Orders of the Day — Industrial Relations

Part of the debate – in the House of Commons at 12:00 am on 6 February 1958.

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Photo of Mr William Blyton Mr William Blyton , Houghton-le-Spring 12:00, 6 February 1958

I hope that the hon. Member for Scarborough and Whitby (Sir A. Spearman) will forgive me if I do not follow his argument, except to say that I believe that the debate today has justified itself in the light of the statement of Government policies since October of last year. What is troubling the country and, particularly, the trade unions, today is the problem of keeping incomes and prices stable so that people will know, at least for months ahead, what their money will buy.

A good deal of the inflation in our economy today is due entirely to the political actions of the Government. Once they decided to set the people free—as the right hon. Member for Woodford (Sir W. Churchill) put it some time ago—and once they decided to scrap all physical controls and planning, letting prices, profits and rents find their natural level, inflation was as certain as night follows day. It has always been rather remarkable, when Tory Governments have been in power, that when workers were weak and poorly organised, they could reach equilibrium on a policy of that sort, at the cost of unemployment and a cut in the standard of life of working people. But that policy cannot succeed today against the opposition of a strong trade union movement, because the trade union movement has the power to keep wages somewhere near prices and also to demand a share in the increased national product whenever it is there.

It is no use the Tories, as they have been doing, trying to blame the trade unions for the present situation. The trade unions did not start this insane gamble. In fact, they warned the Government many times against it, but the Government took no notice. This, at least, can be said of the trade unions, that when the economy was regulated in the immediate, difficult post-war years, they did hold wage demands in check at a time when, with their power, they could have got any increase they liked. Why did they do that? They accepted wage restraints in those days because they believed that there was a genuine effort being made to build up the country's resources, and that the division of the national product would be made on the basis of equity. Who benefits today if the trade unions accept a cut in the real standard of life of their members?—the Stock Exchange governors, the landlords, the drawers of dividends, the take-over merchants, the private enterprise firms which take large profits.

There is no purpose today in our economy, but a scramble for personal gain, and the tragedy of it all is that many decent people suffer because they are not strong enough to defend themselves. The Government, having neither purpose nor resolution, are trying to get out of their difficulties by two methods, both of which will prove disastrous to the country. One is the slashing of the social services, the cutting of capital expenditure—the insurance policy for our national future—and the creation of some unemployment, I believe, to weaken the trade unions. The second is the jeopardising of free negotiations between trade unions and employers, dictating to arbitrators who have to judge the claims of the workers.

As trade unionists, we have always said that our job is to keep wages in line with rising prices. The Government cannot expect the trade unions to sit complacently by, doing nothing, while they, by political actions, reduce the standard of life of the workers. It is noteworthy that, since the Government came to power, their policy has resulted in an almost continuous wage struggle, and they have most certainly created a general lack of confidence in the future of our conciliation machinery.

I believe that the only way the Tory Party can carry out its policies is by the creation of unemployment and a reduction of the standard of life of the people. In other words, Tory policies can be carried out only by the sacrifice of workers to rent, interests and profits. Their policy worked in the 1920s. I reiterate that it cannot work today, because first, the trade unions will resist it, and, second, the Government and all employers in the country know that it would mean their political extinction.

Because the wages of workers in industry are basically a political issue, we have raised the whole matter in this debate. They have become a political issue because of Government statements, particularly in the nationalised sector, first, that what is called the national situation must be considered in relation to wages, and, second, even after that, that they will not find the money to meet any decision made unless it comes out of savings or increased production.

Let us examine these statements. The Government have increased the Bank Rate to 7 per cent. This, surely, was a measure to stop enterprise and stifle industrial development. It is a step taken at a time when we are spending less on new equipment than any other industrial Power in Europe. This action is now beginning to show increasing unemployment. By the end of the year it will be considerably higher. There is no need for me to guess what the Government are trying to achieve. All my experience in the past has shown that the instrument of high interest rates cuts down the volume of industrial activity. The resulting unemployment makes it easier to resist wage claims or even to cut wages.

The Government have been shouting for a long time for a show-down with the trade unions. They have been urging employers to get tough. The engineering and shipbuilding strike last year was the first attempt to do it. But it failed. Now the Government are reinforcing the employer by their financial methods. I believe it is their fervent hope to make it easier for them in this round to defeat the trade unions.

The abolition of subsidies, the increases in prices, in rents, in the price of the National Insurance stamp, and in the Bank Rate since the last increase in wages was given have all been achieved by political action and have brought about the present wage demands.

The ex-Chancellor's statement about not finding the money in the nationalised sector has shattered free negotiation in the basic industries. If that is the case, the Government are in trouble in the nationalised sector. Railways, transport and miners are all to be tested, and the arbitrators cannot decide their cases on merit. Even if the arbitrator takes into consideration the national interest and awards an increase, according to my interpretation of the statements made, they will not get it because the present Chancellor says that he supports the policy not to give them the money. I presume from that that the Government will not allow increased prices to meet wage awards and, even if the award is given, they will not increase prices and allow the nationalised industries to go into the "red" to meet the award.

We get a situation like this. The mining industry, which, according to the Press, will be refused a wage increase, will have to go to compulsory arbitration under its agreement. If an award is given, will the Minister refuse to give that industry an increased price to meet the cost of the award? If this happens, the mining industry will either have to go into the "red" or say to the Government that it will not go into the "red". It cannot meet the award of an arbitration court because the money is not being provided, as the Minister has refused an increase in the price of coal. I foresee that that situation can be dynamite industrially.

The unions, on the basis of maintaining the same purchasing power of wages up to the last increase, have a stonewall case for an increase that is now before the different employers in the country. In the light of what I have said, the Government must not be surprised in the months that lie ahead if all the unions that are now in the arbitration court, and who have their applications refused, rightly say that the disallowance is due to Government interference with the arbitrators. So shaken is the faith of the unions in the conciliation machinery that we shall have a lot of this, because there was much free negotiation before last October. Unions will now refuse to go through the process of arbitration. Therefore, if, because of the Government's decisions and statements, arbitrators make refusal after refusal in the light of circumstances of this character, the Government must not be surprised if unions ignore their arbitration agreement and go back to a war of attrition, which means the use of the strike weapon.

Trade unions must not retreat to the past. If the Government persist in their policies, no matter how unpleasant it may be and no matter how we dislike to face the last resort we have, namely, to strike—some of us have done a lot of that in the past and we do not want any more of it if it can be avoided—it would be better for the trade unions to face this than sink into national decrepitude to which the Tory policies are condemning us.

I support the Motion because it seems to me that in all this shouting about a show-down with the trade unions, the Government are trying to make the worker in industry the scapegoat for their disastrous economic policies. If it should arise, the blame must rest squarely on the Government. In every case that I have known the trade unions have acted patiently and constitutionally. There have been no national strikes, and negotiating machinery has been followed, but the belief is persisting that the Government are sabotaging the agreements and the conciliation machinery. There can be no foundation for charges of irresponsibility by the trade unions if this country is plunged into industrial strife. It is the Government who have created this terrible belief that collective bargaining is in jeopardy and that arbitrations are now loaded against them.

The trade unions today are in many cases asking for an advance equivalent only to the increase in last year's cost of living which, according to the figures of the Ministry of Labour, is 4½ per cent. But the price rises vary from 2 per cent. for clothing to 11½ per cent. for rent and housing. It is because of the Government's policy that we find these demands coming in. I believe that the Government's objective is a wage standstill policy, but it cannot take place. There is £100 million per annum going to the landlords in increased rent. There is at least another £100 million extra interest on the National Debt to be found because of the increased Bank Rate. There is the increased rake-off to moneylenders on loans for private building, council buildings and council projects. Last year £35 million was given to the Surtax payer. All this has to be paid for with increased effort and more production if the worker is to maintain his standard of life.

Last year profits went up by 5 per cent. above 1956, and dividends went up by over 6 per cent. Bonus shares were issued, and although the Government have made appeals about profits, they have not taken the same tough line with the companies as they have with the trade unions. There are two sentences in the ex-Chancellor's speech in which he says that a lot of profit should not be distributed. There are columns about trade union wages and the standstill which ought to take place. If in the light of all that trade unions cease their wage demands, will not industry seize that as an opportunity to push up profits even further? It is against those facts that the Government and industry are trying to browbeat the unions into accepting what I regard as an actual reduction in wages.

There is a parallel to the present situation. I remember that after I left the Navy after the First World War we had a great election which Lloyd George won with a predominantly Conservative Government and in which he said, "We will make this land fit for heroes to live in." How true that slogan was, because in the twenty years that followed I found that it took a hero to live in the pits! What was our lot in those days? In the early 1920s it was the same as now—abolish controls, let us fight inflation, let us retain and capture export markets. How was it done? The forebears of hon. Members opposite did it by forcing much unemployment. Wages were attacked, strikes took place and the standards of the workers were forced down to a very low level.

It must not be forgotten that during those years the Tory Party backed the employers against the working people. We saw the social services slashed. We saw unemployment pay brought to a low level, and we can still remember that when those of us in the mining industry were unemployed we got 1s. a week to keep our children. Now we see a situation, not as bad as then, revealing itself. Unemployment is growing and is likely to increase. The social services, so the Press tells us, are to be slashed, and we have higher contributions to pay. The Government have been urging employers to get tough with wages. In the nationalised sector of industry, the Government are preventing negotiations by their edicts and by their statements that they will not finance wage awards. The policies of the Government are identical with those of Stanley Baldwin and Neville Chamberlain, with the days of the man we shall never forget, Montagu Norman, the former Governor of the Bank of England.

The only difference between then and now is that the Labour Party is now stronger and the trade union movement is strong and well. I believe that the trade unions cannot accept the present position and that no self-respecting body of men will accept a reduction in their standard of life without a struggle. It is the busmen who are first in the firing line. The trade unions should stand behind the busmen, because if the busmen fail, as happened in the 1920s, it will be the other unions in their turn who will get the same medicine. The trade union slogan is "Unity is strength". They will need that strength in the months that lie ahead.

The Tories have never been the friends of the unions in my lifetime. We have had to fight them every time and I am not being taken in by sweet and honeyed words from the benches opposite. Their policy is one of defending rent, interest and profit against the workers and I hope that we shall not be misguided by what we have heard tonight. They will try, because they cannot face the country with their political policies, to get an election slogan "The trade unions versus the State". I do not believe that the country would be misled by a slogan of that kind, nor do I believe that the workers would accept a reduction in their standard of living.

The only way to save the country from the disaster which looms ahead in the policies and announcement of the Government since October last year is to have an early Election and to let the country decide the issue. It is only by a change of policies that we can stave off the impending disaster, which surely lies ahead, for collective bargaining and arbitration agreements in the great industries of this country.