Clause 3

Part of Orders of the Day — Finance Bill – in the House of Commons at 12:00 am on 10th April 1973.

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Photo of Mr Raymond Carter Mr Raymond Carter , Birmingham, Northfield 12:00 am, 10th April 1973

One of the great arguments in favour of tradition is that it is dynamic and is constantly evolving and changing. If I add just a little to that tradition today, I am sure that it will not destroy either the content of this debate or that of future debates.

When I refer to motor car insurance premiums, I am not referring to taxation but to matters which arise out of the Counter-Inflation Act and in part out of last year's Finance Act. They were referred to by my right hon. Friend the Member for Leeds, East, and the Chancellor of the Exchequer himself has made reference to the Counter-Inflation Act.

My point about motor car insurance premiums arises directly out of the Counter-Inflation Act. I should not have thought it was straining the traditions of this debate or the general rules of our proceedings to raise this matter, especially as I have tabled parliamentary Questions to the Secretary of State for Trade and Industry and have received entirely negative answers on a matter of great public interest. As we have a Treasury Minister with us today who is responsible for Government economic policy, I feel that we might perhaps get some response from him, even though his attitude so far has given no indication of that.

Last week the major motor car insurance companies one by one announced in the Press that they had applied to the Government for increases in their premiums. Figures quoted ranged from 5 per cent. to 20 per cent. Under the Counter-Inflation Act additional powers were devolved upon the Secretary of State for Trade and Industry in respect of motor car insurance premiums. The Act provides for the right hon. Gentleman to examine any applications for increases and to decide whether they are justified. In parliamentary Questions to the Secretary of State for Trade and Industry I asked how many companies had applied for increases, what was the nature of those applications, and what he intended to do about them. I received from the right hon. Gentleman an entirely negative answer.

When we were considering the Counter-Inflation Bill in Committee hon. Members were assured time and time again that if we had Questions on price increases or pay awards, whether they were with the Price Commission, the Pay Board or the Minister, we could table Questions and would receive answers from the Ministers responsible. It is not good enough for the Financial Secretary to tell me today that I am stretching the terms of this debate. I have already asked the Minister responsible for answers which I was assured in Committee that I would get, only to find that I have not been given them. For that reason I raise the matter again today.

6.15 p.m.

I can assure the Minister that if we fail to get answers to Questions of that kind we shall seek every opportunity that we can to raise these matters in other ways. I make no apology for doing so today even though, apparently, I have caught the Financial Secretary unawares. In view of the nature of the legislation that this House has passed, I believe that we have to be extremely watchful. My fear is that, applications having been made to the Secretary of State, decisions will be taken during a parliamentary recess. That is not good enough. If it is possible for the Press to have available to it all the information that I have mentioned, why cannot it be given to hon. Members?

I hope that the Financial Secretary can give us some answer on this matter. I appreciate that it is not strictly within his purview, but it concerns the Government's economic policy for which he is responsible and with which he can deal.

I turn now to a matter which is perhaps within the traditions of this debate. It has been referred to already, although it may be that it was out of order then. It concerns investment. I want to compare the present investment situation with the rosy economic picture which the Government constantly put before our eyes. It is a staggering fact that in every year of this Government's tenure of office investment has fallen as a percentage of the GNP. This is a unique figure in British economic life since the war. I do not know how the Government can declare that the British economy is running at full steam, at maximum efficiency and with the future assured. If we are to have any assurance at all about the future, it must be out of the fact that investment is rising and providing us with the plant, equipment, machinery and factory space which can provide the jobs, the opportunities, the products and hence the markets of the future. I do not believe that the investment picture that we see gives us any hope for the future.

In an intervention 1 referred to the present employment position. It is true that unemployment is falling. Looking at the statistics, clearly it is equally true that employment is not rising. I do not know the reason for that contradiction. It may be that the Government do not know. I am sure that there are hidden factors at work. For example, it is clear that fewer women are at work today compared with the position four or five years ago. This has something to do with equal pay. More probably it is because the jobs which they used to do are no longer available since men who have been unemployed for long periods are being given these employment opportunities. The jobs are lost to women. It means that the employment picture, too, gives us no great hope for the future.

I wonder what the Press and the establishment generally would have had to say about a Labour Government if their economic performance was turning out in the way that the present Government's is. We still have massively high unemployment and falling investment. The pound can by no means be described as strong. We are running into a balance of payments crisis, and still we have skyrocketing inflation. To me, all that does not add up to a picture of sound economic performance. Yet only this afternoon the right hon. Gentleman the Prime Minister told us that we have a booming economy and there is really nothing to worry about as far as the future is concerned. I am extremely concerned about the future. I am worried about Britain just after it has entered the Common Market, with the enormous and powerful continental competitive forces by which we are now faced. If we had entered the Common Market 10 or 15 years ago British industry would have been in a very powerful position, not in terms of modernisation and efficiency but in numerical terms; and probably we could have won markets which would have ensured that British industry would have had the capital wherewithal to have improved its base.

Clearly, however, that is not the picture now. We are faced with French industrial capacity which is highly efficient and modernised, and with a similar German machine. Italy, too, in the motor car industry, the machine tool industry and various other aspects of industry is far in advance of what we are here. It is said by some of those who look at the British economy and feel that it is not doing as well as it could, that capitalism is outmoded, that it can no longer function properly in the kind of economy we have had in this country over the past 30 years. I do not believe that that is the case at all, because, after all, capitalism is doing pretty well elsewhere.

I believe that in every area of our development where entirely new methods are required it is not a question of capitalism versus socialism but simply a matter of trying to re-gear and retool machinery some of which is over 200 years old, 100 years older than that of many of our competitors on the Continent. It is going to require quite superhuman effort on the part of of the British people, the British nation and the British economy for our industry to take its place equally alongside its continental competitors. I believe that for the Government to pretend that the economy is moving towards that position is the height of obscurantism. We arc not moving that way at all.

If I may refer back to investment, only one of our EEC partners has a lower level of investment than we have; that is Italy. The time has come, as I have said on numerous occasions in the past, for the Government to be entirely honest with themselves and with the British public outside. I believe they would be surprised at the response. What I am sure of is that we can no longer carry on deluding ourselves into believing that somehow, by manipulating this or that, we can break out of the difficulties that we are in.

The difficulties we face are enormous, and before long, with this Government or the next, measures of a quite fundamental nature will have to be taken to put right the ills of the British economy. So I hope that in the course of this Finance Bill we can once again, as many of us did in the Counter-Inflation Bill, point out to the Government precisely what they have to do in order to put the British economy right; and in order to do that they have first to stop deluding themselves.