Orders of the Day — The Economy

Part of the debate – in the House of Commons at 12:00 am on 18 December 1974.

Alert me about debates like this

Photo of Mr Edward Du Cann Mr Edward Du Cann , Taunton 12:00, 18 December 1974

For myself, I cannot say I am sorry that 1974 is coming to an end. The Chancellor of the Exchequer said, in what I thought was a profoundly disappointing speech, that this had been a difficult year. The right hon. Member for Devon, North (Mr. Thorpe) was much nearer the mark when he said that he thought it had been disappointing. We have made too little progress in the effective management of our affairs. That may be thought to be a matter for regret. I say that it is a matter for shame on the part of this House of Commons.

In what I know everyone will say was a fine and courageous speech, the hon. Member for Ashfield (Mr. Marquand) said that we were suffering an economic and financial crisis of the greatest magnitude. That is true, and I am sure that it is right that, like him, we should not endeavour to meet the situation with party dogma but, rather, by saying plainly that our concern is for our country and for the future of our children. That is the priority, and nothing else should be.

The situation is most severe—there is no lack of evidence of that—and my right hon. Friend the Leader of the Opposition said that it was deteriorating. I am sure that it is right that we in this House should warn. We have a duty to do that.

However, my theme is a different one. It is that much public discussion at present is misdirected. We should look to the causes rather than to the symptoms of what is wrong. So I speak hopefully of remedies rather than indulging in the current petty fashion of constant carping cynicism and complaint which seems to occur so frequently in dinner table and other conversations. I have no sympathy with what may be called, listening to the wireless in the morning, the gloom-and-doom brigade.

Thus I do not ask whether the strength of our people is adequate for the tasks facing the nation and moan that they are not. I prefer to think of ways to refresh or renew the resolution which lies untapped or too little tapped in our people. The needs are to stimulate, maintain and develop the national will to succeed and to give the leadership by which it can be achieved.

What is to be done in practical terms? We live in a practical world, and we should speak in practical language. Our overriding problems, of many, are inflation and the balance of payments. Like the right hon. Member for Devon, North and the hon. Member for Ashfield, I have some proposals to put forward which in conjunction could affect both beneficially.

I was flattered to hear that the Chancellor of the Exchequer had read the article which I wrote last Sunday in the News of the World. It was probably better reading for him than the stuff which must be served up to him constantly. I shall endeavour to amplify some of the remarks that I made in that article.

First, cannot we construct a comprehensive programme to save energy? What has been suggested to date is hardly impressive. Nor is there evidence of a determined search for or encouragement of the exploitation of alternative sources of supply. I give some instances. So far as I am aware—and I have made inquiries—there is little or no research into the possibility of methane production from farm waste. There is little research into the uses of solar energy. There is still less research into the uses of the wind for electricity generation.

Another matter referred to by my right hon. Friend the Leader of the Opposition concerned the development of our resources. It seems to me that the Government are much more interested in taxation than in production. Looking at the financing of North Sea oil exploration and how far it has got, I am bound to say that it is too slow and exists far too little. What I argue for—and this is one aspect of it—is a credible programme of self-help. I see no sign of that at present.

Second, the Government should mount an import-saving drive. I do not mean that I am in any way an enemy of a liberal trade policy. I remember well that UNCTAD conference in 1964 to which my right hon. Friend the Leader of the Opposition referred. He and I were colleagues in government at that time. I am much in favour of broadening the basis of trade throughout the world.

I object strongly to imports which enter the United Kingdom because we are careless, idle or wasteful. For example, for every ton of paper that we recycle we save importing a ton of pulp. Surely that is obvious. We can look at the bill. The figures are there for all to see. Yet my local authority has now stopped waste paper collection. Meantime, United Kingdom imports, to quote a single figure, constitute 20,000 tons of waste paper per month. That is nothing short of scandalous. I understand that there is now a danger that some waste paper merchants, at any rate in the West Country, will go out of business. This state of affairs seems so extraordinary that it is hardly credible.

In the United States the recycling industry—paper, steel, iron, plastics, and so on —enjoys a system of special tax relief. In Holland, the Government finance the stockpiling of waste materials for future recycling.

Surely, with imagination, it should be possible to mobilise public enthusiasm for this cause. The hon. Member for Ashfield was entirely right to point out that the public is largely unheeding of our cries of "Wolf" at present. I suggest that we should let that imaginative programme be done, and be done at once. These may appear to be small matters, but I say that in the aggregate they are substantial in terms of cash contribution to the balance of payments.

Even more important is the psychological effect of these matters. It is right that we should endeavour to promote public awareness of the dangers that we face, and the consequence of failure. Many people in our society have taken prosperity for granted for far too long. Indeed, one must be well over 40 years of age to have experienced anything other than a comfortable life. It is urgent to mobilise public enthusiasm to counter those dangers.

I turn now to larger matters. I would pick up the theme of my right hon. Friend the Member for Finchley (Mrs. Thatcher) in the excellent speech that she made at the opening of yesterday's debate. My right hon. Friend was, in effect, saying that we depend for our very life and livelihood on commercial success. Can we not agree between us to remove the discouragements to commercial success which politics seem constantly to impose? In one way they are practical—the kind of discouragements that we hear every small business and saver in the country speak about. It would not be difficult to remove them.

The discouragements are also political. It is urgent that we remove from industry, commerce, insurance, shipbuilding, steel—I could give a longer list— the threat, if not the reality, of political interference of the gravest kind.

I thought that my hon. Friend the Member for Bridgwater (Mr. King) did the House a service when he interrupted the Chancellor and asked how he thought industry and commerce could sincerely believe that the Government have their best interests at heart when we still have in the Government the right hon. Member for Bristol, South-East (Mr. Benn). There could be no greater improvement in confidence than to see changes in certain Departments at this time. We need more practical success and less intellectual dog-fighting over industry. Could we not agree to a 10-year moratorium from political pressures on industry? Why cannot we leave industry well alone to do the job that it is supremely qualified to do?

I now turn to the fourth point that I should like to make. On this subject particularly—the social contract—I found the Chancellor hardly inspiring, let alone convincing. My view about the social contract is simply described. I hope to see it succeed. Manifestly it is not succeeding. It must have stronger backing.

I do not argue for a freeze for anyone, least of all for senior executives who so often seem to be a target of one kind and another, but excessive settlements must be brought under better control. There are various possibilities, as the House knows. The right hon. Member for Devon, North referred again today to the possibility of taxes on higher percentage increases. That is one possibility. Indexing, which I favour, is another. But there is a need to remove uncertainty from people at the lower levels of remuneration, and especially the continual scrapping to which this country is now subject. We also need to encourage greater emphasis on increased earnings through increased production or productivity.

We are doing none of these things. We are not handling satisfactorily any of the matters with which we should be coping. For the Government to pretend that the social contract, as it exists, is ideal, is patently absurd. It requires amendment, and soon, if the prevailing mood of cynicism about it is not to grow to an extent which will inevitably destroy it.

Fifth and last in my list, I would write a new industrial charter. It should be easy to write an obligation to bring about a greater degree of consultation in industry and commerce. The strategy of a business should not be the exclusive prerogative of the boardroom. Equally, its profitability is highly relevant to the work force. Industry is a partnership, not a battleground. Let us promote unity in industry by every available legislative device for consultation, for directorships, if people wish to have them, for profit sharing—heavens, if the French can do it, why cannot we?—and for share ownership, a matter in which I have long taken a personal interest. These and other devices are readily to hand. I am sure that they provide a vastly better recipe for industrial harmony than all the apparent delights of State ownership.

My list of five points is by no means exhaustive. Other right hon. and hon. Members will have many proposals to make involving such matters, perhaps, as the restoration of confidence in markets —so very much needed—and better control of Government and local authority expenditure. Whatever the Chancellor may have said, neither local government nor central Government expenditure is under control. I am as certain as I am standing here—I speak as a past Chairman of the Public Accounts Committee and as the first Chairman of the Public Expenditure Committee—that it would be possible to get vastly better value for money than we currently do.

Other right hon. and hon. Members will wish to talk about the regeneration of industries—for example, the construction industry, which, in the South-West at any rate, is having a miserable time—or the deficit financing which we are enjoying, if "enjoying" is the right word.

Returning to the general, I was extremely pleased that my right hon. Friend the Leader of the Opposition this afternoon spoke about support for the Government for every proposal where common sense and patriotism are the sponsors. I endorse that approach. We on the Opposition side of the House should and shall, I believe, always support the Government in such circumstances, not least the Chancellor's efforts to counter on a world scale the imbalances which result from the sudden increase in oil prices to which he referred.

I should like to make a supporting proposal. I suggest that the Chancellor should mobilise the support of the developing world, not least in Africa. It is true, as many speakers have remarked in the past, and will again, that to a large extent the balance of power in the world is changing. The sufferings of some of the developing countries are great, and they need help, and they could well support us in the councils of the world.

Some of us welcome the Chancellor's Budget as a step in the right direction of liberating industry from the shackles that he previously imposed upon it. Of all the examples that one might quote, I suppose that the most important discussions that we shall enjoy—again, if that is the right word—in 1975 in this House will be those about the European Economic Community.

I was an opponent of our country's entry into the Community. I thought then that there were better alternatives, and I still think that. I have never seen any reason to change my opinion, but, the House having made a democratic decision, we should now work for success in Europe and try to shape its destiny as we believe to be right. If we succeed, well and good. If we do not, then will be the time again to consider the alternatives. Meantime, let enthusiasm be in order. What we need above all—I am trying to say this by means of illustration— is certainty in what we do.

I return to my main theme. It is within the knowledge of many hon. Members that, lately, I have seen something of many whom I am pleased to regard as personal friends in both Africa and the Gulf, notably in Kuwait. They all seem to say much the same thing to me, and I dare say, to other right hon. and hon. Members from time to time. I can summarise it like this: "We who have confidence in you and your nation beg you to have equal confidence in yourselves". I would pray, so let it be.

It is true to say that this country is at a crossroads, but the reality is that our destiny is in our own hands. I just hope that in 1975 we are more worthy of it than we have been this year.