TUC

HC Deb 27 April 1978 vol 948 cc1617-9

2. Mr. Molloy

asked the Chancellor of the Exchequer when he next expects to meet the TUC.

The Financial Secretary to the Treasury

Friend is in constant touch with representatives of the TUC at the NEDC and on other occasions, but he has no specific date in mind for a meeting at present.

Mr. Molloy

When my right hon. Friend the Chancellor does meet the TUC will he acknowledge that the millions of ordinary working people who have made such a contribution to the fight against inflation will be looking forward to a justifiable relaxation of the reins of constraint and will wish to see a gradual return of their union representatives to a form of free collective bargaining? Can my right hon. Friend give an assurance that the lifting of the restrictions, when it happens, will apply to the public sector as well, and that it will not be discriminated against? In the public sector the restrictions have created many anomalies, which must be ironed out. Those in the public sector are entitled to full consideration.

Mr. Sheldon

My hon. Friend is quite right. I am happy to acknowledge the contribution to the fight against inflation by the trade union movement, as are the Government generally. My hon. Friend is also right to point out the increase in the number of anomalies. The Government must, of course, have responsibility for the public sector. It is this that throws in doubt the aims of the Conservatives, because they cannot avoid this. The Government have responsibility for the public sector and for that reason they have responsibility in the matter of pay generally.

Mr. William Clark

Can the Chancellor be persuaded to explain to the TUC when he next meets it why the average working man is paying far more tax today than he was when this Government came in?

Mr. Sheldon

I suppose that the hon. Gentleman has in mind income tax. The proportion of income tax is lower than it was a number of years ago. I see that the hon. Gentleman seems to doubt this. May I give him the figures. Compared with the golden days of Macmillan, when the proportion of our revenue paid in income tax was 35.3 per cent., it is now 33.9 per cent. What the hon. Gentleman has in mind is the decline in real take-home pay as a result of the levels of import payments that we have had to make as a result of North Sea oil and other commodity prices.

Mr. Frank Allaun

Is my right hon. Friend aware that the TUC and the Labour Party are still pressing for a full restoration of the cuts in housing, health and education, particularly because of the massive unemployment? Secondly, we hope that the action promised by my right hon. Friend the Chancellor—or, rather, hinted at by my right hon. Friend—will take place this summer.

Mr. Sheldon

I note the regular concern that my hon. Friend brings to these matters. To the extent that it is possible to bring about these increases—and we have been very successful in these areas in the past—I accept much of what he says, but he must bear in mind that this expenditure can only go hand in hand with our economic recovery. That must be the prime motive force behind the kind of expenditure that he wishes to see and that I wish to see, too.

Sir G. Howe

Following the point made by my hon. Friend the Member for Croydon, South (Mr. Clark), will the right hon. Gentleman confirm that at the time of the last Conservative Budget the percentage of the pay packet of the average family with two children being paid in income tax and national insurance was 21 per cent., and that after the Budget that this Chancellor has just introduced the percentage is still in excess of 25 per cent.? For those on twice or three times average earnings the increase in the bite taken by taxes is even larger.

Mr. Sheldon

I am fully aware of the credit that the right hon. and learned Gentleman seeks to claim as a result of the tax reductions of the Chancellor of the Exchequer of that time, Anthony Barber, but the right hon. and learned Gentleman knows and I know how that was paid for. It was paid for by the gross inflation of the money supply, which is still a matter of concern and a matter on which the Conservatives continually fight battles, not against us but against their own predecessors.