§ Mr. Ellisasked the Secretary of State for Economic Affairs whether he has received the Report by the National Board for Prices and Incomes on the reference to them of distributors' margins in relation to manufacturers' recommended prices; and if he will make a statement.
§ Mr. ShoreYes. The Report, which is being published today, recommends that in general manufacturers when increasing recommended prices to the final consumer because of devaluation should reduce the percentage margin traditionally allowed to distributors. The Government welcome this Report which, in the particular case of recommended prices, endorses their own view, stated in my reply on 8th December, 1967, to the hon. Member for West Lothian (Mr. Dalyell), that there should not be automatic maintenance of current percentage margins where retail prices have to be increased as a result of devaluation. The Board are unable, for reasons explained in their Report, to make precise recommendations on how changes in recommended prices should be determined. Their findings however provide general support for the Government's view that increases in distributors prices, as well as in manufacturers prices, should be no greater than is justified by the increase in overall costs incurred.
186WGovernment Departments are arranging to bring the findings of the Report to the attention of the principal industrial and commercial interests concerned.