§ LORD O'NEILL OF THE MAINEMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
§ [The Question was as follows:
§ To ask Her Majesty's Government whether they are now in a position to assess the benefits which have been conferred upon the community by the abolition of the Prices and Incomes Board; and whether the time is now approaching when they should have a new look at their economic policies.]
§ THE MINISTER OF STATE, DEPARTMENT OF HEALTH AND SOCIAL SECURITY (LORD ABERDARE)My Lords, the Government do not believe that detailed intervention in the determination of pay and prices of the kind carried out by the National Board for Prices and Incomes would make any effective contribution to the welfare of the community. There is evidence that the Government's policy of bringing about by voluntary means a substantial reduction in the general level of pay settlements is achieving some success.
§ LORD O'NEILL OF THE MAINEMy Lords, while thanking the Minister for his reply, may I make three small points? First of all, is the Minister aware that after paying tribute to the courage with which the Government were tackling their inherited problems, I expressed some fears during the debate which we had on the Wilberforce Report? Secondly, has the Minister read this morning about the vast increases in wages announced for the private sector, not least as reported in the Daily Telegraph? Thirdly, is he aware that I personally should be perfectly content if the Minister could tell me that the Government would be flexible in the 1290 future in their approach to these grave and apparently growing problems?
§ LORD ABERDAREMy Lords, I thing I can answer, "Yes" to the first and third questions. I am certainly aware of what the noble Lord said earlier. Also, I can certainly assure him that the Government will be flexible. In answer to his second question, I am aware that there have been a number of high settlements, particularly in the car industry, but I am also aware that in the last three months there have been a number of settlements, both in the private and in the public sectors, which have been running at a lower rate than in the previous year.
§ LORD SHEPHERDMy Lords, will the noble Lord understand that the House will expect answers to have some relation to the facts? In view of his answer to the second supplementary question, can the noble Lord say which of the settlements in the private sector the noble Lord had in mind when he said that they are below the old rate?
§ LORD ABERDAREMy Lords, I can assure the noble Lord that my answers have regard to the facts. I am surprised that he should think they have not. The fact is that in the last three months there have been a number of settlements below the going rates in both public and private sectors.
§ LORD SHEPHERDMy Lords, I am certain that the House is not yet aware of what the Government have in mind as the going rate. Perhaps the noble Lord can give us one or two examples of where settlements in the private sector have been below what the noble Lord says is the going rate.
§ LORD ABERDAREMy Lords, may I quote from what my right honourable friend the Prime Minister said in another place on March 26? He estimated the average percentage increase in earnings resulting from major pay settlements concluded and notified to the Department of Employment since July 1, 1970, at 13 .5 per cent. Recently there have been a number of settlements, in both private and public sectors, running around the 10 per cent. level and less.
§ LORD LINDGRENMy Lords, can the noble Lord tell us which ones? We 1291 know of the last settlement for the railway industry, but can he tell us about the private sector?
§ LORD ABERDAREMy Lords, the noble Lord, Lord Robbins, was about to rise to his feet—
§ LORD LINDGRENMy Lords, I apologise to the noble Lord.
§ LORD ABERDAREMy Lords, I did not say that for that reason. I expect that the noble Lord, Lord Robbins, was going to put the same question as he put to my noble friend about a week ago, asking about this very point. The only reason why I am not anxious to go into the matter is that I do not think it is altogether advisable to have a kind of league table of settlements. But I have the various figures here.
§ LORD ROBBINSMy Lords, I assure the noble Lord that I did not intend to put the question which I put to his noble friend last week. I have received a very courteous letter from his noble friend. It does not altogether allay some anxieties which I may have entertained, but for the time being, needless to say, I accept it as the best information that can be provided. I was going to ask the noble Lord whether he agrees that, even at whatever conception he may entertain of the going rate, it is still a powerful inflationary factor in the economy.
§ LORD ABERDAREMy Lords, I would accept that; and our policy is to try to bring these rates down. The only point I was making is that there have been a number of lower settlements lately. The noble Lord was courteous enough to say that he had received my noble friend's letter, and I can communicate with the noble Lord if he wishes.
§ LORD BYERSMy Lords, is not the real problem that the average is too high? If the average is 13 .5 per cent., one would expect some of the settlements to be below it and some above.
§ LORD SHINWELLMy Lords, is the noble Lord aware that what is embodied, above all else, in the Prices and Incomes Board's Report which has just been published is that it is quite impossible to improve the conditions of the lower-paid 1292 workers, particularly in the public service —in hospitals and the like—without a prices and incomes policy? And that we also give qualified support—with certain reservations, I agree-to a minimum wage policy? Furthermore, do I understand from his Answer, which represents the Government's view, that the Government reject the Prices and Incomes Board's recommendations?
§ LORD ABERDAREMy Lords, the Prices and Incomes Board was part of the previous Government's policy for a statutory prices and incomes policy. That is a policy which we do not believe in, and we are trying to solve this problem in our own way.
§ LORD SHINWELLMy Lords, will the noble Lord be kind enough—clearly he does not want to be discourteous; I am certain about that—to reply to my first supplementary question; namely, is he aware that it is clearly embodied in the Prices and Incomes Board's Report that it is impossible to improve the conditions of the lower-paid workers in the public services wihout a prices and incomes policy?
§ LORD ABERDAREMy Lords, I hesitate to set myself up as an economic expert, but I doubt whether I would agree with that proposition.
§ LORD O'NEILL OF THE MAINEMy Lords, is the noble Lord aware that I am grateful to him for his reply to my remarks where he said that the Government will be flexible in the future in dealing with these difficult problems? I accept his reply, and thank him for it.
§ LORD BALOGHMy Lords, how high a figure of unemployment does the noble Lord think will be necessary in order to teach the Government the economic lesson which everybody knows?
§ LORD ABERDAREMy Lords, I think that is going very wide of the original Question. It is extremely difficult to enter into the whole of an economic policy in a Question and Answer session.
§ BARONESS WOOTTON OF ABINGERMy Lords, would the noble Lord not agree that this is a matter of very great public importance; and if he cannot explain to us why he is so diffident in producing what he calls a league table, will he not give an undertaking that we 1293 may have very full information at an early date on what the settlements have been which give rise to his confidence?
§ LORD ABERDAREYes, my Lords; I am grateful to the noble Baroness. I will certainly consider, and bring to the attention of my right honourable friend. the feeling about this. But I would reiterate that I think there are dangers in publishing a list of settlements because it encourages those who may think they have not got enough to ask for more.
§ LORD DAVIES OF LEEKMy Lords, is the noble Lord aware that in another place the Chancellor of the Exchequer, in a stentorian voice, to the best of his ability announced Draconically his own view, which is
that an attempt by exceptional fiscal measures to bring about a substantial reduction in unemployment in present circumstances would do irreparable harm to our longer-term prospects"?In other words, is the noble Lord aware that the Government are on an uncharted sea, without any charts, and working empirically to God-knows-where?
§ LORD ABERDAREMy Lords, I am not in the least aware of that, and I entirely agree with what was said by my right honourable friend.
§ LORD SHACKLETONMy Lords, since the noble Lord is dealing, I think, with unfamiliar territory, or uncharted seas, would he or the Leader of the House again give consideration to the request that was made, that the basis of their statement with regard to the level of wage settlements should be made available? Would he also, since others asked this question, arrange for the letter that the noble Lord, Lord Drumalbyn, or someone else, sent to the noble Lord, Lord Robbins, to be tabled, so that the rest of us may know? In particular, could they ensure that the details differentiate between settlements in the private and in the public sectors?
§ LORD ABERDAREYes, my Lords; that is what I thought I had undertaken to do in reply to the noble Baroness, Lady Wootton of Abinger.
§ LORD SHACKLETONMy Lords, the noble Lord did not promise to do anything of the kind. He merely promised to consult his right honourable friend.
1294 We are saying that we are in fact demanding these figures.
§ LORD GLADWYNMy Lords, as I understand it, the noble Lord has said that the policy of the Government is to be flexible in this matter. Does that mean that if things go very badly they will not exclude the possibility of a wages and prices freeze?
§ LORD ABERDAREMy Lords, I cannot comment on that. That is something in the future.
§ LORD PARGITERMy Lords, did not the noble Lord suggest that his right honourable friend in another place referred to 13 .5 or 13 .7 per cent. as earnings? And did not his subsequent figure refer to wages settlements? Is there not very often a considerable difference between the level of earnings and the level of wage settlements?
§ LORD ABERDAREYes, my Lords. It was the increase in earnings to which my right honourable friend referred, and I was talking about the wage settlements in the last three months.
VISCOUNT ST. DAVIDSMy Lords, will the noble Lord give us one or two examples, although he is not very willing to give us a list? Because there is a considerable feeling that the high cases relate to several hundred thousand wage-earners, whereas the low cases relate to two men and a dog.
§ LORD ABERDARENo, my Lords. I have already undertaken that I will look into this point. I seriously will ask whether these figures can be made available. I think that is as far as I can go.
§ THE EARL OF LAUDERDALEMy Lords, is my noble friend aware that the way he has answered these questions gives great satisfaction to those on this side of the House?
§ LORD ABERDAREMy Lords, I am extremely grateful to my noble friend.
§ LORD GARNSWORTHYMy Lords, will the noble Lord take note that his noble friends are very easily satisfied?
§ LORD BALOGHMy Lords, does that mean that the noble Lord is very satisfied at the rise in unemployment?