HC Deb 19 June 1979 vol 968 cc1109-16
Q1. Mr. Winnick

asked the Prime Minister when she expects next to meet the leaders of the Trades Union Congress.

The Prime Minister (Mrs. Margaret Thatcher)

I shall be meeting the economic committee of the TUC next Monday.

Mr. Winnick

That is very interesting. Is it not clear that, with the rich man's Budget, the abolition of the Price Commission and the devaluation of the green pound, full responsibility for the high rates of inflation and the discontent which will certainly come will lie with the right hon. Lady and her Administration?

The Prime Minister

Bearing in mind that the Budget took 1.3 million people out of tax altogether, that it helps elderly folk who have to pay tax and that it helps taxpayers throughout the wage scale to pay less tax and have more money in their pockets to spend in their own way, I should have thought that the TUC would welcome the Budget.

Mr. Kenneth Baker

Before my right hon. Friend sees the TUC, will she look at the speech made last weekend by the Leader of the Opposition in which he said that it would be quite wrong for the trade union movement of this country to precipitate politically motivated strikes in order to bring down this Government? Is she aware that that view has the overwhelming support of hon. Members of this House and will she ensure that a copy of that speech is placed in the Library of the House of Commons so that in the coming months when the situation may be rather different, all hon. Members, including the Leader of the Opposition may refresh their memories on the details of the speech?

The Prime Minister

That is the view of all who believe in parliamentary democracy, and it is shared by the vast majority of trade union members and a considerable number of trade union leaders.

Mr. David Steel

Can the Prime Minister confirm the report this morning that the Government are engaged in constructing a pay policy, even if it is to be known by some other name? If so, may we be told when we shall hear about it?

The Prime Minister

I am not able to confirm that. The right hon. Gentleman knows my views on these matters. The only incomes policy in which I am interested is an output policy—to get increasing output at competitive prices. That is the only way to get a rising standard of living in this country. The Budget was designed as a first step in that direction.

Mr. Donald Stewart

In view of that, will the Prime Minister, when she meets the leaders of the TUC, be able to assure them that there will be no question of a wages freeze or an incomes policy under her Government?

The Prime Minister

The right hon. Gentleman has heard me on this subject before. On that particular issue I do not rule things out for ever, but let me assure him that I shall strain against them because I believe that it is far better for people to be faced with the consequences of their own wage claims than to try to save them from them.

Mr. Emery

Will my right hon. Friend point out to the leaders of the TUC next monday that a considerable amount of the £700 million investment being made by General Motors in Spain would have been made in Britain had the trade unions been able to guarantee consistently a reliable and high level of output by a British labour force?

The Prime Minister

I agree with my hon. Friend's basic premise that we would get more investment both from overseas and from home if people could be assured of a good return on that investment. That means having a go at restrictive practices and also making sure that those who make the investments will get reasonable interest or dividends from them.

Q2. Mr. Gwilym Roberts

asked the Prime Minister when she plans next to meet the Trades Union Congress.

The Prime Minister

I shall be meeting the economic committee of the TUC next Monday.

Mr. Roberts

In view of the fact that the Government are pushing inflation to a rate of 17 per cent. or 20 per cent. this year, with massive tax handouts to the very rich, will the right hon. Lady give the TUC any guidance on wage restraints?

The Prime Minister

As the hon. Gentleman knows, taxpayers are keeping more of their own money in their pockets. That applies whether they are on low or high pay. If they are very low paid they will receive an increase in family income supplement. As for wage restraint, if wage levels rise steeply without increased output, the result, as has frequently been said from this Dispatch Box, will be increased unemployment.

Mr. Forman

As my right hon. Friend has already stressed the importance of trade unionists facing the consequences of their actions, will she reassure those of us who value the idea of a wider economic forum—within NEDC or a similar framework—that such a proposal might be put into effect?

The Prime Minister

I cannot tell my hon. Friend when it will be put into effect, but I can tell him that work is proceeding on the setting up of such a forum. It will be wider than the TUC and the CBI, as we indicated in our manifesto.

Mr. Alexander W. Lyon

Will the Prime Minister discuss with the TUC a report of the Department of Energy that three-quarters of British oil is being exported? Why is it just that there should be an undercutting of the standard of living in this country in favour of the oil companies' profits?

The Prime Minister

If the hon. Gentleman inquires further he will find that a good deal of the oil belonging to BNOC was being exported. BNOC has no refining capacity, and it was selling some of that oil abroad without linking it to the import of crude oil into Britain. Such linkage was much more likely with the commercial companies. The Secretary of State for Energy is doing all that he can to ensure that we receive all the oil supplies that we need.

Mr. Crouch

When the Prime Minister meets the TUC, will she discuss the possibility of arranging a major conference to consider improving productivity in British industry?

The Prime Minister

I agree with my hon. Friend that there is a great need for such an improvement. We are concerned about the lack of competitiveness in our labour costs last year when compared with other countries. There is a need to increase productivity and output, but I doubt whether a conference will help that. Now that incentives have been given to those on the shop floor, skilled workers and management, I believe that, between them, they will help to achieve the improvement.

Mr. Norman Atkinson

When the Prime Minister meets the economic committee will she clear up the doubts that are being expressed by trade unionists throughout the country that the Government are going back on the principle of comparability between earnings in the public services and those in private industry? Will she, in advance of the publication of the Clegg commission's report, undertake that the Government will accept what the report says about comparability?

The Prime Minister

We have already given a clear undertaking that we will accept what the Clegg commission says about the first four or five references to it. As for the future of the Clegg commission, it would be far better to wait and see how it works before deciding its future finally.

Mr. Renton

When my right hon. Friend meets the TUC will she confirm the Government's strong commitment to encouraging employees to own shares in the companies for which they work—including the successful nationalised industries? Is that not a far better route to employee participation than the unionnominated directors suggested in the Bullock report?

The Prime Minister

I agree wholeheartedly with my hon. Friend. It is our wish that those who work in industry—whether public or private industry—should make great strides towards being real capital owners.

Q3. Mr. John Evans

asked the Prime Minister when she expects to meet the Trade Union Congress.

The Prime Minister

I refer the hon. Gentleman to the reply which I have given twice already.

Mr. Evans

When the Prime Minister meets the economic committee on Monday will she engage its members in a discussion about whether it would be better to spend taxpayers' money on organisations such as the NEB which are attempting to create jobs than on unemployment benefit because there are no jobs?

The Prime Minister

If more taxpayers' money is left in their pockets they can create jobs by the goods and services that they purchase. One of the great differences between Labour and Conservative, Members is that we believe that taxpayers are entitled to spend more of their money as they choose.

Mr. Neubert

When my right hon. Friend meets the TUC will she weary it by impressing upon it—yet again—that higher production and productivity are the only solution to our economic problem? Will she point out that the Central Electricity Generating Board is considering bringing in more coal because insufficient coal at a competitive cost is available from our bountiful resources?

The Prime Minister

I shall stress continually the need for increased output at competitive prices. I hope that debates on that subject will take the place of debates on incomes policy, as has been the case in the past. Increased output is the other and the important side of the equation. We cannot stress that too much. In that way lies the only hope for improving our standard of living.

Mr. Ashton

If productivity does not increase because of the Budget, will the Prime Minister give fair warning to the TUC of the levels of inflation and unemployment that will have to be reached before a wage freeze is imposed.

The Prime Minister

The only way to achieve increased productivity is to give people incentives to increase output. That applies to unskilled and skilled workers, to management and to those working in manufacturing or services or in the public sector at any level.

Mr. Grylls

When my right hon. Friend meets the TUC will she explain that the central part of the Budget is to achieve the right climate to establish the expansion of real jobs in the private sector rather than to subsidise jobs which will not last for long?

The Prime Minister

I agree with my hon. Friend that we have to get that strategy across. Countries which have had a lesser proportion of jobs in the public sector, more in the private sector and a tax system which provides more incentives have been more successful at creating new jobs, products and services than this country has been. There is no magic about that. Our first Budget is going in that direction, and I hope that we shall be able to create more genuine new jobs than have been created in the past.

Q4. Mr. Rooker

asked the Prime Minister when she expects to meet the leaders of the Confederation of British Industry.

The Prime Minister

I hope to do so shortly and a date is being arranged.

Mr. Rooker

Before the Prime Minister tells the CBI, will she tell the House why the Government are proposing to increase youth unemployment by removing the job protection measures for youngsters between the ages of 16 and 18 years? The removal was detailed in a written answer last week.

The Prime Minister

The Government are not removing job opportunities from young people. We are hoping that because of the Budget more small businesses will be prepared to take on more young people, but we believe that the Labour measure was a deterrent to that effect.

Mr. Scott

Will my right hon. Friend assure us that, in the work that is being carried out on the proposal for a wider forum, consideration will be given to involving representatives of the majority of workers in this country who do not belong to unions affiliated to the TUC?

The Prime Minister

We shall give consideration to the matter. It is not easy to arrange because those workers are not represented. However, we are anxious to have a wider forum than just that of the TUC and the CBI.

Mr. Skinner

On the question of parliamentary democracy and mandates, will the Prime Minister indicate to me where in the Tory Party manifesto there is a reference to imposing a 15 per cent. limit on VAT? As she will not be able to find that reference, is it not clear that she has no mandate for carrying forward that policy? Therefore, is it not right and proper for Labour Members to engage in activities in order to ensure that those who suffer injustices will have them put right—whether inside or outside Parliament?

The Prime Minister

If the hon. Gentleman objects to measures taken by the Government, I suggest with respect that this House is the place for him to pursue his own particular views.

Mr. Skinner

The right hon. Lady has no mandate.

The Prime Minister

We certainly have a mandate.

Mr. Skinner

Not on that matter.

The Prime Minister

We have a mandate for reducing direct tax and for increasing indirect tax. I think that the hon. Gentleman's fear is that this Budget will be a great deal more popular than he supposes.