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Orders of the Day — Prices and Incomes Bill

Part of the debate – in the House of Commons at 12:00 am on 9th August 1966.

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Photo of Mr William Rodgers Mr William Rodgers , Stockton-on-Tees 12:00 am, 9th August 1966

If I understand the question which the hon. Gentleman is putting, this is provided for by paragraph 18(ii) of the White Paper. But we are not discussing specific issues on this Clause but the much wider issue of productivity.

We all acknowledge that some so-called productivity agreements have been bogus. We acknowledge also that there should not be simply two parties to a productivity agreement, that it is not simply a matter of management and unions carving up the extra increment which is obtained in one way or another from the abandonment of practices which were obstacles to growth. The public interest must be considered. In the past, this has not always been acknowledged, and it has been assumed that the extra increment resulting from such an agreement should be divided between two parties and not between three.

I now come to the immediately relevant question of whether, in framing the policy and particularly in introducing the Bill, we should have made special provision for existing productivity agreements, which I understand is the point made by the hon. Member for Barry, or for productivity agreements which may be reached in the next six months or which would otherwise be caught by the standstill starting on the 20th July.

This was a very difficult issue and we spent a lot of time considering how rigid the policy should be. As is so often the case, it was a question of balance of advantages. If we tried to make some exceptions, would not this result in a breach of the dam? Would not many people argue that their agreements were eligible for consideration, whether or not we felt that they were genuine productivity agreements?

In the end we decided—I am sure quite rightly—that we had to maintain the standstill in every respect, except with regard to the very special exceptions which are spelt out in paragraph 18 of the White Paper, and particularly in paragraph 18(ii) which deals with specific cases where increases in pay result directly from increased output. We drew this very narrowly indeed, because we felt that if we did not do so agreements would slip through which would in the long run breach the policy.