Oral Answers to Questions — Cost of Living

– in the House of Commons at 12:00 am on 12th April 1956.

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Photo of Mr Donald Wade Mr Donald Wade , Huddersfield West 12:00 am, 12th April 1956

asked the Minister of Labour whether he will now make a statement on steps that are being taken to ascertain the household expenditure of pensioners as distinct from the comprehensive household expenditure upon which the proposals for the new Index of Retail Prices are based.

Photo of Mr Robert Carr Mr Robert Carr , Mitcham

I would refer the hon. Member to the answer which my right hon. Friend gave on 26th March to a Question by the hon. Member for Dunbartonshire, West (Mr. Steele).

Photo of Mr Donald Wade Mr Donald Wade , Huddersfield West

Does the hon. Gentleman agree that the Index of Retail Prices is quite inappropriate for calculating the adequacy of superannuation payments, because many of the articles taken into account are beyond the range of those who do not earn a wage or salary or have a substantial private income?

Photo of Mr Robert Carr Mr Robert Carr , Mitcham

Yes, Sir, but the hon. Gentleman asked in his Question about ascertaining the household expenditure of pensioners. I would remind him that in the Answer to which I have referred my right hon. Friend made it clear that the pattern of expenditure, as shown in the 1953–54 inquiry, will be published in full later in the year, so that the information for which the hon. Gentleman asked in his Question will become available.

Photo of Mr Donald Wade Mr Donald Wade , Huddersfield West

asked the Minister of Labour when an Index of Retail Prices will be available appropriate for estimating the cost of living of old-age pensioners.

Photo of Mr Robert Carr Mr Robert Carr , Mitcham

On 13th March, when my right hon. Friend announced the introduction of the new Index of Retail Prices, he said that the Government had considered this question and had come to the conclusion that there should be only one official Index of Retail Prices.

Photo of Mr Donald Wade Mr Donald Wade , Huddersfield West

Does the hon. Gentleman agree that there are items in it such as football boots and children's toys which, even if pensioners wished to buy them, they could ill afford to pay for? Would it not be helpful and practicable to work out an index whereby we could test the adequacy of old-age pensions?

Photo of Mr Robert Carr Mr Robert Carr , Mitcham

The important thing is that the information about the pattern of expenditure should be available. That has been found as a result of the household expenditure inquiry, and will be made available. We feel—this is not a new view—that it would be confusing to have more than one official Index of Retail Prices, and on balance we think it is right to hold to that view.

Mr. Lee:

Would the hon. Gentleman agree that people on small fixed incomes, such as old-age pensioners, spend a larger percentage of their income on food? Would the Government, therefore, watch the weighting of the food portion of the Index which presses more hardly on old-age pensioners?

Photo of Mr Robert Carr Mr Robert Carr , Mitcham

I do not think that we could consider altering the weighting of items in this Index, because the object of it is to give a proper representation of the normal pattern of spending in this country. It may be that there is something in what the hon. Gentleman says about the different balance of expenditure of these lower income groups. That is why they were excluded on this occasion, as in the past, from the make-up of the published Index. However, the pattern of their expenditure will be published and is being made available to the National Assistance Board as quickly as possible.

Photo of Mr James Griffiths Mr James Griffiths , Llanelli

Since the Phillips Committee, which the present Government set up, was definitely of the opinion that there ought to be a separate index, and stated that its inquiry was handicapped by its absence, can we take it that the decision of the Government now is that they have rejected one of the important recommendations of that Committee before this House has had an opportunity of considering it?

Photo of Mr Robert Carr Mr Robert Carr , Mitcham

I think that the right hon. Gentleman may have misunderstood the Report of the Phillips Committee, because in paragraph 108 it stated that: There has been no systematic analysis of the income and expenditure of elderly households in Great Britain. We attach great importance to such an analysis … The Report did not speak of an index but of an analysis of expenditure. That was made in the inquiry, and will be published later in the year.