HC Deb 24 March 1980 vol 981 cc921-3
8. Mr. Barry Jones

asked the Secretary of State for Industry when next he proposes to meet leaders of the Trades Union Congress.

Sir Keith Joseph

At the National Economic Development Council on 2 April.

Mr. Jones

Does the right hon. Gentleman accept that, if he meets the TUC leaders, some of them certainly would say to him that his industrial policies are needlessly turning some of our workplaces into centres for trials of strength between management and the shop floor? Does he agree that his inflexible monetarist policies are posing a danger to the social fabric of our country as well as bringing about the likelihood of an unemployment figure well beyond 2 million?

Sir K. Joseph

I did not notice that the previous Government's industrial policy brought about a situation of unrelieved sweetness and light in every workplace.

Mr. Peter Bottomley

When my right hon. Friend meets the TUC will he discuss the apparent difference between the industrial rate of exchange and the financial rate of exchange? Will he make the TUC understand that a neutral monetary policy—monetary control—leaves it to employers and trade unions to negotiate pay increases that are greater than the increase in the money supply? Does he not agree that those increases will lead to reduced industrial competitiveness, and higher unemployment?

Sir K. Joseph

I agree that excessive unit labour costs, which result from wage claims that are not accompanied by higher productivity, will destroy jobs.

Mr. Heffer

When the right hon. Gentleman meets the TUC—apart from his philosophical discussions about monetarism—will he hold concrete discussions on selective import controls? Does he not agree that such import controls will save some of our industries from the pressures that they now suffer?

Sir K. Joseph

At present, we have some selective import controls. To go further would risk encouraging inefficiency and price rises as well as retaliation.

Mr. Henderson

When my right hon. Friend next meets the leaders of the TUC will he stress the important role that they could play in the application of microprocessor technology to industry? Does he not agree that that technology can substantially improve our industrial efficiency and assist in raising the standard of living of TUC members?

Sir K. Joseph

TUC leaders do not need much persuasion. A TUC booklet called "Employment and Technology" was recently published. As I have mentioned in public before, it contained a most encouraging welcome for micro-processing as a new technology. However, I think that some of the conditions attached to the application of those new techniques are misguided.

Mr. Winnick

Is the right hon. Gentleman aware of the sense of dismay that is felt by leaders of the TUC and by the country about the Government's monetarist policies? Does he not recognise that such policies can lead only to a return to massive unemployment? Does he not accept that we shall have disaster areas instead of industrial areas?

Sir K. Joseph

The hon. Gentleman has got it entirely wrong. It is long-established common sense that a monetary policy involves moving towards a balance between the growth of demand and the growth of supply. The hon. Gentleman has forgotten that the last leader but one of the Labour Party, the right hon. Member for Huyton (Sir H. Wilson) got it exactly right. He said that inflation, which monetary policy seeks to abate, is the father and mother of unemployment.

Mr. Emery

When my right hon. Friend speaks to the TUC will he emphasise the need for increased productivity in most of our industries? Does he not agree that if we are to compete and to attain the level of production and employment that all hon. Members desire, there must be a heightening in the level of productivity and a lowering in unit costs? Will he stress that point, above all else, in his discussions with trade union leaders?

Sir K. Joseph

To be fair, those trade union leaders attending the NEDC do not need any persuasion. They understand that perfectly well. However, at shop steward level, one finds resistance, because there is fear about the loss of jobs. At that level there is no understanding that higher productivity is a source of greatly increased employment.

Mr. John Silkin

When the Secretary of State meets TUC leaders and gives them his ideas on the necessity to curb inflation, will he explain why his Government doubled VAT in the last Budget, thereby increasing inflation to double the figure that existed when they took over?

Sir K. Joseph

The right hon. Gentleman must remember that the previous Labour Government complained throughout their lives that the inflation that occurred during their first two years of office resulted from an inherited lag from the previous Conservative Government. We can, therefore, make the same claim now. We inherited rising public expenditure and a rising monetary supply. At present, the country is suffering from the consequential inflation.