Orders of the Day — Commission for Industry and Manpower Bill

Part of the debate – in the House of Commons at 12:00 am on 8th April 1970.

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Photo of Mr Robert Carr Mr Robert Carr , Mitcham 12:00 am, 8th April 1970

As I listened to the right hon. Lady the First Secretary I felt that perhaps at least and at last there was one point on which she spoke with real knowledge and experience. That was when she spoke about what it feels like to have cold feet.

It struck me during her opening remarks that the right hon. Lady must have had a vision last night. She must suddenly have seen the date of the General Election and, the date of the Government's defeat, and felt it urgently necessary to get practice in speaking from an Opposition point of view. She did us the compliment of devoting the whole of the first part of her speech to an attack on the future Government's policy. Of course, it is the policy of the future Government that really matters for this country now.

The right hon. Lady painted a picture of the Bill. She called it "the ally of industry". I suspect that industry will have a somewhat Trojan horse suspicion about this ally coming into it. She spoke of it as "a stimulus to efficiency". I should have thought it much more likely to be a stimulus to delay in decision-making, a stimulus to reduction in capital investment and to a reduction in the competitiveness and vigour of industry, which is what we want. She spoke of this Commission as a watchdog for the consumer. It must be a new breed of barkless, toothless mongrel from the point of view of protecting the consumer. I can only think that in her speech the right hon. Lady epitomised the truth of the saying: Beauty is in the eye of the beholder. When she looks at this Commission and sees it as bringing virility into industry, imagination knows no bounds.

At least the right hon. Lady has now got another cause, another crusade. In the past, as each oasis on her desert horizon has turned out to be a mirage, she has immediately gone undaunted towards a new one. First, we had productivity and productivity bargaining. That was the theme of her hot gospelling activities about two years ago. We do not hear much about productivity bargaining today—even with paper bottoms, let alone copper bottoms. In 1969, the great theme was the conciliation pause and "In Place of Strife". These too have "gone with the wind". Now we have the Commission for Industry and Manpower.

An evil fate seems to hang over almost every cause which the right hon. Lady espouses. Her prices and incomes policy has ended in the most inflationary wage increases since the Prime Minister last tried to win an election with a wage bonanza. It has led to the most rapid rise in prices since there was a Socialist Government 20 years ago. Her industrial relations policy, which, as if tempted by fate, she called "In Place of Strife", has resulted in industrial strife on an unprecedented and still escalating scale.

For centuries the alchemists of old searched in vain for the Philosopher's Stone to turn base metal into gold. The right hon. Lady has fallen upon the secret of what one might call anti-alchemy. Every bit of gold she touches turns to lead. This C.I.M. will sink with the rest like a lump of lead, too, because it is based on muddled thinking and confused motives. If we are to understand the Bill at all, we have to see it exactly for what it is—another instalment in the Government's ineffective and damaging prices and incomes policy. It is supposed to be the final and permanent version of that policy.

When casting around for that final version, the Government had the not unhopeful idea—at least in theory—that the answer might be found in an instrument to correct the abuse of market power. That is what the Prime Minister told us in the debate on the Address on 28th October last. It is also what the right hon. Lady told us in the debate on prices and incomes on 17th December, when she spoke about accepting the principle that all those who exercise market power should be accountable to the community for their actions."—[OFFICIAL REPORT, 17th December, 1969; Vol. 793, c. 1379.] It is also what was said in the consultative document, which was distributed before the Bill was prepared. The last sentence of paragraph 3 of that document spoke about the need for machinery to deal with all situations of imperfect competition. The first sentence of paragraph 4 of the document promised that The new commission will be in a position to deal with this problem throughout the economy. I ask the House to note the use by the right hon. Lady in December of the phrase, all those who exercise market power and the use of the words in the consultative document that we needed machinery "throughout the economy" and "to deal with all situations of imperfect competition."

But now we have the Bill, that promise has not been kept: these principles have not been put into practice. Whatever the differences—and there are enormous differences of a deep kind—between the supply of labour and of goods, nevertheless market power can be exerted and can be abused both by the price fixers and by the wage fixers.

For example, take the case of the printing industry. Can anyone pretend that the supply of labour, the manning scales, the levels of pay, the admission of women and the existence of restrictive practices are not all strongly affected by the market power exercised by the printing trade unions through their extremely tight closed shop and other arrangements. Of course they are.

And if one is to attempt to achieve me Government's avowed objective—to quote the Prime Minister—of the correction of the abuses of market power, then the correction has to be applied equally, as the right hon. Lady herself said in December, to all those who exercise it. And any control over the abuse of market power and the supply of labour is, as the right hon. Lady admitted, specifically excluded from the Bill.

It might well be argued that the supply of labour should not be dealt with in this sort of legislation or by this sort of corn-mission. That could and would be a serious argument. The point about it is, however, that the Government is making no attempt to deal with this sort of market power either in this Bill, or any other Bill or in any other way. [An HON. MEMBER: "Neither did the right hon. Gentleman's party from 1950 to 1964.'] We are at the moment talking about the C.I.M. Bill and the principles the Government laid down and which they are failing, as always, to put into practice.

Quite apart from any question of justice in the treatment of one section of the community compared with another, this omission inevitably renders largely nugatory the principle of dealing with the problem by the control of market power. So we have a Bill, and under it a Commission, in which the principle of market power is hopelessly mixed up with and largely overlaid by considerations which, in our view, will prove as harmful in their new C.I.M. context as they did in the past in their old prices and incomes policy context.

Thus, this C.I.M. is a strange mongrel creature in which, unfortunately, the dominant characteristics have been inherited from the P.I.B. rather than the Monopolies Commission parent. Under this proposed dispensation we now have a situation where prices can be statutorily regulated and controlled; and not only, whatever the right hon. Lady may say, when the abuse of market power has been proved. The Bill goes much wider than that.

We have, under this proposed dispensation, the situation where prices can be statutorily controlled and wages cannot be. We do not believe—and we are absolutely consistent in this—in the detailed statutory control of either wages or prices. But this particular mix of statutory price control and no wage control is a recipe for disaster. It will encourage either roaring inflation—if it is possible to get an inflation more roaring than the one we are in at the moment—or, if prices should, by any chance, be held below the rising wage costs, declining profitability and, therefore, declining investment in industry when the Chancellor is saying that declining investment would be one of the worst things for economic policy.

Those, then, will be the penalties we would pay and that would be the sort of disaster. Paradoxically, we may find ourselves with a mixture of both evils at the same time—the traditional Labour Government induced "stagflation" about which my right hon. Friend has often spoken——