I beg to move,
That this House, noting that the attempt to control incomes by law has failed in its purpose, is causing grave damage to industrial relations and is frequently unjust in its application, urges Her Majesty's Government to repeal these objectionable statutory powers forthwith.
From the very beginning, when these statutory powers were introduced in 1966, and repeatedly since then, we on this side of the House have warned that these statutory powers would not work, that they would fail in their purpose; and that is what has happened. We also said that, in so far as they did have effect, they would bite in such an arbitrary and uneven manner as to cause injustices and gross anomalies. That is what has happened. We also said that for little or no short-term economic gain they would do grave long-term damage to industrial relations; and they have.
The evidence for all this has been accumulating steadily and is now overwhelming. I ask the House to consider the record for 1968. In 1968, basic weekly wages rates rose by 6–9 per cent. for all industries and services and by 8–8 per cent. for manufacturing industry alone. That was the largest increase in any year since the present index began in 1956.
Basic hourly rates, as opposed to weekly rates, tell exactly the same sort of story. So does the increase in weekly earnings. Average weekly earnings for male manual workers over 21 between October, 1967, and October, 1968, rose by 7·6 per cent., markedly more than during the two previous years and well above the average for the previous 13 years. Similarly, average hourly earnings from October, 1967, to October, 1968, rose by 6·9 per cent., also considerably faster than over the previous two years.
Thus we see in both wage rates and earnings that the increases in 1968 have been approximately double the 3½ per cent. ceiling set for 1968 and 1969 in last April's Prices and Incomes White Paper. The rates of increase of hourly earnings have returned to approximately the level that led up to the July, 1966, measures and the pay freeze.
The record for 1968 surely proves not only our basic contention that the attempt to control wages by law would not work, but also our very important subsidiary contention that compulsion feeds on itself and that with each successive year of statutory control more and more compulsion, applied over a wider and wider field, would be needed to produce less and less effect. That is what has happened.
We must also remember another feature of 1968. It was the year of the highest sustained level of unemployment since the war. Statutory incomes policy was originally advocated to the House as an alternative to higher unemployment. In fact, it has proved to be supplementary to it. So, in 1968, the Government achieved the highest levels of unemployment for nearly 30 years and the highest increase in wage rates for nearly 20 years, with the strongest-ever compulsory powers. One would have thought that such a combination of events would have been impossible. One must at least give credit for an achievement of perverted genius.
And all this for no conceivably adequate compensating benefit in return. Productivity, people may say. I can almost hear the right hon. Lady the Secretary of State for Employment and Productivity saying it already. Of course productivity has risen—and a fine state we should have been in if it had not. However, it is impossible, even on the most optimistic interpretation of recent trends, to claim that the underlying rate of increase in productivity has doubled over the past year. Yet that is what would be necessary to justify the extent to which the increase in incomes has exceeded the ceiling laid down under the policy.
In any case, any argument about productivity is utterly disposed of by applying the Prime Minister's own chosen test, that which he laid down as an original justification for this policy when he addressed the House on 20th July. 1966, and used these words:
But the House will recognise that the whole operation stands or falls on the extent to which we can keep our costs and prices under control. In recent years money incomes have been increasing at a rate far faster than could be justified by increasing production; in 1965 we paid ourselves increases in money incomes of about £1,800 million compared with the previous year. About £1,300 million of this represented increases in wages and salaries. Over the same period we earned only £600 million by way of increased production."—[OFFICIAL REPORT, 20th July, 1966; Vol. 732, c. 635.]
The same calculation, the same test as was chosen by the Prime Minister when applied to the latest available figures gives the following results. Between 1966 and 1967 money incomes rose by £1,500 million and production by £368 million. Between the third quarter of 1967 and the third quarter of 1968, the latest full 12-month period for which figures are available, money incomes rose by £1,566 million and production by £520 million.
Therefore, on the basis of the Prime Minister's calculation, on the Prime Minister's own chosen test and justification for this policy, and despite all the compulsory powers, money incomes have still been rising three times as fast as production. If any further proof is needed, I think that the House will agree that it is provided by comparison with what was achieved by the Conservative Government with no statutory powers following the pay pause of 1961.
When one compares the period following the pay pause of 1961 with the period following the pay freeze and the statutory powers of 1966 one finds that, in the earlier period, under Conservative Government with no statutory control, there were lower increases in earnings and prices and higher increases in productivity—all with lower levels of sustained unemployment.
I stress once again that, in rejecting statutory incomes policy, on the clear basis of proof which those figures provide, we on this side are not irresponsibly throwing overboard the idea that the movement of incomes in relation to national production is a matter of very great importance. We have said before, and I say again, that any Government in present-day conditions must have a strong view about the movement in incomes and must try to influence it. The last Conservative Government did so and the next will also do so.
What we reject is the attempt to control wages by law, because while it causes very damaging economic and social side effects it is bound to be ineffective, at least unless it is embarked on as a very strong and long-term policy, a permanent policy.
As the right hon. Gentleman does not want to control wages by law, how does he justify his party's proposals to put a legal straitjacket on trade unions and prevent them from properly organising their members and negotiating?
That is quite a different question, but I should like the hon. Gentleman to reflect that perhaps even he will one day come to realise what his right hon. Friend is beginning to realise before him, that a condition for the return to freedom, to the real independence in the details of free collective bargaining, is the acceptance by management and unions alike of a somewhat closer, stricter framework of rules—
—than has been practised in this country before, but which has been the custom in every other industrial country for many years.
So we reject the attempt to control wages by law. We also reject making incomes policy a major instrument of economic management, because in our view—a view which is now proved beyond argument by experience—to make it a major measure of economic management puts on it more weight than it can ever bear. So we say that much more success with far less damaging side effects can be obtained if one gets one's basic economic, fiscal and industrial policies right, which means very different from those of the present Government, and then uses voluntary means to influence incomes as a minor and supplementary rather than a major instrument of economic management. We say that the record now proves beyond argument that we are right and the Government have been wrong.
So much for the fact that statutory control has failed in its purpose. I should now like to turn to another limb of our Motion, namely, that the policy has frequently been unjust in its application. The reasons for the unfairnesses and the gross anomalies are in many cases the same as the reasons why the policy has failed in its economic purpose. One could spend literally hours recounting the injustices and anomalies which the policy has brought about and is increasingly bringing about. I will put only a few examples before the House.
First, the legal control under this policy applies generally only to settlements affecting more than 100 people. Approximately, no fewer than 25 per cent. of all employees in manufacturing industry work in establishments with fewer than 100 employees, so they are immediately outside the general application of the policy. That in itself is grossly unfair to those who are caught in the bigger establishments. This is not just a theoretical point. Anyone who goes around industry will know that it is a practical point.
I will quote one example. The efforts of the Transport and General Workers' Union in relation to small road haulage companies in recent months, at least in the Midlands and parts of Yorkshire and East Anglia, have managed to obtain settlements far in excess of incomes policy. I make no judgment on whether those settlements are right or fair, but this is one concrete example of the policy leading to gross unfairness between one group of workers and another.
The policy is also unfair because it is hopelessly inadequate in the way that it deals with settlements which do come under general control, because the machinery for vetting and supervising is hopelessly inadequate. The number of settlements over the year is far too great for them all to be vetted equally thoroughly, so it is largely a question of luck whether one "gets the works" or not. Again, anyone active in a union or in management knows that this is true.
But, apart from whether the vetting machinery can cope with the vast number of settlements with which it should cope, it also lacks the expertise in the assessment of productivity agreements. It is very difficult, as anyone with experience knows, to spot a fake from a true productivity agreement, even in one's own company, with goodwill and all the detailed knowledge aided by tools, such as cost measurement and the like. It becomes virtually impossible for. a small body of civil servant in Whitehall to judge the merits of a productivity deal in relation to hundreds of different industries and thousands of different companies.
Again, anyone who has worked in a company which has to submit one of these deals to the Department will know two things—the good faith, integrity and goodwill with which they attempt to deal with them, but also—I am sorry to say this—the inevitable underlying ignorance with which they are judged. This is not theoretical ignorance—I am not blaming those concerned—but the expertise cannot be there because it is so detailed and so specialised, not just in principle but in its application to each individual industry and factory.
On top of that is the inadequate capacity of the Prices and Incomes Board. I hasten to add that it is inadequate only in relation to the task which the Government are trying to put upon it. When an agreement has gone through the vetting machinery, nothing more can happen unless it is referred to the Board, but the number of cases with which it can deal in a year is relatively very small. Therefore, the D.E.P. must allow to go through many agreements, even if they see them to be failing to meet the criteria, simply because the Board could not physically cope with going into them in detail.
Again, I will give a concrete example. Last August, it was reported that the Midlands Brewers' Association's pay claim for 10,000 brewery workers was allowed to go through, even though the Department said that it was not justified—presumably because the P.I.B. was clogged up. I can think of no other reason. I am sure that that one example could be multiplied many times.
Another cause of unfairness is the lack of adequate machinery for checking on how approved productivity deals work out in practice. My hon. Friend the Member for Oswestry (Mr. Biffen) could tell the House more about this than most hon. Members. Any of us who look through HANSARD daily know the many tens, perhaps hundreds by now, of Questions which he asks on this point and the futility of the Answers. The truth is that one can get away with murder providing one can present one's first case glibly enough to get by.
Yet another cause of injustice in the policy is the unfairness as between similar groups of workers. There are two well-known examples. The first is that of Scottish and English electricians, often having to work together on the same sites. The pay settlement for the Scottish electricians was frozen by the right hon. Lady. Thus, the Scottish electrician has had to work on the same site at a lower rate of pay than his English colleague.
Secondly, there was the case of the municipal busmen. Those who toed the Government line in the summer have had less than those who refused to toe the Government line, because those who refused and had their increase frozen for 12 months got the full back payment for 12 months just before Christmas. Those who were responsible suffered and those who dug their toes in gained. That is only one of the many examples, of how the strong get away with it under the policy while the weak suffer.
Let us look at the cases of the railway workers, the engineers, the tally clerks and the overseas telegraphists. The Government thought that the telegraphists were weak at first and only discovered later that they were strong. Wherever real strength is shown, the stringent testing—the Chancellor's own description—of achieved productivity which he promised in his Budget speech last year, goes out of the window. Compare these cases with the building workers and the municipal busmen, and one sees how the weaker get clobbered.
One of the avowed objectives of the policy was to help the lower-paid workers, to strengthen their position and to make life fairer for them. But no one yet, either the Government or the P.I.B., has decided who are lower-paid workers. The agricultural workers are a classic example of them, but the Government decided that they were weak enough to have their case referred to the Prices and Incomes Board. We are glad about the way in which that case emerged. This great policy was designed to help the lower-paid workers, yet the Board had to say that the agricultural workers should really have their increase quashed, but that an exception might be made. The Government jumped at the chance and made an exception. They had to make an exception in the policy to help lower-paid workers.
What about others affected? What about equal pay for women, which we hear so much about at times from the right hon. Lady? They are lower-paid workers yet, last summer, she rejected an Amendment to the Prices and Incomes Act which would have exempted from the operation of the statutory incomes policy any voluntary collective agreement which might breach it in order to promote greater equality of pay between men and women. Now she has the Ford women once again on her plate or in her teacup, or wherever it is she has them. I wonder what she will do.
Let us look at workers in those companies where productivity is already very high. If it is already so high—and let us take an extreme case—that it cannot be made higher, these people have to suffer for their efficiency and for the efficiency of their managements by not qualifying for any increase. If one works for inefficient management in an inefficient way, almost the sky is the limit in extra productivity deals.
Then take the position of those—and there are many—who depend principally on locally fixed piece work rates for a substantial part of their earnings. As we have pointed out, and as the Board has pointed out, this policy does not bite in any effective way on them. Good luck to them, but it is bad luck on those who do not get much or any of their pay under such agreements.
There is the case, also, of the salary earners. The university teachers have just had their pay judged by the Board, which has said that comparability cannot be taken into account under the policy. Compare this with the doctors and dentists, whose recommended and accepted increase is based entirely on arguments of comparability. Where is the fairness or the justice in that?
I could go on with endless examples showing that the weak and the responsible tend to suffer and that the strong and the irresponsible tend to gain. All this does grave long-term damage to industrial relations, and that is the third limb of the Motion. The effect of the damage is obvious in the 1968 strike record. But it is not only in that record. Anyone, whether on the management or union side, who goes about the country and knows these things, realises that, apart from the strike record, industrial relations are tense where they used to be relaxed. Where there used to be good relations there are worsening relations.
I want to quote what the right hon. Member for Belper (Mr. George Brown) said as long ago as 1961 in relation to the Conservative Government's pay pause. He said:
What will all this achieve in the private sector? It will introduce friction between management and men where friction does not now exist. Even where industrial relations are good enough for management and workers to get on, because the Government have called upon management to act differently and management loyally does friction will be produced in industrial relations where hitherto there has been none."—[OFFICIAL REPORT, 27th July. 1961; Vol. 645, c. 620.]
If the right hon. Gentleman feared that in relation to the voluntary, mild attempts to influence incomes in 1961, how much more true are his views—and we know that they are true—when applied to trying to control incomes by law? So it is not only in the strike record, but in the general climate of industrial relations that the greatest and most long-term damage is taking place.
One of the worst of the effects is that it is clearly becoming more and more a paying proposition to wield the big stick. Look at the railways, the engineers and the overseas telegraphists. That last sorry business is a direct invitation to people to strike in future to get what they want. It is a direct example of how, if one cannot get it by a responsible approach, one should try direct action. Once that belief is more strongly established—and it was too prevalent before—it will be very difficult to get rid of it again. Under this policy, it too often happens that responsible collective bargaining does not pay.
That classic case under this policy was the case which dragged on throughout last year, of the building workers. The House was denied a debate on that matter. If ever there was a case of union leaders and management trying to do the right thing, giving the Government a whole year's warning before they were to make their new agreement, this was it. The Government sat on it, did nothing for six months and when half the warning time had gone, referred it to the Prices and Incomes Board.
When that report was delayed, the building workers unions and employers had to make an interim agreement in a hurry, because the old agreement was running out in a few days, and there was no news from the Government or the P.I.B. They made an interim agreement, reported it to the Minister who allowed them to bring it into operation, and then had it quashed after it was in operation. I can imagine no better way of undermining responsible approaches to collective bargaining by union leaders and management than the conduct of incomes policy over that claim.
The attempt to control wages by law has, since 1966, progressively and seriously undermined the authority of responsible and official union leadership, while it has strengthened the influence of unofficial leaders.
It has gravely damaged the chances of achieving a more responsible and more constructive development of collective bargaining. All responsible opinion, including the Donovan Commission, stresses the urgency of doing the exact opposite. Even the Government pay lip service to this, but as so often, they say one thing and do another, or do one thing with one hand and another thing with the other, cancelling each action out. There is no doubt that both the major symptoms of trouble in industrial relations, inflationary wage increases and the dangerously rising trend in a number of strikes, are evidence of the increasing failure of collective bargaining, particularly at company and plant level.
We have either to give up free collective bargaining or set about in earnest trying to strengthen it and that is why we have kept on saying that the choice before the Government and the country is either to go on to more compulsion on a permanent basis, or to go back to freedom within a framework of reasonable discipline and order. [Interruption.] It is impossible to have freedom, except within a reasonable framework of order. That is exactly what the trade unions and their members have been finding out to their cost. It is what their colleagues in other countries found out long ago. If we go into factories, take opinion polls or make any test, we find that this is what the rank and file workers know, and their hon. Friends opposite have not yet woken up to this.
What is required from the Government, above all, in legislative action is the introduction of a comprehensive new industrial relations Bill, and the repeal of the statutory incomes policy. Both are needed, together and quickly. The Government are now taking halting steps towards the first, but they are still making no commitment regarding the second Once more it is too little too late, and the worst of both worlds. Instead of policies which are mutually reinforcing, we are getting policies pulling in opposite directions. The incomes policy left hand of the right hon. Lady commits arson and fans the flames already alive. Her industrial relations right hand plays at being a fire brigade, and the one hand makes unnecessary work for the other.
I am convinced that the terms of our Motion are proved to the hilt by the facts and the knowledge of people throughout the country. Legal compulsion has failed. It has caused frequent injustices, and it does great damage to industrial relations. Hon. Gentleman opposite know that as well as anyone. I am sure that on a free vote this Motion would be passed overwhelmingly by the House.
Of course, we would not, did not, expect a free vote. But the Government appear determined not to allow a vote at all on the main issue. What an incredible display of confidence they have in the main plank of their policy! Can they no longer depend on a majority, even with a three-line Whip? I could understand it if vanity made it impossible for them to accept the opening part of our Motion, I could even understand it, if for the same reason, they found it impossible to refuse a commitment to repeal forthwith. But surely, at this stage, we could have had an Amendment from the Government which had some bearing on their intention, either to keep or remove the statutory incomes policy. No. They have dodged the issue altogether, and tabled a fatuous Amendment which gives the House no opportunity to express any view about continuing or ending statutory powers in the short or long run. Even though the Government have refused to face a commitment by way of a Motion, they must give the House today a firm statement about their future policy. What do they intend to do about the future?
Meanwhile, they can play what word games they like on the Order Paper. We know that our Motion expresses the true feelings of the House and of the vast majority of the people in the country. If we are partisans we are proud of it, because we know that the vast majority of people are partisans, too. We also know that the direction pointed by this Motion is the only direction of hope for the future prosperity for the country.
I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
'notes that Her Majesty's Opposition is more concerned with partisan criticism of Her Majesty's Government's productivity, prices and incomes policy than with the promotion of a constructive and socially just economic strategy'.
This is an extremely fascinating Motion that we are debating. I suspected that the most interesting part of the Opposition's attack upon the Government will lie in its wording. After the lugubrious category of destructive detail that we have had from the right hon. Member for Mitcham (Mr. R. Carr), and the total lack of a positive philosophy or economic policy, I doubt very much whether the right hon. Gentleman was the author of the Motion. He is an earnest and honest and painstaking man. His heart obviously was not in it. It is not in his character to be so devious.
I suspect that this Motion is the brainchild of that consummate fisher of Parliamentary men, the right hon. Member for Enfield, West (Mr. Iain Macleod), who, in plotting it has been in no way inhibited by the fact that its purpose is to veil the unalluring nakedness of Conservative economic policy. The right hon. Member for Enfield, West, knows his politics. This is stark vote-catching and he hopes that it will reap him a dividend this afternoon.
I am sorry to disappoint the right hon. Lady. Perhaps she will take it from me, as a personal assurance, that I did not draft the Motion, but that my right hon. Friend the Member for Mitcham (Mr. R. Carr) did.
I accept the right hon. Gentleman's disclaimer of the honour I was heaping upon him. Clearly, the right hon. Member for Mitcham must have been sitting at his feet.
The second interesting thing about the Motion is the signatories to it. Any Motion on prices and incomes policy which unites the right hon. Member for Enfield, West—who, a few days ago, told the National Federation of Building Trade Employers:
I cannot forecast a happy or long life for the Prices and Incomes Board under a Conservative Administration"—
with the right hon. Member for Barnet (Mr. Maudling)—who is on record as a supporter of a prices and incomes policy—simply has to be negative.
What about the right hon. Member for Bexley (Mr. Heath)? He delivered himself of a speech to the Young Conservatives' national conference the other day in which he managed, at one and the same time, to condemn what he called the "Socialist misery-go-round", and the present level of public expenditure and the Government's withdrawal from east of Suez. Therefore, it is not surprising that he is condeming the Government's failure to create misery among wage-earners; it is merely indecent.
Incidentally, it is nicely ironic that the right hon. Member for Enfield, West should have chosen an audience of building trades employers in which to denounce the prices and incomes policy, because he is on a winner both ways. He can appear as the champion of the poor oppressed building worker, robbed of his penny by this cruel Government, while assuring the building trades employers that under the Conservatives they would never more have to suffer the inquisition of the Prices and Incomes Board which, in its Report on the pay claim, trounced them for the poor quality of their management, the excessive use of overtime due to poor site organization, and their failure to promote incentive bonus schemes effectively linked to increased productivity.
Let me tell the right hon. Gentleman that what is of far more concern to building workers' unions than the penny an hour is chaotic conditions of organisation and of wages structures in this industry as revealed by the Phelps Brown Report and the Reports of the Prices and Incomes Board. What the building workers' unions want is a chance to work out proper productivity schemes to replace the present farcical system of so-called incentive bonus schemes, which may cover only two-fifths of the workers in the industry, with authentic bonus schemes genuinely related to output. They want decent working conditions on the site, stronger trade union organisation, greater continuity of employment and a curb on the abuses of labour-only sub-contracting, which was a growing menace to trade union organisation and the national Exchequer long before the Selective Employment Tax appeared on the scene.
It is these improvements which the work of the Prices and Incomes Board holds out to them. It is these improvements which my right hon. Friend the Minister of Public Building and Works and I have been discussing with them only in the last few days, pledging the Government's support in realising them and thus keeping my promise that once the argument about the interim settlement was out of the way we could work out together ways of giving building workers the chance of organised advancement for which they looked in vain under the Conservatives.
My right hon. Friend and I have already set up a working party to pave the way for policy decisions on legislation. [Laughter.] Hon. Members opposite should not show their total frivolity. When did they even sit down and study the problem of labour-only sub-contracting in this industry, let alone start preparing the legislation to solve the problem and deal with the self-employment in the industry? It is hoped that the unions will be joining in these discussions as from next week, followed soon, I hope, by the employers. My right hon. Friend the Minister of Public Building and Works is also reviewing his own contract procedures with a view to strengthening the provisions governing the use of labour-only sub-contracting on contracts let by his Department, thus taking the Government action which the Prices and Incomes Board Report urged.
The building workers' claim, far from being a matter on which to accuse the Government, is a good starting point from which to discuss the purpose of a productivity, prices and incomes policy. What is the purpose which the Motion says the policy has failed to achieve? I would not expect Conservatives to grasp it; it is far too civilised a concept for them to understand. The purpose is not, as the Opposition argue outside the House, to make workers shoulder the whole burden of national economic recovery by holding down wages but letting prices and all other incomes rise. If that had been the purpose, we would indeed have failed. Is it this failure which we are asked to condemn by our vote tonight? If so, I plead guilty to it.
I am sorry to disappoint the hon. Gentleman. There is no significance at all. My right hon. Friend and I are working jointly and enthusiastically on improving conditions in the building industry.
Hon. Members opposite, and particularly right hon. Members, are fond of talking with two voices. They accuse us in the country, but in the House their argument is totally different. The right hon. Member for Bexley, in the debate on the economic situation on 25th November, denounced us for a very different failure. Then he said:
Earnings are up by 8 per cent. and prices by 6 per cent. This is another condemnation of the failure of the Government's prices and incomes policy."—[OFFICIAL REPORT, 25th November, 1968; Vol. 774, c. 36.]
I hope that my hon. Friends have noted that. It is a very different failure from that for which the Opposition are trouncing us in the country, where they have actively encouraged the vast majority of people to believe that prices have risen and that wages have been kept down.
The hon. Gentleman must not publicly contradict the leader of his party who, as I have just shown, accused us of letting wages rise far higher than prices. That accusation has been repeated by the right hon. Member for Mitcham today, who said that between October, 1967, and October, 1968, wage rates rose by 6·9 per cent. for all industries and services and by 8·8 per cent. in manufacturing—the biggest increase for 12 years. My first reaction is, some misery-go-round!
The figures that he has quoted are of little value unless they are analysed in terms of the criteria, the ceiling and the purposes of the current phase of the productivity, prices and incomes policy. It is to the purpose of that policy and how we have succeeeded in achieving that purpose that I want to turn.
The purpose of the policy is a simple and essential one. It is to keep increases in money incomes as closely as possible in line with increases in national output, and thus to act directly on industrial costs in order to maintain our international competitiveness. Do the Opposition agree with that, or are they merely saying that we have not succeeded? If we have not succeeded, incidentally, they can hardly blame us, since they have done everything possible during the last few months to wreck the policy.
Let me give the right hon. Gentleman and the House figures that are more relevant, because they cover the period of the current policy. From March 1968, when the new phase of the policy was introduced, to December 1968, hourly wage rates rose by 4·2 per cent., earnings by 5·8 per cent. and prices by 4·7 per cent. [An HON. MEMBER: "By how much did dividends rise?"] Dividends rose by 3·2 per cent.—[HON. MEMBERS: "Oh."] Yes, we had better face facts.
We are talking about incomes, not capital. What matters is not profitability, but how the profits are distributed. This is what this policy is concerned with. I will return in detail to the policy for dividends.
I am sorry, I have accepted already half a dozen interventions.
Why have wage rates risen above the ceiling of 3½ per cent.? Partly because of the engineering settlement, which produced a sharp rise in the index because of the large increase in minimum earning levels last December, an increase incidentally, which affected the figure quoted by the right hon. Gentleman.
There are two points to note about this settlement. First, the effect on the wage rate index is misleading because the vast majority of engineering workers are already earning above the minimum. Secondly, the settlement is for the first time linked to productivity conditions of inestimable benefit to the industry, as the employers will be the first to admit because they negotiated it.
If we leave out engineering, we find that between March and December, 1968 the weighted average size of settlement on a per annum basis was 3·7 per cent. in the private sector and 3·9 per cent. in the public sector. Is the right hon. Gentleman saying that this is too high? Does he think we could have achieved it without the policy? He says that he objects to our type of control.
Hon. Gentlemen opposite tried to control incomes when they were in power and the right hon. Gentleman has said that they will try to influence them again. To hear them talk, one would never believe that they operated the pay pause in 1961–63. Their way of doing it was to hold down the wages of public employees while just hoping that wages in private industry would follow suit. They are still hankering after it.
Only last March, the Leader of the Opposition in the Budget debate said this:
Above all, the Government have the responsibility to ensure that the vast public sector which is now under their control does not grant wages which are more than productivity will justify."—[OFFICIAL REPORT, 19th March, 1968; Vol. 761, c. 308.]
The right hon. Gentleman was echoed by the right hon. Member for Enfield, West in the same debate. He demanded:
'The Government should give a lead. They should be seen to be absolutely firm in their own negotiations. A stand by them…would do more good than any amount of exhortation' ".—[OFICIAL REPORT, 20th March. 1968; Vol. 761, c. 440.]
Some policy, to get tough with nurses, policemen, teachers, industrial and non-industrial civil servants generally, regardless of what is happening to other wages and salaries! And they dare to talk about our policy being unjust in its application. The aim of our policy is to treat the private and public sectors equally, and the figures which I have quoted show that we have achieved broad success.
As far as wage rates are concerned—
Is my right hon. Friend aware that after the building trade settlement those in private industry working on large contracts recouped their loss of Id. the following morning by various productivity agreements, and so on, but those who were working in the National Health Service, in local government maintenance and in the lower-paid sections of the building industry actually lost the Id. and it meant a great deal to these workers?
In so far as the Id. was recouped by genuine productivity agreements, I would be the first to welcome it. If my hon. Friend had been listening to the first part of my speech he would have heard me say that what matters to building workers and what they are asking for—and the other day I met all their unions—is the opportunity for genuine productivity agreements to be applied throughout the industry generally. It is this to which we are now giving attention and which was overlooked for all those years under the Conservatives.
So far as wage rates are concerned, it is clear that they are broadly in line with the policy—
Very well; the hon. Gentleman can have that on record in HANSARD.
Prices also are in line with the policy. I hope that there is one accusation that Her Majesty's Opposition will now have the grace to retract; the accusation made by hon. Gentlemen opposite time and again in the Standing Committee on the Prices and Incomes Bill when they claimed that the Government's aim was to push up prices as much as possible. They jeered when I said that we would vigorously resist unjustifiable price increases. The price index proves that we have kept our promise and have done so successfully.
Our aim has been to contain price increases within the limits dictated by devaluation and the Budget, and we have achieved it as a result of the machinery of the present policy. If hon. Members doubt that, they should study the experience of other countries who devalued at the same time.
What, then, about earnings, which is the figure that hon. Gentlemen opposite prefer to quote? The increase between last March and December was, as I have said, 5·8 per cent. Again, are hon. Gentlemen opposite saying that it was too high? If so, how would they have brought it down?
What we are saying is that we have a simple test: has an increase of this size been earned? Has the country earned it by an improvement in our national economic position? Have the individuals concerned earned it by increased productivity? In so far as it has not been earned, the Government are bound to take corrective measures by other means.
The answer to these questions is that we have partly earned it by increased output, which has been rising rapidly, increased exports, which are at an all-time high and still, I am glad to say, on a rising trend, and by increased productivity, which has been one of the marked successes of the policy: even the T.U.C. admits as much. [Interruption.] It has been accused of being critical. I suggest that if hon. Gentlemen read the Economic Review they will see that the T.U.C. admits that the policy has had a direct stimulus on productivity.
Output per head has been rising at a rate of nearly 7 per cent. in the production industries over the last full year, and one of the contributory factors indisputably is the emphasis now being laid on productivity bargaining under the policy, as those firms and unions which increasingly are turning to our Manpower and Productivity Service for help would be the first to testify. We have always stressed the positive productivity element in the policy, and the results are proving that this was not just an empty phrase.
It is true that we did not earn all this increase, which is one of the reasons why the Government have been compelled to take measures of restraint on consumption. But how much more stringent would those measures have had to be if we had not had a productivity, prices and incomes policy. Indeed, right hon. and hon. Gentlemen opposite have admitted as much. In his speech last March, the Leader of the Opposition attacked the Chancellor for not stamping down earlier on the spending spree. Presumably, he would have had a tough Budget even earlier; but it would not have been as socially equitable as the Chancellor's. According to Mr. David Wood, in The Times the other day, the next Tory Government will shift taxation from earnings to spending. That is hardly a charter for the lower paid.
It was soon clear whose spending the right hon. Gentleman was most eager to cut—the Government's. He made it quite clear how he would do it. He would do it not by cutting defence expenditure, but by cutting agricultural and housing subsidies; in other words, by forcing up the price of food and rents for millions of workers whose interests they have been hypocritically peddling this afternoon. He added arrogantly that, if people on low incomes were particularly affected by any increase in the price of food, they can be helped through the social services. If the right hon. Gentlemen who drew up the Motion were honest, they would have added the following words to it:
… and calls on the Government drastically to reduce wage earners' standard of living by reducing public expenditure.
We all know why they left out these words, but that is their alternative policy.
What do the right hon. Gentleman's detailed complaints about our policy amount to? The Motion says and the
right hon. Gentleman says that the prices and incomes policy is
causing grave damage to industrial relations.
He made some play with the Post Office settlement. Let me say at once that I accept my share of responsibility for the situation which developed over that claim, and I will not pretend that it was particularly well handled at the beginning by the Government. But I do not apologise for the fact that we insisted on relating the claim to the criteria of our policy, especially on the productivity side. Is not that exactly what the Leader of the Opposition asked us to do? He called upon the Government to see that the public sector
… does not grant wages more than productivity will justify".
It was because we were able to satisfy ourselves on this point that we were able to reach a settlement.
As for the Motion's general reference to "grave damage to industrial relations", this is one of those unsubstantiated assertions of which the Opposition are so fond. Of course, industrial relations have been strained often over a wage claim. It has been a common occurrence throughout the whole history of collective bargaining. Are the Opposition saying that relations should never be strained over wages? If so, we might as well abandon the word "bargaining".
The right hon. Gentleman just hinted at the figure in respect of the increase in strikes last year due to the policy. He did not quote it, but I will. Last year, 4½ million working days were lost through strikes. That is the highest figure since 1962. But he knows—and that is why he did not quote it—that the figure includes H million days lost as a result of the one-day engineering strike last March. It was part of their normal negotiating strategy—[Interruption] If the right hon. and hon. Gentlemen opposite like, I will quote a year when the number of days lost reached 8 million because of engineering strikes when they were in office.
If we leave the one-day engineering strike out, the figure is roughly comparable with 1965, and it could not hope to compete with the high levels achieved under right hon. and hon. Gentlemen opposite, notably the 5¼ million days lost in 1959. The right hon. Gentleman's argument is nonsense. We all know that Canada and the United States have been losing roughly six times as many working days through strikes each year as Britain, and they have no statutory prices and incomes policy.
The right hon. Gentleman's second complaint is that the policy is frequently unjust in its application. He contrasted the treatment of doctors and dentists by Kindersley with the treatment of university teachers in the Report of the National Board for Prices and Incomes. We recognise that there have been differing interpretations of the criteria by the various public bodies responsible for advising us an salaries in the public sector, and this is obviously a factor that we shall have to take into account in considering any future development of the policy.
I am sure that the right hon. Gentleman is the last person to say that we should have brushed aside the Report of the Kindersley Review Body, set up in 1962 by his own Government, especially when it had taken the prices and incomes policy fully into account. Equally, I am sure that he would welcome the way in which, in its Report on the pay of university teachers, the National Board for Prices and Incomes draws attention to the difficulties caused by loose forms of comparability as the sole justification for increases in pay. I repeat, it is the Leader of the Opposition who has said that the Government should give a lead in the public sector in relating pay to productivity. Indeed, it was his Government which referred the pay of university staff to the National Incomes Commission in 1963. But it is true that, as a result, we have been left with some anomalies between the treatment of different groups in the public sector, and the issues involved are now under review by the Government. They are complex ones, and of course, we should have full consultation with all those concerned beforehand if any change were contemplated.
It is essential that salaries, as well as wages, should be brought within the disciplines of the prices and incomes policy. That is why we have made a number of professional salary references to the National Board for Prices and Incomes and have currently referred not only top salaries in the private sector and nationalised industries but the salaries of executives in the middle range of management. Before we assume that salary increases have got wildly out of line, I suggest that we wait for the evidence of these reports.
The results of my Department's survey of salary earnings last October are not yet available, but a report by the Corn-market Careers Centre calculates that the median salaries of certain professional groups in 1968 increased by an average of 4·7 per cent., which is far less than the increase in hourly wages.
My hon. Friend the Member for Poplar (Mr. Mikardo) is quite right to ask what has happened to dividends. I am glad to give him with exactitude the latest figures available, which are those to the end of September, 1968—
I refused to give way to the hon. Member for Oswestry (Mr. Biffen), and it would be very unfair to him if I gave way to my hon. and learned Friend. I would not like to be thought unfair, so I will give way to my hon. and learned Friend, and, after that, I shall have to give way to the hon. Gentleman.
Does my right hon. Friend not appreciate that the people with real money have not been living on income for years? They have been living on capital gains, which are infinitely easier to get than dividends and bear much less tax.
Of course I appreciate that this is not the whole picture, but neither is the prices and incomes policy the whole of the picture. We have never claimed that it was. We have never claimed that it is the sole, nor even the major, element in an overall economic and fiscal strategy. This has never been the Government's case. The Government's case has been that we were taking measures, through this policy, to deal with wage and salary incomes, dividends, prices and rents, and that the other measures are appropriate, as the T.U.C. Economic Review points out, for achieving the Government's aim of social equity. This is not what we are claiming for the policy and it is not a point that falls to me to answer this afternoon.
But on one thing I am sure we would all agree: that is, that the agricultural workers have not been unfairly treated under the policy. The right hon. Gentleman scoffed at us for having referred their claim to the Prices and Incomes Board at all. He cannot have it both ways. He cannot complain at one moment that the policy is inconsistent and the next object to its comprehensiveness. The simple fact is that we asked the Board to indicate how this claim ranked in the light of the criteria of the policy, both on grounds of productivity and of low pay. For reasons of which my hon. Friends will be aware, the Board said that this was an exceptional case and that it had been treating it exceptionally. I should think that right hon. and hon. Gentlemen would be welcoming this flexibility, not criticising it.
Could the right hon. Lady explain why, if in order to get this comprehension it was right to refer the agricultural workers' claim, it was not also right and necessary to refer the tally clerks' claim?
The reason why the tally clerks' claim was not referred was because we did not wish to hold up the encouraging progress towards a comprehensive and radical productivity deal for the docks with which we are pressing ahead with all possible speed.
The moral of these cases is that, if an incomes policy is to continue, we must progressively refine and improve the criteria. It is no part of my argument to claim that the Government have found the final solution to the complex problems of securing a more equitable and efficient system for distributing rewards. But what I do claim is that we have forced every one of us to face up to the moral and economic issues involved.
As the T.U.C. says in its current Economic Review:
One useful by-product of the incomes policy is that it has at least directed more attention to this problem …
of the low paid. It also admits that, while Congress had continued to assert the need for action to improve the relative position of low-paid workers,
… it is doubtful whether collective bargaining alone is likely to achieve this in the short run.
I doubt whether it will achieve it alone in the long run either, because we all know that one of the main aims of collective bargaining is to maintain existing differentials as sacrosanct.
This is a challenging problem for all of us, and I hope that in our forthcoming discussions on what should follow the current legislation, when it expires at the end of this year, we will face up to it honestly and realistically with the help of the information that the Government have collected through their sample survey on the distribution of incomes within industries and on the causes of low pay and their study of the cost and implications of a minimum earnings guarantee. The report of this study will be published shortly.
The implications of such a guarantee would be far reaching, and I ask the House to consider the report very seriously when it is published. Here again, I believe that they will show that one could not hope to improve the relative position of the low-paid except in the context of some incomes policy.
Whether, in its next phase after 1969, it should be a statutory policy is something that we shall be discussing during the next few months. But I say to my hon. Friends that it will not be simple or easy to find a more comfortable, more efficient or more equitable way of achieving our social and economic aims. It is very easy to criticise, as we heard from the right hon. Gentleman's speech this afternoon, but to construct something positive is very different. Certainly hon. Gentlemen opposite, for all the deceptive wording of their Motion, do not offer any alternative that we could accept. Of course they do not support a productivity, prices and incomes policy, statutory or otherwise. The only policy that they ever had was an incomes policy pure and simple.
For all the criticisms that have been, and will be, levelled against the Government this afternoon, let us remember that 1968 was an encouraging year in this important respect. We enjoyed an upsurge in growth—4 per cent.—associated with an improvement in the balance of payments—unlike our unhappy experience in the past when a high rate of growth has almost automatically meant that the balance of payments has deteriorated—and our standard of living has risen at the same time.
No one on this side of the House would want to endanger that triple advance, still far too precarious for us to relax. Because I believe that the productivity, prices and incomes policy, for all its imperfections, has made a modest but vital contribution to our progress in the past year, I ask the House to reject the Motion.
I have seldom heard, certainly at the start of a speech, a weaker or a greater joke perpetrated on the House than the approach made by the right hon. Lady. To dismiss the Motion, as she did at the start of her speech, showed no understanding of the importance which so many people place upon the debate today
I should like to take the right hon. Lady to the start of this debate. On Second Reading of the Prices and Incomes Bill the right hon. Lady said:
The starting point must be devaluation. This was designed to enable us to turn our backs on deflationary policies…We are no longer asking the people to hold down wage increases as part of an overall reduction in the level of economic activity."—[OFFICIAL REPORT, 21st May, 1968; Vol. 765, c. 301.]
I wonder whether the Under Secretary of State, in winding up the debate this evening, will tell us whether he is in agreement today with those statements which were made by the right hon. Lady when the prices and incomes legislation was introduced.
Have the Government turned their back on a deflationary policy? Of course not. The whole approach since May, 1968, has had to be greater and greater deflation. Indeed, the demand that has been made by the right hon. Lady to ensure a limitation in wages by her controls has reduced, without any doubt, the overall increase in the level of economic expansion.
Maladministration has become synonymous with Labour Government, and there is no Minister of which this is more true than the First Secretary of State for Employment and Productivity. What a misnomer it was when she chose "Employment and Productivity" as the new title for the old respected and respectable Ministry of Labour. Surely it would be more true today to take a leaf from the title of the right hon. Lady's White Paper on trade unions, and rename the Department, "Department of Strife and Unemployment"?
That is the situation which exists at the moment. The number of days lost because of strikes in industry is of major concern, especially when one compares our record with that of other nations in Europe. Ours is one of which no-one can be proud, and the percentage of that figure which is due to unofficial stoppages makes the situation even worse.
When one comes to the level of unemployment when considering the overall position of the right hon. Lady's policy, one finds that it has been essential to have a high level of unemployment to ensure that the Government would be able to press forward with their policy. The figure of 500,000 unemployed this year has lasted for a longer time than ever before in modern times, and it must be remembered, of course, that this figure is somewhat misleading because it is lower than the comparative figures which were used prior to 1964. I say that because what most people do not realise is that the unemployment figures today do not include school leavers, and the figures for Northern Ireland have been excluded from the overall totals.
The figures reveal that the policy for prices and incomes has, in many instances, been a policy of vacillation. The right hon. Lady has been willing to get tough with the moderates, with the reasonable people, with those who are unlikely to strike, and with those whose strike action would not hurt the economy, but she ensures that the Government give way to anybody who stands up to them.
Is not the dilemma in which we find ourselves due to the fact that the right hon. Lady's actions in the past have been wrong, while the words in the latter part of her speech could not have been more right? Words and actions conflict.
I was paying pretty close attention to many of the right hon. Lady's words during the whole of her speech. I did not find in them an analysis of our real problem, or a solution to it. What the right hon. Lady says and then does bears no relation to what we see happening in the country.
When it comes to dealing with the tally clerks, with railway workers, and with post office workers, where there is considerable strength, the Government have been willing to give way. If the Government allow the incomes policy to be breached by workers for whom they are almost entirely responsible, how can, and why should, they expect industry to take their policy more seriously than they are doing themselves? Part of the right hon. Lady's speech was a condemnation of the Conservative Government who, she said, when holding to the pay pause were more stringent than the rest of industry. If the Government are to govern, they must set the example, and even with the right hon. Lady's own figures of adjusted increases one finds figures of 3·7 per cent. and 3·9 per cent., one in the private sector, and the other in the public sector. This only goes to point the moral that the Government expect industry to be tougher and more stringent with their workers than the Government are willing to be with those for whom they themselves are directly responsible.
The right hon. Lady's motto might well be, "He who fights and runs away lives to fight another day". That is what she has encouraged. Where she has been able to, she has forced her policy through, but where somebody has been prepared to stand up and fight, however much giving way may have meant breaching her policy, she has given way.
The harm of statutory wage control can be summed up in four ways. First, nobody is in favour of it, not even the Prime Minister, and we do not have to go back over old quotations to discover that. Secondly, the C.B.I, and the T.U.C. believe that it is a major interference in industry. Thirdly, more often than not ways are found to get round it to ensure that the 3½ per cent. norm is exceeded. This is a major weakness of the policy. It is this which, to a greater extent than anything else, underlines the rightness of the Motion. The norm has been breached on an innumerable number of occasions. Fourthly, and perhaps most damaging of all, and something which has been ignored, is that the Government's policy is precipitating the largest wage bomb of pent-up, unsatisfied and unsatiated wage claims which awaits only the removal of statutory wage control to burst forth in cyclonic proportions to swamp industry. It will bring the largest increase in labour costs that this country has ever known. This is a desperate position, and one to which the right hon. Lady has shown no sign of finding a solution.
The Labour Party has only one bankrupt solution to deal with the problem, yet another, the fourth, round of prices and incomes legislation, and with all this the fact that wages went up faster during the 12 months from October, 1967, to October, 1968, than ever before in the previous 12 years. How then can the Government suggest that it would be right to continue this kind of legislation?
The right hon. Lady said that the difficulty about replacing the present statutory incomes policy was that "it would be difficult to find one more comfortable, more efficient, and more equitable". What a lot of nonsense that is, and it is because of the difficulties into which the Labour Party has got itself that I predict that it will be necessary to prolong the statutory wages control beyond the end of the year.
This control is encouraging a lack of discipline within the trade union movement. We are seeing the unofficial strike grow, and the "Dash you, Jack. I'm ail right" element play a major part in our troubles. Strangely the Left-wing Amendment. We are seeing the unofficial strike gest an immediate attempt to return to free market conditions. This is a strange view coming from hon. Gentlemen opposite, rather like anarchists at the London School of Economics petitioning for more gates to be erected before they will agree to co-operate.
One factor has been neglected entirely The upper limit of 3½ per cent. has been set, but nearly every settlement which has not been referred to the Board or to the right hon. Lady has been based on a minimum of that figure. In other words, the norm has been accepted as the bottom level for wage increases, and many ways have been found to get round it, by backdating, by pseudo productivity agreements, and so on. The hon. Lady has claimed with much vigour that she wants to see justifiable productivity arrangements brought in. But one of the major problems of any settlement all of us must realise is that a productivity bargain agreement should not receive payment until it has actually started to work. One of the difficulties is that settlements have been made with productivity bargains included, but the bargains have been very limited during the next 12 months. The wages have been paid, but the return to the industrialist or the Government in increased productivity has been negligible.
I turn now to the limitation on prices. The right hon. Lady seemed proud of her achievement, and boasted of it. But, from October, 1964, to December, 1968, there was a 19-plus percentage increase in the index of retail prices. Food prices rose by over 16 per cent. If an average family—and this was the yardstick taken—was spending £19 10s. a week in 1964, it would need to spend today £23 4s., an extra £3 14s., to buy the same amount. When she refers to the work of the nationalised industries, it is as well to point out that their prices have risen by over 25 per cent. since 1964. Is she proud of that?
The whole of her speech was an example of what is so often wrong with the Government. The Prime Minister and his Ministers have personally, by their continued statements guised to mislead the British people, done much to undermine public confidence in Parliament and politicians to a point lower than at any time since the days of Machiavelli.
Let us consider the record. On 30th October, just before the Bassetlaw by-election, the right hon. Lady said that no economic freeze was on the way. A few days later, when hire-purchase restrictions were brought to the same crisis level as in 1966, she dismissed that with the phrase "Just a touch on the tiller". But less than three weeks later, the November emergency Budget was brought in, bringing an extra £250 million of taxation, with 5d. on petrol and cigarettes, a 10 per cent. increase in Purchase Tax by means of the regulator—a form of taxation which was roundly condemned by hon. Members opposite when a Conservative Government introduced it—a squeeze on bank lending and an import deposits scheme, all at a moment's notice. Was this just "a touch on the tiller "? The right hon. Lady must be either criminally out of touch or culpabably incompetent in understanding how the economy should be managed.
I cannot understand this single, double or triple somersault which the Opposition seem to be performing. Are they saying that it is wrong that wages should rise and the cost of living should be controlled or that, if they were in power, they would reduce wage levels and allow prices to rise? Is it not a fact that, under this Government, although there is a norm under the prices and incomes policy, which I support, there are exceptions to the 3½ per cent. which allow for the rise in wages and therefore for the rise in the standard of living of the great majority of people?
That raises about five other points; let me deal with the two main ones. First, we condemn the Government for their set policy, which they have propounded in this House and the country because it has failed absolutely—
Let us say, the tally clerks. Was it right that their claim should be allowed when the municipal busmen were nearly double-crossed over their claim? Was it right that the Post Office and railway workers should have received the special treatment which university lecturers were refused? Let us just take those illustrations—[Interruption.] If the hon. Gentleman does not like my answers, he must just accept them and try to catch Mr. Speaker's eye himself later.
The whole of the Government's policy is bound to fail. Once they set forward on using the compulsory power of this House to control wage negotiations, they are bound to the slippery slope of failure, unless they use more and more compulsion. This is what we condemn and it is for these reasons that the Conservative Motion should be supported.
The hon. Member for Honiton (Mr. Emery) pursued his case in his normal highly rhetorical fashion. I do not intend to run away from him, but I do not need to pursue him down the corridors of what he termed "the Department of Strife and Unemployment". On the surface, at least, there is much in the Motion with which I can agree but I am a little nauseated with the hypocrisy of leaders of the Opposition in putting it down. One can see their reasons in the Motion and they were made clear by the right hon. Member for Mitcham (Mr. R. Carr).
The Motion says
… the attempt to control incomes…has failed in its purpose …
In other words, wages have not been held down rigidly enough. Their policy, of course, would rely on market forces, buttressed by the policy outlined in their document "A Fair Deal at Work", which would bind the trade unions to a rigid code of law.
For workpeople in the factories, the docks, the mines and the workshops to accept the Tory Party's policy in place of the Government's policy is merely a case of jumping out of the frying pan into the fire.
Just for clarification, I believe that my right hon. Friend's Motion, when it says that the law has failed in its purpose, means that it has failed in the purpose which the right hon. Lady and the hon. Gentleman's friends had in mind, and not on the basis of what we on this side believe.
My right hon. Friend can answer that for herself.
Hon. Gentlemen opposite are worried lest the Government's incomes policy has what one might term a quiet burial. They intend to stir things up to the very end. They know that the Labour movement is decidedly split over this policy. Trade unionists are worried about their cherished right of free bargaining, something for which they fought over the years and, to a large extent, won.
It is noticeable that in Fascist countries like Franco's Spain and pre-war Hitlerite Germany one of the first acts was to attack the freedom of the trade union movement. I am not so much against an incomes policy: I have been opposed to the fact that the Government's incomes policy has tended to be operated in a vacuum.
An incomes policy is part of what one might call a Socialist conception of society, but the Government have failed in that they have not had the courage to introduce the accompanying Socialist props like realistic price control, selective economic controls, policies designed to narrow and not widen the gap between the rich and the poor, a major expansion of public ownership, more cuts in defence expenditure and cuts in the costly featherbedding of B.A.O.R.
The Government's incomes policy has been the cornerstone of their economic policy, but it has been operated without these essential props and therefore, far from stumbling into Socialism—a phrase once used by an articulate member of the Government to describe the policy—the Labour Party and the Government have been stumbling to disaster. We have lost control of almost every major local authority and many safe Labour Parliamentary seats into the bargain. As my union, the Transport and General Workers' Union, has repeatedly maintained, the Government should not have gone into this field and, having gone in, they should get out of it now. Considering the essentially capitalist nature of our society, this analysis of the situation is probably justified.
How can my hon. Friend argue on the one hand that we have done so much wrong and, on the other, accept that wages have risen more than the cost of living and that the Government have kept prices down more than they have wages, and in so doing have recognised that trade unions not only have rights but responsibilities? Is my hon. Friend aware that there are 8 million pensioners in Britain who must be considered along with everybody else?
If my hon. Friend will be patient, I will reply to those very points.
The accent all along should have been on productivity. I welcome the Government's conversion in the last year or so to this point of view. The very change in the name of the Department to include the words "employment" and "productivity" is an indication of the changed feeling in the Government. The whole conception of productivity being the answer was not so much accepted by the Government 18 months or two years ago, and I have never believed that wages are a basic cause of our economic ills. Indeed, it could be said that low wages have contributed to many of our economic difficulties because they have given companies no incentive to modernise their equipment and thereby increase productivity. Wages in countries which are our principal competitors have been rising faster than wages in Britain, yet the Government, despite all these obvious factors, have still insisted on their incomes policy being the cornerstone of their economic policy.
Has this policy been justified? The answer was provided in July of last year with the publication of the Third General Report of the Prices and Incomes Board. It said that the average annual increase in earnings in recent years had been just under 1 per cent. less than it otherwise would have been. Could any other observation on this policy be more revealing? If all the Ministerial effort, Parliamentary time and trade union activity which have gone into imposing or resisting the policy could instead have gone into increased productivity, does anyone seriously doubt that the productivity so increased would have been greater than just under 1 per cent.?
One need only think of all the strikes that have taken place because of the policy, not least the disastrous seamen's strike. Consider the morale of many good Labour supporters in the factories and workshops. Consider the parsimonious treatment of the busmen's £, which was freely negotiated, the builders' penny, and the ineptitude in dealing with the Post Office telegraphists. There are many other examples one could cite.
I hope that the incomes policy will be buried at the end of its term towards the
end of the year and that "R.I.P." will be written above it. Our Amendment—it is worth noting that it represents the decision of the Labour Party Conference last October and a Motion originally placed on the Agenda of that Conference by my union, the T. & G. W.U.—states:
recognising the extent to which legislation restricting wage and salary movements has hindered both legitimate trade union activity and economic expansion, calls for the repeal of this legislation, and also rejects any further legislation the aim of which would be to curtail basic trade union rights …
The Under-Secretary does not believe that we should take very much note of annual conference decisions. I, on the other hand, believe that the sooner we get back to the fundamentals of the Labour Movement the better. Some Members of the Government would be well advised to study past conference resolutions.
At the October conference my right hon. Friend the Member for Cannock (Miss Jennie Lee), who is a member of the Government, was able to point out in her chairman's address that 9 per cent. of Britain's population control over 80 per cent. of personal wealth. She wondered how, in this situation, trade unionists could be expected to adhere to an incomes policy. This maldistribution of wealth must be tackled and the Chancellor of the Exchequer and the First Secretary should study with care the concluding chapter in the T.U.C.'s economic review entitled "Capital Growth and Equality". My right hon. Friend made some carefully selected references to this important document. I say "carefully selected" because she did not refer, for example, to the passage in the review which sets out how more and more wealth in this country is being accumulated in fewer and fewer hands. It sets out how the balance could be redressed by a capital wealth tax. This is what the Government should be tackling instead of pursuing trade unionists and this policy which is a will o' the wisp.
Apart from the moment when the hon. Member for Newport (Mr. Roy Hughes) described his reactions to our Motion as being nauseating, unlike his right hon. Friend, who said that she was fascinated, I found myself in agreement with a great deal of what he said, although I do not go the whole way with him on the matter of a wealth tax.
The hon. Member appeared to be complaining about us stirring things up in connection with the Government's incomes policy, but I do not think he should criticise us on that. If we feel that something is basically wrong, basically un-British and bad for the country, it is right that we should stir it up to the greatest extremes.
One cannot comment on the Government's particular brand of incomes policy without examining their justification for having such a policy. With the wisdom of hindsight such an examination is very revealing, and what it reveals is fairly horrifying. There are few items of Labour Party policy which testify quite so eloquently to the ruination of our country which is taking place. Having inherited what was a temporarily mediocre economic situation, of perfectly soluble proportions, the actions of the then Chancellor, now Home Secretary, succeeded in making matters infinitely worse.
Since then, the change to a new Chancellor, who was a slave to the same philosophy, has merely and predictably compounded our state of grief. All the time, in the background, there has been the real architect of disaster, the Prime Minister himself, a man who has exposed himself as being plainly dedicated more to the promotion of Socialism than to the well-being of our population. He is the real villain of the piece, the creator of the state of perpetual crisis which gives him the necessary pretext for running a system which involves State control of the private pocket in the individual. That is what this control of incomes is.
The right hon. Gentleman is the master-mind who has brought our country so far along the road towards economic ruin. I further charge him with having done this deliberately. Because the whole justification for having such tyrannical control over the individual is our economic plight, it is important that we should be absolutely clear how we have arrived in such a state. If we are to find the quickest way of getting out of it we must know how we arrived there.
The charge I make it a grave one and I shall seek to substantiate it. No one would question that the Prime Minister is a clever man. He has available to him the best economic advice which one could find anywhere. It is stretching the imagination too far to suppose that we have sunk to the present depths by accident or incompetence. It is all part of the purpose of the "gritty and purposeful government" which he promised us. We know now that a little more oil might have been more appropriate than grit, but that is a minor matter compared with what is involved in the general purpose aspect. This purpose is becoming all the more plain to those not too naive to see it. It is the pursuit of Socialism at all costs and to hell with the rest.
What is the evidence for saying this? First, we have the contracting out of our world rôle—the betrayal of our friends, allies and dependants whose combined strength was the shield of the Western nations and the free world. So, having at the start of his reign determined to turn his back on the world on the ground that we could not afford it, he has taken every step to try to ensure that we cannot afford it. Secondly, there is the deliberate creation of crisis after crisis in recognition of the fact that only when we are in dire straits are the people prepared to swallow almost any remedy that is served to them. With every remedy consisting of a further dose of Socialism and a further shift to the Left, he achieves his ruinous purpose. Why else should he look so cock-a-hoop, when the nation is crumbling around his ankles, when any normal man would be grovelling in abject apology? I was glad to hear the right hon. Lady, for the first time for many months, saying she regretted she did something wrong.
I think that my hon. Friend is correct, but at least it was a Government admission that they did something wrong.
That is something very rare. Unless we have more admissions of that kind, I fear that the last remaining respect which people have for Parliament will fast disappear.
Reverting to my theme it is precisely what the Prime Minister intended should happen, relying on his gullible cohorts to come along year after year and month after month contentedly believing the story of jam tomorrow, or the next day. Here they are, always turning up and supporting him.
I do not want to give way, as I wish to make my speech as quickly as possible so as not to take up the time of the House, and think I may be able to anticipate the point the hon. Gentleman has in mind.
But has the Prime Minister, at last, made the mistake of thinking that by controlling the pockets of the population he can also control their minds. Never before in peace or war have we had a Government who have advanced so far along the road towards dictatorial suppression of freedom. Never before was the phrase "in the national interest" so over-worked and abused. Never before has the average Briton been so brainwashed by constant squeeze and freeze into accepting it as the norm, like the man who grows to enjoy ill-health.
There are signs that we are resigning ourselves to the worst with a shrug instead of challenging each new outrage as it comes. Perhaps our climate teaches us to accept what cannot be changed, but because we have grown accustomed to enjoying bad weather there is no reason for enjoying bad government and all that this means in terms of the compulsory freeze. Tacit acceptance of this policy of strangulation by the trade unions is perhaps the most surprising thing of all.
I am sure that the hon. Member will have an opportunity to make a speech on that very point.
Of course, we need to have restraint in wages and to match wages to productivity, but what a way to set about it. With all I he emphasis back to front, it was doomed to failure from the start. It is only natural that the more money one takes out of a man's pocket to squander on an ideological notion the more he will ask for. The more one enforces restriction to reduce produc- tion the more one increases the unit cost of production. The more men there are drawing the dole the harder it is to secure agreement for one man with a machine to do the work of five.
And quite apart from the inhumanity of it all, can anyone suggest a more extravagant way of running the economy than by paying thousands of men vast sums of money for doing precisely nothing, as the Government have done by creating a vast pool of unemployed?
Some foreigners may think that as a country we have "had it". So long as we continue with this Government, they will be very nearly right. But I believe that there is still one hope. We are short of natural resources, and in relation to our over-population this is a very dangerous situation. However, we have one great national asset; we have a vast reservoir of latent skill, talent and brawn just waiting to be released by the right kind of leadership and incentives. This is our one natural resource, and with it I think that we could once again astonish the world with our ability to recover and prosper.
Stop-go was bad enough, but stop-stop is a prescription for disaster. As an expansionist by nature, I believe that we simply must have expansion and a let-up from this suppression from which we are suffering before we come to a complete standstill. It is just possible that we could justify permanent stop and restriction if it took control over inflation. The fact is that, although we have been suffering from the superhuman controls which the Government have applied, inflation has been worse during these last four years than in the six previous years. The cost-of-living figure has risen on average 4½ per cent. a year over the last four years, as compared with 2½ per cent. over the preceding six years. This proves that this policy has not succeeded in controlling inflation.
When I talk about expansion, I do not mean the sort of synthetic boom which the Government are doubtless planning to coincide with the next General Election, followed by more squeeze and freeze as before. No one believes the promises of politicians any more, but at least there are some sane members of the community who remember that for 13 relatively golden years Conservative methods did work in practice, to the advantage of the whole population in terms of prosperity, a rising quality of life, and, above all, freedom from the disastrous controls which we are condemning today.
I understand that the noble Lord the Member for Edinburgh, North (Earl of Dalkeith) represents the Scottish aristocracy. I am certain that he does not represent workers' opinion in Scotland. I am sure that he will understand if I do not follow him into the byways of the ideas which he has attempted to propound but, instead, comment on some of the wider aspects that have been raised by hon. Members opposite.
As a result of neither the noble Lord's speech, nor of any other speech, are we any nearer to an understanding of the Opposition's policy. Why are they complaining? We have gathered that their opposition to the prices and incomes policy is because wages have risen too high. That is their basic complaint.
One hon. Member opposite said that the Motion had been tabled because the policy had failed from a Labour Party point of view, not from a Tory point of view. There are some problems opposite. There is some difference of opinion as to why this Motion was tabled. It does not require much imagination to understand the circumstances in which it was tabled. It is no secret that the Shadow Cabinet listened last week to an organ performance by the Leader of the Opposition; at the time he was playing the "Enigma Variations" and the right hon. Member for Enfield, West (Mr. Iain Macleod) said, I suspect, "That is it. That is what we ought to do—the 'Enigma Variations'. Let us table a Motion on prices and incomes".
Although it may be true that the right hon. Member for Enfield, West did not write the Motion, it was his suggestion and, therefore, the right hon. Member for Mitcham (Mr. R. Carr) wrote out the Motion and it is now on the Order Paper. There may have been some discussion about this, because hon. Members opposite could have stolen the clothes of the Labour Party; they could have quoted accurately from the Labour Party conference debate and put that quotation on the Order Paper. But they said, "That would be too dishonest. It would be too hypocritical. We had better not do that. Let us stick to the bare bones. We will try to make the case accordingly".
So the Motion appears. The intention behind it, with all the ingenuity of the right hon. Member for Enfield, West, was, "If we table it in these terms, there may be some division among ourselves, but one thing which we can certainly do is divide the Government benches. We can recruit some support on the Government side to defeat the Government's policy".
There is a lack of understanding here of the whole purpose of the wage argument. The fact is that most hon. Members opposite, unlike the noble Scottish Lord, who represents the aristocracy, represent the employers. They collectively speak on behalf of the employers* associations, while we on this side of the House try to put forward the trade union point of view. It is, therefore, impossible to subscribe to the hope expressed by the right hon. Member for Mitcham that both sides of the House—both employer opinion and trade union opinion—could combine to defeat the Government's policy. This is impossible because, if the Government were defeated under those circumstances, the employers' point of view would be bound to prevail in the end.
Therefore, the Left on this side of the House could never join the Tories in such an operation, because by doing so they would be promoting the employers' point of view; and the whole purpose of our political and trade union activity is to defeat that point of view. Therefore, the hope or theory expressed by the right hon. Member for Mitcham is a non-starter.
Hon. Members opposite have said that the problem is that wages have risen too fast. They have obviously made out the case, and are still doing so on behalf of employers, that wages have exceeded those which prevailed during their period of government. This is borne out by the figures produced this week by the Departments concerned. During the four years of Tory Government from 1960 to 1964, real wages for manual workers rose by 10·3 per cent. From 1964 to 1968, according to Government figures, they have risen by 11·8 per cent. Manual workers have fared better during four years of Labour government than they did under four years of employers' government.
The Opposition still say that the policy has failed. We on this side say that it has failed for totally different reasons. The arguments which have been advanced to support the employers' view that wages must be held back have led them to advocate wages' contracts—in other words, contract law. That is the restriction which the Tories would like to be placed upon wages. They want to take wage negotiation away from the methods used so far and place it under the restriction of contract law. Such a scheme has all the problems which are attendant upon the scheme in operation in the United States.
Why could not the Government have spelled out in some detail support for their own policies in the Amendment? Why is there this nebulous arrangement of words? The answer is that the Government realise that there is no support in the country for their incomes policy. [An HON. MEMBER: "That is not true."] It is borne out by the overwhelming majorities recorded by the whole Labour movement against the policy.
My right hon. Friend the Prime Minister said at the annual conference of the Labour Party that while the Government could not take an instruction from conference they would accept that its vote was a warning. We have seen the result of that warning on the Order Paper. The Government have heeded the words spoken at the conference, and they cannot spell out in detail support for their policy because they have accepted that warning.
My right hon. Friend the First Secretary of State and Secretary of State for Employment and Productivity has said that the options are open on the future of the policy. She repeated that this afternoon, and said that a great deal of thought was being given to finding a successor to the policy. No final decisions have been taken. Therefore, the options are still as wide open as they were at the beginning. For that reason alone it was impossible to put down any detail on the Order Paper.
If the Government are now saying that the policy has not achieved what it set out to achieve, and since opinion is demanding that the policy be ended, it obviously cannot be put on the Order Paper and voted on. Those are further reasons for not spelling this out in detail.
Is the hon. Gentleman saying that he understood his right hon. Friend to say in her speech that she is contemplating change in the prices and incomes policy, in other words, doing away with the third prices and incomes policy when the present one ends in 1969? Hon. Members on this side understood clearly that the Minister was saying that she would have to introduce another one.
If the hon. Gentleman was he would have heard as clearly as I did that the Government were now thinking about the policy to succeed that now being followed. Our function on this side of the House is to try to influence Government thinking to the maximum, to try to get the kind of policy we believe will give the maximum benefit to the workers we represent.
Surely the point is that it is not a matter of changing the policy of having a controlled wage-price level, but perhaps finding an alternative means by which this control can be exercised?
Quite, and that is no doubt part of the consideration now being given to the problem.
One of my fundamental concerns is that the second part of the policy described in "In Place of Strife" will be the successor to the present prices and incomes policy. It looks dangerously like that. Further disaster lies in that direction if the Government have such ideas. It could well be the basis of a future incomes policy, because the Government's predominant fear is of wage drift. It also preoccupied right hon. and hon. Members opposite in the long years they were in office. They also would have very much liked to design a kind of compulsory intervention along the lines suggested in the White Paper. I heard some odd remarks earlier about the title of "In Place of Strife". It was suggested that it was a twist of "In Place of Fear", the title of a book written by our good friend Aneurin Bevan. That is not so. It came as a result of the Prime Minister's idea that Galsworthy's "Strife" was very apt. It is in place of the class struggle. If my right hon. Friend were here she would confirm this.
I am rather puzzled. Can my hon. Friend tell me any right that is taken away from the trade union movement in the document "In Place of Strife"? On the prices and incomes policy, does not he agree that there is a need to try to get away from a free-for-all society in which only the strong and the militants shall win and the weak and the poor shall go to the wall?
I shall come to the free-for-all question shortly. But I shall rapidly clear up my hon. Friend's point about trade union rights that have been taken away. Plenty are taken away by this policy. The "In Place of Strife" policy suggests that workers should not have the right to withdraw their labour under certain circumstances.
My hon. Friend shakes his head. Rather than allow my speech to become like a series of interventions on my part, I shall come to the three or four points I want to make
I have summed up my criticism of the Government and explained why they could not spell out in detail in the Amendment the support for their policy statement on prices and incomes, and have therefore had to leave it to other people. The point is that there is a further Amendment on behalf of the National Executive Committee of the Labour Party. It did not ask for the Amendment to be tabled, but we are constitutional members of the Labour Party, and it is our function as members to translate conference decisions into some form of activity here, and ensure that our rank and file can make their opinions known inside the House.
Therefore, on behalf of the National Executive Committee we put down as an Amendment the words used in a motion moved by Mr. Frank Cousins, of the Transport and General Workers' Union and Mr. Hugh Scanlon, of the Amalgamated Engineering Union, at the annual conference of the Labour Party where it was overwhelmingly carried. I regret that Mr. Speaker was unable to select the Amendment, but it is on the Order Paper, to give our rank and file members the chance to express themselves in this way. Therefore, it is there on behalf of the National Executive Committee.
In passing, I might say that it was unable to table the Amendment itself because of the ridiculous situation that 11 members of the Government are on the National Executive, and because of the articles of faith they adopt when they go into the Government they are not allowed to subscribe to such Amendments whilst remaining members of the Government. That is why we have done it on their behalf.
I thank the hon. Gentleman for that intervention. It is absolutely true, and I thought that I had put that fairly plainly when I made the point that the Executive and conference are not allowed to instruct the Government. But the Prime Minister accepted the warning. He said so himself. It is not an instruction, but a warning. I do not want to go over the Laski argument with an earlier Prime Minister once again. I think that the House accepts what the position is.
The only title I can find for the Liberal Amendment is "In Place of Progress". It is a sort of anarchist's charter. The Liberals have had to look around to the other areas on which they thought they could get something on the Order Paper, and they have come up with this. They are saying that there should be a complete abolition of national negotiations or industry-wide negotiations and therefore wages could be negotiated only at a plant level. If that has any part in the Government's thinking, it supports some of our fears that Part 2 of "In Place of Strife" could be a successor to the present policy. I hope that does not come about. I hope that the Liberals are not having much influence on the Government in suggesting total abolition of national negotiations.
One of the biggest problems of the motor car industry is the absence of industry-wide negotiations. If large employers like Vauxhall, Ford, B.L.M.C. and the rest wrote into their contracts with suppliers of components a fair wages clause which was agreed throughout the industry, we would eliminate many of the problems.
What we want is some degree of industrial harmony. We want to do away with the periodic industrial upheavals that bedevil the motor industry. I have said that one way is for an assembly company to write a fair wages clause into its agreements with suppliers of components. At the moment, the parent company, as it were, which assembles the components, is responsible only for specification of materials, questions of quantity, inspection limits, etc. It is not concerned in wage agreements in the component suppliers' factories. I believe that this is one way in which we could help solve the motor industry's troubles.
The Liberals say, "Abolish the lot. We do not want industry-wide negotiations". Imagine such a situation in a nationalised industry, such as electricity supply. Negotiations would be at individual power stations. Some might offer 8s. 6d. an hour to supply 240 volts while others offered 10s. 6d. It would be an anarchic situation.
The right hon. Member for Mitcham said that wages had risen too much during the period of the Labour Government.
I am sure that the hon. Gentleman would not wish to misrepresent me. That is not what I said. Our case is that wages have risen under this policy in relation to the cost of living and productivity, contrary to the Govern- ment's prices and incomes policy, which is a different matter.
I am grateful to the right hon. Gentleman for confusing the matter a little further. What is he now saying? Is he saying that wages have not gone up too high in his opinion?
It has failed from all these points of view, including the worker's point of view. I suspect that when, earlier in his speech, the hon. Gentleman gave figures about real increases in earnings under the Labour Government as compared with the Conservative Government, he was leaving out of account the very important and large effects of increases in taxation under this Government. The real take-home, keep-in-your-pocket pay has not gone up.
We are now on to the real basis.
I want to finish on this theme of how the workers have failed to get a fail deal within capitalist society. This is, after all, part of the purpose of our political activity. I am glad that the right hon. Gentleman agrees that capitalism has failed to solve the problems of the workers. Hon. Members opposite cannot have it all ways. What have we had in the post-war years? We have had a succession of Chancellors from both sides blaming wages for our economic problems. They all said that wages were too high. Not one has failed to make that comment.
We had a long succession of policies put up by right hon. Members opposite. Most of those present opposite were in the House when those policies were being designed. The policies included the pay pause and the plateau. Mr. Harold Macmillan clung desperately to some sort of plateau. He said that high wages were ruining the country's economy. There were the "three wise men" and the N.I.C.—better known as "Nicky". We have had all sorts of delightful titles, but now we are on prices and incomes. It is the end of a long line of policies exclusively designed to restrict wage-earners' rights.
All our Governments, from both sides, have accused the wage earners of getting too much out of the economy, or taking something to which they were not entitled, and it is utter nonsense. But because the idea has been propagated for so long, we are living in a low-wage economy, and this is our problem. It should be the job of every hon. Member to shout as loud as he can that the solution to our problems is in higher wages. These difficulties have been with us so long because we have always tried to argue that wages are far too high.
Let us take this situation in Fords as an example. In the headlines this week the new settlement has been described as the most magnificent since the war. Much Press praise has been given to it. The settlement was made by Mr. Blakeman, who is now to become a Government employee. But is it such a magnificent achievement? Let us examine the position. The skilled worker at Fords in 1939 was earning 2s. 5d. an hour, or £5 16s. a week. At that time, Fords believed in a high-wage philosophy. That was the basis of the firm's ideas. Indeed, it paid wages higher than in most other industries at the time.
Under the so-called magnificent new agreement the new rate is £25 6s. 8d. a week. But the index of retail prices shows that the Ford workers should be £5 better off in order to maintain the 1939 standard. No one can challenge the fact that a man earning £5 16s. before the war could have a higher living standard than a man earning £25 6s. 8d. now. None of us can challenge it.
It is difficult to make comparisons in their case, because so few of them are eligible to claim equal pay. There are not so many doing manual work and, therefore, equal jobs. Before the war, there were even fewer. There is no real comparison. However, the agreement is a magnificent step forward for them and I congratulate those who negotiated equal pay. I would like to see equal pay brought in throughout the country, which can afford it and should do it.
The point I am making is that we have not improved the lot of the workers over those 30 years of capitalism. All these wages policies have failed. A London busman, earning £4 10s. a week before the war and living in a council house, is now worse off after 30 years of capitalism. We reject this intervention in the whole process of wage agreements. It has failed. There is no such thing as a free-for-all. There is no employer standing at the factory gate handing out bonus packets to workers. Wages have to be fought for, and in the case of 10 million workers in this country they have to be earned by piecework conditions. Their wages are measured by their individual output and there is no free-for-all.
The hon. Gentleman asked someone to contradict him on his claim that the Ford workers now are not better off than they were in 1939. He gave £5 15s. as the wage then and £25 as the wage today. What he did not give was the purchasing power of the £ in those two years. The internal purchasing power of the £ today is about one-third of what it was in 1939. On that basis alone, the worker today is far better off than he was in 1939. Further, the social benefits that he now draws are incomparably higher than they were in 1939. Therefore, the hon. Gentleman's argument is not true.
The hon. Member shakes his head, but the Government disclosed these figures a fortnight ago. If we take the 1938 basis, the £ today is worth 5s. 5d. If the hon. Member looks it up in HANSARD, he will see that I am correct. I am sorry to take so long, but I seem to provoke so many comments.
As to the change that is taking place, of course there is an increase in the social wage; of course the Labour Party and the Labour Government have done an enormous amount to increase the social wage. The family wage has gone up, but the fact is that if wives were not working there would be a wage revolution. It is the wages of working wives who augment the wages of their husbands that enable this situation to continue. That is the point. These 30 years of capitalism, these wage policies, have singularly failed. It is our job to support the workers at last, and to pay no attention to the voices opposite, but to try to do all we can to change the policy of the Government.
Connossieurs of incomes policy may well have felt that they had been summoned to a requiem this afternoon when they saw the terms of this Motion, because there was a widespread expectation—and that eternal optimist the hon. Member for Tottenham (Mr. Atkinson) certainly felt that there was some indication of it—that the Government would make an announcement that we were seeing the withering; away of the statutory obligations which now attend the Government's prices and incomes policy.
That certainly was not my understanding. I turned up at a wake expecting to find the widow in her weeds, wailing and saying, "Yet it was a great policy while it lasted." But there has been none of that; she is unrepentant. Admittedly, the policy is yet again to be evolved when the present legislation comes to an end, but the Minister was more disposed to apply the kiss of life than to wail at its passing.
So now we move to a new situation. What did the right hon. Lady say? I made a very careful note. She said that the policy had made a modest but vital—and that is the key word—contribution to the Government's economic strategy. That other eternal optimist, the hon. Member for Newport (Mr. Roy Hughes), concentrated on the modesty, and said that even Aubrey Jones had said that it only made a modest difference in one of his many Prices and Incomes reports. "Vital", was the word used by the right hon. Lady. It reminded me of Browning's lines:
Oh, the little more, and how much it is! And the little less, and what worlds away!
There is no doubt what is the psychology of the Government in the
highest places on this matter. The office has transformed the holder. Whatever scepticism the right hon. Lady may have had about the ability of the Government to intervene in industrial processes before she went to the Department, she is now as enthusiastic an advocate of prices and incomes policy, as we understand that term, as was her predecessor. It was Talleyrand who said, "Pas trop de zéle," and it is the sheer enthusiasm of the right hon. Lady which begins to worry me, an enthusiasm particularly evident when she waxes about productivity.
That is a five-syllable word, almost invented for the politician. It has that ring of solemnity and dignity which so appeals to the Privy Councillors. According to the Prime Minister, such productivity agreements must be "copper-bottomed", "stringently tested", says the Chancellor, "genuine", says the White Paper, Cmnd. 3590, under which we now operate the policy.
My right hon. Friend the Member for Mitcham (Mr. R. Carr) was kind enough to refer to the digging and delving I do by way of Parliamentary Questions to find out a little about these productivity agreements. I take one instance only, which refers to a pay settlement affecting the 600 fitters employed by Swan Hunter and Tyne Shipbuildiers. I will not weary the House with the full quotation, but there were Questions on 19th December, 31st January, and 7th February, to establish exactly by what amount earnings had gone up as a result of the productivity agreement and by what amount productivity had gone up by that agreement.
I was told, on asking on Friday, 31st January,
What have been the percentage increases in rates, earnings and productivity over the past two years",
settlement superseded a variety of rates and earnings in five different yards. Information in the form requested is not available."—[OFFICIAL REPORT, 31st January, 1969; Vol. 776, c. 391.]
Then, in all innnocence, I asked on what criteria the Minister determined whether or not the recent pay settlement affecting the 600 fitters employed by Swan Hunter and Tyne Shipbuilders fell within the incomes policy in view of the fact that information indicating the estimated percentage increase in rates, earnings, and
productivity arising from the settlement was not available? "Ah," says the Under-Secretary:
This settlement has been examined in the light of the criteria set out in the White Paper,…(Cmnd. 3590), and the company has supplied my Department with sufficient information for that purpose."—[OFFICIAL REPORT, 10th February, 1969; Vol. 777, c. 206.]
But not sufficient is available for the House to be told. Not sufficient information for us to know by what percentage the increase had been. I was prepared, being reasonably good-natured, to let that pass, to say no more. These things happen, I am sure. There was probably a very good example, and tradition in this part of the world and in this company, of increasing productivity and we could take it for granted and give the benefit of the doubt to the Department. But only a few days later I saw a Financial Times headline which said "Fears that Tyne shipyards productivity deal is misfiring." This was referring to other workers than the 600 fitters to whom I have referred, but it is the same area of employment, the same group of employment.
I quote briefly from that article. It says:
The pay and productivity deal recently agreed for 3,000 boilermakers, shipwrights and blacksmiths "—
I am not now talking about 600 fitters, but people in different employment working in the same area—
in the Tyne Shipbuilding Consortium and described as heralding a new era on the river is said to be misfiring. Nine weeks of operation have shown that while most of the men are receiving higher wages under the agreement they have not increased their production in line with this. … Sir John Hunter has revealed himself as unhappy about this state of affairs. He warned that unless productivity increased in line with higher wages a 'hopeless future' faced the yards.
I make no comment on that, only to say that when a Minister acts with the enthusiasm and certainty with which the right hon. Lady acts I am somewhat puzzled when these situations come to light.
I pass to the second point, which very much flows from the first. There is a little bit of sleight of hand going on and the House should be forewarned. We should apply our own early-warning system to what I suspect the Department of Employment and Productivity is up to concerning the pay of the chairmen of nationalised industries.
I am glad to have the substantial support of the hon. Gentleman.
Some may remember that a while ago the pay of Mr. Jocelyn Hambro excited a degree of comment, mostly from hon. Members opposite. As a result, it was announced that the National Board for Prices and Incomes—that repository of knowledge, dignity and discernment—was to carry out a wide-ranging investigation. We thought, "Perhaps now we shall know a bit more about what goes to make the pay of the successful entrepreneurs, managers and executives in the private sector." But there is now a widespread expectation that this report is to be used as an excuse or pretext for a substantial increase in the pay of chairmen of nationalised industries. I am not entering into the muddy arguments about whether they are being paid too much or not enough. I am merely concerned at this point to try to alert the House to what is happening.
I am immensely suspicious about what the Secretary of State said this afternoon. Again, I noted the words. She talked about "loose comparability" and her anxiety to ensure that the public sector was treated no less favourably than the private sector. This could be open to very interesting interpretations. For instance, it could be said that the right hon. Lady is anxious to ensure that the public sector chairmen of nationalised industries are treated no less favourably than their counterparts in the private sector. That is an interpretation which will increasingly be put on her words.
Having decided that the pay increase for the chairmen of nationalised industries should proceed to bring them in line with their private enterprise counterparts under the term of "loose comparability", we shall be interested to know at what speed it will prevail. May we be assured, even this evening, that it will be at a speed no more than the permitted ceiling of 3½ per cent. per annum? Make no mistake: that was the rule which was applied to the workers at Glasgow Airport.
I wish to verify that by quoting from HANSARD an Answer given to me by the
Under-Secretary of State concerning the pay of staff at Glasgow Airport. I will not quote it entirely, but the Under-Secretary, the hon. Member for Don-caster (Mr. Harold Walker), referring to the claim which had been made by the staff at Glasgow Airport, said:
The Government were informed that the claim for British Airports Authority rate"—
which was what the Glasgow staff were asking for—
was based on comparability, and as such increases are limited by the ceiling to an annual rate of 3½ per cent. it was not consistent with incomes policy."—[OFFICIAL REPORT, 5th November, 1968; Vol. 772, c. 61.]
Three and a half per cent. was the rule for the staff at Glasgow Airport. There will be a widespread expectation that the same rule will apply to Lord Robens.
I assume that comparability will go further down the scale. I assume that the deputy chairman and all the officials and staff will also ask for comparability and that then all the workers in similar industries will ask for comparability. I assume that the Minister will give exactly the same treatment to them.
That undoubtedly hostile question was more intended for the hon. Gentleman's own Front Bench than for me.
I should like to touch on another aspect of the policy which clearly increasingly occupies our mind when we talk about the next stage. What I say may not entirely please all of my hon. Friends. I refer to the belief that, somehow or other, there can be a voluntary incomes policy which is sub-contracted to some outside agencies and bodies, and that, in particular, the T.U.C.—one might say, quoting the right hon. Lady, "even the T.U.C."—is conceived as possibly having a rôle. With that zeal and enthusiasm of which I have already spoken, she has told the House that she is having consultations with the T.U.C. about what rôle it might have, presumably as some kind of supervisor of a voluntary incomes policy.
The assumption that non-unionised members will be subject to the same restraints as unionised members I leave on one side, because that is an argument which hon. Members opposite will be par- ticularly keen to deploy. I ask the House to consider the willingness of unions to accept T.U.C. supervision. This debate could not have happened at a more apt time in this respect. We have just seen the T.U.C. trying to arbitrate in the very delicate situation in the steel industry between blue collar unions and the A.S.T.M.S. and the C.A.W.U. It would be indelicate to quote what Mr. Clive Jenkins has had to say in reaction to the finding of the T.U.C.
I should like to go back a little further to the annual conference of the Clerical and Administrative Workers' Union, in March, 1967, when Mr. David Currie, the president of that union, discussed the possibility of the T.U.C. having some rôle as supervisor in a so-called voluntary incomes policy. I quote from the Financial Times:
Referring to the T.U.C.'s proposals to run its own incomes policy, Mr. Currie said: 'We cannot say that Congress will succeed in applying such a policy. We do not know if it has the skill, the knowledge and the authority to make it work.'
The report goes on:
Mr. Currie pointed out that the T.U.C. entered this field with substantial weaknesses. It represented only about one in three of employed people and about one in five non-manual workers.
The situation which exercised the mind of the president of the C.A.W.U. back in the spring of 1967 has been exacerbated considerably by the dispute which is proceeding in the steel industry.
We must, therefore, realise the ineffective sanctions which we can expect from the T.U.C. in applying such a policy. The idea that we can have a voluntary incomes policy is an illusion. It would be a farce. To be told that it would be a subsidiary rôle in economic policy is relegating it to being a mini-farce—and it is not much the better on that account.
The hon. Gentleman is presenting a very interesting point of view. Apparently, he is opposed to the prices and incomes policy adumbrated by the Government. He has observed that a voluntary policy supervised by the T.U.C. would be of no value. What does he want? Does he want a free-for-all? Does he want the workers to place a higher, and reasonable, value on their labour before they hire it out? I would accept that, but does the hon. Gentleman want it?
I will—as the next part of my speech was headed—"Reality".
I want the Government to confine themselves to what I believe to be their prime and indispensable economic rôle. The most important function which they can discharge in this respect is in relation to the money supply. We come back to an argument which might have been dismissed out of hand by those who were brought up and whose arteries were formed in Keynesian days—dare I say such provocative words to the right hon. Member for Easington (Mr. Shinwell)?
I assure the right hon. Gentleman that those who argue that economic policy and Government control of economic policy should proceed primarily through the money supply and balancing aggregate demand of the resources available, are receiving not merely considerable encouragement from current economic trends and thinking, but that the Government are reluctant captive converts to much of this as a result of the tutelage which they now receive from the International Monetary Fund.
To those like the hon. Member for Penistone (Mr. John Mendelson), who imagine that this is a policy which is socially regressive, and like the right hon. Lady, who was brash enough to talk about her policy as oriented towards social justice, let me say that the policy today with its heavy emphasis on inflation that we have experienced over the last few years, has not benefited the workers in this country.
No, I will deal with this.
The hon. Member for Dunbartonshire, East (Mr. Bence) can shake his head, but I call in the ample reinforcement of the hon. Member for Poplar (Mr. Mikardo) on this point. It has been the rentier class which has benefited most from inflation. A study of the Financial Times index will prove that all the increases in prices or in wages or salaries about which we have talked today have been outstripped by the rise in that index. It is the rentier class which is the major beneficiary of inflation. If the hon. Gentleman really is dedicated to social justice he should be arguing on the side of those like myself, who claim that the prime responsibility of the Government is to control inflation by controlling it at the very source—
As a toolmaker, in 1932, 1 worked for a company in the Midlands which provided bicycle racks for its workers. In the same plant, in 1951 those racks had gone, for a car park.
I am grateful to learn this from the hon. Member for Dunbartonshire, East but I cannot understand its immediate relevance. If it is the argument of the hon. Member that only inflation provides rising living standards for the working population, then he is denying to his eyes the evidence of the progress of other countries which have had similar rises in living standards not accompanied by inflation.
Just before the hon. Gentleman returns to his peroration, I want to welcome his appeal that we should all return to reality. He has just done so by disclosing that he fully agrees with the kind of policy that the International Monetary Fund might try to impose. In speaking of the salaries of chairmen of nationalised industries he mentioned muddy waters, but he did not tell the House that it was his hon. and right hon. Friends who pressed the Prime Minister to put up the salaries by several thousand pounds.
I made the specific point that I was not seeking to judge whether or not the salaries should go up; I was merely saying that the Government, having landed themselves with this policy, and to be consistent with their policy, were pledged to behave in a certain fashion. It was no more than a deliberate attempt to acquaint the House of that. Those of my hon. Friends who see cause to object to the policy are perfectly entitled so to argue, as I would. However, I will not be deflected from my peroration, because I accept that the advice that has been offered by the International Monetary Fund is some of the best economic advice that any Government have had to listen to during the post-war period.
Our success in turning that good advice to reality and achievement depends on the willingness with which the Government are prepared to abandon their present concepts, to accept price and profit as major determinates in a market-oriented economy and to relegate prices and incomes legislation to the medieval dustbin from which it should never have emerged.
The hon. Member for Oswestry (Mr. Biffen) made a very interesting and entertaining speech. I concede that he has a certain ability to spot the sensitive areas of hon. Members on this side of the House. I do not know whether it is a natural ability or whether it is something which he has acquired, but he is not bad at it.
I will address myself to points which are of concern to this side of the House. The argument about prices, incomes and productivity is taking place on this side of the House, by which I mean within the Labour and trade union movement. Hon. Members opposite have nothing to contribute since they are not genuinely interested in solving the problems of the workers and there is nothing wrong in admitting this.
I am delighted to see my right hon. Friend here. At the risk of damaging my reputation as a dark horse, I hope that she will take note that I intend to support her. I say that deliberately. This has been a bad time for me. The hon. Member for South Ayrshire (Mr. Emrys Hughes) described me as Right-wing, and he has called me "safe". I am a little perturbed at being labelled safe; it might be misconstrued as having something to do with supporting family planning. The hon. Member for Edinburgh, North (Earl of Dalkeith) suggested that anybody on this side who dared to try to understand what the Government were trying to do was just a gullible cohort of the Prime Minister.
We on this side have some hard thinking to do. I do not agree with my hon. Friend the Member for Tottenham (Mr. Atkinson) that there is no support for, not necessarily the Government's prices and incomes policy, but no support for an attempt to find a satisfactory prices and incomes policy. There is a difference here.
I say that notwithstanding conference decisions. I am not unduly influenced by Labour Party conference decisions. This is probably because I have never been in a majority in their decisions in the past, and have never been able to argue from a position of strength knowing that I have a party conference decision behind me. Usually I am more concerned in case someone in party circles expects me to toe the line, since I do not agree with so many decisions which have been made. I am surprised at some of my colleagues who use the argument that at last we have a party conference decision with which we can agree as if it were the be all and end all of everything in the Labour movement.
Unlike so many other problems associated with prices and incomes, psychology plays a bigger part in our attempt to understand the criticisms than the logical analysis that we delude ourselves we are making.
I say that because of the very frustrations and difficulties involved in finding the right economic policy, as one who is attempting to understand what the movement is about. Such people as the gnomes of Zurich, the I.M.F. and other vague figures behind the scenes who seem to be able to make decisions over which we have little or no control, help create those difficulties and frustrations, causing comrades in the labour and trade union movement to fasten on to something which they can understand, namely, "Let us get a conference decision in our favour". Some of my hon. Friends make more out of getting a conference decision than of facing up to our economic problems and the difficulty of finding the right solutions, and I want to look at the psychology which arises from it.
I am sure that all hon. Members accept that wages have risen faster than prices. However, people outside this House do not, and wage earners do not. I am not condemning the Government for that. I merely say that there is something wrong somewhere with the thinking and approach of many people in the Labour and trade union movement. They do not accept the facts. They work on impressions, on what they want to believe, and this is the responsibility of some of the critics on this side of the House who are not encouraging people outside to make a critical analysis of what is happening. They are not asking them to examine the facts. Instead, they are playing on their misunderstandings and impressions in an effort to gain support. I suppose that we are all guilty of this from time to time, but it is beginning to get out of hand.
I am usually quite careful.
I will give another example of what I mean. It arises at any conference in a housing estate where people are concerned about their rents. The impression one gains is not that the National Board for Prices and Incomes reported that rents in Scotland should not be increased by more than 7s. 6d. a week unless there were exceptional circumstances. The argument put up by the tenants is that the Government have said that rents have to go up by 7s. 6d. every year. In other words, there has been a failure to get across what the Government have done and what the National Board for Prices and Incomes has said.
Another example is transport. The attitude of people on housing estates such as those in my constituency is that transport workers have had a raw deal because wage increases have been the subject of difficulty. I have not time now to go into the complications or arguments involved. But those who argue that we should have done something to help transport workers are the very people who are most vocal in their criticism when fares have to go up to pay for wage increases. They cannot have it both ways. I am not objecting to wage increases, because I think that the rates of pay in the transport industry are a disgrace and are one of the reasons why we have poor services.
Some of my colleagues have a tremendous responsibility for not turning the minds of our own supporters to the problems which we are trying to solve. I concentrate on my colleagues, because I am not concerned with that lot opposite or about what they say.
To give another example, recently I attended a teach-in on productivity organised by the Post Office Engineering Union. I regard that union as a first-class body. It is well organised and operates in an industry which offers every opportunity for arriving at good productivity agreements. The union had just negotiated a substantial increase at a time when the Post Office had also announced increases in telephone rental charges and television licence fees, and I was surprised to hear a member bitterly condemning the increase in gas prices following a wage award in the gas industry. It is that sort of inconsistence which perturbs me, and it raises problems which it is for the Labour and trade union movement to find solution. No contribution can be made by hon. Members opposite.
I ask those who have signed the critical Amendment, how they would protect the unorganised workers. How, for example, do they propose to deal with the civil servants? There is something in this criticism. Those responsible for the Amendment are skilful, in exploiting the divisions on our side of the House. But what is the logic of the development taking place? Is it that we should encourage civil servants to be more militant and indulge in industrial action? Is it that we should encourage bank employees to do the same? That is the logic of the policy which too many comrades are pursuing at the moment, and I think that it is dangerous.
It is the kind of policy which many right hon. and hon. Gentlemen opposite want the trade union movement to adopt, so that a climate can be created where they can make their attacks on the movement if and when they ever get back to power. There are warnings for us all in this situation.
Let us look at the attitude which lies behind the critical Amendment supported by a number of my hon. Friends. It refers to the extent to which legislation restricting wage and salary movements has hindered both legitimate trade union activity and economic expansion. I am addressing these questions as much to myself as to some of my colleagues, because I do not know the answers. Equally, I am sure that it is not good enough for trade unionists and their leaders merely to repeat that collective bargaining means free collective bargaining and that, no matter what the effect on anyone else, if they can get an agreement out of an employer, no one has the right to interfere. I do not accept that. It is time that more active trade unionists faced up to their responsibilities and said that they do not accept it, either.
Does it follow that, because one has strength, because one can win a wage award, one has no responsibility if it means putting a company out of the export market? Does it mean that one has no responsibility to feed back some of the extra in productivity to the consumer? Surely it is time that someone said, following a wage agreement, "What about the social services that have to be provided? How do we provide for them?". These are matters which concern us all.
Finally, who is to determine the rewards to which people are entitled? Who determines the relative importance of the doctor, the university teacher, the joiner, or the civil servant? Has anyone worked out a way to answer those questions? I recognise that the contribution of the man who sweeps the streets, in some cases, is greater than that of some professional people. But we need to rethink our attitude on what constitutes a contribution to the community. Is it to be measured simply in terms of the length of apprenticeship that we serve or the academic skills that we have? These are all problems for us, but they are all linked with trying to find out what is a just prices and incomes policy.
I do not know what Marx would have said in 1969. I am concerned about what my comrades are saying in 1969. If they bring Marx up to date we might get more constructive thinking.
I am perturbed about the psychology of our present situation, because of the attempt that seems to be made to direct this hostility against the Government. I want to discuss it and thrash it out.
I took down some of my right hon. Friend's words, as no doubt did hon. Members opposite. However, I am not trying to be mischievous; I am genuinely trying to be helpful in the interests of my party and the people that I represent. I thought that my right hon. Friend said that we must look to the future and decide whether we need a statutory policy. If it is any comfort, I share her dilemma. I do not say this in any critical sense, but I should almost like to pray. I have never believed that it did any good, but I pray that we can find some way of uniting the Labour and trade union movement. I think my right hon. Friend is desperately anxious to do this. But it is not helped by the assumption made by many outside and inside the House that the Government are hell bent on being bloody minded with our supporters. I do not think that they are doing it deliberately. It may be that some members of the Government almost enjoy doing it—that is a different matter—but I do not think that it is being done deliberately.
We have plenty to sort out. We need to do something about salaries and dividends. We get a lot of fun from the funny men opposite about the salaries of chairmen of nationalised industries. I think that this will be difficult, but we must do something.
We need to be seen to be doing something about the William Hickey society. It should not always appear as though we are trying ot placate the C.B.I, for the sake of getting some agreements. We are living in a class society. We cannot always get agreements, so why should we be so anxious to get agreements? Usually when that happens we are being jockeyed into a position in which we should not find ourselves.
I should like to encourage the workers to be more militant. It is ridiculous in this age that the workers should have no say about the salaries paid to management or the fees paid to directors. Directors and management can take their half days off to play golf, have their works outing, or have their cars run for them. They can do many things. I should like to see the trade unionists in the factories demanding that these things be made public and having the right to express their views on what should go on, not just as it affects them directly, but within the orbit of the factory or the company employing them.
Finally, concerning "In Place of Strife". If we can find ways and means
of dropping some of the offending things and convince our comrades in the movement that we are genuinely trying to seek a solution in the interests of all and if we can link it with ideas which might come out of the Budget, then, in the words of the Amendment, I think we can look forward to an economic policy which contains
…the promotion of a constructive and socially just economic strategy.
I hope that those are not just words which have been stuck on the Order Paper. In my innocence, perhaps, I genuinely believe that there is a willingness on the part of the Government to come up with some of the answers to the difficult problems with which we have been faced for so long.
I am glad to have the opportunity of following the hon. Member for Glasgow, Provan (Mr. Hugh D. Brown). Coming from an industrial conurbation myself, I share his feeling that the Government have failed lamentably to get across their prices and incomes policy to the industrial workers of this country.
My diagnosis of the Government's failure to have their policy understood may be different from that of the hon. Gentleman. First, I think that it is due to the humbug in the Government's policy about prices. If they had come clean from the start—as the Chancellor of the Exchequer, to his credit, has several times done in this House—and admitted that there must be substantial price rises, there would have been less disappointment by the public about the operation of the policy.
Secondly, I agree with the newly-appointed Professor of Industrial Relations at the University of Leeds, who says:
… it seems quite certain that it will never be possible to 'sell' an incomes policy to the labour market participants as a balance of payments instrument alone, or even primarily: the connection between the balance of payment and the shop floor is altogether too remote; nobody eats the exchange reserves after all, and if we do believe an incomes policy can help the balance of payments, we need to find some much more positive functions for it as well.
Having regard to the barren mutual petulance of both the Motion and the Government's Amendment, and whilst
bowing entirely to the total discretion of the Chair, I and my Liberal friends feel that the public interest would have been better served if the debate today could have been on the Amendment tabled by the hon. Member for Poplar (Mr. Mikardo) and his hon. Friends and the Amendment in the name of my right hon. Friend the Member for Devon, North (Mr. Thorpe) and other Liberal Members. As it is, the Motion and the Government Amendment—the substance of today's debate—are, in my view, a prime cause of the boredom, and, in many cases, the despair which people in this country feel about the conduct of public affairs at present; namely, that we spend our time here in an idle ping-pong political match ignoring the real issues which give the ordinary people so much concern.
I admit that the Conservatives have been open to considerable temptation, because the state of equity in pay and conditions of work has never been in such confusion since the memorable time when my hon. Friend the Member for Orpington (Mr. Lubbock) first established himself in his constituency. At that time, as is well remembered, the Conservative Government flexed their muscles at the nurses, but trembled at the knees in face of many male workers receiving comparatively prosperous incomes. Now we have a Labour Government flexing their muscles at certain teachers and the builders, but trembling in the face of the doctors and certain other pressing claimants. Indeed, for many an Englishman who is the victim of the unfair part of the policy, his mortgage is now his castle.
The deficiencies in the Motion, I think, divide into two parts. First, there is a total lack of any constructive proposals whatever to take the place of the Measures which are so petulantly condemned. The reason is not far to seek. I will quote two Members of Parliament, although I have here a sheaf of evidence from other Conservatives which I will spare the House.
The hon. Member for South Angus (Mr. Bruce-Gardyne), writing in the Spectator on 13th September last about what he described as the "dilemmas of opposition", stated:
The classic example of this, of course, is the incomes policy. I cannot myself see any
possibility of devising a meaningful statement which will command the simultaneous endorsement of, let us say, Mr. Maudling and Sir Edward Boyle, on the one hand, and Sir Keith Joseph and Mr. Powell, on the other. So why try?
They have not tried.
The right hon. Member for Birmingham, Handsworth (Sir E. Boyle), who commands such great respect on all sides of the House for his robust independence, writing in a Conservative document, "Conservative and Economic Planning" published by the Conservatives in January, 1966, said
I just cannot believe on the evidence available that a slightly lower level of demand in the economy as a whole will of itself solve the problem of rising wage costs. And here I note wish paricular interest the views of the American President's Council of Economic Advisers, when they say in their 1965 Report that 'Powerful unions can and sometimes do obtain wage increases that outrun productivity, even when the labour supply is relatively abundant'.
I think there is also a danger in feeling that because no incomes policy can ever be anything like 100 per cent. effective, therefore it is not worth persevering with it at all.
Those who were present when the right hon. Member for Mitcham (Mr. R. Carr) opened the debate will recall that practically the whole of his speech was devoted to showing, which is such a facile task, that the incomes policy has not been 100 per cent. effective, or 100 per cent. fair. This in itself is to us not the real criticism of the policy.
The other aspect of Tory policy to which I should like briefly to draw attention is that all the remedies which they advocate when they are in a semi-constructive mood, which is as far as they ever get, are ones from which economic results can scarcely be expected within less than four years of attaining power. If they were in a political position, in the opinion polls, when they thought power was a long way off, it would be legitimate to regale this House week after week with the consequences which will flow from eventually reforming the trade unions, and eventually persuading the Inland Revenue that they have time to administer a new tax system and all the other vague Tory promises, all of which would take years to mature, even if they could work at all.
But the Conservative Party does not take the line that power is a long way off. The Chairman of the Conservative Party, his heart bleeding for the workers of Altrincham and Sale under the incomes policy, rallies the allegiance of Conservative lady canvassers, saying that it is time they got on their working-class hats, and got out canvassing for the election which the right hon. Gentleman says may be imminent. If the Conservatives believe that they are about to take power, they should compliment the House, they should treat the House with sufficient respect, to produce measures and suggestions which are capable of yielding some results within at least 18 months. I include within this condemnation of all measures which will take a long time to fructify the much more interesting, more stimulating proposals of the hon. Member for Oswestry (Mr. Biffen). His suggestions are more original than those which come from the Tory Front Bench, but they are certainly not instant remedies. In my part of the world Tory policy is dismissed as being very much like some Italian woollens—pretty to some tastes, but liable to fall apart in one's hands.
Our criticism of the Government's policy has been repeated from this bench time and again during the debates on the annual festival of incomes legislation to which the Government treats us, and I do not want to repeat at length what has been said from this bench on so many occasions. Our criticism remains, that in the incomes pool in which we believe any Government have to fish, this Government have been fishing with a series of rods, instead of with lines and nets. They have been looking at and interfering with, items here and there. They have been picking on small specific cases in this instance or that, rather than facing the real challenge, which is the challenge of the outdated nation-wide or industry-wide pay agreements.
We think that this is bad strategy, because they are not facing the real dangers to the economy, and also bad tactics, because time has proved that fishing with a rod, looking into these relatively small-scale applications for pay rises and agreements for productivity, is just impracticable, and cannot be successfully done.
What we want to see is bargaining at the plant. This is where the matter can really be dealt with. I think it was Carlyle who said that when an oak tree falls the whole forest reverberates, but that 10,000 acorns are sown in silence on the breeze. How true that is of pay bargains. It is in the day-to-day, in many cases hour-to-hour, bargains at the place of work that the significant pay increases take place, and the trouble about the nation-wide agreements which the Government persist in tolerating is that they create an unnaturally high floor, on top of which the plant bargaining then takes place as an aggravating factor.
We should like to ban nation-wide agreements—we use the word "outlawed ". One method which occurs to us is that the relevant part of the Restrictive Trade Practices Act which now excludes the trade unions might well be repealed, or re-enacted in a looser form. In the meantime, we should like to see teeth given to the new Commission for Industrial Relations so that it will have legal sanctions for something more than just obtaining information, which is the only sanction we understand it is likely to have. We should like to see it given power to intervene where it feels that important plants are not developing their plant bargaining arrangements. Secondly, we should like to see early legislation to secure the independence of the shop steward, who in future will be the key figure in operating a sensible and modern system of plant bargaining.
We do not altogether distrust the right hon. Lady's intentions. No doubt she recalls that before the Bill, which is now the Act, was given its Second Reading my right hon. Friend the Leader of the Liberal Party and I went to see her. We put to her our points about the dangers of persisting with nation-wide agreements. I am not quoting the right hon. Lady exactly, but the impression that she gave us was that she was in sympathy with our point of view, but that she must allow one more round of national agreements. We all know from our experience as parents that it is when our children ask for one more lollipop, or another quarter of an hour before going to bed, that that is the moment when the sensible person resists. But there is a further reply which is often given and which is even more dangerous than just giving in. That is when the parent says, 'You will have to go and ask your Dad". What has often happened in recent weeks is that people have been sent to ask Dad in Downing Street, and they have got practically all they wanted, very often to the public disadvantage.
We believe, too, that early legislation to make works councils compulsory, and to give them certain powers in bargaining, is required. We are not altogether unhopeful that we shall see this from the Government, although nothing of the kind matured during the period of Tory power. In the meantime, so long as the present policy is so obviously failing to work, the victims for whom we are most concerned, are, first, the pensioners, who have no redress from the results of inflated pay claims based on the monopoly power of certain unions which at present goes unchecked, and those who are low paid.
The people in my constituency who understand the incomes policy, and who were delighted when I joined my hon. Friends in supporting the Government against certain wrecking Amendments tabled to the Bill during the summer, are those who are weakly organised, badly organised, especially the women workers, who realise that, unchecked, the big unions will get away with it, and the weakly organised will suffer. It is a fact, backed up by fairly respectable research, that something over 20 per cent. of our working population are at present sinking into relative poverty because they are not getting their fair share of pay increases.
As I said in opening, as a result of the selection of the Amendment for this debate, we feel that we are witnessing an empty charade. While that charade is carried on, as it presumably will be, in both Lobbies, I shall have no hesitation, having heard all the debate so far, in recommending my right hand hon. Friends to remain firmly in their places.
I had not intended to deal with the Liberal Amendment, but I must make one or two comments on some of the points raised by the hon. Member for Colne Valley (Mr. Richard Wainwright). He and his party must learn something about industrial relations. I hope that he does not think that I am being pompous. In some industries a national agreement is essential, but in others it is not, and, there, plant bargaining is probably the best way. But if this were applied as a blanket across industry, the situation would be chaotic.
For example, would the hon. Gentleman suggest that the nurses in every hospital should negotiate within their own hospital and not have a nationally worked-out policy for pay and conditions? The question only has to be asked to provide the answer. Even in relation to the general principle of a national agreement in certain industries, does he not know that, in each industry, even where there is a national agreement, there are regional and local variations? The workers in a certain industry with a national agreement do not necessarily get precisely the same wage. An engineer working on Merseyside might not get the same as an engineer in Glasgow or Birmingham.
I therefore appeal to the hon. Member not to suggest that the panacea of all our problems and the answer to the prices and incomes policy is the blanket substitution of local plant bargaining for national agreements.
I do not think the hon. Gentleman in the least pompous. I would point out that I represent a constituency which is 99·5 per cent. industrial, with some very large plants as well as some very small ones, and, incidentally, a large plant in the automotive industry, to which the hon. Member for Tottenham (Mr. Atkinson) referred. I believe, as a Liberal, that there is practically no limit to the possibility of plant bargaining and I look forward to a society, perhaps in my children's time, in which nurses in each hospital will do their own negotiating. I do not think that I said anything to the contrary. Naturally, the training of a sufficient number of plant negotiators is a long-term business. I do not suggest for a moment that the matter can be attended to tomorrow.
I hope that no other hon. Member who intervenes will take up that much time, since it will mean that I will not be able to make my speech and that other hon. Members who want to speak will not have a cat in hell's chance of being called.
The hon. Member referred in his speech to the unorganised women in factories in his constituency. Without a national agreement, those women have little chance of improving their conditions if they are, first, unorganised, and, second, bound to rely on the fact that they have no strength in their plant. I will leave that, because there is nothing else to be said about the Liberal Amendment.
I suppose that, without examining the Opposition Amendment closely, and taking my point of view, one might vote for it. But when one looks at the words closely and then listens to hon. Members, one realises that one would not be seen dead in the same Lobby with them, certainly not on this Motion. It reads:
… noting that the attempt to control incomes by law has failed in its purpose…
I assume that that means that, if the attempt had not failed, they would be very happy with the policy of my right hon. Friends and that their objection is that it has failed—in other words, that incomes have gone beyond the criteria of my right hon. Friends.
This is really the argument. I listened carefully to the speech of the right hon. Member for Mitcham (Mr. R. Carr) and came to the conclusion that my right hon. Friend the Secretary of State is quite right—they are speaking with two voices. Immediately following this point about the Government's policy having failed, he said, "But look at what we did. Look at our policy following the 1961 pay pause. That did not fail; it did keep wages down." So the point is that it is all right keeping the workers' wages down, provided that laws are not used and one relies on the other traditional method, which is that the employer should resist every wage claim and allow protracted negotiations and arguments. Therefore, the right hon. Member's case does not commend itself to me.
I am in a curious situation regarding my right hon. Friend the Secretary of State. I have a sort of love-hate relationship with her—not in a personal but in a political sense. There is no doubt that, today, she argued a very bad case extremely brilliantly. She is a good Minister—probably one of the best Ministers that the Government have. I have always believed this. When she took her present job, I asked her, "Do you really believe in this policy?" She said that she did, and she does. That is the great tragedy. She passionately believes that the policy of incomes control and the prices and incomes policy generally is the right one for the Labour Party.
My right hon. Friend has the enthusiasm of the new converts to the Church, who are always more dangerous than those who were born into it. They proselytise with much greater vigour and sometimes with much more disastrous results than those who accepted it as natural from the very beginning.
Although my right hon. Friend argued cogently, she dealt in a peremptory fashion with certain points. I particularly have in mind the position of building workers. I accept that these workers want all the things she said they want. After all, conditions in the building industry have up to now been appalling. The "labour only" contracting system is pernicious and dangerous and we must try to control it if we cannot eliminate it altogether. I trust that as a result of the activities of the working party, which is now looking into this matter, this system will be eliminated.
It is true that the building workers want proper productivity agreements throughout the industry. It should be remembered that the payment by results system was first introduced in to the building industry by the Labour Party, by the Government of 1945–50, and that it was George Isaacs who appealed to my colleagues in the building industry to accept the payment by results concept.
The trouble has been that this concept applies, even now, to only about 30 per cent. of all building operatives. Thus, only a small percentage of those in the building industry are able to enjoy the national working rule agreement. When the building workers found that the Id. an hour increase which had been agreed had to be rejected—hon. Members will recall the last ditch stand which they put up; it lasted only for a few minutes, so to speak, but at least they made a battle of it—they decided to turn their attention to an extension of productivity agreements with the idea of forcing such agreements on all employers in the industry.
I urge my right hon. Friend not to believe that simply because trade unions leaders in the building industry are totally loyal to the Labour Party and the Government they were not prepared to force a strike, and that all is well in the industry. Although a strike did not occur, mainly because of their loyalty, a residue of bitterness has been left in the industry which will take a long time to eliminate. This feeling of bitterness is particularly felt by workers who are not enjoying the ability to earn productivity bonuses based on the national working rule agreement.
The bitterness in my trade union branch must be experienced to be believed. When I receive letters from branches of the bricklayers' unions, my union and others, saying that their members are considering whether to continue to be affiliated to the Labour Party, it is obvious that the Government must note this trend, particularly since this bitterness has developed as a result of the unfair application of the prices and incomes policy.
In considering the agricultural workers, I agree with my right hon. Friend that the P.I.B. said that there was to be an exception. However, everybody knew that the pay of agricultural workers was lagging far behind that of other workers. Why was the matter referred to the Board in the first place? It was not the best sort of agreement the agricultural workers could have got, but they accepted what they were given and it is obvious that it should have been given to them in the first place, without argument. When I read in The Landworker about a branch of the union saying that its members are considering the whole question of their affiliation to the Labour Party. I am driven to urge my right hon. Friend to take note of this trend because this is the grass roots of the Labour Party speaking.
My right hon. Friend referred to the Economic Review of the T.U.C. I draw her attention to this comment on page 30 of that document:
The General Council are satisfied that trade unionists will respond to a positive challenge, but a negative and restrictive attitude on the part of the Government, expressed in and dependent for its enforcement on the legislative control of wages and salaries, to which the Trade Union Movement is opposed, is no way to win that response.
My right hon. Friend did not refer to that passage. I do not blame her. If I had been arguing her case I would have
ignored it, too. I quote it because it puts the matter in perspective.
Again, the T.U.C. says on page 34 of its Review:
Experience of the Government's incursions into the field of wage determination in recent years have made trade unionists wary of accepting Government participation in any form of incomes policy. There is genuine apprehension among trade unionists that any such Government participation would inevitably lead to the imposition of statutory limitations, rot only on voluntary collective bargaining but on trade union activities generally.
That is the authoritative voice of the T.U.C.
What is the attitude of the T.U.C. towards the prices and incomes policy? I do no: agree with the hon. Gentleman opposite who suggested that we want a free for all. That is not the view of the Trade Union movement. I do not agree that a voluntary system cannot operate, even within the context of the miserable, lousy, rotten capitalist system in which we live. The T.U.C. has consistently argued for a voluntary system and has opposed, all the way along the line, the use of statutory powers in this matter by the Government.
The T.U.C. set up a vetting system and even unions which were opposed to the Government's prices and incomes policy trotted along to the T.U.C. to have their claims vetted. The building workers did precisely that. They put their claim to the vetting committee and the T.U.C. said, in effect, "This is a fair claim, but we think that you should spread it over a longer period". The building workers replied, "If that is the view of the T.U.C, that is precisely what we will do". Thus, their claim was submitted on the basis of advice given by the T.U.C.; and the interim settlement for building workers was framed within the prices and incomes policy.
I accept that a minority of T.U.C. member unions have not wanted anything to do with voluntary agreements. However, the majority of unions affiliated to the T.U.C. have, all the way through, been prepared to accept such agreements. I am sorry that my right hon. Friend has left the Chamber. I hope that she will come back in a few minutes.
I want to deal with one or two points raised by my hon. Friend the Member for Glasgow, Provan (Mr. Hugh D. Brown). He made an excellent speech, but I did not agree with all of it. It was a speech that we have to take note of and to answer because it was the only challenge made to my hon. Friends and me this afternoon. He wanted to know why we were so dedicated to the Labour Party conference resolution, which appears almost word for word on the Order Paper in the names of my hon. Friends and myself. I make clear that we are not bowing to a great fetish. This resolution is included in the Amendment not because we honour all conference resolutions. Like my hon. Friends, during most of my life in the Labour Party I have found myself in opposition to most conference resolutions.
This resolution was on the agenda of the Labour Party conference because it had been passed overwhelmingly by the Trades Union Congress. We put it on the Order Paper of the House because it is the expression of the trade union and Labour movement throughout the country. [An HON. MEMBER: "Nine-tenths."] An overwhelming majority. That is why we believe the authentic voice of the Labour Party and the trade unions should be expressed in this House this afternoon. That is why we have put down the resolution and are supporting it.
My hon. Friend asked whether we want bank employees, civil servants, Post Office workers and others to be militant. I have never complained about workers being militant. I have always complained when they are not militant because they are more likely to get things when they are militant than when they acquiesce and lie down. We said that if this policy went through the workers would become more militant. Certain sections who have never been involved in industrial struggle would become militant as a result of this policy. This is what we warned about.
My hon. Friends appeared to suggest that it was because we were critical of the policy the workers reacted in this way. Ever since I have been in this House, since 1964, we have argued on Government policy on Vietnam. We were critical from 1964 to 1966, but we did not lose a vote because of criticism of the Front Bench on the Vietnam war. The average worker considered that that was some-think in the realm of international politics which he did not know much about.
Now we have had the House of Commons putting Order after Order against trade unions getting increases in wages and only a handful of Orders on the question of prices.
There was one on laundry prices. I said at the time that it was like closing the door when the horse had bolted.
The workers have understood this well. The policy that the Government have pursued has led to revolt by the workers. It has not been the criticisms which my hon. Friends and I have made of this policy. My hon. Friend asked how we determine the price, or the benefit to society, or the money that will be paid to an individual because of the particular job he does. I commented that Marx had worked this out a long time ago and my hon. Friend said that we should bring Marx up to date.
I do not want to go into Marxist economics, except to say that he pointed out that labour, like any other commodity, had a value attached to it and that the value was determined by the socially necessary labour time taken to produce that commodity. If one is a teacher or a doctor the socially necessary time to produce a teacher or a doctor is more than that necessary to train a joiner or a roadsweeper. That basically determines the value of the commodity, that is, the doctor, or whoever the commodity is. I say this in passing because it is sometimes essential to bear in mind that other people studied this problem a long time ago. So long as we have the capitalist system, unfortunately, that is the way in which the value of the commodity has to be determined.
The Amendment in the name of my hon. Friend the Member for Poplar (Mr. Mikardo), which has not been called, is quite right. It says that this policy
has hindered both legitimate trade union activity and economic expansion,
calls for the repeal of this legislation …
Obviously, my right hon. and hon. Friends will not repeal it, but I put this to the Government. I hope that there are no silly ideas floating about that once the Prices and Incomes Act has come to an end another will follow it, for that is the recipe for disaster. That would be the end of the line. I say to my right hon. and hon. Friends, "If that is the idea you have, forget it. Forget it now and take note of the attitude of the Labour Movement".
I was much encouraged by the fact that the Government were not prepared to defend their policy, except verbally and not by a written Amendment.
We do not want further legislation which would curtail basic trade union rights. Much of the White Paper is very valuable indeed. It is valuable because the trade union movement has been demanding that many of those things should be put into operation. But there are certain features of the White Paper—the conciliation pause or cooling-off period the question of interference in internal union affairs and forcing unions to have ballots, the attachment of fines to workers' wages—which the trade union movement will not tolerate nor accept.
That would be going in the direction in which hon. Members opposite want us to go. Immediately the White Paper came out they said that this was a step in the right direction, but did not go far enough. They spelled out what they want. They spelled it out in—another misnomer—" Fair Deal at Work ". They spelled out the whole policy of how the trade unions would be legally hog-tied with a battery of lawyers on every occasion when required. We are not having that. We have seen the experience in the United States. When there is an 80-day cooling-off period what happens? Dockers in New York have been on strike officially for more hours than our dockers have ever been on strike unofficially. Would it improve industrial relations? I do not think so. The dockers of London stopped work for another half day merely because some of their colleagues were suspended. Imagine what they would do if their wages were attached. That is no way to improve industrial relations.
The Government should drop the prices and incomes policy as it now applies and allow the Trades Union Congress to operate a voluntary system. If the Government drop these provisions in the White Paper, the Labour Party will once more be a united party and will go to the country united and determined to carry though the programme of Socialism upon which the movement was founded
In the part of his speech just before his peroration the hon. Member for Liverpool, Walton (Mr. Heffer) spoke about what will happen at the end of this prices and incomes policy. He sounded like the song—
I'll never say 'never again' again".
they have to. Again and again the hon. Member and his hon. Friends said that they would not stand any further impositions of incomes policy, but again and again they marched into the Lobbies and supported the Government on it.
The hon. Member for Tottenham (Mr. Atkinson) said something with which I fundamentally disagree, namely, that we on this side speak for employers and he and his hon. Friends speak for trade unions. He said that, because of this, it would be impossible for there ever to be agreement on industrial relations between the two sides of the House. This is fundamentally wrong. I do not speak for employers. I speak for the people of Harrow, West and for what I believe is the good of the country as a whole. I believe that the hon. Gentleman is not blinkered only to think of a trade union attitude.
I also think that the hon. Gentleman perhaps forgot his experiences during the years before he entered the House, because surely the partnership between employer, employee and trade unions in businesses and companies is the normal thing. It is disputes which are abnormal. There are discussions and disagreements, but there is a partnership and there could prove to be an even stronger part- nership. The hon. Gentleman was unwise to make that point as strongly as he did.
Hon. Members opposite have been in a terrible state in the debate. No two hon. Members have been able to present the same approach to the Motion, or to the first Government Amendment, or to the second Amendment in the name of the hon. Member for Poplar (Mr. Mikardo). The Government say that the policy is successful because it works and makes a vital contribution. The hon. Member for Huddersfield, West (Mr. Lomas), in a longish speech if all his interventions are added together, said that the policy is successful because it does not work. The signatories to the second Amendment, led by the hon. Member for Poplar, say that the policy is unsuccessful because it does work.
In a very good and touching speech, the hon. Member for Glasgow, Provan (Mr. Hugh D. Brown) genuinely showed the attitude of a Labour Member who wanted to find a way to support the Government. His was the first speech on those lines that I have heard for many years. He said that the policy is unsuccessful because it is not properly understood. On many occasions I had to defend unpopular, and not necessarily always totally right, policies of my party when it was in power. One says, "The policy is not understood. The public relations are bad". However bad the turbot is on British Railways, public relations will never make it into a good dish. However hard the Government try with their public relations, they could not make their prices and incomes policy successful.
Many rude things have been said about the Motion. I rather like the hon. Member for Poplar's Amendment and, had it been on the Order Paper earlier, I would probably have signed it. I am totally in agreement with it. The only thing I would have like to have had explained is what is meant by "basic trade union rights". If the basic trade union rights are to fight for the long-term security of their members, free collective bargaining, a higher long-term standard of living, and the right to strike in accordance with contracts of employment, which is what I think the legitimate basic trade union rights are, I should be happy to add my name to the other 39 names.
We must be grateful to the Government for one aspect of their prices and incomes policy, because it has shown for ever that statutory control of incomes is totally ineffective and will never work. It means that no other Government for the next 50 years need even bother to think about it; it has been tried; it has been given a tremendous run by the right hon. Lady the Secretary of State for Employment and Productivity, who has gone into the selling of it to her party and to the country with enormous gusto, but it has been a total and abject failure.
I believe that we are a low-wage, low-production society. Wages should be higher. Production should be higher. We are dogged by high taxation and economic unreality caused by Government interference in people's everyday lives. The most interfering aspect is probably this policy.
I want to examine why the policy has failed and what would have happened if there had not been this policy. The most depressing thing for the Under-Secretary of State for Employment and Productivity and other members of his Department must have been this sentence in Mr. Aubrey Jones's Third Report:
It would seem to indicate that the average annual increase in earnings in recent years may have been just under 1 per cent. less than otherwise it would have been.
So Mr. Aubrey Jones, who has studied this question as closely as anybody could, believes that if we had not gone through the whole paraphernalia of this policy incomes might have been 1 per cent. higher. That, I believe, would be a good thing, too.
Mr. Aubrey Jones did not speak about the industrial disputes which have been caused and generated by this policy. Nor did he mention, as the hon. Member for Walton mentioned, the dangerous loss of good will in industry which has occurred ever since this policy has been operated. Another reason why it has failed and why I, as a simple businessman, believe that there was the 7 per cent. increase last year, is that after a lot of argument, television appearances, threatened industrial disputes and possibly cups of tea in St. James's Square, a national agreement of 3½ per cent. is reached. A few weeks later the same discussions go on at the plant or in the company, but with less publicity, and after less discussion a further 3½ per cent. is agreed. That makes the 7 per cent.
If the right hon. Lady were to say that that is not how it works, I can say that it is. A business friend of mine told me the other day that in a situation such as I have outlined, he told the union official and shop stewards, "There has already been a national increase of 3½ per cent. The Minister says you cannot have any more". They replied, "It is not she who pays it. It is you. Give it to us." And he did.
I shall give the detailed reasons why I think that the machinery has failed. Paragraph 48 of the latest White Paper on prices and incomes and productivity says that where 100 workers are involved, or a smaller number if it would influence a larger total—but in general where fewer than 100 workers are involved—the increase does not have to be reported to the Ministry.
In the 1958 industrial census figures, which are the latest we have to go on, it is reported that 21 per cent. of employees in productive industry work for firms employing under 100 people. I do not believe that the employer or the unions in such a plant will say, "Perhaps we might have an influence on other companies in the same industry." They will go ahead and make their agreements. In the larger firms another 20 per cent. work in units of under 100 people, so in productive industry we have 40 per cent. excluded from those who report wage negotiations and agreements above 3½ per cent.
There are also the service, farming, catering industries, and so on. A figure is not available there, so my guess is as good as the Minister's. Let us take a figure of another 40 per cent. Therefore, I would say that about 40 per cent. of the total working population of 24 million are in units where it is unlikely that a wage increase of more than 3½ per cent. will be reported.
The policy has failed. How can we prove that, apart from the fact that the norm is nil, the ceiling 3½ per cent., and the actual increase 7 per cent.? The best proof was when the post offices in London, including that in the House, and in our cities were closed about three weeks ago. On the same day, 12,000 members of the National Union of Bank Employees were queuing up outside the House to see their Members. The fact that the post offices were closed, and bank employees were up in arms and militant because of the Government's incomes policy, shows the depth of the failure of good will that their policies have led to.
The bank employees were not particularly happy to hear, though they had sympathy with the case, that Aubrey Jones's Report about the farm workers had been thrown out of the window while they were rendezvousing outside at half-past two that afternoon. Nor would the ordinary users of the post office services, who found themselves greatly inconvenienced, have been happy had they realised, as we in the House realised, that the Government said, "You can have 7 per cent.", but would not give the Post Office workers 5 per cent. and talk about the rest.
The strike was because the Government offered 7 per cent., but would not give 5 per cent., and would not talk. Of course, the next day it was settled, and now we discover that the whole of this great and damaging strike was justified only by a saving of, I think, £50,000 on what was originally requested by the employees and was originally acceptable to the Postmaster-General.
What is most significant in the debate, and the whole question of the policy, is what is to happen at the end of the year when the present legislation runs out. We are told that discussions are going on, and then perhaps in the autumn there will be legislation on the new White Paper "In Place of Strife", a helpful and useful step towards "Fair Deal at Work". We are happy that the Government have started to learn something.
But it would be totally against the interests of the country for the Government to feel that they must justify their past actions and relegislate for a fourth term of the prices and incomes policy. I hope that they will realise that that if they do this, and even if their supporters in the House go docilely into the Lobby with them, as they no doubt will tonight, this final dose will be the death-knell for the Government in the minds of thinking people in industry—trade unionists and employers alike.
Having sat through this debate I am shocked at some of the ideas that the public must get of hon. Member's views on political economy. Speech after speech of hon. Members opposite seemed to suggest that workers from top to bottom in industry have an inalienable right to an annual increase in their wages or salaries.
The idea that, irrespective of whether we produce more or become more efficient, there must be an annual increase in our dividend, profit, salary, wage or professional fee, is the great disease from which we have suffered for many years. I am an engineer by profession, but to anyone who knows anything about political economy this is nonsense. There is no inalienable right to an increase in one's real income every year. It must be earned by society as a whole, by every man in whatever profession he happens to be. Speech after speech by hon. Members opposite has suggested that the incomes policy has failed, from some points of view because the workers have had too big an increase, and from others because they have not had enough.
What should determine everyone's increase in income and prosperity is what the individual produces and the energy that the group expend, in increasing productivity, whether it is a company or anything else. I wish that in our debates on economic matters more Members on both sides would bring home to the people that it is not Governments that create prosperity but those on the factory floor and the directors and managers of businesses. They create real prosperity, though Governments can help to create a climate for it and to see that there is social justice.
When I read the Motion, I was reminded of William Cobbett, an early 19th century Tory. His bitter complaint in "Rural Rides" was that, in this country, everyone was concerned and acclaimed success only with the planting of seeds from which they themselves collected the crops. No one was interested in planting trees which the next generation could enjoy.
The Motion says that, after three years, the incomes policy has failed. I could understand criticism of the shortcomings of the policy and the suggestion of an alternative. But to say simply that after three years it has failed is hardly giving it a chance. Three years in the life of a nation is nothing. Cobbett, in his essay, attacked that section of society which was concerned only with the immediate crop. I am surprised that the followers of Disraeli and Cobbett are now expanding this doctrine of, "Grab what you can and never mind the seed corn". Yet this is what the Tory Party is telling our people. Indeed, our seed corn was being consumed from 1959 to 1963, and we know the cost. But the Opposition still advocate it.
The hon. Member for Oswestry (Mr. Biffen) always makes interesting speeches. Although we do not always agree with him, we all enjoy his speeches. He wants to reduce taxation. I certainly hope that a Government will be able to cut Income Tax by 4s. in the £ one day before I die. But hon. Members opposite also want to increase defence. They want more roads and more schools. They think that doctors and teachers are underpaid. If, therefore, they are to reduce taxation, the only way in which they can get all the money which they want to spend is by creating it or borrowing it from the monetary system. Do they want to increase the monetary supply?
The hon. Gentleman says "Hear, hear" to both. The party opposite does not know where it is. Hon. Members opposite are confounded and confused by modern economy. They do not know whether Disraeli, Cobbett or Gladstone was right. They are the most confused ideological party ever to sit in opposition. The Motion shows it.
The speech of the right hon. Member for Mitcham (Mr. R. Carr) was enjoyable and an excellent contribution, as always. He said that the statutory control of wages was unjust and would not work. What is the policy of the Opposition? If they get back into power, they will abolish statutory control over wages but will introduce legislation to stop workers doing anything to try and get more money. They should make up their minds. First, they say that they are against statutory control of incomes; then they say that, if returned, they will pass legislation to prohibit groups of workers who feel unjustly treated from taking the necessary action to get justice in their wages.
In other words, it would be an offence. Surely a breach of contract is an offence. [HON. MEMBERS: "No."] Very well. I will withdraw the word "offence" and will merely say that it will be a breach of contract. Supposing workers find a contract unjust. Under the Conservative proposals, they will be debarred by law from taking action to renegotiate it. But I suspect that the employer who suddenly gets a letter from his bank saying that his overdraft is £750,000 and that it must be reduced to £500,000 quickly will find every reason for breaking the contract and making 200 people redundant. I do not see how that sort of legislation is going to work.
I support the Government's prices and incomes policy for many reasons. I do not say that it is an absolute success. I am not a perfectionist. I do not expect the Government or management or the trade unions to be successful completely. But they improve. We all learn. We British are wonderful people for experimenting. We are liberals—with a small "1". There are very few Liberals with a capital "L" left. I believe that the character of our people is such that we will experiment and go forward carefully. The Government have been careful in going forward with their policy. I remind the House that the previous Government made several attempts to establish an incomes policy and, indeed, had some success.
Of course, the mechanics of the thing are difficult. There has been an incomes policy for many years, including under the last Government, but the present Government have devised mechanism to give it a chance. Let us see how it works. I was apprenticed in the engineering industry in 1917, which is a long time ago. I quickly discovered that 80 per cent. of what I produced was consumed by the investing section of the community and the higher income group.
In those days when industrial action was taken it was not to obtain higher wages, but to stop the owners pushing our wages down. Nevertheless, 80 per cent. of what we produced went to the high income group. When we tried to get a bigger income for our labour, we were getting it out of people with vastly higher incomes than ourselves. What is the position today? In every industry 80 per cent. of production is consumed by the next-door neighbour. We are a mass production society. One of my hon. Friends said that the standards of the workers have not improved. When I was an apprentice toolmaker I earned half a crown a week, began work at 6 o'clock in the morning and finished at half past five at night. I was working for Is. 8d. an hour in 1932 and could just afford a bicycle and four cigarettes a day.
When anyone tells me that the working people are not better off than they were in the 'thirties then I say that they are not living in this world.
I must make the point clear. What I was saying was that the Ford workers' standards of living have not shifted dramatically from 1939. Thirty years of capitalism has not brought about a great improvement.
When I finished my apprenticeship I was canvassed by the Ford people who were then at the Trafford Park. We were offered jobs as toolmakers at wages of 1s. 4d. an hour. In 1939 the National Defence contribution was introduced. The country was crying out for toolmakers. All over Europe there was the demand, in Germany and France as well as Britain. Wages went from 1s. 8d. to 2s. 8d. My hon. Friend quoted the very year when there was a great drive in this country because we knew that our existence was threatened by Hitler.
My hon. Friend is wrong. I went to a rally in Wolverhampton in 1964 and the divisional organiser asked me if I was fed up with politics. I said:
No, not on your life, we will win this election.
He said that he would get me a job as a jig-borer—I was a jig-borer all through the war—at £42 a week in the Midlands. Let us not have any nonsense about this. Before the war the boat from Broomielaw to Rothesay was packed. It is not packed today, all those people are at the airports flying off to Majorca and Canada. The working people of this country have done well since 1939.
I would not go all the way with Mr. Macmillan who said that we have never had it so good, but we have had a fair deal in the last 20 years. As a Britisher and a Member of Parliament I will not stand by and hear people say that our standard of living has not been improved when it has improved considerably. Today we are producing washing machines, food mixers and all sorts of consumer durables, and when we push our wages up, we are asking our next-door neighbours to pay more, not just the rich. We are exploiting our fellow citizens.
Nothing, or, when they went for another job, that firm made an inquiry to find out why they had lost their first job There was no redundancy pay and very little sympathy from anyone when a man lost his job, not even from his wife, because money was short. Very few workers in the 'thirties had £200 or £300 in the bank.
I was talking with a bunch of workers in the local where I live, and they were playing the devil with me because of this campaign to increase motor taxation. One said to me:
I am paying enough now.
I asked him what his job was, and he told me that he delivered milk. Let us have a bit of reason in this. People are better off than they have ever been. This is a campaign to kid people that they are not. They are being kidded by the party opposite, and by my hon. Friend, although not seriously.
My hon. Friend must face the facts, he would agree that in 1939, skilled Ford workers were receiving £5 16s. a week. The equivalent today, under the new agreement suggested, is that the same workers should get £25 6s. 8d. I am suggesting that those two figures are about equivalent. As for the 30 years of capitalism, they have not helped the British worker.
Of course they have. There has been reference to 1939. But why start at 1939? Let us start at 1930.
My hon. Friend said that the Government should introduce a new policy. We do not want a new policy. I want a planned economy. I want the resources of this country to be planned. That is what I always wanted. We want to get rid of economic anarchy—this competitive jungle system. At that time, the Conservative Party also wanted to get rid of economic anarchy, of laissez-faire Liberalism. This was the argument between the Liberals and the Tories. The Tories wanted protectionism. They did not want free trade and economic competition. They wanted a regulated, controlled economy. So do we. The argument between us is about the best way of achieving it.
But the Conservative Party is so schizophrenic and divided in its views that it does not know where it is. It is courting the Liberals. It has even started to court our supporters. I warn those in my party not to be courted by the Conservatives. If they do, they will be in some trouble. I would not go so far as to say that they would get into the same trouble as the pals of my hon. Friend the Member for Fife, West (Mr. William Hamilton). But they should be careful about being wooed by the Tory Party. If these people were to get full range, and if some of the ideas expressed by hon. Members opposite were to be implemented, it would be a tragedy, not only for working people, but for small busi- nessmen. If the hon. Member for Oswestry had his way, not only would there be over 1 million unemployed, but many small businessmen would be in the bankruptcy courts.
When there is a request to curb the supply of money, the Government write to the joint stock banks asking them to do that. The banks reply, "Mind your own business". The Tory Party is telling the Government to curb the supply of money. But the merchant banks say, "Why should we? It would smash little businessmen". We must be careful about the language we use when we discuss these matters.
The point has been made several times that any attempt to put a statutory control on incomes has failed and must fail That is fantastic. All my life lawyers and solicitors have had statutory fees for property conveyance, and so on. They used to charge 7s. 6d. for writing a will. All their income is laid down by statute. There is a whole range of people—civil servants, nurses, doctors, teachers—whose incomes are statutorily controlled because they are employees of Government agencies.
Fancy the Black Watch and its officers having a meeting in Perth and deciding to send a deputation to the Secretary of State for Defence saying, "We are the famous Black Watch. We want another 10s. a week." Fancy the Royal Marines at Chatham sending a deputation saying, "We are the Royal Marines of the Chatham division. We have the best marines' band in Europe. We want another £1 a week". There would be civil war in the Army or in the Navy. These propositions are stupid. They are not worthy of the junior common room of the newest university. I have never since my school days heard such inept and controversial ideas as those put forward from the benches opposite tonight.
This is a new experiment; it has not been tried since the Middle Ages under the feudal system. It is the first attempt to bring some regulation into the distribution of incomes, which is the distribution of the product. That is what the distribution of incomes means: it means getting the product away, getting people to consume it and the regulation of its consumption. It is a new idea, and I congratulate the Government on tackling it. Of course it is unpleasant to those who have been brought up in the tradition of free bargaining. I can accept it easily, because most of my free bargaining with the employers was not free bargaining to increase my wages but to bring them down or to save the war bonus of the First World War. Young fellows in industry today do not know what it is to have the threat of reduced wages hanging over them; they have got used to their annual increment.
I have much sympathy with skilled men in industry, pattern makers, machine tool fitters, turners, who have to serve an apprenticeship. They see fellows going into offices and getting regular annual increments. I know that there is resentment about this. There was resentment in the motor plant in which I worked that everyone except those who worked on the shop floor received an annual increment. We began to look for the annual increment, and if we did not get it we fought for it. It is not right for politicians to kid the people that there is no need for an incomes policy and at the same time to say that there is an inalienable right in their hands to get an annual increment.
The argument from the other side is that productivity cannot be measured. Of course it can. Increased productivity can be achieved in a factory at a given point, and the men at that point may be paid more for increased productivity but, because of bad organisation, bad management and the bad movement of materials, the benefit of that increased productivity may be completely lost before the product gets to the gate of the factory. Nevertheless, it is difficult to measure productivity overall.
I compliment my right hon. Friend the Minister and I compliment the Government on undertaking a difficult task. I admire the way in which they have stuck to their guns notwithstanding the opposition in the country, and I wish them every success.
One of the more unfortunate trends that has run through the debate is the constant assertion by hon. Members opposite that they are the sole guardians of the rights of working people. This I reject, since I think that I represent more trade unionists and industrial workers than anyone else who has spoken.
In speaking of the increase in the standard of living of workers, we do well to remember that what counts is the real personal after-tax income. On real personal after-tax incomes, the record is quite clear; they rose twice as fast under the previous Conservative Government, and this was without a statutory incomes policy, as under the present Socialist Government. This is what the whole argument is about.
The right hon. Lady, in her opening speech, did not lay too great stress on productivity, and this perhaps is just as well. The planning paper which, apparently, was leaked to the Financial Times in December, 1968—and as far as I am aware this leak has never been repudiated by the Government—made it clear that there was no justification for projecting forward a higher rate of growth and productivity than that which took place between 1961 and 1966. If the paper is correct, that was an annual average increase of about 3·1 per cent.
In addition, we are told that the economic growth for this year will be about 3 per cent. Therefore, if one had a substantial increase in productivity with an increase in production of only 3 per cent., this would argue that unemployment will rise substantially. It is already high, and I do not think that anyone wants to see it go higher.
What is more important is to ask what has been achieved. In its Third Report, the National Board for Prices and Incomes said that the average annual increase in earnings in recent years may have been just under 1 per cent. less than otherwise it would have been. The Under Secretary said last summer that that represented a reduction in demand of about £100 million a year. As my hon. Friend the Member for Harrow, West (Mr. John Page) said, it seems to be an extraordinary exercise, the tearing apart of and a traumatic experience for the Labour Party and a harmful effect on industrial relations, to achieve a reduction in demand of £100 million a year.
I would put it to the Under Secretary that very probably the pre-Budget boom, a year ago, when the Chancellor of the Exchequer announced the tough Budget that we were to have and which did not come, was far in excess of £100 million worth of extra demand in the economy and certainly outweighed the advantages of a statutory incomes policy.
We want to look further. I would be interested to know the effect upon the balance of payments of the statutory incomes policy. I have never seen it quantified. My guess is that, in the short term, the effect is minimal.
The right hon. Lady spoke about the wonderful position of the balance of payments last year. However, the balance of trade deficit last year was over £600 million, in a period when we had a statutory incomes policy. Looking purely at trade—and the incomes policy has an effect on the balance of trade rather than capital—I question the effect that it has had, and I think that hon. Members should be told.
I would put it to the hon. Gentleman that any beneficial effects that the statutory incomes policy has had are more than offset by the ban on the sale of arms to South Africa, or, if that is not to the liking of some hon. Members, our buying of American military aircraft or having to pay cancellation charges on the Fill. I contend that the foreign exchange payments in those transactions are in excess of any savings which we might have got from a statutory incomes policy.
We are also paying the price for the freeze introduced by the Prime Minister in July, 1966. Looking at the effects of that freeze of incomes and prices, and everything else that occurred, the White Paper on the Prices and Incomes Policy, Command 3235, said in March, 1967:
Internally, the measures have eliminated the excess pressure of demand, have freed resources for export production and other essential purposes, and have slowed down the rise in prices and incomes.
The Third Report of the National Board for Prices and Incomes, published towards the end of last year, talking about the freeze, says:
The most likely explanation of what occurred in 1967 is the deferment into that year of wage increases which would have taken place in 1966, a deferment to a greater degree than took place after the pay pauses of 1948–49 and of 1962; the net increase in earnings in the two years of 1966 and 1967 could none the less be lower than it otherwise might have been. It is possible indeed that the more frequently a 'freeze' is imposed the greater is the subsequent militancy in claims. A 'freeze' of necessity does not
affect all wages and salaries equally; it can therefore add to anomalies and thus to later militancy. This later militancy can itself in turn aggravate the inflationary problem and thus invite a return to the very state of affairs from which escape had been sought.
This is one occasion when I agree with Mr. Aubrey Jones and the N.B.P.I. I am sure that this is one reason why the statutory incomes policy has been framed from that original decision of the Prime Minister in July, 1966 to introduce the freeze.
One point which should be gone into—perhaps the Under-Secretary will be able to give an answer to this matter when he winds up—is where the Chancellor of the Exchequer comes into the picture. In January last year the right hon. Gentleman said:
Unless firm restraint in increases in all forms of incomes becomes a reality, I shall be forced to take away the excess increases by extra taxation."—[OFFICIAL REPORT, 17th January, 1968; Vol. 756, c. 1790.]
Last year we had about £1,200 million worth of extra taxation, so I suppose that the Chancellor was keeping his word. What about the figures revealed by my right hon. Friend the Member for Mitcham (Mr. R. Carr), figures known to all Members? Is this forecast a prelude to what we are to expect in the Budget in eight to 10 weeks' time? If the Chancellor is still standing by his statement of January last year, as night follows day, there must be many hundreds of millions of pounds to be taken out of the economy and out of the consumer demand in the Budget which he will be presenting in the near future. Either that, or he has gone back on that original statement, having done his job, as it were, in 1968, and now we can move forward and he is not prepared to soak up this increase in the forms of taxation of excess incomes. It would be interesting if the Government could clear people's minds on this matter.
My right hon. Friend referred to one matter on which there has been a crashing silence from the other side. I hope that the Under Secretary will be able to answer this point, because I have a personal interest. I refer to equal pay for equal work and the Ford agreement, to which the hon. Member for Tottenham (Mr. Atkinson) and the hon. Member for Halifax (Dr. Summerskill) earlier referred.
I had the honour and pleasure of moving an Amendment on Report stage of the Prices and Incomes Bill last year which sought to exclude from the Bill advances towards equal pay for equal work such as is now proposed in the Ford agreement. The Amendment was eventually defeated, but only after the right hon. Lady had promised that there would be consultation and that she was envisaging a seven-year timetable towards equal pay for equal work. The Government might have been in a happier position had my Amendment been accepted then. What I, the House and, indeed, the country want to know is how the Government view the equal pay provision in the Ford agreement. What criteria does it satisfy under the prices and incomes policy?
I understand that it is not a question of the men getting a smaller increase in wages; it is a clear equal pay for equal work agreement. Jolly good luck to the women. I am in favour of the agreement. But what criteria is it satisfying and will the Government give it their endorsement? If they do not endorse this agreement, which is a good one, it means that many of the statements of the right hon. Lady about equal pay for equal work must be suspect.
I remind the Government that they now have: six years and four months left to the end of this seven-year timetable when there should be full implementation of equal pay for equal work throughout the country. The Ford agreement is important in this matter. It depends very much on good will, not only by the people concerned at Fords, the unions and all the rest, but certainly on the backing of the Government. I shall be interested to see under what criteria of the prices and incomes policy they allow this agreement to be implemented.
What has been the price of this nonsensical self-delusion? I believe that is what the present statutory prices and incomes policy amounts to. First, we had the tragic and bitter experience of industrial relations last year. It was no good the right hon. Lady saying, "We have lost 4½ million working days or thereabouts ". These are provisional figures. As the Under-Secretary told me when I tabled a Written Question in January—I think that I am correct, but I know that he will put me right if I am wrong—provisional figures are nearly always up-dated. It may turn out that nearly 5 million working days were lost, but I will not argue about half a million. It is no argument for the right hon. Lady to say that as part of the normal practical process under a Labour Government a strike involving 1½ million working days is natural.
Much more interesting in this context is the number of strikes started last year. If we exclude coal mining and quarrying we find that over 2,100 strikes were started, which, if my researches, are correct, is an all-time record in our history. This is the peak of a rising trend that has been accelerating over the last two or three years.
I do not pretend that the statutory prices and incomes policy is the sole reason for this, but it plays a major part in souring industrial relations and making many hitherto moderate and responsible unions, who have fought sensibly on behalf of their members, increasingly militant. Another factor that has not been mentioned is that when union officials are elected in this sort of atmosphere the more militant ones are successful. The responsible ones are going. All this is happening at a time when most people and most Members want to see some form of industrial relations reform.
The Government's proposals do not go nearly far enough. They are woefully lacking in many respects. We welcome the first faltering steps of the Government to implement this reform but we shall have to implement a much more comprehensive industrial relations reform. It is not a good time to do it when the whole field has been soured by non-senses of this sort.
Then there is the matter referred to by my hon. Friend the Member for Honiton (Mr. Emery). The disillusion of the electorate and the fact that the House, Parliament and politicians stand in low esteem is due to many reasons, one of them being that for domestic political purposes undue emphasis has been placed on the prices part of the prices and incomes policy. That was mentioned again by the right hon. Lady. When one examines the facts and figures one sees that increases in taxation by the Government have put up the cost of living by 6½ per cent. since they came to power and the charges made by the nationalised industries have risen by 25½ per cent.—much more than is normal in other sectors—in the index of retail prices. The nationalised industries and taxation do things for which the Government are directly responsible. Both taxation and prices in the nationalised industries have risen much faster and have helped to push up the spiralling cost of living that we all face.
It is no good pretending that the prices, productivity and incomes policy has kept down prices. Anybody who is married and has to do the housekeeping knows that that is not so. Our people are, therefore, rightly sceptical about the promises made for this policy. We know the excuses that are made. We debated them many times in Committee last year, when the Bill was going through. It is one more of the things that has added to the disillusion of politicians and the contempt of the Government.
Many people—voluntarily or involuntarily—are now probably breaking the law. I understood from the Under-Secretary of State that all firms with 100 workpeople and above should notify all the agreements they arrive at to the Department of Employment and Productivity. Sometimes up to 20,000 agreements are negotiated in one day. I wonder whether this notification has been going on or whether, all too often, a nod and a wink has been given and people have not bothered to notify the Department. I am sure that that is so.
There are many more constructive and sensible policies which would help to solve this problem, but time does not allow me to go into them. The incomes policy is the one piece of credit that the Government have left with the international bankers, to whom we owe so much money. That is why the Government are clinging to it like a fading actress clings to her rouge and false eyelashes. The sooner the curtain falls on this Act, the better it will be for all of us.
The right hon. Lady the Secretary of State made some extraordinary observations about the parentage of the Motion moved by my right hon. Friend the Member for Mitcham (Mr. R. Carr). Of course it is common form these days for Ministers to put up Aunt Sallies and then knock them down, but the right hon. Lady this afternoon achieved the rather unusual feat of not merely putting up an Aunt Sally but then getting herself knocked down by it as a result of the intervention of my right hon. Friend the Member for Enfield, West (Mr. Macleod).
I think that this has been—I hope that the Under-Secretary will agree—a very useful debate. The arguments for and against the control of incomes by statute have been deployed many times, and, from the very beginning, the Conservative Party has been resolutely and consistently opposed to it. We opposed the introduction of compulsory powers under Part IV of the 1966 Act, the implementation of Part IV in October of that year, the 1967 Act and the third Act, passed last year. On the other hand, the Government, with the support of the majority of their back benchers, have with equal consistency, voted again and again to hold wages down by law, which is the purpose of the legislation—
I will quote something said by senior Ministers in a few moments to justify what I say.
The fact is that the longer the Labour Government cling to these powers, the more apparent it becomes that their exercise is not only grossly unfair but also largely ineffective.
No one who has held any responsibility in an economic Department can doubt the importance of the maintenance of a proper balance between the rise in incomes and the rise in output. I agree with much of what the hon. Member for Dunbartonshire, East (Mr. Bence) said about this. Furthermore, so far as I know, there is not an industrialised country anywhere in the world where the Government does not concern itself with this balance. It does so because there is hardly any greater social injustice than runaway inflation. So I start by saying that to pretend that the trend of incomes is no concern of the government is naive and superficial economic nonsense.
I will mention just one example to justify what I believe. It is of course ridiculous to pretend that any Chancellor can ignore the likely trend of incomes when framing his Budget, but of course an incomes policy can take a variety of forms. It can take the form which has been devised by the present Labour Government, of legal compulsion. It can take the form which exists in the United States of voluntary guidelines, or it can take the form of a policy of increasing competitive processes or changing the structure of collective bargaining. I agree with some of my hon. Friends who have congratulated the right hon. Lady on the steps which she intends to take in industrial relations in due course. We do not believe that they go far enough, but she should have credit for her courage in going that far.
My hon. Friend the Member for Edinburgh, North (Earl of Dalkeith) referred to the Prime Minister in the context of this debate and was right to do so. Over the years, successive Conservative Governments pursued an incomes policy, but it was unthinkable that we should ever introduce legislation of the kind now on the Statute Book, for reasons which were stated with such typical candour by the present Prime Minister when he said—I quote these well-known words again because they are highly germane to the argument—
Once you have the law prescribing wages I think you are on a very slippery slope. It would be repugnant to all parties in this country.
Those were the words of the present Prime Minister and he was, of course, absolutely right. But that was said during the last General Election and four months later he did precisely what he had promised that he would not do.
We have said many times that the great mistake of this Government is in elevating their incomes policy to the dominant—indeed, to listen to some of the speeches of right hon. and hon. Members in support of Government policy one would think that it was almost the only—factor of economic policy. The result of this over-reliance on incomes policy has been that, when it has failed, it has failed with a vengeance, with all the problems flowing from that failure.
The facts speak for themselves. The Government first decided to hold down wages by law—I use that phrase advisedly—in the summer of 1966, 14 weeks after the General Election and after the Prime Minister had said on television what I have just quoted. They did this because between April, 1965, and April, 1966, hourly earnings had risen by 9·6 per cent., the steepest rise for 14 years. In other words, the one factor which the Government had placed foremost in their economic thinking had failed disastrously. So the Prime Minister changed his tack and started on what only four months previously he had picturesquely described as the very slippery slope which was repugnant to all parties. We are still on that slope, thanks to the support which he has been given time and again by Labour Party back-benchers in the House of Commons.
For reasons which I shall give, a statutory incomes policy was not only, in the Prime Minister's words, repugnant to the British people, but doomed to failure from the beginning.
I have said before in an economics debate that the economic aims of any Government are four: economic growth, price stability, full employment and a satisfactory balance of payments. That was the aim of the Conservative Government. It is the aim and objective of the present Government. But this Government is the first ever to have achieved the remarkable distinction of failing in all four objectives at the same time. One might almost call it "the uneconomic miracle ", but that is by the way. In the pursuit of these objectives, the trend of incomes is only one factor, although, I agree, a very important factor. But the Government's aim should be, by their overall management of the economy, to create conditions under which the rise in incomes is broadly in line with the rise in output.
The first reason why we believe that the Government should abandon these compulsory powers is that they have manifestly failed. What has been the Government's objective in the past 12 months? In the now classic words of the Secretary of State for Economic Affairs—I am not surprised that he does not listen to these debates any more; he used to speak in them—he told the House in March last year, when no doubt the right hon. Lady agreed with him, and I assume that she agrees with him now:
… it follows that personal consumption will need to fall…".—[OFFICIAL REPORT, 21st March, 1968; Vol. 761, c. 616.]
I can be even more specific. I quote the Department of Economic Affairs' Progress Report for April last year:
The measures contained in the Budget aim to cut back personal consumption by about 1 per cent. a year below the level in the second half of 1967—or by about 2 per cent. in all from the level that it might otherwise have reached".
That is the Government's policy. That is what they set out to do. They were to use the statutory control of incomes to achieve it. That is the first point which we must bear in mind.
The principal weapon for achieving the objective of cutting back people's standard of living was, under penalty of law, to hold down wages so that people would be worse off. The sentence which I have quoted from the "Economic Bulletin" can mean nothing else. But thanks to the ingenuity of British managers and trade unionists, and, if I may say so, to the incompetence of the right hon. Lady and her fellow Ministers, the Socialist Government have failed even in this unique venture.
What has been the outcome of all the ill-feeling and trouble which has been engendered by the policy the right hon. Lady has been pursuing? The right hon. Lady gave us some figures this afternoon of wage rates from March to December, 1968. I wonder why she chose March to December. That happened, of course, to suit her case very well. She was trying to show that the rise had not been as great as all that in wage rates, but why start in March? We have had the incomes policy controlled by Statute for getting on for three years now. Why not take the whole of last year, the figures which practically every economic and financial commentator has been using in the serious articles they have been writing to try to get to the bottom of the troubles with which we are dealing?
Last year basic weekly wage rates went up by 6·9 per cent., the largest increase since the index began 12 years ago; in manufacturing industry by 8·8 per cent., the largest increase since the present index began 12 years ago; and hourly wage rates went up by 7·1 per cent. and were again the largest increase for 12 years. All the bureaucratic paraphernalia which the right hon. Lady has operated with such panache has failed.
The increase in wage rates last year was double the 3½ per cent. ceiling on which the Government set such store.
I quote again the Secretary of State for Economic Affairs. In last year's Budget debate, he said:
…3½ per cent. is …
I hope the right hon. Lady will listen because this is particularly important and relevant—
the maximum figure for settlements which in our view is consistent with fully maintaining the competitive advantage of devaluation.
This was not the right hon. Lady's tale this afternoon. She said—I took down her words—" It is not the purpose of our policy to hold down wages while prices rise "—which is absolute nonsense. She said that this is not the policy of her right hon. Friends, but in March last year the Secretary of State for Economic Affairs said:
It is …a necessary condition of the economic adjustment which we have to make that incomes should rise more slowly than the cost of living over the next year."—[OFFICIAL REPORT, 21st March, 1968; Vol. 761, c. 621–22.]
Who is right? [HON. MEMBERS: "Answer."] Does she not accept what her right hon. Friend said? It is the direct contrary of what she told the House this afternoon. One does not expect two senior members of a Cabinet to take diametrically opposed views on something as important as this. May I give a little advice to her? This is why she gets into so much trouble with a section of her party. They know that one of them is not telling the truth. They do not know who to rely on. But that is for her to sort out.
My hon. Friend the Member for Oswestry (Mr. Biffen), in a typically pungent, incisive and admirable speech, reminded us that the right hon. Lady had said that this policy was a vital part of the economic strategy. She may argue that the situation would have been far worse if she had not had these powers and, if that were true, I suppose it would have been an argument for retaining the legislation once again this autumn.
But even that argument does not hold water. As the hon. Member for Newport (Mr. Roy Hughes) and my hon. Friend the Member for Meriden (Mr. Speed) pointed out, even the Prices and Incomes Board has concluded that the effect on earnings of the Government's statutory control of incomes has been less than 1 per cent. My hon. Friend gave some figures which seemed to show that this would have had a very minor effect, or a comparatively minor effect, on the balance of payments.
Throughout the past year the right hon Lady and her friends have plodded doggedly on down what the Prime Minister called "the slippery slope" and what the right hon. Lady calls, rather more attractively, "socialisation of the wages sector." But what has she achieved? As my hon. Friends the Members for Harrow, West (Mr. John Page) and Meriden have pointed out, she has achieved a loss of good will and engendered bitterness in the trade union movement and a massive increase in the number of days lost in strikes—last year of 4,692,000, twice as many as in 1964. Even this figures takes no account of the number of days lost through the shortage of supplies as a result of strikes.
I saw the right hon. Lady laughing then. I am not surprised that she was laughing, because I think she may have been rather amused recollecting something that she said off the cuff in her opening speech, which I want to refer to. Talking about this great increase in the number of days lost through strikes last year, she gave what I think must surely become a classic excuse to all trade unionists to go on strike. She said that the figure, of 4½ million days lost in strikes was misleading because it included 1½ million days lost as a result of the engineers' strike "as part of their negotiating strategy ". Now we know, and so will every trade unionist in the future, that it should not be included in the statistics if it is part of the negotiating strategy.
My right hon. Friend was absolutely right on the question of the 1½ million days. The engineering employers were dragging their feet and refusing to talk realistically about wages to engineers for 18 months. It was the employers who forced the trade unionists to take one-day action to make the employers talk realistically about wages. If anyone was to blame for that 1½ million lost days, it was the employers.
The hon. Gentleman knows perfectly well that on that occasion the employers were doing their best to conform with the policy laid down by the Labour Government.
If hon. Members opposite, including the hon. Member for Tottenham (Mr. Atkinson), believe that the statutory control of wages has been successful, they must recognise that it is failing now. All the indications are that the incomes policy is breaking down. Those are not my words. They are taken from a serious article in Monday's Financial Times. Those words are true, and it is failing because the right hon. Lady is caving in all along the line and, by so doing, making a mockery of the legal powers which she is purporting to operate.
Consider the Post Office settlement, as to which the right hon. Lady made the ridiculous claim that it was related to productivity. Apart from the incredible inter-departmental bungling, one thing is absolutely clear—that if the Chancellor of the Exchequer and the right hon. Lady had allowed the Postmaster-General at the outset of the negotiations to offer the terms which were finally offered the strike would never have taken place. We know what happened. The Government thought that they could bluff their way through it. They thought that they could rely on the traditional loyalty of the Post Office workers. But their bluff was called, and so they capitulated. One day's strike and they capitulated; and every trade union leader knows that the settlement was way outside the incomes policy.
Then there was the case of the farm workers, who got an increase well above the 3½ per cent., which the Prices and Incomes Board found to be quite unjustified by the rules. She can laugh. So will every trade unionist throughout the country. They know perfectly well that one has only to be tough, one has only to threaten, and the right hon. Lady or her Cabinet colleagues cave in. Everybody knows that that is what they will do.
What about the doctors and dentists? I am delighted that the Government are to pay them a substantial increase. They fully deserve it. Maybe we can now encourage a few more of them to stay in this country. But anyone who pretends that the doctors' rise is consistent with the Government's incomes policy should see a psychiatrist. The increase blatantly
ignores the incomes policy. If the right hon. Lady thinks that this is just some Tory observation, let me read her the headline in Friday's Daily Mirror on an article by Mr. Alan Law, its industrial correspondent. Under the headline:
No Freeze On Pay Rise For Doctors
the article says:
Although the increases blatantly ignore the incomes policy, the Prime Minister declared yesterday that the Government was ready to make an early start on talks aimed at putting them into effect.
Later it says:
'' They "—
other union leaders—
will clearly be outraged at the Government's inconsistency.
Of course they will be.
I have given only a sprinkling of illustrations of where the Government, for political reasons, to curry favour or to avoid trouble, have driven a coach and horses through the incomes policy criteria which were to be enforced with the full panoply of the law. But the Government will never take on the big battalions. As we have seen, it is only the small fry who always get the stick.
If the Government have driven a coach and horses through their own criteria, this is nothing compared with the extent to which those criteria are being flouted with impugnity throughout the length and breadth of Britain. If the employers of millions of men and women want to pay more than 3½ per cent., there is not the slightest problem about their doing it.
My hon. Friend the Member for Honiton (Mr. Emery) pointed out that any union prepared to hold the country to ransom will always force the Government to abandon their criteria. I have mentioned the Post Office settlement. One can also refer to the railway settlement and to the London Docks tally clerks, who had a 15 per cent. increase on basic rates. The right hon. Lady made a very interesting comment on that settlement. She said that she did not refer it to the Prices and Incomes Board because, "We did not wish to prejudice the general progress in the docks." What a reason! That was right outside the policy. That means not only that if one goes on strike as part of one's strategy it does not count, but that anyone who is to take the right hon. Lady at her word can in future pay more than 3½ per cent. as long as it is done because one does not wish to prejudice the general progress in one's industry.
A source of much greater inequity arises from the widespread evasion of the Government's statutorily backed policy. My hon. Friend the Member for Harrow, West reminded us that the right hon. Lady has laid down that normally no claim or award need be notified unless it affects more than 100 workers. I do not know how many such firms there are, but there are certainly at least 50,000, and probably more than 100,000. Such companies can ignore with impugnity the ceiling of 3½ per cent. that the right hon. Lady has laid down, and many are doing just that. It is going on all over the country all the time. The right hon. Lady and her horde of officials have not the remotest idea of what is happening, and the employers and union representatives concerned have nothing to fear.
Then there is the farce of back-dating. I shall not go into the details, because we had a very good example with the municipal busmen. They were told three times that their claim was postponed at the behest of the right hon. Lady or her predecessor—I cannot remember which—and then after a year it was back-dated. Just after Christmas 19 local authorities gave to the municipal busmen—77,000 of them—a year's back pay of between £80 and £100 each. What nonsense this all is. It is not surprising that Mr. Larry Smith, the National Bus Officer of the T. and G.W.U. commented:
This drives a tank right through the prices and incomes policy. It vindicates the attitude the union national officers have taken over the standstill, and indicates the stupidity of the Government's action in stopping the rises in the first place.
So one could go on. There is what the Secretary of State for Economic Affairs described as the "hole in the ceiling" for productivity cases. Some hole! As my hon. Friend the Member for Honiton explained, there is in practice not the slightest difficulty in some small company cooking up a "phoney" productivity bargain—and this is what they do.
The right hon. Lady referred specifically to building workers and told us that she has set up a working party. Does she have any idea as to how she may be able to enforce her ridiculous legal criteria on the small builder who, in order to keep his men, pays them over the odds? Everyone knows that there is absolutely nothing she can do about it because no one tells her and she cannot find out. The hon. Member for Liverpool, Walton (Mr. Heffer)—I am sorry I did not hear the whole of his speech—pointed out that, in the private building industry, there is not the slightest difficulty in getting round the 3½ per cent.
The Under-Secretary of State told us in May last year that this policy was of great importance. The Chancellor six months later said that the policy was of central and crucial importance. Yet these Ministers, who pose as honest men, in their mid-term manifesto made not a single even passing reference to the key question of wages policy. Yet it is supposed to be central to their economic policy.
Is it that the right hon. Lady and her right hon. and hon. Friends have such contempt for the intelligence of their own party workers that they thought that the omission would go unnoticed? If the right hon. Lady thinks that to oppose the holding down of wages by law is, in the terms of the Amendment, "partisan criticism", does that also go for the opposition of the Labour Party conference by 5 million votes to 1 million? My hon. Friend the Member for Honiton referred to the T.U.C. conference and I think that the right hon. Lady said, 'even the T.U.C. "at one moment. Was it" partisan criticism "for the T.U.C. conference to oppose her policy by nearly 8 million votes to 1 million?
Bearing in mind that the trade union movement now opposes her policy by an overwhelming majority, does she still stand by her words, spoken only 14 weeks before the T.U.C. gave its verdict? She told the House:
… we all recognise—and the Government recognise—that an incomes policy cannot work if the whole concept is repugnant to the trade union movement and if it has to be imposed by the use of compulsory powers.
Does she still stand by those words? [HON. MEMBERS: "Answer."] If her words have any meaning, does she still think that the policy will not work in those conditions? If the right hon. Lady is not prepared to reply, perhaps
the Under-Secretary of State will. He himself used even stronger words in the same debate, when he said:
'' It cannot and will not work unless we have the overwhelming, general, voluntary support of the trade union movement."—[OFFICIAL REPORT, 21st May, 1968; Vol., 760, c. 306–417.]
We are entitled to know the answer.
The Government also ask their supporters in the Amendment to vote for what they call their
…constructive and socially just economic strategy.
This is the strategy which has saddled the nation with £3,000 million additional overseas debt; this is the strategy which has led to the devaluation of the £; this is the strategy which led last year to the largest trade deficit for 23 years and to the highest summer unemployment for 28 years. In addition to this misery, this economic strategy which they ask their hon. Friends to approve, led last year to the largest increase in taxation in our history. If that is what hon. Gentlemen want let them vote for it. We are against it.
I begin by answering the two questions which the right hon. Member for Altrincham and Sale (Mr. Barber) put to me in tones which might have led some of his hon. Friends to believe that they were questions difficult to answer. First, he asked whether we stand by what my right hon. Friend and I, and the Secretary of State for Economic Affairs, and many others have said about the essentially voluntary nature of the prices and incomes policy. Of course we do. If the policy was rejected physically and positively by the trade unions and the country it could not survive.
I take an example. If the agreement concerning the building industry, of which my right hon. Friend is properly proud, had been rejected by the building trade unions, that agreement in its amended form could not have gone forward. By definition, if the time arrives when the sanctions of the policy have to be used on an immense scale, when the criteria of the policy can only be supported with the backing of sanctions, when the powers become something which are not used in exceptional circumstances, but need to be used invariably, then the policy cannot work. That is what we always said and will continue to say about the policy's essentially voluntary nature.
The right hon. Gentleman then asked me about the supposed mystery of the 3½ per cent. ceiling and the relationship between prices and earnings during the last year. It is a mystery which he and his right hon. Friends have tried to probe before. I will not weary him or embarrass myself with a long quotation from a speech I made on this subject in April of last year. I will remind him of what the Prime Minister said on 23rd May on exactly this point. [Interruption.] I am sorry if this is about to bore right hon. and hon. Gentlemen opposite. Perhaps they might care to ask whether the right hon. Gentleman knew about the Prime Minister's explanation, and chose not to give it to the House, or whether his researchers into HANSARD have not been sufficiently thorough to turn the point up.
What the Prime Minister said on 23rd May was in response to a question suggesting that the conflict drawn to the House's attention tonight was a real conflict. The Prime Minister made the point very clear and definite. He said:
Given an even minimal increase in productivity … a very substantial increase in living standards is possible this year, but it is dependent on productivity…".—[OFFICIAL REPORT, 23rd May, 1968; Vol. 765, c. 862.]
What my right hon. Friends have said consistently is that were all wage negotiations conducted on an across-the-board basis, unrelated to productivity criteria, undoubtedly during the last year there would have been a fall in real living standards. If, on the other hand, a substantial number of productivity bargains were negotiated, then there could be a real increase in living standards.
It is the second and more happy alternative which has been the case. [Interruption.] Hon. Gentlemen who were here earlier will remember that my right hon. Friend drew the attention of the House to the fact that the Leader of the Opposition was complaining about that very statistical point.
The second alternative has turned out to be the case, and it is that alternative which I shall use as a justification and a substantiation of my certainty that the incomes policy has been a success, and will continue throughout the year to be a success.
Throughout the day we have been asked to measure the success of our policy against yardsticks manufactured by hon. Gentlemen opposite. I wish to make it clear that I do not intend to follow all the hares that they have set off. I will not pursue allegations of our having broken promises which we never made, of failing to reach targets which we never set and falling short of estimates which we never gave.
Let me give two examples of what I mean; what the right hon. Member for Mitcham (Mr. R. Carr) described as our policy towards the lowest paid was quite wrong. Further, his general description of what the prices and incomes policy is intended to achieve was equally wrong. I take those two examples to explain, at any rate to my hon. Friends, how the Motion and the way in which it has been argued by hon. Gentlemen opposite is misconceived.
The right hon. Member for Mitcham said that the avowed purpose of the policy was to help the lowest-paid worker strengthen his position. We have never said anything half as total as that. [HON. MEMBERS: "Oh."] If hon. Gentlemen opposite will bear with me for a moment I will quote to them what we have said. We said that we intend—and we have always intended this—that the more rigorous application of the policy should be spared the lowest paid.
I mention with some embarrassment what I said on the Report stage of the Measure. I said that the lowest paid would be insulated from an admittedly hard policy. I said that that was the sum of what we were claiming. In other words, it was not the avowed purpose to help the lowest paid as such but to insulate the lowest paid from the rigours of the policy. [HON. MEMBERS: "What is the difference?"] The difference is that under the policy we are making sure that the lowest paid—negotiating wage increases through the normal processes and receiving wage increases as the result of those means, or receiving Agricultural Wages Board awards—automatically receive an increase up to the ceiling of the criteria simply because they are the lowest paid. That is, in itself, a justification. It is, in itself, an exception to the policy. That is what we always said we would do and that is what we have done.
Indeed, we have done more than that. My right hon. Friend said many times during the early stages of the proceedings on the Prices and Incomes Act that one of our hopes is that, as part of any general settlement, the lowest paid in an industrial group would be given priority and that within the ceiling a general increase would be so constructed that the lowest-paid recipients would get rather more than the 3½ per cent.
That, too, has happened. I take as an example the engineering agreement, where the increase in the minimum rate is substantially greater than 3½ per cent., yet the overall agreement was within the policy. The only conclusion one can draw is that those engineering employees who are the lowest paid and who are on the minimum are benefiting by a larger proportion than the higher paid in that industry. That was the intention of our policy. It is the intention, and it is being carried out.
Since the hon. Gentleman has made that point, would he say that he agrees with his right hon. Friend the Home Secretary, who said that when the new legislation ran out it would need to be a voluntary policy? His right hon. Friend went on to say that he knew the trade union movement too well to believe that it could be otherwise. He added that by the autumn of 1969, when the current powers expired, we would have had legislation concerned with wages for 3½ years and that that was long enough. Does the hon. Gentleman agree with that, and, if so, is that Government policy?
I know that quotation well. It occupied two days discussion in Committee. If the right hon. Gentleman will have a little patience he will find that, before the end of my speech, I will talk about the future—[HON. MEMBERS: "Answer."] I hope that that is some consolation to him.
What I am saying concerns the lowest-paid workers. When the Bill passed into law, we asked for the right to subject wage claims concerning the lowest-paid workers to the National Board for Prices and Incomes to ensure that those proposed increases were genuinely for that category of worker. We promised that when that proof was obtained the wage increases for the lowest paid workers would go through. Both promises have been fulfilled. That is why 27 Wages Councils Orders have gone through during the life of the Act. That is why we rightly allowed the full award of the Agricultural Wages Board to be paid.
Since right hon. and hon. Members opposite have been so anxious to criticise that award, let me put some points to them about it. According to the criteria accepted by he House, and which form the general policy for prices and incomes, there is a 3½ per cent. ceiling A 17s. increase for the agricultural workers was an apparent breach of it. In those circumstances, the Government could have done three things. They could have rigidly applied the letter of the policy. We know what right hon. Members opposite would have said about that. Because of our sympathy for the agricultural workers, we could have simply capriciously and unilaterally set the policy aside. We know what right hon. Members opposite would have said about that.
Our third possible course, which we took, was to examine the application of general policy to this very special case. The confirmation that it was a very special case resulted in the response which I hope my right hon. and hon. Friends would have expected of us, namely, the payment of the full amount because of the exceptional circumstances which make the workers in that industry, not only the lowest paid, but outstandingly the lowest paid. If there needs to be or should be a vindication of the social aspect of the policy, it is surely that.
I remember very well that during the Committee stage of the Bill some of my hon. Friends, supporting our proposals on the lowest paid, said that they could not and would not believe that the Labour Government would turn down an increase for agricultural workers. I remember that when that increase was first announced a few of my hon. Friends wondered whether their hopes at the time of the Committee stage had been misplaced. As we subsequently proved, their hopes were not misplaced. Their faith was justified. It remains the major and substantial vindication of the lowest-paid worker criteria in the Act.
Does not the hon. Gentleman agree that in cases in which he has given way to claims from the higher-paid workers he has automatically increased the cost-of-living burdens on the lowest-paid workers?
Of course I do. I agree that whenever one has given way, if given way is the phrase—it is not a phrase which I like—or whenever a wage increase goes through, one is making a contribution to all sorts of unfortunate economic factors if it is not related to productivity. But, as I hope to show, we must face the realities of the policy rather than its theories.
One of the realities of the policy which I hope right hon. and hon. Members opposite will begin to get to grips with is that it was never intended to hold down wages while prices rose. It was certainly never intended to do that with the maximum use of legal sanctions. The real achievement of the policy has been encouraging wage increases based on productivity and more effective working practices. The real achievement of the policy has been to shift the basis of wage negotiations from damaging general increases to increases based on productivity objectives without using legal powers and legal sanctions.
The Leader of the Opposition will very often hear references to what he said on 25th November, 1968. His complaint then was that earnings had gone up by 8 per cent. and that prices had risen by only 6 per cent. He described it as another condemnation of the prices and incomes policy. If our objectives—
That quotation has been made several times today. My right hon. Friend referred to it. None of the Leader of the Opposition's right hon. Friends thought it necessary to correct what my right hon. Friend said—I suspect because it was in all ways an accurate quotation.
The hon. Gentleman is wrong in his construction of the quotation. My right hon. Friend the Leader of the Opposition was pointing out that the object of the exercise was to make sure that incomes should rise more slowly than the cost of living. Those were the words of the Secretary of State for Economic Affairs. It was to that that my right hon. Friend was referring, and he was right and justified in doing so.
If the right hon. Gentleman asked me to give way to correct the quotation, he ought to correct it rather that argue about it. The words which his right hon. Friend used were exactly those that I used. I now intend to comment on them.
Had it been our intention simply to hold down wages, the accusation of the Leader of the Opposition would have been an appropriate one. In fact, there was a time when the incomes policy was intended to hold down wages. That was during the standstill and the period of severe restraint. During that time, we did it rather well. We held down wages to an increase of about 2·1 per cent., and we held down prices to hardly more than that. But the new phase of the policy—certainly that presided over by my right hon. Friend—has always contained the possibility of substantial and continual wage increases so long as they are related to improvements in productivity.
Since the right hon. Member for Mitcham originally made the comparison, it is interesting in this context to compare the full 2½ years of our policy with the 2½ years which began with a previous July when what was called the Selwyn Lloyd pay pause began—[Interruption.]
One hon. Member groans, and the hon. Member for Ormskirk (Sir D. Glover) says, "We are not debating that". The comparison was made originally by their right hon. Friend the Member for Mitcham.
The right hon. Member for Altrincham asked why figures were not supplied for the full period of the prices and incomes policy. I shall do that and compare it with another 2½ years of a prices and incomes policy.
Certainly, during our 2½ years, earnings have risen rather faster than during the previous period. Certainly, during our 2½ years, prices have risen slightly faster than during the previous period. But the important factor, or the first of the two important factors, is the relationship of those two to each other—the relationship of annual price rises to annual wage rises. During the 2½ years following the Selwyn Lloyd pay pause, earnings increased about 1·8 per cent. faster than prices. During the 2½ years which began with 20th July, 1966, wages increased 2·5 per cent. faster than prices. Comparing the two periods, the real increases in wealth have been almost 50 per cent. greater per annum in terms of prices versus wage increases.
I hope that my hon. Friend will not bother too much arguing against right hon. and hon. Members opposite, but will concentrate more on answering some of the points raised by hon. Members on this side of the House.
I suppose that my hon. Friend thinks that I have special obligations to him because he is one of my supporters—[Laughter.]
I wanted to go on to say that the only criterion which can be used to judge the effectiveness of the 2½ years which followed the Selwyn Lloyd pay pause was its ability to hold down wages, because that was the only object of the policy. The criteria which must be used in part to judge the result of the 2½ years that followed our policy is its ability and success in promoting productivity.
Let us look at those figures. In the most recent year for which figures are available, gross domestic product per head under our policy has improved by 4·8 per cent. For a corresponding year under right hon. and hon. Gentlemen opposite, it increased by about a quarter of that level. Those two figures, 1·1 per cent. versus 4·8 per cent., are the vindication of my right hon. Friend's contention that as long as productivity increases, wage increases go ahead proportionately.
Having said that, I do not for a moment minimise the part that the policy has to, and must, play in minimising costs and limiting demand. We have heard constant references today to the figure of 1 per cent. estimated in the summer by the National Board for Prices and Incomes as the figure by which effective demand is reduced as a result of the policy. I am open to correction, but I believe that was first invented by the right hon. Member for Mitcham, who said that that was the maximum figure for which we could hope, and his estimate was that it would be a considerably smaller amount.
I make no comment whether that 1 per cent. is accurate. But I say that the Opposition are wrong to minimise the importance of a 1 per cent. reduction. A cut from effective demand of £100 million in a year is a substantial contribution to our economic strategy. Certainly, by my standards, cutting it from effective demand by an incomes policy is an infinitely more palatable way than other methods which might be put forward. It is certainly better than cutting it from public spending and certainly better—and I suspect that right hon. and hon. Members opposite agree—than putting it on taxation.
When right hon. and hon. Members opposite consider not only the merits of the policy, but the desirability of it, they must also decide the desirability of any alternative which may be put in its place.
Many accusations have been made against the Government this afternoon. I will deal with only three more before I say a word about the future of the policy. First, to conjure up from the air some general theory that because of the incomes policy industrial relations have deteriorated is a very unscientific estimate.
The hon. Member for Honiton (Mr. Emery) says that it is true.
Hardly anybody has any figure relevant to such a contention, a contention which it is almost impossible to prove or disprove.
About the best figure which can be produced to give an answer one way or the other is the percentage of disputes in any one year resulting from wage claims. Presumably it is wage claims that the prices and incomes policy affects and presumably it is in that area where it has soured industrial relations.
Right hon. and hon. Gentlemen opposite will, I am sure, be relieved to know that last year the average number of disputes arising from wage claims, as a proportion of the total number of disputes, was about average. The year before it was substantially below average, and the year before that it was also substantially below average. An examination of any figures that can be produced, inaccurate as they are, though the best figures which can be created, suggests and, indeed, confirms that the incomes policy has in no way injured or soured industrial relations.
Finally, I turn to the question of the future. Before turning to that question—[Interruption.] The question of the future of the Government is easy. There is a question of the future for right hon. Gentlemen to answer. We know that right hon. and hon. Gentlemen opposite would abolish the statutory powers and we understand that they would abolish the National Board for Prices and Incomes. We know that they believe in some general regulation of incomes policy. What we must ask them is whether those creative things which have been the result of the policy, those things which have come from the Board irrespective of wage limitation—I refer to things like "Guidelines for Productivity Bargains", proposals to local authority manual workers and how improvements can be made in local authority efficiency and pay without extra burdens on the ratepayer—would be done by a board set up by them.
For us, the answer can be very clear. A year ago the Prime Minister laid down the criteria according to which the prices and incomes policy in its statutory form might or might not be abandoned, and I say again this evening that the decision about the future of the prices and incomes policy must be taken in the light of the necessities at the end of this year. Clearly, the Government cannot, and will not, at this stage undertake to abandon a policy which might be necessary in the interests of the nation. Any hon. Gentleman below the Gangway who assumed from the wording of the Amendment that this was the beginning of our intention is mistaking what we have in mind.
The wording of the Amendment is intended to convey our contempt for the rather shoddy political manoeuvre into which right hon. Gentlemen opposite have entered this afternoon, and my hon. Friends should assume nothing but contempt for it. Our point of view is clear and perfectly specified. The need for a prices and incomes policy in a statutory form will be assessed towards the end of the year. If some powers remain necessary, it would be irresponsible of us not to take those powers, but I say again that, for my part, there is no doctrinal wish to see a continuation of the statutory powers. I do not in any way see them as a virtue in themselves. I see them as a hard necessity in a difficult situation, and the assurance which I can give the House this evening is that we shall face the hard necessity if required.
I can assure the House that, while, if we accept nothing else we accept that there is a substantial element of unpopularity in the operation of the policy, unlike hon. Gentlemen opposite, we shall not regard that as an appropriate criterion of whether it should go on or not. The criterion is whether the economy and the country need it. Obviously, our hope is that they do not, but if the country and the economy need it it must be renewed, and that is the only promise and the only undertaking that I can enter into about the future.
It is clear, from the noise, that the House can see through the double talk of the hon. Gentleman. He came here to sooth his back benches, but admits that the policy will be renewed in the autumn. [Interruption.]
|Division No. 69.]||AYES||[9.59 p.m.|
|Albu, Austen||Doig, Peter||Hughes, Rt. Hn. Cledwyn (Anglesey)|
|Allaun, Frank (Salford, E.)||Driberg, Tom||Hughes, Emrys (Ayrshire, S.)|
|Andereon, Donald||Dunnett, Jack||Hughes, Hector (Aberdeen, N.)|
|Archer, Peter||Dunwoody, Mrs. Gwyneth (Exeter)||Hughes, Roy (Newport)|
|Ashley, Jack||Dunwoody, Dr. John (F'th & C'b'e)||Hunter, Adam|
|Ashton, Joe (Bassetlaw)||Eadle, Alex||Hynd, John|
|Atkinson, Norman (Tottenham)||Edeiman, Maurice||Irvine, Sir Arthur (Edge Hill)|
|Bagier, Gordon A. T.||Edwards, Robert (Bilston)||Jackson, Colin (B'h'se & Spenb'gh)|
|Barnett, Joel||Edwards, William (Merioneth)||Jackson, Peter M. (High Peak)|
|Baxter, William||Ellis, John||Janner, Sir Barnett|
|Bence, Cyril||English, Michael||Jeger, George (Goole)|
|Benn, Rt. Hn. Anthony Wedgwood||Ennals, David||Jeger, Mrs. Lena (H'b'n&St. P'cras, S.)|
|Bennett, James (G'gow, Bridgeton)||Evans, Albert (Isilngton, S. W.)||Johnson, Carol (Lewisham, S.)|
|Bidwell, Sydney||Evans, Fred (Caerphilly)||Johnson, James (K'ston-on-Hull, W.)|
|Binns, John||Evans, loan L. (Birm'h'm, Yardley)||Jones, Dan (Burnley)|
|Bishop, E. S. Blackburn, F.||Faulds, Andrew||Jones. Rt. Hn. Sir Elwyn (W. Ham, S.)|
|Blenkinsop, Arthur||Fernyhough, E.||Jones, J. Idwal (Wrexham)|
|Boardman, H. (Leigh)||Finch, Harold||Jones, T Alec (Rhondda, West)|
|Booth, Albert||Fitch, Alan (Wigan)||Judd, Frank|
|Boston, Terence||Fletcher. Rt. Hn. Sir Eric (Islington, E.)||Kelley, Richard|
|Bottomley, Rt. Hn. Arthur||Fletcher, Raymond (likeston)||Kenyon, Clifford|
|Boyden, James||Foley, Maurice||Kerr, Dr. David (W'worth, Central)|
|Bradley, Tom||Foot, Rt. Hn. Sir Dingle (Ipswich)||Lawson, George|
|Bray, Dr. Jeremy||Foot, Michael (Ebbw Vale)||Leadbitter, Ted|
|Brooks, Edwin||Ford, Ben||Ledger, Ron|
|Brown, Rt. Hn. George (Belper)||Fowler, Gerry||Lee, Rt. Hn. Frederick (Newton)|
|Brown, Hugh D. (G'gow, Provan)||Fraser, John (Norwood)||Lee, Rt. Hn. Jennie (Cannock)|
|Brown, Bob (N 'c'tie-upon-Tyne, w.)||Freeson, Reginald||Lee, John (Reading)|
|Brown, R. W. (Shoreditch & F'bury)||Gardner, Tony||Lestor, Miss Joan|
|Buchan, Norman||Garrett, W. E.||Lever, Harold (Cheetham)|
|Buchanan, Richard (G'gow, Sp'burn)||Ginsburg, David||Lever, L. M. (Ardwick)|
|Butler, Herbert (Hackney, W.)||Gordon Walker, Rt. Hn. P. C.||Lewis, Arthur (W. Ham, N.)|
|Butler, Mrs. Joyce (Wood Green)||Gray, Dr. Hugh (Yarmouth)||Lewis, Ron (Carlisle)|
|Callaghan, Rt. Hn. James||Greenwood, Rt. Hn. Anthony||Lipton, Marcus|
|Cant, R. B.||Gregory, Arnold||Lomas, Kenneth|
|Carmichael, Neil||Griffiths, David (Rother Valley)||Loughlin, Charles|
|Carter-Jones, Lewis||Griffiths, Eddie (Brightside)||Luard, Evan|
|Castle, Rt. Hn. Barbara||Griffiths, Rt. Hn. James (Lianelly)||Lyons, Edward (Bradford, E.)|
|Chapman, Donald||Griffiths, Will (Exchange)||Mabon, D. J. Dickson|
|Coe, Denis||Gunter, Rt. Hn. R. J.||McBride, Neil|
|Coleman, Donald||Hamilton, William (Fife, W.)||McCann, John|
|Conlan, Bernard||Hamling, William||MacColl, James|
|Corbet, Mrs. Freda||Harman, William||MacDermot, Niall|
|Cawshaw, Richard||Harper, Joseph||Macdonald, A. H.|
|Crosland, Rt. Hn. Anthony||Harrison, Walter (Wakefield)||McKay, Mrs. Margaret|
|Crossman, Rt. Hn. Richard||Hart, Rt. Hn. Judith||Mackie, John|
|Cullen, Mrs. Alice||Hattersley, Roy||Maclennan, Robert|
|Dalyell, Tam||Hazell, Bert||McNamara, J. Kevin|
|Darling, Rt. Hn. George||Healey, Rt. Hn. Denis||MacPherson, Malcolm|
|Davidson, Arthur (Accrington)||Heffer, Eric s.||Mallalieu, J. P. W.(Huddersfield, E.)|
|Davies, G. Elfed (Rhondda, E.)||Henig, Stanley||Manuel, Archie|
|Davies, Dr. Ernest (Siretford)||Herbison, Rt. Hn. Margaret||Mapp, Charles|
|Davies, Harold (Leek)||Hilton, W. S.||Marquand, David|
|Davies, Ifor (Gower)||Hobden, Dennis||Marsh, Rt. Hn. Richard|
|de Freitas, Rt Hn. Sir Geoffrey||Hooley, Frank||Mason, Rt. Hn. Roy|
|Delargy, Hugh||Houghton, Rt. Hn. Douglas||Maxwell, Robert|
|Dell, Edmund||Howarth, Harry (Wellingborough)||Mayhew, Christopher|
|Dempsey, James||Howarth, Robert (Bolton, E.)||Mellish, Rt. Hn. Robert|
|Dewar, Donald||Howell, Denis (Small Heath)||Mendelson, John|
|Diamond, Rt. Hn. John||Howie, W.||Mikardo, Ian|
|Dickens, James||Hoy, James||Millan, Bruce|
|Dobson, Ray||Huckfield, Leslie||Miller, Dr. M. S.|
|Milne, Edward (Blyth)||Price, Christopher (Perry Barr)||Taverne, Dick|
|Mitchell, R. C. (S'th'pton, Test)||Price, Thomas (Westhoughton)||Thomas, Rt. Hn. George|
|Molloy, Will am||Price, William (Rugby)||Thomson, Rt. Hn. George|
|Moonman, Eric||Probert, Arthur||Thornton, Ernest|
|Morgan, Elystan (Cardiganshire)||Pursey, Cmdr. Harry||Tinn, James|
|Morris, Alfred (Wythenshawe)||Randall, Harry||Tomney, Frank|
|Morris, Charles R. (Openshaw)||Rankin, John||Tuck, Raphael|
|Morris, John (Aberavon)||Rees, Merlyn||Urwin, T. W.|
|Moyle, Roland||Reynolds, Rt. Hn. G. W.||Varley, Eric G.|
|Mulley, Rt. Hn. Frederickz||Rhodes, Geoffrey||Walnwright, Edwin (Dearne Valley)|
|Murray, Albert||Richard, Ivor||Walden, Brian (All Saints)|
|Newens, Stan||Roberts, Albert (Normanton)||Walker, Harold (Doncaster)|
|Noel-Baker, Rt. Hn. Philip (Derby, S.)||Roberts, Rt. Hn. Goronwy||Wallace, George|
|Oakes, Gordon||Roberts, Gwilym (Bedfordshire, S.)||Watkins, David (Consett)|
|Ogden, Eric||Robertson, John (Paisley)||Watkins, Tudor (Brecon & Radnor:|
|O'Malley, Brian||Robertson, Rt. Hn. Kenneth (St. P'c'as)||Weitzman, David|
|Oram, Albert E.||Rodgers, William (Stockton)||Wellbeloved, James|
|Orbach, Maurice||Roebuck, Roy||Wells, William (Walsall, N.)|
|Orme, Stanley||Ross, Rt. Hn. William||Whitaker, Ben|
|Oswald, Thomas||Rowlands, E.||White, Mrs. Eirene|
|Owen, Dr. David (Plymouth, S'tn)||Sheldon, Robert||Whitlock, William|
|Owen, Will (Morpeth)||Shinwell, Rt. Hn. E.||Wilkins, W. A.|
|Padley, Walter||Shore, Rt. Hn. Peter (Stepney)||Williams, Alan (Swansea, W.)|
|Page, Derek (King's Lynn)||Short, Mrs. Renée (W'hampton, N. E.)||Williams, Alan Lee (Hornchurch)|
|Paget, R. T.||Silkin, Rt. Hn. John (Deptford)||Williams, Clifford (Abertillery)|
|Palmer, Arthur||Silkin, Hn. S. C. (Dulwich)||Williams, Mrs. Shirley (Hitchin)|
|Pannell, Rt. Hn. Charles||Silverman, Julius||Williams, W. T. (Warrington)|
|Park, Trevor||Skeffington, Arthur||Willis, Rt. Hn. George|
|Parker, John (Dagenham)||Slater, Joseph||Wilson, William (Coventry, S.)|
|Parkyn, Brian (Bedford)||Small, William||Winnick, David|
|Pavitt, Laurence||Snow, Julian||Woodburn, Rt. Hn. A.|
|Pearson, Arthur (Pontypridd)||Spriggs, Leslie||Woof, Robert|
|Peart, Rt. Hn. Fred||Steele, Thomas (Dunbartonsh re, W.)||Wyatt, Woodrow|
|Pentland, Norman||Stewart, Rt. Hn. Michael|
|Perry, Ernest G. (Battersea, S.)||Stonehouse, Rt. Hn. John||TELLERS FOR THE AYES:|
|Perry, George H. (Nottingham, S.)||Strauss, Rt. Hn. G. R.||Mr. J. D. Concannon and|
|Prentice, Rt. Hn. R. E.||Summerskill, Hn. Dr. Shirley||Mr. Charles Grey.|
|Alison, Michael (Barksion Ash)||Crouch, David||Harris, Reader (Heston)|
|Allason, James (Hemel Hempstead)||Crowder, F. P.||Harrison, Col. Sir Harwood (Eye)|
|Astor, John||Cunningham, Sir Knox||Harvey, Sir Arthur Vere|
|Atkins, Humphrey (M't'n & M'd'n)||Currie, G. B. H.||Harvie Anderson, Miss|
|Awdry, Daniel||Dalkeith, Earl of||Hastings, Stephen|
|Baker, Kenneth (Acton)||Dance, James||Hawkins, Paul|
|Baker, W. H. K. (Banff)||d'Avigdor-Goldsmid, Sir Henry||Hay, John|
|Bainiel, Lord||Dean, Paul||Heald, Rt. Hn. Sir Lionel|
|Barber, Rt. Hn. Anthony||Digby, Simon Wingfield||Heseltine, Michael|
|Bennett, Sir Frederic (Torquay)||Dodds-Parker, Douglas||Higgins, Terence L.|
|Bennett, Dr. Reginald (Gos. & Fhm)||Doughty, Charles||Hiley, Joseph|
|Berry, Hn. Anthony||Douglas-Home, Rt. Hn. Sir Alec||HiIl, J. E. B.|
|Biffen, John||Drayson, G. B.||Hogg, Rt. Hn. Quintin|
|Birch, Rt. Hn. Nigel||du Cann, Rt. Hn. Edward||Holland, Philip|
|Black, Sir Cyril||Eden, Sir John||Hordern, Peter|
|Blaker, Peter||Elliot, Capt. Walter (Carshalton)||Hornby, Richard|
|Boardman, Tom (Leicester, S. W.)||Emery, Peter||Howell, David (Guildford)|
|Body, Richard||Farr, John||Hunt, John|
|Bossom, Sir Clive||Fisher, Nigel||Hutchison, Michael Clark|
|Boyd-Carpenter, Rt. Hn. John||Fletcher-Cooke, Charles||Iremonger, T. L.|
|Boyle, Rt. Hn. Sir Edward||Fortescue, Tim||Irvine, Bryant Godman (Rye)|
|Braine, Bernard||Foster, Sir John||Jenkin, Patrick (Woodford)|
|Brewls, John||Galbraith, Hn. T. G.||Jennings, J. C. (Burton)|
|Brinton, Sir Tatton||Gibson-Watt, David||Johnson Smith, G. (E. Grinstead)|
|Bromley-Daven port, Lt.-Col. SirWalter||Giles, Rear-Adm. Morgan||Jones, Arthur (Northants, S.)|
|Brown, Sir Edward (Bath)||Gilmour, Ian (Norfolk, C.)||Jopling, Michael|
|Bruce-Gardyne, J.||Gilmour, Sir John (Fife, E.)||Joseph, Rt. Hn. Sir Keith|
|Bryan, Paul||Glover, Sir Douglas|
|Buchanan-Smith, Alick (Angus, N&M)||Glyn, Sir Richard||Kaberry, Sir Donald|
|Bullus, Sir Erlc||Godber, Rt. Hn. J. B,||Kerby, Capt. Henry|
|Burden, F. A.||Goodhart, Philip||Kershaw, Anthony|
|Campbell, B. (Oldham, W.)||Goodhew, Victor||Kimball, Marcus|
|Campbell, Gordon (Moray & Nalrn)||Gower, Raymond||King, Evelyn (Dorset, S.)|
|Carlisle, Mark||Grant, Anthony||Kirk, Peter|
|Carr, Rt. Hn. Robert||Grant-Ferris, R.||Kitson, Timothy|
|Cary, Sir Robert||Gresham Cooke, R.||Knight, Mrs. Jill|
|Channon, H. P. G.||Grieve, Percy||Lane, David|
|Chichester-Clark, R.||Griffiths, Eldon (Bury St. Edmunds)||Langford-Holt, Sir John|
|Clegg, Walter||Gurden, Harold||Legge-Bourke, Sir Harry|
|Cooke, Robert||Hall, John (Wycombe)||Lewis, Kenneth (Rutland)|
|Cordle, John||Hall-Davies, A. G. F.||Lloyd, Rt. Hn. Geoffrey (Sut'nC'dfield)|
|Corfield, F. V.||Hamilton, Lord (Fermanagh)||Lloyd, Ian (p'tsm'th, Lartgstone)|
|Costain, A. P.||Hamilton, Michael (Salisbury)||Loveys, W. H.|
|Craddock, Sir Beresford (Spelthorne)||Harris, Frederic (Croydon, N. W.)||McAdden, Sir Stephen|
|MacArthur, Ian||Pearson, Sir Frank (Clitheroe)||Stoddart-Scott, Col. Sir M.|
|Maclean, Sir Fitzroy||Peel, John||Summers, Sir Spencer|
|Macleod, Rt. Hn. lain||Percival, Ian||Tapsell, Peter|
|Macmillan, Maurice (Farnham)||Peyton, John||Taylor, Sir Charles (Eastbourne)|
|McNair-Wilson. Patrick||Pike, Miss Mervyn||Taylor, Edward M.(G'gow, Cathcart)|
|Maddan, Martin||Pink, R. Bonner||Taylor, Frank (Moss Side)|
|Marples, Rt. Hn. Ernest||Pounder, Rafton||Temple, John M.|
|Marten, Neill||Powell, Rt. Hn. J. Enoch||Thatcher, Mrs. Margaret|
|Maudling, Rt. Hn. Reginald||Price, David (Eastleigh)||Tilney, John|
|Mawby, Ray||Prior, J. M. L.||Turton, Rt. Hn. R. H.|
|Maxwell-Hyslop, R. J.||Pym, Francis||van Straubenzee, W. R.|
|Maydon, Lt.Cmdr. S. L. C.||Quennell, Mies J. M.||Vaughan-Morgan, Rt. Hn. Sir John|
|Mills, Peter (Torrington)||Ramsden, Rt. Hn. James||Vickers, Dame Joan|
|Mills, Stratton (Belfast, N.)||Rawlinson, Rt. Hn. Sir Peter||Waddington, David|
|Miscampbell, Norman||Rees-Davies, W. R.||Walker, Peter (Worcester)|
|Mitchell, David (Basingstoke)||Renton, Rt. Hn. Sir David||Walker-Smith, Rt. Hn. Sir Derek|
|Monro, Hector||Rhys Williams, Sir Brandon||Wall, Patrick|
|Montgomery, Fergus||Ridley, Hn. Nicholas||Walters, Dennis|
|Morgan, Geraint (Denbigh)||Ridsdale, Julian||Ward, Dame Irene|
|Morrison, Charles (Devizes)||Rippon, Rt. Hn. Geoffrey||Weatherill, Bernard|
|Mott-Radclyffe, Sir Charles||Robson Brown, Sir William||Wells, John (Maidstone)|
|Munro-Lucas-Tooth, Sir Hugh||Rodgers, Sir John (Sevenoaks)||Whitelaw, Rt. Hn. William|
|Murton, Oscar||Rossi, Hugh (Hornsey)||Williams, Donald (Dudley)|
|Nabarro, Sir Gerald||Royle, Anthony||Wilson, Geoffrey (Truro)|
|Neave, Airey||Russell, Sir Ronald||Wolrige-Gordon, Patrick|
|Nicholls, Sir Harmar||Scott, Nicholas||Wood, Rt. Hn. Richard|
|Noble, Rt. Hn. Michael||Scott-Hopkins, James||Woodnutt, Mark|
|Nott, John||Sharples, Richard||Worsley, Marcus|
|Onslow, Cranley||Silvester, Frederick||Wylie, N. R.|
|Orr, Capt. I. P. S.||Sinclair, Sir George||Younger, Hn. George|
|Orr-Ewing, Sir Ian||Smith, Dudley (W'wick & L'mington)|
|Osborn, John (Hallam)||Smith, John (London & W'minster)||TELLERS FOR THE NOES:|
|Osborne, Sir Cyril (Louth)||Speed, Keith||Mr. Jasper More and|
|Page, Graham (Crosby)||Stodart, Author y||Mr. Reginald Eyre.|
|Page, John (Harrow, W.)|
|Division No. 70.]||AYES||[10.13 p.m.|
|Albu, Austen||Coleman, Donald||Foley, Maurice|
|Allaun, Frank, (Salford, E.)||Conlan, Bernard||Foot, Rt. Hn. Sir Dingle (Ipswich)|
|Anderson, Donald||Corbet, Mrs. Freda||Foot, Michael (Ebbw Vale)|
|Archer, Peter||Crosland, Rt. Hn. Anthony||Ford, Ben|
|Ashley, Jack||Crossman, Rt. Hn. Richard||Forrester, John|
|Ashton, Joe (Bassetlaw)||Cullen, Mrs. Alice||Fowler, Gerry|
|Atkinson, Norman (Tottenham)||Dalyell, Tam||Fraser, John (Norwood)|
|Bugter, Gordon A. T.||Darling, Rt. Hn. George||Freeson, Reginald|
|Barnett, Joel||Davidson, Arthur (Accrington)||Gardner, Tony|
|Baxter, William||Davies, G. Elfed (Rhondda, E.)||Garrett, W. E.|
|Bence, Cyril||Davies, Dr. Ernest (Stretford)||Ginsburg, David|
|Benn, Rt. Hn. Anthony Wedgwood||Davies, Harold (Leek)||Gordon Walker, Rt. Hn. P. C.|
|Bennett, James (G'gow, Bridgeton)||Davies, Ifor (Gower)||Gray, Dr. Hugh (Yarmouth)|
|Bidwell, Sydney||de Freitas, Rt. Hn. Sir Geoffrey||Greenwood, Rt. Hn Anthony|
|Binns, John||Delargy, Hugh||Gregory, Arnold|
|Bishop, E. S.||Dell, Edmund||Griffiths, David (Rother Valley)|
|Blackburn, F.||Dempsey, James||Griffiths, Eddie (Brightside)|
|Blenkinsop, Arthur||Dewar, Donald||Griffiths, Rt. Hn. James (Llanelly)|
|Boardman, H. (Leigh)||Diamond, Rt. Hn. John||Griffiths, Will (Exchange)|
|Booth. Albert||Dickens, James||Gunter, Rt. Hn. R. J.|
|Boston, Terence||Dobson, Ray||Hamilton, William (Fife, W.)|
|Bottomley, Rt. Hn. Arthur||Doig, Peter||Hamling, William|
|Boyden, James||Driberg, Tom||Hannan, William|
|Bradley, Tom||Dunnett, Jack||Harper, Joseph|
|Bray, Dr. Jeremy||Dunwoody, Mrs. Gwyneth (Exeter)||Harrison, Walter (Wakefield)|
|Brooks, Edwin||Dunwoody, Dr. John (F'th & C'b'e)||Hart, Rt. Hn. Judith|
|Brown, Rt. Hn. George (Belper)||Eadie, Alex||Hattersley, Roy|
|Brown, Hugh D. (G'gow, Provan)||Edelman, Maurice||Hazell, Bert|
|Brown, Bob (N'c'tle-upon-Tyne, W.)||Edwards, Robert (Bilston)||Healey, Rt Hn Denis|
|Brown, R. W. (Shoreditch & F'bury)||Edwards, William (Merioneth)||Heffer, Eric S.|
|Buchan, Norman||Ellis, John||Henig, Stanley|
|Buchanan, Richard (G'gow, Sp'burn)||English, Michael||Herbison, Rt. Hn. Margaret|
|Butler, Herbert (Hackney, C.)||Ennals, David||Hilton, W. S.|
|Butler, Mrs. Joyce (Wood Green)||Evans, Fred (Caerphilly)||Hobden, Dennis|
|Callaghan, Rt. Hn. James||Evans, loan L. (Birm'h'm, Yardley)||Hooley, Frank|
|Cant, R. B.||Faulds, Andrew||Houghton, Rt. Hn. Douglas|
|Carmichael, Neil||Fernyhough, E.||Howarth, Harry (Wellingborough)|
|Carter-Jones, Lewis||Finch, Harold||Howarth, Robert (Bolton, E.)|
|Castle, Rt. Hn. Barbara||Fitch, Alan (Wigan)||Howell, Denis (Small Heath)|
|Chapman, Donald||Fletcher, Rt. Hn. Sir Eric (Islington, E.)||Howie, W.|
|Coe, Denis||Fletcher, Raymond (likeston)||Hoy, James|
|Huckfield, Leslie||Mayhew, Christopher||Roebuck, Roy|
|Hughes, Rt. Hn. Cledwyn (Anglesey)||Mellish, Rt. Hn. Robert||Ross, Rt. Hn. William|
|Hughes, Emrys (Ayrshire, S.)||Mendelson, John||Rowlands, E.|
|Hughes, Hector (Aberdeen, N.)||Mikardo, Ian||Sheldon, Robert|
|Hughes, Roy (Newport)||Millan, Bruce||Shore, Rt. Hn. Peter (Stepney)|
|Hunter, Adam||Miller, Dr. M. 8.||Short, Mrs. Renée (W'hampton, N. E.)|
|Hynd, John||Milne, Edward (Blyth)||Silkin, Rt. Hn John (Deptford)|
|Irvine, Sir Arthur (Edge Hill)||Mitchell, R. C. (S'th'pton, Test)||Silkin, Hn. S. C. (Dulwich)|
|Jackson, Colin (B'h'se & Spenb'gh)||Molloy, William||Silverman, Julius|
|Jackson, Peter M. (High Peak)||Morgan, Elystan (Cardiganshire)||Skeffington, Arthur|
|Janner, Sir Barnett||Morris, Alfred (Wythenshawe)||Slater, Joseph|
|Jeger, George (Coole)||Morris, Charles R. (Openshaw)||Small, William|
|Jeger, Mrs. Lena (H'bn&St. P'cras, S.)||Morris, John (Aberavon)||Snow, Julian|
|Johnson, Carol (Lewisham, S.)||Moyle, Roland||Spriggs, Leslie|
|Johnson, James (K'ston-on-Hull, W.)||Mulley, Rt. Hn. Frederick||Steele, Thomas (Dunbartonshire, W.)|
|Jones, Dan (Burnley)||Murray, Albert||Stewart, Rt. Hn. Michael|
|Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)||Newens, Stan||Stonehouse, Rt. Hn. John|
|Jones, J. Idwal (Wrexham)||Noel-Baker, Rt. Hn. Philip (Derby, S.)||Strauss, Rt. Hn. G. R.|
|Jones, T. Alec (Rhondda, West)||Oakes, Gordon||Summerskilll, Hn. Dr. Shirley|
|Judd, Frank||Ogden, Eric||Taverne, Dick|
|Kelley, Richard||O'Malley, Brian||Thomas, Rt. Hn. George|
|Kenyon, Clifford||Oram, Albert E.||Thomson, Rt. Hn. George|
|Kerr, Dr. David (W'worth, Central)||Orme, Stanley||Thornton, Ernest|
|Lawson, George||Oswald, Thomas||Tinn, James|
|Leadbitter, Ted||Owen, Dr. David (Plymouth, S'tn)||Tomney, Frank|
|Ledger, Ron||Owen, Will (Morpeth)||Tuck, Raphael|
|Lee, Rt. Hn. Frederick (newton)||Padley, Walter||Urwin, T. W.|
|Lee, Rt. Hn. Jennie (Cannock)||Page, Derek (King's Lynn)||Varley, Eric G.|
|Lee, John (Reading)||Paget, R. T.||Wainwright, Edwin (Dearne Valley)|
|Lestor, Miss Joan||Palmer, Arthur||Walden Brian (All Saints)|
|Lever, Harold (Cheetham)||Pannell, Rt. Hn. Chartes||Walker, Harold (Doncaster)|
|Lever, L. M. (Ardwick)||Park, Trevor||Wallace, George|
|Lewis, Arthur (W. Ham, N,)||Parker, John (Dagenham)||Watkins, David (Consett)|
|Lewis, Ron (Carlisle)||Parkyn, Brian (Bedford)||Watkins, Tudor (Brecon & Radnor)|
|Lipton, Marcus||Pavitt, Laurence||Weitzman, David|
|Lomas, Kenneth||Pearson, Arthur (Pontypridd)||Wellbeloved, James|
|Loughlin, Charles||Peart, Rt. Hn. Fred||Wells, William (Walsall, N.)|
|Luard, Evan||Pentland, Norman||Whitaker, Ben|
|Lyons, Edward (Bradford, E.)||Perry, Ernest G. (Battersea, S.)||White, Mrs. Eirene|
|Mabon, Dr. J. Dickson||Prentice, Rt. Hn. R. E.||Whitlock, William|
|McBride, Neil||Price, Christopher (Perry Barr)||Wilkins, W. A.|
|McCann, John||Price, Thomas (Westhoughton)||Williams, Alan (Swansea, W.)|
|Mac Coll, James||Price, William (Rugby)||Williams, Alan Lee (Hornchurch)|
|MacDermot, Niall||Probert, Arthur||Williams, Clifford (Abertillery)|
|Macdonald, A. H.||Pursey, Cmdr. Harry||Williams, Mrs. Shirley (Hitchin)|
|McKay, Mrs. Margaret||Randall, Harry||Williams, W. T. (Warrington)|
|Mackie, John||Rees, Merlyn||Willis, Rt. Hn. George|
|Maclennan, Robert||Reynolds, Rt. Hn. G. W.||Wilson, William (Coventry, S.)|
|McNamara, J. Kevin||Rhodes, Geoffrey||Winnick, David|
|MacPherson, Malcolm||Richard, Ivor||Woodburn, Rt. Hn. A.|
|Mallalieu, J. P. W.(Huddersfield, E.)||Roberts, Albert (Normanton)||Woof, Robert|
|Manuel, Archie||Roberts, Rt. Hn. Goronwy||Wyatt, Woodrow|
|Mapp, Charles||Roberts, Gwilym (Bedfordshire, S.)|
|Marquand, David||Robertson, John (Paisley)||TELLERS FOR THE AYES:|
|Marsh, Rt. Hn. Richard||Robinson, Rt. Hn. Kenneth (St. P'c'as)||Mr. J. D. Concannon and|
|Mason, Rt. Hn. Roy||Rodgers, William (Stockton)||Mr. Charles Grey.|
|Alison, Michael (Barkston Ash)||Brinton, Sir Tatton||Cunningham, Sir Knox|
|Allason, James (Hemel Hempstead)||Bromley-Davenport, Lt. Col. SirWalter||Currie, G. B. H.|
|Astor, John||Brown, Sir Edward (Bath)||Dalkeith, Earl of|
|Atkins, Humphrey (M't'n & M'd'n)||Bruce-Gardyne, J.||Dance, James|
|Awdry, Daniel||Bryan, Paul||d'Avigdor-Goldsmid, Sir Henry|
|Baker, Kenneth (Acton)||Buchanan-Smith, Alick (Angus, N&M)||Dean, Paul|
|Baker, W. H. K. (Banff)||Bullus, Sir Eric||Digby, Simon Wingfield|
|Balniel, Lord||Burden, F. A.||Dodds-Parker, Douglas|
|Barber, Rt. Hn. Anthony||Campbell, B. (Oldham, W.)||Doughty, Charles|
|Bennett, Sir Frederic (Torquay)||Campbell, Gordon (Moray & Nairn)||Douglas-Home, Rt. Hn. Sir Alec|
|Bennett, Dr. Reginald (Gos. & Fhm)||Carlisle, Mark||Drayson, G. B.|
|Berry, Hn. Anthony||Carr, Rt. Hn. Robert||du Cann, Rt. Hn. Edward|
|Bitten, John||Cary, Sir Robert||Eden, Sir John|
|Birch, Rt. Hn. Nigel||Channon, H. P. G.||Elliot, Capt. Walter (Carshalton)|
|Black, Sir Cyril||Chichester-Clark, R.||Emery, Peter|
|Blaker, Peter||Clegg, Walter||Farr, John|
|Boardman, Tom (Leicester, S. W.)||Cooke, Robert||Fisher, Nigel|
|Body, Richard||Cordle, John||Fletcher-Cooke, Charles|
|Bossom, Sir Clive||Corfield, F. V.||Fortescue, Tim|
|Boyd-Carpenter, Rt. Hn. John||Costain, A. P.||Foster, Sir John|
|Boyle, Rt. Hn. Sir Edward||Craddock, Sir Beresford (Spelthorne)||Galbraith, Hn. T. G.|
|Braine, Bernard||Crouch, David||Gibson-Watt, David|
|Brewis, John||Crowder, F. P.||Giles, Rear-Adm. Morgan|
|Gilmour, Ian (Norfolk, C.)||Langford-Holt, Sir John||Rees-Davies, W. R.|
|Gilmour, Sir John (Fife, E.)||Legge-Bourke, Sir Harry||Renton, Rt. Hn. Sir David|
|Glover, Sir Douglas||Lewis, Kenneth (Rutland)||Rhys Williams, Sir Brandon|
|Glyn, Sir Richard||Lloyd, Rt. Hn. Geoffrey (Sut'n C'dfield)||Ridley, Hn. Nicholas|
|Godber, Rt. Hn. J. B.||Lloyd, Ian (P'tsm'th, Langstone)||Ridsdale, Julian|
|Goodhart, Philip||Loveys, W. H.||Rippon, Rt. Hn. Geoffrey|
|Goodhew, Victor||McAdden, Sir Stephen||Robson Brown, Sir William|
|Gower, Raymond||MacArthur, Ian||Rodgers, Sir John (Sevenoaks)|
|Grant, Anthony||Maclean, Sir Fitzroy||Rossi, Hugh (Hornsey)|
|Grant-Ferris, B.||Macleod, Rt. Hn. lain||Royle, Anthony|
|Gresham Cooke, R.||Maomillan, Maurice (Farnham)||Russell, Sir Ronald|
|Grieve, Percy||McNair-Wilson. Patrick||Scott, Nicholas|
|Griffiths, Eldon (Bury St. Edmund")||Maddan, Martin||Scott-Hopkins, James|
|Gurden, Harold||Marples, Rt Hn, Emest||Sharples, Richard|
|Hall, John (Wycombe)||Marten, Neil||Silvester, Frederick|
|Hall-Davies, A. G. F.||Maudling, Rt. Hn. Reginald||Sinclair, Sir George|
|Hamilton, Lord (Fermanagh)||Mawby, Ray||Smith, Dudley (W'wick&L'mington)|
|Hamilton, Michael (Salisbury)||Maxwell-Hyslop, R. J.||Smith, John (London & W'minster)|
|Harris, Frederic (Croydon, N. W.)||Maydon, Lt-Cmdr. S. L. C.||Speed, Keith|
|Harris, Reader (Heston)||Mills, Peter (Torrington)||Stodart, Anthony|
|Harrison, Col. Sir Harwood (Eye)||Mills, Stratton (Belfast, N.)||Stoddart-Scott, Col. Sir M.|
|Harvey, Sir Arthur Vere||Miscampbell, Norman||Summers, Sir Spencer|
|Harvie Anderson, Miss||Mitchell, David (Basingstoke)||Tapsell, Peter|
|Hastings, Stephen||Monro, Hector||Taylor, Sir Charles (Eastbourne)|
|Hawkins, Paul||Montgomery, Fergus||Taylor, Edward M.(C'gow, Cathcart)|
|Hay, John||Morgan, Geraint (Denbigh)||Taylor, Frank (Moss Side)|
|Heald, Rt. Hn. Sir Lionel||Morrison, Charles (Devizes)||Temple, John M.|
|Heseltine, Michael||Mott-Radclyffe, Sir Charles||Thatcher, Mrs. Margaret|
|Higgins, Terence L.||Munro-Lucas-Tooth, Sir Hugh||Tilney, John|
|Hiley, Joseph||Murton, Oscar||Turton, Rt. Hn. R. H.|
|Hill, J. E. B.||Nabarro, Sir Gerald||van Stranlienzee, W. R.|
|Hogg, Rt. Hn. Quintin||Neave, Airey||Vaughan-Morgan, Rt. Hn. Sir John|
|Holland, Philip||Nicholls, Sir Harmar||Vickers, Dame Joan|
|Hordern, Peter||Noble, Rt. Hn. Michael||Waddington, David|
|Hornby, Richard||Nott, John||Walker, Peter (Worcester)|
|Howell, David (Guildford)||Onslow, Cranley||Walker-Smith, Rt. Hn. Sir Derek|
|Hunt, John||Orr, Capt. L. P. S.||Wall, Patrick|
|Hutchison, Michael Clark||Orr-Ewing, Sir Ian||Walters, Dennis|
|Iremonger, T. L.||Osborn, John (Hallam)||Ward, Dame Irene|
|Irvine, Bryant Godman (Rye)||Osborne, Sir Cyril (Louth)||Weatherill, Bernard|
|Jenkin, Patrick (Woodford)||Page, Graham (Crosby)||Wells, John (Maidstone)|
|Jennings, J. C. (Burton)||Page, John (Harrow W.)||Whitelaw, Rt. Hn. William|
|Johnson Smith, G. (E. Grinstead)||Pearson, Sir Frank (Clitheroe)||Williams, Donald (Dudley)|
|Jones, Arthur (Northants, S.)||Peel, John||Wilson, Geoffrey (Truro)|
|Jopling, Michael||Percival, Ian||Wolrige-Gordon, Patrick|
|Joseph, Rt. Hn. Sir Keith||Peyton, John||Wood, Rt. Hn. Richard|
|Kaberry, Sir Donald||Pike, Miss Mervyn||Woodnutt, Mark|
|Kerby, Capt. Henry||Pink, R. Bonner||Worsley, Marcus|
|Kershaw, Anthony||Pounder, Rafton||Wylie, N. R.|
|Kimball, Marcus||Powell, Rt. Hn. J. Enoch||Younger, Hn. George|
|King, Evelyn (Dorset, S.)||Price, David (Eastleigh)|
|Kirk, Peter||Prior, J. M. L.||TELLERS FOR THE NOES:|
|Kitson, Timothy||Pym, Francis||Mr. Jasper More and|
|Knight, Mrs. Jill||Quennell, Miss J. M.||Mr. Reginald Eyre.|
|Lane, David||Ramsden, Rt. Hn, James|
|Rawlinson, Rt. Hn. Sir Peter|