HC Deb 23 March 1978 vol 946 cc1737-9
Mr. Kilroy-Silk

asked the Chancellor of the Exchequer what further steps he proposes to take to restrain wages when stage 3 of the present policy ends.

Mr. Healey

It is too early to make any statement on this subject.

Mr. Kilroy-Silk

Is my right hon. Friend aware that, while many of us object strongly to the present pay policy and to the anomalies and injustices that are part of it, we would warmly welcome a Socialist incomes policy which would deal with all forms of income and wealth? If we are to have an incomes policy at all, that is the way in which we should be progressing.

Mr. Healey

My hon. Friend knows that it is the Labour Party's intention to introduce a wealth tax after winning the next General Election with a majority that is adequate to ensure its passage through Committee. I welcome my hon. Friend's support for an incomes policy. I believe that there is growing understanding among the British people and the trade union movement that an unregulated free-for-all is not likely to be conducive to either economic health or social justice.

Mr. Cope

Does not the Chancellor think that it is made even clearer in this morning's newspapers that the Government's attempt to restrain wages by means of contract clauses was grossly inadequately thought out in detail and in advance as well as being objectionable in principle?

Mr. Healey

I do not think so. The interesting thing is that the objection in principle comes largely from the Conservative Front Bench, which was heavily defeated when it put its views to the House in successive debates in recent weeks. I am glad to see that both of the main employers' organisations are not prepared to fight the principle of sanctions through such clauses. We have had extensive discussions with them in order to make the proposals a great deal more acceptable than they appeared at first sight.

Mr. Goodhew

Will the Chancellor tell the House why it is that the Government have guaranteed to the firemen that they will be restored to comparability regardless of the financial constraints of the day and why he has not made the same promise to the Armed Forces?

Mr. Healey

We have not yet taken any decision, or announced a decision, with regard to the Armed Forces. The decision in respect of the firemen was welcome to the House in general, although the Conservative Party initially appeared to be pressing the firemen to continue an indefinite confrontation with the Government. The whole House will be grateful for the remarkable success which the Government's pay policy has had during the current round, which makes nonsense of the predictions of explosion which came from the Conservative Front Bench only nine months ago.

Mr. Lawson

In order that the Chancellor does not persist much longer with the illusion that he has total agreement in what he is saying, will he have a word with the Secretary of State for the Environment, who, in an important lecture the other day, said that normal collective bargaining must be restored in order to produce new relativities and differentials, which have become badly compressed over the last four years?

Mr. Healey

I never expect to have the full agreement of the House, especially from Conservative Members. My right hon. Friend made it completely clear in the whole text of his lecture that collective bargaining must be operated in such a way that it does not lead to the sort of pay explosion which led the Conservative Party to introduce statutory controls on incomes not so very long ago.