§ Sir Ian Gilmourasked the Chancellor of the Exchequer what will be the effect on (i) the retail and (ii) the tax and prices index of (a) the increase in prescription charges, (b) the increase in the national insurance contribution, (c) the setting of the rate support grant at 56 per cent. and (d) of all the measures announced by him on 2 December.
§ Sir Geoffrey HoweThe increase in prescription charges will have a negligible effect on the retail prices index and the tax and price index. The increase in employees' national insurance contributions will not affect the RPI, but will add around 1–1½ per cent to the TPI from next April. The setting of the rate support grant does not directly affect the RPI and (TPI); any effect will come through local authority decisions on the level of rates for the next financial year. The only other significant impact of the measures will come from the proposed increase in council house rents, which, compared with no change in rents, will directly add to about 0.6 per cent. to both the RPI and TPI from next April.