HC Deb 02 November 1970 vol 805 cc297-8W
Mr. Bishop

asked the Chancellor of the Exchequer if he will detail in the OFFICIAL REPORT the steps taken by Her Majesty's Government since June to stabilise or reduce the cost of living.

Mr. Higgins

The Government's strategy for checking the present inflation consists of the pursuit of firm fiscal and monetary policies while seeking to reduce the excessive rate of wage settlements, and of encouraging the growth of output, productivity and savings and promoting competition. The fiscal measures announced on 27th October by my right hon. Friend the Chancellor of the Exchequer were broadly neutral in their effect on demand, and were followed by action to raise the Special Deposits of the banks as a contribution towards the required restraint of bank lending in the period ahead.

In the field of wages, the Government has made it clear to employers in both the private and public sectors, and to the T.U.C., that responsibility for moderating wage claims and settlements—even in the face of strike threats or action—rests with those directly involved in wage negotiations; and it has also indicated its acceptance of corresponding responsibility in negotiations with its own employees. The Government's concern to promote growth, productivity and savings has been reflected in the forthcoming reduction of income tax announced on 27th October and in the improved terms for National Savings announced on 22nd July. We also attach great importance to the workings of competition, and are considering how best to strengthen the effectiveness of the Monopolies Commission.