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Budget Proposals and Economic Situation

Part of the debate – in the House of Commons at 12:00 am on 11th April 1957.

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Photo of Mr Frederick Lee Mr Frederick Lee , Newton 12:00 am, 11th April 1957

It does not affect the point I am making that Mr. Canon, who is president of the A.E.U., has been in touch with Mr. Douglass on every issue concerning the steel side of the industry in which there have been certain complications arising from this strike. But on this issue, although as I have said, Mr. Douglass and Mr. Carroll have been in discussion, Mr. Douglass has not chosen to raise the issue of the Lancashire Steel Corporation.

May I put this point to the Committee, because it explains some of the complications which can arise? There was confusion in a number of steel works during the strike which has now concluded. So much depends on the degree of engineering which we have in steel works. In quite a number of them the steel owners themselves are members of the Engineering Employers Federation against which body the strike was directed. Therefore, there is the complication of overlapping as between steel and engineering which has resulted in some of the employers being members of the organisation against which the strike was directed. That kind of thing was inevitable under such circumstances.

I join with my hon. Friend in the tribute which he paid to the work both of the management and the men at Irlam. I appreciate what has been done outside the firm itself—to which my hon. Friend referred—in connection with old-age pension organisations and help for people of that type. I hope that the things which have happened there will not result in a lack of harmony between workers in the steel works, because, as was said by my hon. Friend, and I confirm it. basically they are the same type of men engaged in work of great importance on which we all depend so much for our existence as a nation.

I now turn to the matters in the Budget which I desire to discuss. I have listened to all the speeches made by hon. Members opposite speeches in which it has been said that much of the gain which will accrue to the£10,000-a-year class of men, and so on, will result in increased savings. That has been the theme of speeches from hon. Members opposite. It reminds me of nothing so much as the suggestion of Oscar Wilde: Each class preaches the importance of those virtues it need not exercise. The rich harp on the value of thrift, the idle grow eloquent over the dignity of labour. My right hon. Friend the Member for Huyton (Mr. H. Wilson) was right in pointing out that in this Budget the Chancellor seems to snap his fingers at the efforts of the trade unions to get a decent share of the national product for their members. I was interested in what was said by my hon. Friend the Member for Sowerby (Mr. Houghton). With much of it I agree except that I had to swallow a little hard when he said that supertax payers were workers who had been a bit more successful than others. I will not argue too much about that. I hope that trade unions will be successful in getting a few more of their members into the supertax class before long, more especially as the present Chancellor seems to have a weakness for those sort of workers.

My hon. Friend the Member for Sowerby raised an important issue about our future industrial position. He commented on the attitude of the House of Commons towards these grave industrial matters. I have been a Member of this House for long enough to know that one should never try to preach here, and I have never attempted to do so before; but I believe that we in this House would do a far better service to the nation were we to interest ourselves more in industrial affairs at times when there is no struggle in industry. It may be that it is because I like to specialise in these matters, but it appears to me that the House of Commons is never seriously concerned about industrial matters until trouble arises. Then we are all worried for fear that great strikes may break out, and for a time interest is shown. There are very many grave issues on the industrial front which afford hon. Members scope for thought if we are to help in bridging this very serious period through which we are passing.

The background to the Budget is a period in which we have seen our share of world trade gradually declining, and in which industrial production has become completely stagnant. I believe that the economic policies of the Government are largely to blame for this unfortunate position. I should have thought that the Chancellor would have had that fact at the back of his mind when he began to draw up the outlines of his Budget. Against that background there are only two words with which to describe this Budget. They are "irrelevant" and provocative". How any serious-minded person can believe that, witnessing this kind of give-away to those least in need of it, trade unions can now agree to restrain their own legitimate demands on the economy, is beyond my comprehension. It would appear that the element among the employers who have, I think, decided on an industrial show-down with the trade unions, now feel that their case has somewhat misfired and that they should defer it to a more suitable date.

If the Budget had been drawn on the assumption that it would spark off a round of wage demands I could understand it, but if that is not so, it is a revelation of industrial illiteracy of staggering proportions. It would be interesting if the Minister of Labour and National Service could speak for the Government and give us the benefit of his opinions on the subject.

We are now coming into the period in which the annual meetings of trade unions will take place, namely, from Easter onwards. Decisions on wages policy will be taken at these conferences. An atmosphere will prevail, created by the knowledge that the present Chancellor of the Exchequer has given the larger proportion of his reliefs to those receiving between£2,000 and£10,000 a year. No body of men meeting in that atmosphere, and knowing that the other policies of the Government, such as the Rent Bill, will force the cost of living to rise, dare ignore the consequences in unofficial outbursts of restricting their demands on the national economy. It was a great tragedy that the right hon. Gentleman decided to cast his Budget in this mould.

The strike situation has been recently discussed, and on many occasions we have heard the suggestion that the strike weapon is now almost indecent. Let me preface what I have to say on this subject with these words: in my little way I have worked as well as I could inside the trade union movement in the hope of achieving the position in which the strike weapon would never again need to be used. I can look back upon my own trade union and realise that almost from the moment of its inception in 1920 it has never had to organise a strike on a national basis.

In 1922, we were locked out and starved to our knees. We had to mortgage every stick of the union's property. We were driven back and had to suspend the payment of benefits. except for superannuation. We were driven back to a further three weeks without payment of any description. The price of failure was another 16s. 6d. off the wage packet. making 32s. 11d. over twelve months. One recalls that with bitterness. Despite that. we hoped that we had reached a civilised period between the two sides and the Government, when we would never again sec that kind of thing.

One is concerned now at the sort of criticism being levelled against people who are driven to striking. Almost inevitably, criticism by the people I am thinking of is not only of the principle concerned. It becomes violent when it examines the detrimental effect of the strike on the national economy, and at some stage of the discourse the right of the workman to strike is thrown in as a preliminary to a diatribe of abuse against those who avail themselves of that right. The logic of the argument would be that those employed in an industry vita to the well-being of the nation should retain the right to strike as a theory to which it is proper to pay lip-service on condition that they never use it.

If the real point of that opposition is that the strike weapon in such industries is far too expensive for use, that forms an additional reason why the full weight of public criticism should be directed against the anomalies that lead to strikes. I have never found any evidence that strikers give up the right to draw wages out of a fiendish desire to exist under those adverse strike conditions, and nobody with even a little knowledge of the subject has ever found it either.

We appear to be reaching a phase in which the basic right of the worker to withhold his labour may be threatened. I know that is not stated in those terms, but to damn with faint praise is an old method of beginning an assault upon an apparently impregnable position. "Brutas is an honourable man" has had many parallels since the death of Mark Antony.

We should reaffirm the right of the workers to withdraw their labour because it is as fundamental a part of the democratic concept as the right of freedom of speech. For stunters who know little about the nature of industrial disputes to indulge in what one can only call the "character assassination" of trade unionists and their officials is not only disgraceful in itself but it brings bitterness into negotiations and sours the whole of industrial relations.

When we are discussing our loss as a result of strikes we should remember that our position is a very good one. There are very few comparable industrial nations in the democratic world where so few hours have been lost as the result of strike action. It is as well that we should show to the world that although we have our industrial troubles we also have a great record of stability and knowledge. I hope that it is the intention of all people in public life who are interested in these matters to try in every way to get over as shortly as possible the interim period in which we may have difficulties to surmount. I want to discuss a few of those difficulties.

I was interested the other day to learn that the Liberal Party has issued a document in connection with the recent strike. One of the points it made was that wages must be determined by the profit rate in the given industry. I can think of nothing more detrimental to the interests of the nation. The Liberal Party is not present in the Chamber at the moment. I do not know where it is. I wonder how its members defend that position. Will they tell me how we would keep our essential people working in the railway industry? The railways cannot make profits because of the very nature of the industry. I do not know that any railway system in the world can make a profit.

If we say that the profit rate must determine the wage rate, many essential services will be denuded of their personnel and the plums will go to the luxury and gambling industries. I can assure the Chancellor that the production of more fur coats and betting slips will not assist him very much with his balance of payments problem. I have used that illustration deliberately, because I feel that we have now come to one of the issues which my hon. Friend the Member for Sowerby was hinting at. Because of the present inadequate and completely crazy wage structure in many of our vital industries, I believe that with all the good will in the world we cannot give men the rewards to which they are entitled by their increased effort. Let me give one or two illustrations.

The right hon. Gentleman, and the Labour Chancellors before him, laid emphasis on the need for increased earnings to be reflected from increased production and in general I see the force of that argument. But are not there millions of workers who, no matter how much they increase their effort, cannot increase their wage packets in proportion, or at all? There are thousands of labourers, clerical workers and people of that type who are in no way working on a production bonus scheme. Indeed the harder those on production bonus schemes work, the harder the labourer has to work without getting a ½ d. more for doing it, and he has no possible chance on the basis of increased effort to earn an increased pay packet.

We are coming into the period broadly described as "automation". In the main, I believe that we are in a period in which an increasing number of people will have their production rate determined for them by agencies completely outside their control, by automatic machinery and so on. They cannot control the pace at which they work. How can they increase their pay packets by trying to work harder? I believe that before we can get down to answering the questions posed by my hon. Friend the Member for Sowerby we must have a new wage structure in many of our industries related to the new conditions of production.