HL Deb 22 July 1977 vol 386 cc624-7

Clause 1

1 Page 1, line 8, after "corporate" insert ",up to 31st July 1978, except that Her Majesty may, by Order in Council, which shall not be made unless a draft of the Order has been approved by a resolution of each House of Parliament, continue the Price Commission in being as a body corporate for a period which begins with the date on which the Commission would otherwise cease and which is not longer than one year,"

The Commons disagreed to this Amendment for the following Reason:

2 Because it is desirable that the Price Commission should continue to exist on a permanent basis.


My Lords, I beg to move that this House doth not insist on their Amendment No. 1 to which the Commons have disagreed for Reason No. 2. The Amendment we are now considering concerns the permanence of the Price Commission and that issue has already been debated extensively, both here and in another place. Amendments to limit the life of the Commission were rejected in Standing Committee and on Report in the other place. On Report in the other place, the matter was debated for 4½ hours. The Amendment we are considering, although of slightly different effect from similar Amendments debated in another place, nevertheless limits the life of the Price Commission. That is a concept which the other place has firmly and repeatedly rejected and, in the light of the Message before this House, I think it would be wrong for your Lordships to carry the issue any further. I beg to move.

Moved, That this House doth not insist on their Amendment No. 1 to which the Commons have disagreed for Reason No. 2.—(Lord Oram.)


My Lords, your Lordships will not be surprised to hear that we greatly regret that the Commons have not seen fit to agree to our Amendment. We are now authorising, by not insisting upon our Amendment, an indefinite life for the Price Commission. The Commission, in some areas, has draconian powers which we were unable to persuade your Lordships to vary. I agree that not all the powers of the new Price Commission are to be permanent, but we are agreeing these powers in the face and in the knowledge of the Government's policy for wage controls which were announced last week. It is for your Lordships and the other place to judge whether the balance has been properly achieved. I must say that we doubt it.

It is perhaps not wholly realised, although we have endeavoured to persuade your Lordships of this view, that persistent and draconian, as I have called them, controls over prices are all very well if the same controls exist over costs; but, at least in the area of wages and salaries, we believe that the Government's proposals are hardly adequate. Of course, if the figures that the Government have suggested as being appropriate turn out to be observed in due course and in practice, well and good. But if, as some fear, the growth of wages and salaries, unhindered by any effective control, rises at a great rate then companies will be put in gravest difficulties. I am sure your Lordships will understand—although it does not always seem to be so—the need for profits in these circumstances, because without profits there is no growth, no new employment and even, indeed, an extension of the present unhappily high unemployment. All these things, I fear, have been said before and I am not really saying anything very new.

I would end by saying that we greatly regret that the House of Commons has not seen fit to agree to this Amendment, and I would ask the Government whether they are really happy with the printed Reason for the disagreement, which we are asked to accept today. I recall during the passage of, I think, the Dock Work Regulation Act or the Aircraft and Shipbuilding Industries Act, last Session, when there was some "ping pong"— as it is called—going on, when the proceedings on the consideration of our Amendments were guillotined, that the Reasons even then were better than the one that we are asked to accept this morning. I do not believe there is any future for us in pursuing this matter further, and thus I would not propose to oppose what the noble Lord is suggesting.

Baroness SEEAR

My Lords, we on these Benches welcome the fact that in another place this Amendment was rejected, as of course we voted against it when it came before your Lordships' House. We believe it is essential that these powers of investigation should continue. We also believe that they are particularly necessary, now that pay limits are not subject to direct control of the same order as through the Social Contract, which exists until the end of this month. We feel that it continues to be very important that everyone should realise that there are measures for continuing control over prices.

We would, however, urge, as we urged throughout the debate in this House on this Bill, that while we entirely support the idea of continuing investigatory powers, we hope that the existence of the Commission as such will not be continued unduly, and that steps will be taken quickly to amalgamate this organisation with the Monopolies Commission.


My Lords, I should like very briefly to support my noble friend Lord Trefgarne, but will not go into any detail. Naturally, the House will realise that one is very sad that the Government did not see fit to accept this most moderate of Amendments. But, even sadder, I find it very hard to understand why the noble Baroness, Lady Seear, gave support to the Reason given: Because it is desirable that the Price Commission should continue to exist on a permanent basis. The Price Commission continuing on a permanent basis must only indicate that the Government have abandoned all hope of licking inflation, and I think that this is very sad.


My Lords, may I add to what has just been said from this side of the House? We can quite understand the Government's belief that the Price Commission will work; that, indeed, is why they have introduced the measure. But it seemed to us on this side of the House that it would be as well to see whether it achieved confidence or tended, on the other hand, to disrupt confidence. We still think that it would have been much better to introduce a measure which would have enabled us, from time to time, to assess how it was working, because there can be no guarantee that it will work or will maintain confidence in business, which is of such overriding importance.


My Lords, in view of the fact that the noble Lord, Lord Trefgarne, has indicated that he is not opposing the Motion that I moved, it would not be desirable that I should deal at length with the comments that have been made. But I would draw attention to one point, which I tried to stress during our debate in Committee and on Report. This Bill proposes to set up an investigatory system, and that is a long-term purpose not directly related to pay policy and the immediate inflationary situation. It is a new system whose permanency is justified, in our view, by the increased concentration of British industry, and the fact that competition is severely limited in many sectors. It is that long-term purpose which I rather fear has not sufficiently been appreciated in your Lordships' House.

The noble Baroness, Lady Seear, will recall that on several occasions I have indicated our general agreement with the point she made, about a future merger with the Monopolies and Mergers Commission. But I have also indicated that it is not a simple, straight forward matter and time is necessary to consider the complications involved.


My Lords, before the noble Lord sits down, may I ask, in view of what he said in his opening remarks, why it is necessary in this Bill to have powers to freeze prices?


My Lords, that again we discussed very considerably in the Committee stage. I did not say that the Bill, in having a long-term purpose, had no relationship to the immediate situation, and it is in relation to the immediate situation that the price freezing powers are necessary.

On Question, Motion agreed to.