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 Norman Atkinson Mr Norman Atkinson , Tottenham 12:00 am, 8th April 1970

I cannot remember ever having heard the Opposition in such difficulty in trying to criticise a Bill. The opening speeches from both Front Benches were arguing opposite cases, but seemed to be frightened to death of the case they were arguing. My right hon. Friend the First Secretary—I hope that I get the gender right—is an absolute master of the soft sell. But there is a problem there. While she tries to project this concept, trying to placate criticism which may be coming from the C.B.I. or from the other side of industry, she is infuriating the people whom we represent.

In trying to point out that the thing is not really so sharp-toothed, that it will not make all that difference in terms of intervention, and that industrialists should not be afraid, my right hon. Friend is showing the Labour Movement that this is not a major instrument in projecting some of the policies which we have argued for so long. So there are great difficulties in that argument.

The Opposition are frightened of being honest and admitting that they are totally non-interventionist in their whole approach to the management of the economy. Thus they get into the schizophrenic difficulty of trying to argue the case both ways. Obviously, the right hon. Member for Mitcham (Mr. R. Carr) was frightened to death of falling into the arms of the right hon. Member for Wolverhampton, South-West (Mr. Powell), in his arguments about free marketeering. The applause which greeted one or two of his comments suggested that the party opposite are free marketeers and base their whole case on that.

The right hon. Gentleman also said that this could be like the Government throwing a piece of firewood into a fire of industrial relations. If they intervened to freeze a price at the same time as a union was negotiating a wage increase in that industry, he said, there could be an explosion. The unions would welcome that, because part of their case is that we should try to negotiate wages against price ceilings. By negotiating wages in this way, if we were pushing against price ceilings, we would compel the representatives of industry to concede a wage advance at the expense of dividends. We are not afraid of that: we would welcome it. However, many of us feel that it is likely to be a theoretical aspect only.

I turn to the rôle of the new Commission to review wage structures in some parts of industry. This is to be welcomed, because it gives us an opportunity to consider some of the problems that have arisen in sectors of the economy in which wages are paid from taxation, particularly nursing. This could be a new era for negotiating wages in medicine, for nurses and doctors, just as my right hon. Friend pointed out that it could provide a new method for negotiating the salaries of teachers and university staffs. In this respect, the Bill, also, is to be welcomed.

There is a difference of view between the two sides of the House on the question of intervention or non-intervention. My hon. Friends and I are complete interventionists. We therefore regard the Bill as an instrument for intervention, and we welcome it. To us, this is an essential piece of apparatus for intervening in the economy and I hope that, in Committee, the Bill will be strengthened in accordance with, for example, some of the suggestions of the T.U.C.

Not only the T.U.C., but various sections of the trade union movement, including my union, the A.E.U., have made comments on the Bill. In general, the whole of the Labour Movement supports the Bill, its concepts and purposes. The T.U.C. has made some of its criticisms of the Measure known and it has suggested some additional areas of operation for the proposed Commission.

The T.U.C. has suggested that the Commission should be strengthened to give it greater opportunity to investigate the accounting practises of multi-national companies in this country. It is also concerned, in connection with multinationals, to see import-export balances investigated, possibly by the Commission. It is to be hoped, therefore, that the new body will be strengthened to give it the ability to investigate questions of this sort.

Again, on the question of multinationals and other giants in industry, the T.U.C. has pointed to the need for com- panies to submit their manpower and investment policies for periods of, say, three to four years ahead. The T.U.C. would like the new Commission to have power to compel companies, and particularly the multi-nations, to submit their manpower policies for the period ahead.

Next, the T.U.C. believes that the whole system of price intervention should be strengthened. It also suggests that mergers should not be agreed in the absence of an understanding on the redundancy side. I understand that this question is to be discussed in some detail. It is to be hoped that a code applying to mergers and redundancies will be written into the Bill.

When speaking of what he described as the inadequacy of staffing proposed for the new Commission, the right hon. Member for Mitcham was right to mention the fear about the ability of this body to perform its various functions. I believe—this view is supported by many members of the trade union movement with whom I have discussed the matter—that the C.I.M. should create a pool of leading consultants who could adequately deal with such matters as organisation and methods, work study and cost analysis. There has been great criticism of the P.I.B. in this respect and of some of the investigations that it has made.

Similarly, there has been some criticism of the policy of employing foreign consultants in this sphere to work in this country. Many of us have never been able to understand why it was necessary to bring in a team of Americans to tell us what was wrong with the Bank of England, or why it was necessary to bring in a crowd of Americans—people who were totally orientated to private enterprise and who understood the code of behaviour of private enterprise in the United States—to tell us what was wrong with the nationalised industries in this country.

We believe that the new Commission should be strengthened from this point of view because we say that there is a sufficient pool of expertise in Britain—in organisation and methods, work study, cost analysis, and so on—from which we could recruit people to be employed by the Government to undertake investigations of this kind. In other words, we have no need to travel the world looking for consultants to do this job for us.

We strongly believe that these people should be employed by the Government, remembering that in their investigations they could have contradictory parts to play. For example, while investigating a nationalised industry they might reach conclusions which are critical of one or more sectors of private industry. They might feel inhibited from reaching firm conclusions since their next brief might come from the very section of private industry of which they are critical.

The right hon. Member for Mitcham spoke of the need for price stability. The trade unions regard this as a priority and are equally concerned about it. They take this view for two main reasons. First, they refute, as I do, the suggestion that price inflation is the direct result of wage increases. This is not necessarily so. Indeed, when speaking of that emotive thing, the so-called wage explosion, we should not forget that the Ford Motor Company recently concluded an agreement for an across-the-board wage increase of about 20 per cent. That company has gone out of its way to point out that its recent price increase of 3 per cent. to 4 per cent. has nothing to do with its concession of a 20 per cent. wage increase.

The company has detailed why its recent price increase arose and has said that the cost of steel and non-ferrous metals has been basically responsible for it. We should, therefore, congratulate Ford's on conceding a 20 per cent. wage increase and on afterwards arguing that none of it has been passed on to the consumer. Thus, it is not correct to say that the wage claims now being negotiated represent the basis of future price explosions.

Price inflation hits the wage earner hardest. Inflation during recent years has almost cancelled out wage advances gained by organised labour. In 1969, wages went up by 8 per cent. and take-home pay rose by about 6 per cent., but the index of retail prices rose by 5 per cent. Therefore, when one looks at the overall picture, organised workers in general have made little advance in terms of improvement in their overall living standards. Trade unions basically are more concerned about price stability than the actual amount being negotiated in the wage packet since they realised that their efforts are being eroded. In the matter of living standards wage negotiators are having to run like mad to stand still. This is an important point which should be emphasised.

The T.U.C. comments on the Bill touched on the question whether price inflation could be curbed by use of an instrument such as this legislation as a deliberate act of policy. They mentioned the necessity for strict surveillance of Government purchases, the size of which and the nature of overall procurement policy have an enormous influence on prices. The second consideration relates to the efficiency audit, which trade unionsists welcome since we believe that there is an absolute need far an efficiency yardstick by which we can understand what is happening in the nationalised industries. It is in the interests of wage earners that this should be done.

Thirdly, there is the question of maintaining wages against price ceilings. The right hon. Member for Mitcham spoke about throwing firewood into the fire of industrial relations. This again, is a matter of great importance to the trade unions. The fourth matter relates to the intensification of price consciousness in the retail trades.

Finally, there is the shift of indirect taxation to direct tax, on which the T.U.C. has made its views clear. I hope that the Chancellor of the Exchequer will get the message when he comes to make his statement to the House.