its computer confirms that figure, are likely to be self-fulfilling? What will the Prime Minister do to intro- duce a pay policy which will stop earnings rising at 17 per cent. over the 12 months of this pay policy?

The Prime Minister

The only point on which I agree with the hon. Gentleman is that this ridiculous kind of forecasting—

Mr. Skinner

Slap him down.

The Prime Minister

—which seems to be the biggest growth industry in this country, tends to become self-fulfilling. I wish that we could have far fewer forecasts and more people concentrating on what is actually happening.