Orders of the Day — Budget Resolutions and Economic Situation

Part of the debate – in the House of Commons at 12:00 am on 5th May 1966.

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Photo of Mr David Marquand Mr David Marquand , Ashfield 12:00 am, 5th May 1966

I should like to begin by craving the indulgence which the Committee traditionally displays to maiden speakers. There have been so many fierce Cromwellian speeches from these benches on the need for Parliamentary reform and the desirability of sweeping away the ancient traditions of the House that I confess I felt a little apprehensive about whether this tradition would survive long enough for me to make my maiden speech. I hope that it will last at any rate for the next few minutes.

I am proud to be able to stand here today as the Member for Ashfield. It is a very appropriate constituency from which to come if one wishes to take part in a debate on the Budget Statement, because my constituency contains within its boundaries a large part of what is left of Sherwood Forest, and that was, of course, the haunt of that pioneer of progressive finance, Robin Hood.

It has, however, changed considerably in character since the days of Robin Hood. It is now predominantly a mining constituency. Hosiery and engineering are also of considerable importance to a large section of my constituents. However, mining is the linchpin of the economy at Ashfield, and the few points which I want to make in this debate spring directly or indirectly from that fact.

I do not think it is an exaggeration to say that at this moment the coal mining industry of this country faces a grave crisis of confidence as a result of the development of competitive sources of energy and the accelerated programme of colliery closures in uneconomic coal- fields. There is a real danger that miners in the profitable East Midlands coalfields may slowly move away from the mining industry and find other forms of employment.

If that happens, the place of coal mining in the whole economic development of this country could be seriously affected, so my first point is to tell my right hon. Friends that they should pay serious attention to this, and that it is urgently necessary for them to work out a comprehensive fuel programme in order to be able to assure the miners of the East Midlands about their future for a long time ahead.

My second point is rather more general. In addressing the Committee last night, my hon. Friend the Member for Consett (Mr. David Watkins) was extremely eloquent about the impact made on a newcomer to a mining district by the experience of going down a coal mine. I cannot hope to compete with my hon. Friend's eloquence, and I shall not try. But there is another and more disquieting impact made on the newcomer to a coalmining district, and that is to realise that a large number of miners are very poorly paid. There is a tendency among people who do not know mining districts to regard miners as a kind of aristocracy of labour, and to think of them as taking home pay packets of £40 per week and rushing around in powerful cars. That is not so. Many miners in my constituency are earning wages of £11 and £12 a week, and are deplorably underpaid. My main point is connected directly with this.

As I understand it, the debate is concerned not merely with the Budget proposals of my right hon. Friend but with the whole economic strategy, of which the Budget proposals form a part. I want to talk particularly about the incomes policy, to which the Chancellor of the Exchequer referred briefly at the beginning of his speech on Tuesday and which my right hon. Friend the First Secretary spent rather more time on yesterday. I do so for two reasons—first, because I believe that the incomes policy is vital to our whole economy and, secondly, because I am absolutely confident that the only way in which the underpaid miners in my constituency can ever hope to be given a real improvement in their position is through a proper working of the incomes policy. I therefore declare myself a passionate supporter of the policy which is now being hammered out my right hon. Friends.

My reason is that if this policy is to work at all, it must in the long run have be an egalitarian policy. Only then will it work—only if it is aimed at greater social justice, and delivers greater social justice. By nature, an incomes policy is voluntary. The Government are quite right in saying that they intend to bring in legislation of the kind which they started to introduce in the last Parliament, concerning the early warning of wage claims. But whether or not there is legislation in this form, the policy itself is bound to be voluntary.

In a democracy we cannot conceivably impose an incomes policy by fiat from Whitehall over the whole mass of industry. Since the policy must be voluntary, it must be accepted by the people whom it touches, and that, in turn, means that it must be regarded by them as fair—and if they are to regard it as fair, it must in fact be fair.

I know that my right hon. Friends have recognised this throughout. What distinguishes the present Government's incomes policy from the embryonic attempts at an incomes policy pursued by right hon. Members opposite when they were in power is that this policy explicitly says that it is aimed at social justice. The White Paper brought forward by the Government last year not only lays down a norm by which increases should be governed; it also lays down that there may be exceptions to the norm, and that those exceptions are partly, at any rate, to be made on the ground of social justice. My right hon. Friend the First Secretary emphasised this yesterday.

Here, however, I would like to make one small constructive point. The Government arc going to have to extend and, to a certain degree, strengthen the incomes policy if this objective is to be realised. The White Paper on Prices and Incomes introduced by the Government a year ago said that increases above the norm could be granted in exceptional circumstances—if, for example, the living standards of certain groups of wage-earners were deplorably low. It also said—as is common sense—that if exceptional increases are to be granted to some people others must get less than the norm. If we are going to give exceptional increases to some people and do not say that others must therefore get less the norm becomes merely a metaphysical abstraction.

There are some signs that there exists in our society very powerful social pressures which make it difficult to live up to this declaration of the White Paper. The best way of describing what I mean is to look at the recent increase awarded to higher civil servants and to examine the reasons given for that increase. That increase was undoubtedly within the norm, but no one can pretend that it was an egalitarian measure to give considerable increases to people already earning ten times as much as many of my constituents. The justification put forward by the Prices and Incomes Board for giving these increases was the necessity of competing for a very scarce pool of highly talented people.

I want to quote briefly from the Board's report. Paragraph 13 says: We have stated that the Standing Advisory Committee collected information on a confidential basis about the movement of earnings in comparable posts outside the Civil Service. It is clear from their report that evidence of the movements of other incomes was not one of the primary considerations in their minds. … We understand, nevertheless, that their enquiries left no room for doubt that the average annual increase in the two years from April 1963 of salaries and earnings in broadly comparable employment outside the public sector was appreciably greater than the average annual increase for the Higher Civil Service as a whole which would result from their recommendations. We consider, in the light of this evidence, that the salary structure of the Administrative Class must be improved if the Civil Service is to compete fairly with others for its share of talented people, and provide rewards that are commensurate with the responsibilities carried by the various higher grades. That is a very important statement. It says that the public sector is forced to compete with the private sector for this very small pool of highly talented people. In other words, what is happening, according to the Board, is that movements in salaries and emoluments in the private sector are going faster than the norm, and because of this there is a chain reaction back into the public sector, and the public sector has to compete.

This is a very dangerous state of affairs if the incomes policy is to be carried through in the egalitarian way in which it must be if it is to succeed. In the long run I am convinced that my right hon. Friends will have to bring within the ambit of the incomes policy the movements in the emoluments of highly paid people in the private sector of industry—and in the salaries paid to very high management.

As a first step towards this I urge my right hon. Friends, at the very least, to look at the Private Member's Bill introduced by my hon. Friend the Member for Stepney (Mr. Shore) in his days as a back bencher. His Bill sought to make it mandatory that the emoluments and rewards to top management in the private sector should be published, so that we should at least know what the facts are—which is not the case at the moment. I therefore suggest this as a modest way of toughening and strengthening the incomes policy. Only if we can demonstrate to the people of this country that the incomes policy is not simply a wage freeze, but that it is holding back people at the top while at the same time bringing up people at the bottom, can we make it work and stick. I am convinced that if we do not make it stick the outlook for our economy is gloomy indeed.