Orders of the Day — Finance Bill

Part of the debate – in the House of Commons at 12:00 am on 28 April 1971.

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Photo of Mr Joel Barnett Mr Joel Barnett , Heywood and Royton 12:00, 28 April 1971

My hon. Friend may well be right, but that is what the Prime Minister said last week. If escalating wage demands have been halted, one is bound to ask why the Chancellor of the Exchequer went further today than he did in his Budget speech. In his Budget speech and in other statements which he made before the last week or so, he gave the impression that if his Budget did not have the desired effect of reducing unemployment and achieving 3 per cent. growth he would be ready to take further action. What he said today was very different, and it will have caused concern in the country. He said in explicit terms that he was not prepared to take any further action. I should be delighted if that were not so, but I see from the right hon. Gentleman's silence that it is so. The Chancellor has failed to take the opportunity to remove from millions of people a fear which most of us never dreamt would return, a fear of unemployment, not just amongst ordinary workers but amongst executives, young, middle-aged and old. Those people can have received little hope from the Chancellor's speech today.

The right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) and others showed themselves to be compassionate people who were extremely concerned about the level of unemployment. They thought that it was unfair of my right hon. Friend the Member for Cheetham to accuse the Chancellor of deliberately allowing unemployment to rise, but what else can one deduce? The Chancellor knows what he is doing, if hon. and right hon. Gentlemen opposite do not. He knows that if he is not prepared to take action unemployment will rise, but he is not prepared to tell us that he will take action, so what else can one say? In spite of the compassion which right hon. and hon. Gentlemen feel, the Chancellor's policies, which they support, will bring about increasing unemployment, and the only conclusion we can reach is that if hon. Gentlemen are not deliberately doing this, the Chancellor is. I am surprised that, since the Chancellor said in his Budget speech, that he has the power to reduce the level of unemployment, he is still not prepared to say that he will act before unemployment reaches the tragic level of 1 million. If the Government are not disturbed by that, the people in the country will be.

If the Prime Minister is satisfied that the Government are halting the escalation of wage demands, as he said, will he give us an assurance that he will not be considering a statutory incomes policy, in view of the reports of disagreement in the Cabinet on the possible need for an incomes policy? Will he be prepared to give us that assurance? We must assume that the eloquent silence speaks for success in the halting of the escalation of wage demands. If so, he and his colleagues are the only people in the country who are satisfied. No serious commentators are satisfied with what is happening.

Another way was opened to the Chancellor by the T.U.C. In the face of intense provocation the T.U.C. has shown itself to be much more statesmanlike than the Government. The T.U.C. is more than ready to recognise that there is a problem here, and it has said that, given a Government prepared to go for economic growth, the T.U.C. in turn is prepared to consider what is in effect a voluntary prices and incomes policy. The Chancellor dismissed that out of hand.

The Bill and all the measures behind it have to be taken together. Hon. and right hon. Gentlemen opposite are fond of talking about the tax remissions in the Budget and ignoring all the other financial measures that have been taken since last June. Taking these matters together, the chance of co-operation with the T.U.C. has been made extremely difficult. As my hon. Friend the Member for West Lothian (Mr. Dalyell) said in a very brief intervention, what has happened in his area of the motor industry has shown all too clearly the difficulties of getting the co-operation of the trade union movement.

How can trade union leaders, who want to stay in office probably at least as much as do Ministers opposite, be expected to accept wage settlements when, because of Government policy, those settlements would leave their members worse off. One commentator recently said that the Ford settlement of 16 per cent. a year over two years was not enough.