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I am sure that the House will agree that the essence of the criticism of stop-go as we knew it was that, for monetary reasons, the growth either of real output or of real income was restricted. That happened from time to time, and it was because of the legitimate and serious criticism of the whole broad range of economic policy that it came to be known as "stop-go".
We presume that it is the Government's intention that, wherever possible, even during the next six months, the static or, what is more likely, the slowly rising disposable net income of the community should be matched by rising real output, and that the matching should take place provided that it requires no additional strain on the balance of payments to permit that real output to rise. This is the only way to put value back into the pound. It is the most fitting response to the many sections of the community who for years have been taking value out of the pound. What we all now want to achieve is a set of economic circumstances in which value is put back into the pound in conjunction with a real rise in the net standard of living.
If there is a bright feature on the rather dismal economic horizon to which we have become so used in Britain recently it is the success of the Fawley type of productivity agreement. This example has been widely followed, with considerable justification, and if we are going to get out of our difficulties it should be more widely followed.
It may be that I am one of the few hon. Members who have succeeded in extracting from the Prime Minister that
wonderful word "Yes". The other day I asked him whether he would emphasise
that where increases in income are directly and demonstrably related to increases in productivity, it is in the national interest that both should take place
and the right hon. Gentleman's answer was quite unequivocal. It was "Yes". He went on to say:
We have always stressed the importance of pay and productivity agreements where one can be really satisfied that it is not just an aspiration about productivity but where there are clear guarantees that the additional income will be earned out of changes in productivity, particularly changes in manning.—[OFFICIAL REPORT. 28th July, 1966; Vol. 732, c. 1906.]
I submit that he has made an unequivocal statement by using the word "Yes". He has said that this is Government policy. Can we now take it that it is the Government's clear intention that where increases in income can be demonstrably and specifically related to increases in output and productivity even during the next six months those increases in income shall be paid?