HC Deb 25 October 1976 vol 918 cc55-6W
Mr. Gould

asked the Chancellor of the Exchequer what effect on the Retail Price Index the increase in MLR from 9 per cent. to 15 per cent. will have, by virtue of its effects on hire-purchase charges, wholesalers' and retailers' gross and net margins and industry's costs for items such as insurance and distribution.

Mr. Denzil Davies

Increases in hire-purchase charges are not recorded in the

Mr. Joel Barnett

Figures for general Government—central and local government and social security funds—are given in the tables below. The expenditure figures used for table 2 are on a different basis from those usually used in the United Kingdom. They exclude capital transfers, lending and expenditure on the acquisition of company securities.

RPI. Changes in retailers' margins arising from changes in interest rates are allowed to be passed on to consumers under the terms of the Price Code, but their ability to pass on these costs is likely to be reduced by the relatively low level of demand. A rough assessment based on information about the net liquid liabilities of industrial and commercial companies would indicate that the impact on the RPI of higher financing costs in manufacturing and distribution should not exceed 0.1–0.2 per cent.

Mr. Ralph Howell

asked the Chancellor of the Exchequer what is his estimate of the effect on job opportunities in private industry of a 15 per cent. minimum lending rate.

Mr. Denzil Davies

I refer the hon. Member to the reply to my hon. Friend the Member for Southampton, Test (Mr. Gould) on 22nd October.