PRICES AND INCOMES BILL

HL Deb 08 July 1968 vol 294 cc646-57

2.55 p.m.

LORD BESWICK

My Lords, I beg to move that this Bill be now read a third time. We have had on Second Reading, and again in Committee, a careful and informed scrutiny of this Bill. We have had speeches from a former Chairman of the Trade Union Congress; there has been a contribution from a former General Secretary of the Trades Union Congress, and from my noble friend Lord Blyton, whose roots go deep into the history of one of the most troubled of all our great industries, the mining industry. Then there was the noble Lord, Lord Rowley, who himself and his family know the Labour movement as few families in this country know it. All these noble Lords, with their experience and their connections with the great Labour movement, have shown a sympathy and an understanding of the purposes of the Fill that I have had the privilege of moving before your Lordships' House. I am grateful to those noble Lords, and to noble Lords opposite, for the way in which they have enabled the House to take this Bill through the various stages in this House.

The fact is that the powers in this Bill are an essential part of the post-devaluation economic policy, and with the Finance Bill, which has just received its Third Reading in another place, the passage of this Bill will complete the Budget strategy. The Government have never hidden the fact that this Bill has more stringent powers than existing legislation, which the Bill also renews; but these more stringent powers are warranted by exceptional circumstances. Important as it is, it would be a mistake to assume that the measures in the Bill are everything. It essentially requests fall-back powers for a policy which is designed to encourage and promote cost effectiveness and productivity. I think I can claim that Britain today is more cost and productivity conscious than ever before in its history. At the same time, we have also wanted to ensure fair play, and to spread what rigours there are fairly and with consistency. For this reason, we are asking for certain powers to control rent increases and dividend distributions.

In conclusion, my Lords, I should like to emphasise once again that these powers are a buttress to the voluntary system. They are not a substitute for the general voluntary acceptance by those of our people (who constitute the majority) who recognise the need for restraint. I ask noble Lords to give a Third Reading to the Bill as one that is necessary as an insurance to the progressive economic recovery of the country.

Moved, That the Bill be now read 3ª.—(Lord Beswick.)

LORD ERROLL OF HALE

My Lords, I do not propose to re-open the arguments on Third Reading about the merits or otherwise of the Bill, although what the noble Lord has just said, including some extraordinary jargon about cost effectiveness or cost and productivity consciousness, was a great temptation to me. We will let that pass. We were delighted to hear the vote of thanks which he gave to noble Lords on his side, but he gave very perfunctory thanks to noble Lords on my side of the House, who have cooperated with him in circumstances of great inconvenience in a procedure which we were assured last year would never be repeated, but which was repeated. We hope that, in giving a Third Reading to this Bill, we can even at this late stage have an assurance that your Lordships' House will not be treated ever again by this Government in such a cavalier way.

LORD BESWICK

My Lords, may I just say that the noble Lord will find when he reads Hansard that I specifically referred to noble Lords opposite. I apologise that I did not say, "the noble Lord, Lord Erroll, and the noble Lord, Lord Drumalbyn."

LORD CLITHEROE

My Lords, I do not propose to make a Third Reading speech on this Bill, but I cannot let the Third Reading go by without saying how entirely out of sympathy I am with this Bill. The compulsory powers in the Bill are, in my opinion, totally incompatible with a free society. I was deeply saddened to hear the views expressed by so many old stalwarts of the Labour movement, who seem to have convinced themselves that compulsion is necessary. I myself believe that we are drifting into very dangerous waters, and those who believe in freedom may, I think, very well live to regret the day that this Bill was passed.

3.0 p.m.

LORD BROCKWAY

My Lords. I had tabled an Amendment to this Bill during the Committee stage. For physical reasons I was unable to be here, and I hope the House will therefore permit me to put the considerations which were then in my mind. The principal purpose of that Amendment was to delete the penal section of the 1966 Act, but it would also have deleted other sections relating to the compulsory wage restrictions. I am not against an incomes policy. I should like to see a minimum living standard applied in this country to the aged, the sick, the unemployed and the injured. I should like to see in this country a minimum wage of £15 for all workers. I should like to see a limit to the maximum income of the citizens of this country. Away in the 1920's I stood for these principles. But I am opposed to the actual proposals in this Bill for income limitation.

The Government say that prices will rise by 5 per cent. Mr. George Woodcock, the Secretary of the Trades Union Congress, has said that they will rise by 7 per cent. Under this Bill wage increases are limited to 3½ per cent., except where they are attached to productivity agreements. About the need for greater production there is no difference of opinion, but thousands of workers in this country are unaffected by any possible productivity agreements. In this situation it is inevitable that industrial unrest will grow, with prices increasing more than wages, and my great fear is that the cleavage between the trade unions in this country and the Government will grow.

I will now speak for a moment to the members of my own Party. I am deeply concerned by the present rift in the Labour movement. Sixty-one years ago, on the same day, I joined the Labour Party, my trade union and the Co-operative Movement, and I have always regarded them as a tripartite unity. As one who has mostly been engaged on the political side I want to pay my tribute to the Trades Union Congress and to trade union leaders for their attitude to the particular problem which we are now discussing. The Trades Union Congress and the Trade Union Conference of Executives agreed to give voluntary cooperation to the Government in preventing unreasonable increases in wages. They also put forward a constructive policy of economic advance. As one who has had a life-time in the Labour movement, I regard it as most unfortunate that the Government did not accept these approaches which the Trades Union Congress put forward. I have not the least doubt that the actual results would have been better, industrial tensions would have lessened, and certainly there would have been a better spirit of co-operation between the trade unions and the Government.

I am particularly concerned about the penal clause in the Prices and Incomes Bill. Section 16(4) of the 1966 Act applies to any Made union or other person taking, or threatening to take, any action by way of taking part, or persuading others to take part, in a strike in pursuance of demands not authorised by the Act. The union or the individual concerned is made liable, on summary conviction, to a fine of £100, or on conviction on indictment to a fine (if the offender is not a body corporate) of £500. I acknowledge that this section does not directly provide for imprisonment, but if the fine was not paid, distraint on the offender's goods or imprisonment would inevitably follow. One can imagine the indignation and indeed the resistance from trade unionists which the application of this section would arouse.

I appreciate that this provision, although included in the 1966 Act, has never been applied. I am confident that the Minister for Employment and Productivity, for whom I have the greatest admiration, would never wish to apply it. But the action is made more likely under the wage restrictions of the Bill which we are now considering, and trade unions have made their resentment clear. Not only the Trades Union Congress but the Conference of the Trade Union Executives—and not only these, but every trade union conference which has met since the White Paper was published—the shop workers, the clerical workers, the engineers, the draughtsmen, even the local government officers, conservative as they are—have condemned this penal clause.

On this matter the precedents are not encouraging. I remember the circumstances during the war in reference to Order 1305 which prohibited strikes. The Kentish miners at Betteshanger went on strike. The Government decided to prosecute them; there were 4,000 on strike, and the Miners' Union co-operatively agreed that there should be a few test cases. The chairman and the secretary of the Betteshanger branch of the Union were imprisoned. They were close friends of mine, and I was intimately concerned in this issue. When they were imprisoned the consequence was that the minors continued the strike with more determination than ever, the Ministers of the Crown had to negotiate with the imprisoned officers for the men to return to work. There were still difficulties in the judicial field. The Minister of Mines had to consult with the Home Secretary as to how to get the chairman and the secretary out of prison in order that the strike might end, a humilitating experience for any Government.

After the war there was a great campaign against Order 1305. My friends on these Benches will remember the mass strike by the dockers, and again when their leaders were in prison the strike continued with greater determination than ever. I would respectfully warn the Government that if this penal clause is applied the resistance of the rank-and-file workers will become more intense if their leaders are imprisoned.

I want to give one other instance, which is fantastically Irish. The Government of Eire recently passed legislation outlawing strikes in the electricity services. They fined strikers and when they did not pay imprisoned the leaders. The whole electricity industry then threatened to go on strike. A situation developed where the Electricity Board paid the strikers' fines in order to free the leaders from prison. They saw the leaders in prison and the men said, "We do not want to leave now; we have no means of travelling home at night". The Electricity Board representatives then said, "For heaven's sake! you must go back. You must be at the power plant to-morrow morning". The Board actually paid for the taxicabs to take the imprisoned leaders home.

All this is utterly humiliating to any Government. It has happened in this country; it has happened in Ireland. It will happen whenever any Government attempts to imprison trade union leaders against the determination of the rank and file. I have no doubt that if a similar situation arose in Britain the Minister, with her persuasiveness and her ingenuity, would settle the matter by measures equally unorthodox as those to which I have referred. But would it not be much better that the situation should never arise?

I want to conclude with a philosophic point. This Party stands for democratic socialism, combining personal liberty with a co-operative social order. We stand for that in distinction from the totalitarianism of communism or the corporate state of fascism. The compulsion of workers with the sanctions of fines and imprisonment is alien to the whole concept of libertarian socialism. It is too late to alter this Bill, but I hope that the Government will not renew it after 12 months and that they will reconsider this policy, which is detrimental not only to our relations with the trade unions but to the principles on which our Party is founded.

3.15 p.m.

LORD ROYLE

My Lords, my noble friend has just made a very moving speech, and I suppose with most that he has said I should be in almost complete agreement. The theories which he has mentioned have been the basis of our socialist faith and our socialist understanding for many years. My membership of the Labour Party does not go back as long as that of my noble friend, but now it is more than forty years, and I want to assure him that other people on these Benches are just as worried as he is, although we have taken a very different line. I have not uttered a word during the passage of this Bill until now, but it has been with a very heavy heart indeed that I voted for it, and I would not have done so had it not been for the feeling that this "long-stop" of penalties was a necessity in present circumstances. As I have sat through the debates here and read the debates in another place, obviously I. with many noble Lords on this side of the House, have been very worried indeed.

But this seems to be a necessity of this particular day and these present economic circumstances. I agree with my noble friend that one of the terrible things of life in this country to-day is the growth in inequality, and there seems to be a great deal of concentration on setting back and freezing or maintaining where the wages and incomes are the lowest. With him, I should like to see more activity so far as the upper reaches of income are concerned.

The only other thing I want to say is this. In the debates in your Lordships' House and in another place the concentration all the time seems to have been on incomes. This is the Prices and Incomes Bill. We have heard too little about prices. I recognise the difficulties in maintaining low prices, preventing price rises, but it seems to me that income is the main thought and not the prices. The British housewife has not time to go round from shop to shop finding out where prices are the lowest. There should be a greater concentration on the control of prices. The problems would be nothing like so serious, and we should not be so much worried on the incomes side, if a stronger line were taken with prices.

I finish where I began. It is with a very heavy heart that most of us, or all of us, on this side have accepted the terms of this Bill, particularly the penal clauses. We would not have done so had we not felt that the necessity was there, and our great hope is that ere long these clauses can be removed from the legislation.

3.18 p.m.

BARONESS WOOTTON OF ABINGER

My Lords, I should like to strike a more cheerful note. It was a matter of great regret to me that owing to long-standing and unavoidable engagements I was not able to take part in the earlier debates on this Bill. Perhaps in those circumstances your Lordships will not complain if, with due respect to my noble friends Lord Brockway and Lord Royle, and now that the Bill is about to be well and truly launched, I spill a little verbal champagne over it. This Bill is essentially a temporary measure—temporary because it fixes the present structure of incomes with only very moderate scope for variation. I very much hope that the principle which it embodies, together with the Prices and Incomes Board, will become a permanent feature of our economy, and I would say in passing how much I admire the work of the Prices and Incomes Board, and particularly the speed and efficiency of its investigations, which I have followed fairly closely.

The pattern of incomes in any community is of vital importance, both socially and economically. It is of social importance because it is the main determinant of the class structure of society and because it sets limits to the scope of individuals in social intercourse; and it is of economic importance because incomes are at once rewards and incentives. For my part, I have never been able to understand why issues of such importance should be left to the private smash-and-grab of the interests most directly concerned. I have never been able to share the prevailing faith in the divine right of collective bargaining, or, more precisely, in the divine rightness of every collective bargain. Still less can I understand how that faith can be reconciled with the principles of Socialism which lay down that communal action and the economic system should be controlled in the interests of all.

Thirteen years ago I published a book which was most unfavourably received, in the course of which I asked why it was that in this field, and in this field alone, we are expected to believe that public issues are best left to organised private interests to determine. It seems extraordinary that in this world and in this day and age, in which we cannot put up a garage in our backyard without planning permission, designed to safeguard our neighbours' amenities, we are allowed, if I may put it this way, to help ourselves to the contents of our neighbours' pockets without let or hindrance.

Since I first broached this subject 13 years ago there has been a great and welcome change of climate. When I appealed that the question of income determination should be part of the substance of politics I got a quite dusty answer in a great many quarters. But I think to-day we can confidently hope that this Bill will guarantee that hereafter in any negotiations affecting wages, salaries or other incomes determination, a seat will be permanently reserved at the bargaining table for the unknown consumer.

3.22 p.m.

LORD CONESFORD

My Lords, I shall detain the House for but short time. The noble Lord, Lord Royle, made one slip in his short and moving speech. I think he said he had voted for this Bill with a very sad heart. I believe he will find that he has not voted for the Bill, because there has never been a Division throughout the course of our proceedings. I greatly welcome that, not because I think it is a good Bill but because I thought that this House was quite right, whatever it thought of the Bill, to allow the Government to have a Bill which they regarded as essential for their economic policy; and I think their responsibility for this Bill and its results should be crystal clear.

The only matter on which I wish to comment is the actual timing of the Bill in its final stages. The Bill has hitherto been commended to us as essential to the Government's policy, including their policy on productivity. It goes through its final stages in this House on the morrow of a settlement in the railway industry commended by the Minister concerned, a settlement that pays no regard whatsoever to the Government's incomes policy or to the Government's policy on productivity.

In view of what has happened, I do not know how the noble Lady, who always commands the interest of this House when she speaks on economic subjects, can have framed the conclusion of the speech which she has just delivered, that the public interest and the Government's policy would always be considered in wage settlements.

I should have thought there might be a good deal to be said for reaching this settlement, if it was to be reached, in order to prevent the public suffering, as it did suffer, from the go-slow. There would have been something to be said for the Government's insisting on sticking to their principles of productivity, and not yielding to a demand which they had long described as unjustifiable. But we had both evils. The public suffered by the go-slow, and in the settlement the Government's policy on productivity was utterly abandoned. What is illustrated, and I think that it is worth pointing out, is this. Every Government, from time to time, has to choose between two evils. What is unique about this Government is that, whenever they have to choose between two evils, they invariably choose both.

3.26 p.m.

LORD BESWICK

My Lords, it would be fascinating to speculate how the noble Lord, Lord Conesford, would have handled the difficulties we have just seen on the railways. His speech was not entirely up to his usual standards of punctilious accuracy. He said that my noble friend Lord Royle had not voted. I distinctly recall my noble friend saying "Content" when the Question was put. The noble Lord said that the railway settlement was not in accordance with the principles of the prices and incomes policy of the Government. A little later on in another place a Statement will be made about the railway settlement. It is not my business to repeat it in this House, but it is interesting to see that, of the three principles which the Government and the Railways Board have followed in the matter, the third is that any settlement must be in accordance with the productivity, prices and incomes policy, and they are satisfied that the settlement in fact accords with that policy.

I was particularly grateful that my noble friend Lady Wootton of Abinger should have put this matter in its perspective. There are philosophical issues concerned. There are deep feelings aroused by this Bill. But I would say to my noble friend Lord Brockway that all the philosophy is not on his side. There is another point of view to this, and we have tried to put it. As my noble friend Lord Brockway recounted his memories of the past, I felt that he was tending to look at this matter, as Wordsworth might have said, in terms of Old unhappy things, Of battles long ago. Times have changed. My memory went back, too, when as a boy I followed behind the miners marching, to hear A. J. Cook urge that they stand firm on the slogan: Not a penny off the pay, Not a minute on the day! No nil norms in those days.

Those were days when I could understand the line taken by my noble friend. But the coal-owners have gone; Alf Robens has replaced them. A miner's son is now the Chancellor of the Exchequer. A grammar school girl has brought in this Bill. We are faced with other problems than old slogans. We have questions of the balance of payments. We have demand management. We have all the financial problems of paying the bills which Imperial Britain has left behind as it has pulled out of different parts of the world. We are no longer able to shout defiant slogans and feed our people. We have a much more complicated economic task before us.

I should like to think that all trade unions behaved in the way in which my noble friend Lord Brockway suggested they do. But the fact of the matter is that they do not. The overwhelming majority of them are socially responsible. The overwhelming majority of them know the problems we have to deal with. But as his mind went back, mine also went back to a meeting of a few weeks' ago, when the Prime Minister was trying to convince one general secretary of the merits of concentrating on productivity, and trying to get him to give up the opposition that he had to this prices and incomes policy.

This particular general secretary said, "Prime Minister, I understand; but let me tell you a story"—probably it ought to be called a parable. He said: "There was one general secretary who was instructed by his executive to go out and conclude a fresh agreement with a firm on which his union had a stranglehold. He was told to get an increase in pay; if possible a reduction in hours." The story went on to relate how, after protracted negotiations, the general secretary came back and he told his executive, "Yes", he had got an agreement. Pay had been increased much more than the figure they had hoped for. Fringe benefits had been improved. Hours had been reduced. They now worked only on Thursday afternoons. The executive considered this report very carefully, and then turned round to the general secretary and said, "It is not too bad, but what is this about working on Thursday afternoons?" This story was told as a parable to illustrate what some trade union leaders are confronted with.

As I say, this is not by any means typical. But this Bill is designed to try to ensure that there is fairness between one group of organised workers and another; between one group of organised workers, as producers, and their wives, as consumers; between organised workers and those who are too old to work or too young to work or too sick to work. It is an endeavour to ensure that as we have increased material wealth, due to technological advance, it is shared as reasonably as possible. The noble Lord himself said that not all people in this country can benefit from productivity agreements. That is quite true. That is one reason why in those capital intensive industries, where it is possible to increase productivity, a part of the increased wealth should be given to other sections of the community. That is why we want to get some idea of controlling the distribution of our increasing wealth production.

My Lords, it is not for me to delay business in this House. I have certain other responsibilities. I am grateful for the way in which noble Lords opposite and those on this side have listened to the arguments, have put a point of view on this Bill, and I hope that they will now agree to give it a Third Reading.

On Question, Bill read 3^a, and passed.