HC Deb 06 March 1978 vol 945 cc960-3
19. Mr. Edwin Wainwright

asked the Secretary of State for Prices and Consumer Protection if he will make a statement on the latest percentage figure of inflation.

22. Mr. Knox

asked the Secretary of State for Prices and Consumer Protection what is the year-on-year rate of inflation at the latest available date.

23. Mr. Montgomery

asked the Secretary of State for Prices and Consumer Protection what has been the increase in the retail price index since March 1974.

27. Mr. Nicholas Winterton

asked the Secretary of State for Prices and Consumer Protection what is the increase in the Price Commission six-monthly index.

32. Mr. Ioan Evans

asked the Secretary of State for Prices and Consumer Protection what is the latest monthly figure for the retail price index.

Mr. Hattersley

The retail price index rose by 0.6 per cent, in January. This brings the annual rate of increase down to 9.9 per cent, for the first time since October 1973. The increase since March 1974 has been 84.7 per cent. The revised figure for the rise in the Price Commission index for the six months to January is 5.9 per cent, at an annual rate.

Mr. Wainwright

Will my right hon. Friend accept from me all the praise that can be handed to him and to the Government for their policy which has brought down the cost of living? Will he also bear in mind that prices that have come down can go up again if there is not an effort made to preserve a continuous downward trend in the price of goods? May I ask him, next time he broadcasts, makes a statement to the Press or speaks anywhere, to try to explain the Opposition's criticism of the Government's efforts?

Mr. Hattersley

I am grateful to my hon. Friend for his words of congratulation. I am sure that he agrees with me that the congratulations concerning the achievements of the past 18 months ought to go to the trade union movement—leaders and members—whose wages policy has made this achievement possible. Although I agree with my hon. Friend that it is an achievement of some substance, I cannot begin to explain the attitude of the Opposition, which has been solidly and continually against everything that we have done in the past two years.

Mr. Knox

While the recent reduction in the rate of inflation is obviously welcome, may I ask the right hon. Gentleman whether he realises that the annual figure of 9.9 per cent, which he has given and which is the lowest annual rate of inflation under this Government is still higher than the average rate of inflation under the last Conservative Government?

Mr. Hattersley

Of course I very much want to see a further reduction, and our policy will be directed towards that end. I am happy to be a member of a Government who have passed the single figure mark on the way down while the hon. Gentleman was a supporter of a Government which passed the single figure mark going up.

Mr. Montgomery

Does the right hon. Gentleman not think that the fact that prices have almost doubled during four years of Labour Government is total indictment of the Government? Since the right hon. Gentleman launched the Labour Party campaign in the Ilford, North by-election in a great glare of publicity, and since the electors of Ilford, North clearly showed what they think of the Government's policy, may we have an assurance that he will launch all Labour by-election campaigns from now until the next General Election?

Mr. Hattersley

The hon. Gentleman conveniently fails to mention a number of factors about the inflation rate over the past four years, such as an increase of 400 per cent, in oil prices which, I think he will agree, had some effect on prices in this country. As for the Ilford, North result, I can only repeat what I said earlier. I repeat it to the hon. Member in particular. The Ilford, North campaign was fought and lost on a different issue from prices.

Mr. Evans

Does my right hon. Friend agree that the trade union movement has played a large part in getting the inflation figures down and that the next Budget ought to have regard to this? Does he not agree that future financial policies put forward by the Government should ensure that the rate of increase is kept down in the years ahead? Will he look forward to the day when the inflation rate falls below 8.4 per cent., when we shall no doubt have a cheer from the Conservative Party?

Mr. Hattersley

The achievement is largely that of the trade unions. It must be built on and improved upon. The real reward of the two years of hard policy and sacrifice is that during 1978 and into 1979 there will be a real improvement in the standard of living. That will be because earnings will rise faster than prices. That is something for which we have all struggled in the past two years.

Mrs. Sally Oppenheim

Does the right hon. Gentleman really expect congratulations from anyone on the fact that the Government have taken nearly four years to bring down inflation temporarily—very temporarily—to single figures? Has he any idea of the hardship that has been suffered during this period in which prices have almost doubled? Has he not grasped the fact that the people of this country, far from awarding accolades to the Government, will neither forgive nor forget that the Government are the Government of the highest prices ever? Does he not realise that the Ilford, North by-election was won on prices and not any other issue?

Mr. Hattersley

I am reluctant to take lectures from the hon. Lady about financial hardship. It does not seem to me to be a subject on which she is art authority. She ought to understand! that the people of this country are a great deal more understanding about politics and economic reality than she is. I do not believe that she commends herself to them by her constant strident attacks on every achievement by the Government.

Mr. Madden

Reverting to the question of the brewers, may I ask whether my right hon. Friend agrees that they have been profiteering at the expense of their customers for years? Notwithstanding the fact that they have made monster contributions to the Conservative Party for a long time and the fact that the official Opposition oppose price controls of any sort, may I ask my right hon. Friend to institute a price freeze on the products of the brewers? Does he apppreciate that if he were to do this the Chairman of the Price Commission would receive acclamation from the general public for a move which would be warmly regarded by the country?

Mr. Hattersley

I do not want to use words such as "profiteering", but I have said and will continue to say that I believe that over the past two years the brewers have made price increases which were far too frequent and in many cases unnecessary. As for action against specific breweries or the brewing industry as a whole, that must depend upon the report submitted to me by the Price Commission. One major brewer is now under investigation. The way in which the brewers' performance ought to be improved, together with their service to customers, is by a change in their relationships with their retail outlets, the "tie" and those things which create a semi-monopoly in the brewing industry. That is where the long-term action must be taken.