HL Deb 13 January 1976 vol 367 cc14-21

3.3 p.m.

Lord SHEPHERD rose to move, That a Select Committee be appointed to investigate the problem of instability in prices of primary essential commodities; to scrutinise proposals designed to rectify wide price movements in these commodities; and to report on the likely effectiveness of these proposals in reducing the substantial price fluctuations which have occurred in recent years. The noble Lord said: My Lords, I beg to move the Motion standing in my name on the Order Paper. If this Motion is accepted we shall be setting up a Select Committee to investigate the problem of instability in the prices of primary essential commodities, to scrutinise proposals designed to rectify wide price movements in these commodities and to report on the likely effectiveness of these proposals in reducing the substantial price fluctuations which have occurred in recent years.

I have always felt that this House, with its very special wealth of knowledge and experience, is well suited to undertake investigations through our Select Committee procedure. The noble Earl, Lord Jellicoe, when Leader of the House in 1971, in moving a Motion setting up the Select Committee on Sport and Leisure, hoped that it would be the first of a long line of such Select Committees. One of the difficulties has been selecting subjects. Clearly, it needs to be a subject of importance both nationally and internationally; it also should be one about which there is still a good deal of examination to be undertaken and one that, so to speak, has not been investigated or inquired into recently.

The question of commodities is one of direct importance to this country and to the developing world as a whole. I was grateful for the suggestion of the noble Lord, Lord Byers, that this subject was worthy of consideration. I made inquiries of some of my colleagues in the Government and we all took the view that this House was eminently suitable to look into this matter. I am pleased to say that the Government will give full support if this Select Committee is set up. I hope the House will concur with my recommendation. If it does, the Committee of Selection will meet shortly to consider the names of the chairman and members of the Committee. This is an admirable subject on which the wealth of experience in this House will enable us to do a worthwhile job.

Moved, That a Select Committee be appointed to investigate the problem of instability in prices of primary essential commodities; to scrutinise proposals designed to rectify wide price movements in these commodities; and to report on the likely effectiveness of these proposals in reducing the substantial price fluctuations which have occurred in recent years. —(Lord Shepherd.)


My Lords, may I ask my noble friend to say whether this investigation will include the prices of primary commodities in world markets, or only in this country?


In world markets, my Lords.


My Lords, I warmly welcome this proposal. I was in the chair of a large overseas bank for about 20 years and I must have talked and written more on this subject than I care to remember. There is considerable opposition—and we shall, no doubt, find more opposition—from certain vested interests which prefer to see commodity prices go up and down rather than be stable. Similarly, I always had strong opposition from economists who, while no doubt understanding the market forces and economic arguments against any form of agreement, nevertheless seemed to forget the strong political, economic and social objects in discussing this problem. I believe that there is now far too much at stake both for the producers and for consumers of raw materials to leave this issue alone and I very much hope this House will take this on board. An inter-Parliamentary group is at presnt discussing the setting up of a world commodity centre in London. I believe that this subject could also be looked at by this Committee and I hope that something will come of it. It will need Government help to find the correct place. Mr. Allen, the Chairman of the International Tin Council, has given a great deal of thought to this subject and has prepared a very good memorandum on it, which I hope will also be looked at by this Select Committee.


My Lords, I join the noble Lord, Lord Seebohm, in welcoming the proposal which the noble Lord the Leader of the House has put forward, but may I ask Lord Shepherd not to adhere too strictly to the criteria which he enunciated when he introduced the Motion because, although it is true that international problems of this sort are of great importance and are proper for this type of Select Committe, there are many subjects in this country which this House is well qualified to consider, subjects which have no international significance at all. Thus, although we welcome following the initiative of the noble Earl, Lord Jellicoe, one hopes that it will be extended further and particularly to certain problems in this country.


My Lords, may I ask the noble Lord the Leader of the House exactly what this Committee will study? Those who have knowledge of these subjects are aware that proposals of this type have been coming forward for many years and that in only a very few cases has it been found possible to have a workable stabilisation scheme. Who will produce the proposals? Will they be produced by economists at large, or perhaps by the growers of cocoa in some country, or by academic people in this country? What exactly will the Committee study?

3.10 p.m.


My Lords, I am most grateful for the warm welcome expressed by the noble Lord Lord Seebohm, and by the noble Lord, Lord Alport. I attach great importance to the question of commodities, not only nationally but internationally; and certainly so far as this country, as an industrial country dependent on imports, is concerned, a stable commodity régime is infinitely superior to the haphazard and dangerous processes we have seen during the last few years.

To the noble Lord, Lord Hawke, I would say that the way in which the Committee goes about its work is for the chairman and members to decide. There are a number of important papers on this subject and there are matters which have been brought to our attention by the Commonwealth Secretariat. All this material will be available to the Committee and I have no doubt that there will be many people of distinction who will be willing both to provide papers and to give verbal evidence. It will be for the Committee to decide how it should proceed in its work, but the Government will do what they can to see that its work is not only useful but will produce a report that will add to the public debate and to the knowledge which the Government have when they are dealing with these very difficult matters.


My Lords, is it intended to include among the commodities in question those which are greatly affected by climate—for example, agriculture—and those which may suffer as a result of drought or other phenomena? The problems which the Committee will face if this is done will be fantastic. For example, the fact that we are suffering from a shortage of potatoes is entirely due to the weather. Is it intended to exclude from the terms of reference of this Committee any of the matters over which we have no control at all—namely, what the Almighty does for us?


My Lords, I do not believe that anybody could object to an investigation and a Select Committee is as good a method as any of investigating this problem; but I believe that the composition of the Select Committee is perhaps more important than the instructions which are given to it because, if we are to have a Select Committee which will put on the record a purely theoretical point of view and one which does not take into account the practical problems which may arise, it could be that danger may flow from that. When there is a possibility that a body may try to regulate matters such as climate or natural phenomena which, as my noble friend has just said, cannot be regulated, that may interfere with the production of items which are essential. It is vital that we should not try to have matters too neatly tied up, so interfering with the production of items which may well be expensive on occasion but which are necessities whatever the price may be.


My Lords, should I be in order, I should like to venture a slight gloss on a remark made by my noble friend Lord Seebohm. I might remind the House that the first impersonal and systematic proposal for international regulation of prices of certain staple commodities was put forward by the Coalition Government in 1943. It was devised by economists and came to grief for political reasons.


My Lords, I am happy to say that I have more confidence in Members of your Lordships' House than have the noble Lord and the noble Baroness opposite. I agree that the composition of the Committee may perhaps be more important than its terms of reference. So much importance do we attach to it that the selection of members of Select Committees is not a matter which falls to me; the House has decided that it will rely on its own Committee of Selection. I have no doubt that that Committee will seek, not only in the chairman but in the members of the Select Committee, to choose Members of this House who will themselves be able to make a major contribution.

The noble Baroness, Lady Elliot, is quite right: "commodities" is a word which encompasses nearly everything which one consumes, whether it be agricultural or mineral. Clearly, if the Select Committee were to carry out an investigation into every one and into all their different by-products, it is doubtful whether I should be alive to see its report. However, I feel that it is for the chairman and members of the Committee to decide how to proceed with their work and how to identify those commodities with which they may seek to deal. However, these are matters to which I have no doubt that the chairman and the Committee will give their fullest attention, and I am sure that they will be able to produce a report which will be worthy of this House. This Select Committee, unlike that on the Hare Coursing Bill, can, I feel, rightly and properly take its time in preparing its report, so that it is a report of real substance.

Lord HOY

My Lords, I do not wish to detain the House, but I took exception to my noble friend saying that the terms of reference of the Committee might be of less importance than its membership. I do not altogether go along with that assertion; and when I heard the noble Baroness, Lady Elliot, who is a very good friend of mine, assert that the price of potatoes was 11p a pound not because the farmers were charging that amount but because someone on high had ordained that that should be so, I did not accept that line of argument. I believe that such matters are of great importance to the consuming public and to the housewives of this country, and I therefore feel that the terms of reference of the Select Committee are not unimportant. I believe my noble friend will agree with that and I should not like to place less priority upon them than upon the membership of the Committee. I should have a great feeling of weakness about a member of the Committee who asserted that, though the price of potatoes had risen so extremely high—and at a time when the quality was so bad—that had nothing to do with those who produced the potatoes but was the responsibility of someone from further up.


My Lords, I should like to ask the noble Lord the Leader of the House two questions. While I am pleased that the Select Committee is to be appointed to investigate the problem of the instability of prices of primary essential commodities, may I ask whether, in effect, the Select Committee will be making recommendations regarding the creation of stability in this area? Also, in view of the Lomé Convention, will the Committee be receiving representations or considering problems arising equally in the four Anglophone countries of West Africa and in the 14 Francophone countries of West Africa? Would the noble Lord not agree that, following the signing of the Lomé Convention, we should deal with these countries on an equal basis?


My Lords, perhaps I may refer the noble Lord, Lord Merrivale, to the terms of reference of the Committee. He will see that all he is asking for will be included. Certainly the question of the EEC and Lomé, and any other trade arrangements, are matters which the Committee will be able to take into account. In reply to my noble friend Lord Hoy, if he will refer to the terms of reference of the Committee, he too will see that potatoes are not excluded from consideration if the Committee thinks them worthy of consideration.


My Lords, are we waiting for a complete report from the Select Committee, or are we to have interim reports? It seems to me that events are moving very fast in this area. We are to have a series of conferences which will all bear on this point and on which we ought to have some views and some insight.

The Earl of ONSLOW

My Lords, I wonder whether the noble Lord the Leader of the House could enlighten me as to whether the Committee will be permitted and will have the finance to travel if it may feel it necessary to see matters for itself, for example, in the Copper Belt or in the corn producing areas of America? Secondly, has the noble Lord any idea how long the Committee is likely to sit?


My Lords, one thing I do know is that I am transgressing the Rules of your Lordships' House by speaking on far too many occasions, but this has tended to become a question and answer exercise, and I apologise. Whether the Committee should travel overseas is a matter for the Committee, and in its discussions with the Government it can consider what assistance can be provided. I think that the Committee should report when it is clearly in a position to do so. Perhaps it could produce an interim report, but this matter is very much open to the Committee.

At the end of the day the position is that we set up a Committee and it has terms of reference, and it is for that Committee, its chairman and its members, to decide how best to proceed in carrying out the task that this House has given it. If your Lordships felt that this is a matter worthy of a debate on a Wednesday—and personally I think it would be—I should be very happy to see that time is provided for such a purpose, if the Chief Whip could be cooperative. Following upon all the interventions we have had, and with what I believe is a spirit of general good will towards this proposal, I hope your Lordships will now agree that this Motion should be agreed to.

On Quesion, Motion agreed to.