HC Deb 23 November 1978 vol 958 cc1462-3
9. Mr. David Price

asked the Chancellor of the Exchequer what rate of pay increases is being used currently by the Government in determining cash limits for the 1978–79 estimates.

Mr. Joel Barnett

As stated in Cmnd. 7203, the assumptions used for the 1979–80 cash limits will reflect the Government's policy on pay.

Mr. Price

From that non-answer, may I assume that the Government's 5 per cent. pay limit is the cash limit figure? If so, can the right hon. Gentleman tell the House how the Government intend to make it stick in the National Coal Board and with the National Union of Mineworkers?

Mr. Barnett

The answer to the first part of the hon. Gentleman's question is "Yes". The answer to the second part is that we shall continue to persist with making our incomes policy work. I am sorry to see the hon. Gentleman smiling. I hope that he would expect and want us to be successful.

Mr. Loyden

Does not my right hon. Friend agree that wages are only one element of inflation and that the disregard by my right hon. Friend the Chancellor of the Exchequer of the other elements is an indication that wages are seen, certainly by the Opposition, as the total cause of inflation? Does my right hon. Friend agree that it is about time the other elements of inflation were examined and decisions were taken on them?

Mr. Barnett

My hon. Friend must know that neither my right hon. Friend the Chancellor nor I has ever said that wages are the only element in inflation. But I hope that my hon. Friend will accept that they are a very important element in inflation.

Mr. Lawson

Since the Government set such great store by the much-advertised agreement with the TUC over stage 4, and since that agreement somewhat unexpectedly failed to materialise, how much higher does the Chief Secretary expect pay and price inflation to be in the coming year as a result of that grave setback—or was it just a load of eyewash in the first place?

Mr. Barnett

The hon. Gentleman is probably in line with most of the Opposition Front Bench on three points. [HON. MEMBERS: "Answer."] I am about to do so. They are, first, that the hon. Gentleman would have it that the document was of no value; secondly, presumably, that it was a sell-out; and, thirdly, that it would not work. The fact is that the Government are continuing to discuss these matters with the TUC, and we shall continue to ensure that our pay policy works.