§ Mr. Michael Marshall
asked the Chancellor of the Exchequer what is the amount by which his Department estimates inflation has fallen as a direct result of the £6 pay limit.
§ Mr. Joel Barnett
If earnings had continued to rise at the level of increase prevailing at the time the £6 limit was introduced there would have been no significant reduction in the rate of inflation. As it was, the year-on-year rate of increase in earnings fell from 28 per cent. in July 1975 to 14 per cent. in July 1976; and the year-on-year rate of inflation fell from 26 per cent. to 13 per cent. over the same period.