HC Deb 01 February 1977 vol 925 cc224-6
Q2. Mr. Dykes

asked the Prime Minister if he will dismiss the Secretary of State for Industry.

The Prime Minister

I refer the hon. Member to the reply that I gave to the hon. Member for Mid-Sussex (Mr. Renton) on 20th January.

Mr. Dykes

With phase 3 of the Pay Code now being discussed, does the Prime Minister agree that higher wages can be financed only out of higher production? With the latest available production index at 102.6, compared with 103.3 in February 1974, during the so-called three-day working week recession—about which Labour Members complained so bitterly—will the right hon. Gentleman say how high he will put that on the list of the Secretary of State's biographical notes when, in due course, the Prime Minister fires him later this summer?

The Prime Minister

I shall take the serious part of the hon. Gentleman's question. As he probably knows, manufacturing industry production is already starting to move up slowly. I entirely agree that until we have got a higher level of production we cannot do many of the things that we wish to do, including increasing public expenditure on necessary things like housing and health.

What is important is that we should not resume a higher level of production if it will mean higher inflation. That is the problem with which the Chancellor and others are wrestling at the moment. That is why the Government's efforts are bent on export-led growth. I am glad to be able to tell the House that our exports in 1976 were 12 per cent. higher in volume in the last quarter than the average in 1975.

Mr. Rooker

Does my right hon. Friend believe that industrial production will increase when accidents decrease? As Question No. 21, in my name, was not reached, will he confirm that it was a slip of the tongue when he said, earlier, that the reactivation of the health and safety provisions will take place in 1978? Did my right hon. Friend not mean 1977?

The Prime Minister

No, it was not a slip of the tongue. I said 1978 and I meant 1978.

Mr. Heffer

My right hon. Friend must be joking.

The Prime Minister

I am not joking at all. I promise my hon. Friend that I do not joke about these matters. The matter has been carefully discussed, and the regulations will be laid immediately. They will come into legal force on 1st October 1978, but it will be for employers and trade unions, if they wish—and a number will wish to do so—to introduce them earlier. My understanding is that they will want to get on with it.

Mr. Gordon Wilson

Is the Prime Minister aware that the abolition of the regional employment premium, without notice and consultation, is causing repercussions within Scottish industry and is affecting jobs? Can the right hon. Gentleman explain why the premium has been retained in Northern Ireland and why these changes are made without either planning agreements or any other sort of consultation?

The Prime Minister

These matters have been debated on previous occasions and I have nothing to add to what has been said before. I do not agree with the hon. Gentleman, nor is there much evidence, that this is having a profound effect on industry. In many cases we must be able to make changes from time to time in order to ensure that the level and direction of Government support is applied where it gives greatest benefit. The regional employment premium was a very successful medium about 10 years ago, but had begun to outlive its usefulness because the amount of the premium was so small in relation to wages.

By contrast, some of the instruments that our predecessors provided and some that we are providing are enabling us to direct assistance where it is really needed. I assure the hon. Gentleman that this is by far the better way of doing it.

Mr. Kinnock

Will my right hon. Friend accept that the great virtue of the regional employment premium was that it discriminated in favour of those parts of the country with chronic, deep and long-term weaknesses in industrial terms? Both the CBI and the TUC have made representations to the Prime Minister and his right hon. Friends asking for a reversal of this policy so that we can encourage a shake-out of industry in order to provide new jobs for people who have been waiting for them for decades.

The Prime Minister

Yes, but the nature and type of unemployment has changed since REP was introduced about 12 years ago. Some of our large cities, including the inner cities—as I have seen for myself—have problems that are equal to those in the development areas. It is for this reason that we must keep up to date in the way in which we use Government assistance.

Mr. Churchill

How does the Prime Minister explain the scandalous fact that since March 1975 industrial production in two out of every three months under a Socialist Government has been lower than during the three-day working week at the time of the miners' strike? Is it not time that the right hon. Gentleman changed some of his Socialist priorities?

The Prime Minister

I can only say that after careful study I can see nothing better than the policy that we are following in order to try to overcome inflation and increase exports. In their secret hearts Members of the Opposition know that.

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