Orders of the Day — Budget Proposals and Economic Situation

Part of the debate – in the House of Commons at 12:00 am on 6th April 1960.

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Photo of Mr Reginald Prentice Mr Reginald Prentice , East Ham North 12:00 am, 6th April 1960

In both parties there are differences of opinion. It is much healthier if those differences of opinion, which are public differences, are argued in public. In so far as this debate has shown that happening on the other side of the Committee, that is a healthy development, something which we on our side welcome for party reasons, but something which we welcome also as good democrats. There is no reason why any large party representative of the public should not have differences of opinion. Members of Parliament are not and should not be a flock of sheep. Let us see these differences come into the open. We can afford this warfare on the other side.

I should like to refer to two items in the Chancellor's speech which I do not think have been mentioned so far. The right hon. Gentleman referred to the state of the economy last year and spoke of the decrease in unemployment. He referred to the existing figure of 413,000 unemployed and used what to me was an extraordinary phrase when he said: These are good figures." — [OFFICIAL REPORT, 4th April, 1960; Vol. 621, c. 36.] I want to remind him and the Committee that, until it started growing in 1958, only in two years since the end of the war has the figure of unemployment stood at a higher rate than it stands today.

Those two years were 1947, when there was an exceptional fuel crisis, and 1952 which was the first year of a Conservative Government. The general unemployment figure has been below 400,000 and in many years under both Governments it has been below 300,000. I suggest to hon. Members opposite that it is no good going on being smug about an unemployment figure of 413,000.

Hon. Members opposite always speak as though all that remained of unemployment were one or two localities in which there was a special local problem. Adding these localities together, they cover a considerable area of the United Kingdom and represent a national problem. I speak as the representative of a constituency which has full employment, but, looking at it nationally, 100,000 unnecessarily unemployed people are 100,000 cases of hardship and frustration. This is a tremendous waste of the country's economy which needs tackling with far greater urgency than has been displayed so far.

The other matter which has not been mentioned so far in the debate is what was said by the Chancellor when he was discussing the prospects of expenditure and income below-the-line for the coming year and referred to the sale of publicly-owned steel assets. He said that it was expected that in the coming year this would be accelerated and that there would be an income as a result. This is something which we ought to debate this week. It would not be a Finance Bill point but it is a point concerned with the economy and with the general structure of the Budget.

On this side of the Committee we are entitled to challenge the Government by asking what possible justification there is in the public interest for the selling off of these public assets. We realise that this is part of the Conservative myth and that there are doctrinaire reasons in the party opposite for doing this, but can hon. and right hon. Gentlemen opposite give us one reason for it in the public interest? What good will it do the steel industry and the nation if Richard Thomas and Baldwins has a number of shareholders imposed on top of it?

In the two years or so leading up to the General Election we saw a great deal of expensive publicity from the steel industry, paid for, of course, by the customers, telling us how well the industry was doing. These were achievements which we were glad to read about, but they were the achievements of the workers at all levels, including the management. They were achievements to which the shareholders contributed nothing. The present shareholders do not control the steel industry. They run none of the risks with their capital.

There are none of the classical excuses for shareholders in the steel industry today. Shareholders are redundant, but they continue to make profits from other people's work and capital gains, helped along by subventions from the Treasury. I hope that some spokesman for the Government will tell the Committee and the country, leaving aside the doctrinaire views of the Conservative Party, what there is which in the public interest justifies this move in the steel industry.

There are other matters on which I should have liked to say something but in the time left to me I will refer to pensions and the omission from the Chancellor's statement of any proposals in that direction. When the Economic Secretary opened the debate, he said that the Budget speech was not necessarily the occasion for making proposals about pensions, but we are entitled to ask the Government, when is the right occasion? When will there be some statement about pensions?

I do not want to repeat all the arguments, which are well-known, for improving the lot of pensioners—the retired, the chronic sick, the unemployed, the widows and all the other groups. But I appeal to the other side of the Committee for some sense of honour in this matter, because what was said in the Conservative election manifesto and by Conservative candidates gave the impression that something would be done to help the pensioners early in the new Parliament if a Conservative majority was elected.

Those who phrased the manifesto were careful to avoid a specific pledge, but nevertheless the implication was there. The differences which exist between the two parties on the question of pensions were blurred in the public mind by the phrase in the manifesto which said: We pledge ourselves to ensure that pensioners continue to share in the good things which a steadily expanding economy will bring. It is now more than two years since pension rates were adjusted. In those two years the national income has risen. What is to be done, and when, about this problem? I have come to the depressing conclusion—and I hope I am wrong—that the clue to the Government's intentions on pensions is to be found in the National Insurance Act passed in the last Session of the last Parliament.

That Act lays down a new system of financing pensions and a new system of grading them. It contains complicated figures and calculations, all based on the 50s. pension. It is to come into force in April, 1961, and my inference from that is that the Government have no intention of improving pensions before April, 1961, or for some considerable time after that.

That should be either confirmed or rejected by the Government. They should be fair with the nation and state what they intend. If they intend not to do anything for the pensioners then there really ought to be a revolt on the benches behind them. Many of the hon. Members opposite who won marginal seats did so because the impression was given that something would be done to honour the pledge in the manifesto. Many Members owe their election to that fact, and they know that people of all classes want the Government to do something about this.

On Monday evening B.B.C. television interviewed people outside Victoria Station and asked them their reaction to the Budget. All but one of those who appeared in the programme said that the one thing they regretted was that it contained no proposals to improve pensions. This is something on which there really ought to be a revolt of conscience among the people who support the Government.

I was very glad to listen to the speech of my hon. Friend the Member for Grimsby (Mr. Crosland), and he made many of the points I wanted to make about the comparison between the economic performance of this country in the last few years and that of other countries. What amazes me is the complacency of the Government about this matter, and the fact that they convinced the majority of the British people, as evidenced at the election, that we need not be ambitious in this matter and that we could set our sights low.

What is meant by the slogan, "Life is better under the Conservatives"? Better than when? It is eight and a half years since they came into power, and any industrial country in that time makes progress, but why has British progress been so poor compared with the progress of other industrial nations? A question I want to emphasise is why is the progress of the Western world generally so poor compared with that of the Soviet Union?

What we ought to be getting from the Government at this moment is a recognition of this problem and a clarion call to action, asking the nation to do better, making plans and giving a lead towards improving our production so that we can really compare with what other countries are managing to do. In Soviet Russia the national income is now rising by about 10 per cent. per year. It is based on a massive degree of investment in capital goods and a massive investment in education, and that is based in turn on austerity in the consumption of consumer goods which in turn is based upon a political dictatorship which people in Western countries would never accept.

It is just not good enough for us to sit back and say that our people will not accept these things and that, therefore, we shall be by-passed by the Soviet Union. It has become almost a cliche to say that in the years ahead the cold war will be fought more in terms of economic rivalry and political propaganda than in military terms. Is the Western world to allow the Soviet bloc to by-pass it, to invest more and more of its money in under-developed countries without our being able to afford to match that investment? If that is so, the democratic ideals in which we believe will perish in time, because people who are hungry will not worry about the niceties of political freedom, and Soviet influence is bound to follow from that process.

Therefore, the most important charge of all against the Chancellor and the Government this week is that they are complacent about these matters, that they give no lead to the country and that they are not taking charge of our economy and controlling its assets so that we may make the best use of our assets for the good of our country by providing fair shares for our people and so that we may play our part in the world.