HC Deb 17 December 1979 vol 976 cc9-11
11. Mr. Sheerman

asked the Secretary of State for Trade what representations he has received about price increases which call for the use of his present statutory powers to restrain or control prices.

Mrs. Sally Oppenheim

I naturally receive a number of different types of representation about prices. As I have made clear on numerous occasions, the powers which exist were seldom used by the previous Government except in the context of EEC subsidies. They are at present being used in connection with the EEC subsidy on butter.

Mr. Sheerman

Is the right hon. Lady aware that many people, including those in consumer organisations and the trade union movement, are now utterly desperate, feeling that the Government have thrown away all powers to control prices at any stage of crisis, as at this moment? Does the right hon. Lady realise that many people are facing the bitterest and worst Christmas they have known, with the prices of bread, of eggs and ofbeer—all working-class mass-consumption commodities—going through the roof, so that ordinary people are on the point of starvation for the first time in many years?

Mrs. Oppenheim

Naturally, I sympathise with people who are having to tackle a high rate of inflation, but the Labour Government's approach to tackling inflation was to introduce a successsion of policies designed, through price control and the Price Commission Act, temporarily to disguise inflation and deceive consumers for the sake of short-term political benefit. Not only were such policies expensive and time-wasting failures but they were cruel, since they misled consumers about the true rate of inflation, which they have to face in the end. The present Government have no intention of resuscitating such disreputable policies.

Mr. Robert C. Brown

Will the right hon. Lady insist on her civil servants putting a hit of truth into her replies? Will she accept that it was her Government who doubled VAT—one of the most inflationary things to happen since the election—and that mortgage interest rate going up to 15 per cent. and minimum lending rate at 17 per cent., are calculated further to increase the rate of inflation? Will the Government accept responsibility for this?

Mrs. Oppenheim

The hon. Gentleman should not blame my civil servants for my replies, for which I claim authorship. In fact, we have not doubled VAT, but the Labour Government doubled prices, and the short-term manipulations of prices upon which they embarked served only to delay the increases which have to come through in the end. The factors which the hon. Gentleman has mentioned are just some of the factors, but by no means the main ones, in the increase in inflation which the country is having to face today and will have to face for some time to come.

Mr. John Fraser

Does the right hon. Lady recall removing the restriction on the price of bread almost as soon as she got into office? Can she explain why the price of bread has now risen by another 2½p for a standard loaf? Will she, as Minister, start looking forward instead of backward, and answer the question? Will she tell us whether we shall reach an inflation rate of 20 per cent.?

Mrs. Oppenheim

First, we are looking forward to our economic policies restoring long-term price stability, which this country has not known for years. The reason why bread prices have increased during this period is that bread producers' costs have risen as a result of raw material prices rising.

Mr. Gordon Wilson

Will the Minister realise that people are more worried about the price of bread on earth than about the price of pie in the sky, because they expect that if the Government's policies are pursued over the next four years as they have been over the past six months the price of pie in the sky will be prohibitive?

Mrs. Oppenheim

Naturally, I am aware of those concerns. That is why it is the overriding purpose of this Government, through their economic policies, to overcome inflation which, among other things, affects the price of bread.

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