§ Captain Anstruther-Grayasked the Minister of Supply whether he is aware that hardship is being suffered by manufacturers holding contracts which were placed at fixed prices before or immediately after the commencement of the war owing to increases in prime costs; and whether any action can be taken to mitigate it?
§ Mr. BurginI have given careful consideration to representations received both from individual contractors and from trade societies regarding hardship suffered by manufacturers holding contracts which were placed at fixed prices quoted before the outbreak of war and during the following three months. I recognise that in many cases contractors have incurred unavoidable extra expense in the execution of these contracts by reason of rises in prime costs and that to refuse to make any contribution to such extra expense would often cause hardship. It has therefore been decided as anex gratia measure to give sympathetic consideration to claims from contractors who seek enhanced payments to mitigate the hardship they would otherwise suffer. By reason of the ex gratia nature of such payments, the individual cases will generally be considered on satisfactory completion of the contracts concerned; the amount of the extra payment will be based on the extra costs unavoidably incurred owing to rises in the prices of important materials and in the rates of wages, so long as the contractor is not left with more than a strictly limited profit.