Mr. Geraint Howelk:

asked the Prime Minister if she will list her official engagements for Thursday 15 May.

This morning I presided at a meeting of the Cabinet. In addition to my duties in this House I shall be having further meetings with ministerial colleagues and others.

Is the Prime Minister aware that the very high interest rate is having a disastrous effect on small businesses? Will she discuss the matter today with the Chancellor of the exchequer and recommend that the bank rate should be lowered forthwith?

As a matter of fact, I discussed that subject with the Chancellor of the exchequer this morning. The banking figures published recently, and the money supply figures published today, indicate that there is still a very high demand for borrowing from manufacturing industry, and also some considerable demand from the personal sector. While that demand remains as high as it is, the interest rate cannot be reduced.

Will my right hon. Friend confirm that pay increases not justified by productivity are the greatest avoidable source of unemployment and that to the extent that the TUC continues to promote them, yesterday's demonstration resembles the rage of Caliban at seeing his face in a glass?

Will my right hon. Friend also confirm that she will be ready to talk to the TUC as soon as it has thought through policies that are more clearly in tune with the long-term aspirations of its members, who are taxpayers, consumers and wage-earners, than are the policies that were rejected yesterday?

The Prune Minister:

I agree with my hon. Friend that where there is a wide gap between high pay increases and increased output, that gap will lead to increased unemployment. I hope that everyone will take that fact into account. With regard to yesterday's events, I believe that the people of Britain gave their verdict. It was " Carry on Britain ", and it was right.

Has the Prime Minister noted reports that the inflation rate is about to reach 21 per cent.? Is she aware that the pensions increase announced in the Budget will in no way keep pace with inflation? Will she arrange for an early announcement to the effect that pensions will be increased even further?

On the earlier part of the question, it is expected that when the inflation rate is announced tomorrow it will be seen to have risen. There are, of course, technical reasons for that. The Budget was earlier this year than last year. There are also great reasons of substance, namely, very high pay increases not backed by productivity, and substantial increases in raw material prices over and above the increases in the price of oil.

On the question of pensions, the requisite figure is from November to November, and it is too early to say what that will be.

rose—

I shall call the right hon. Gentleman in a moment..

asked the Prime Minister if she will list her official engagements for Thursday 15 May.

I refer my hon. Friend to the reply which I have just given.

Will my right hon. Friend take time to study the difference in pay settlements between the private sector and the public services and public monopolies, especially the water authorities? Will she bear in mind that our constituents, especially mine, are increasingly unable to pay for the enormous cost of water and sewage treatment? Will she draw the appropriate conclusions?

I confirm that the level of settlements in private manufacturing industry has, in general, been lower than the level of settlements in public monopolies, including those in water authorities. One water authority has already been referred to the Monopolies and Mergers Commission, and it is the intention to refer other water authorities to it. I hope that everyone will take note of the fact that competition keeps down prices far more than monopolies do.

Will the right hon. Lady consider telling us now, or possibly publishing in the Official Report, which of the Government's failures she would describe as technical or economic? During her busy day, has she had the chance to read the excellent interview in the Evening Standard, given by the Secretary of State for Employment, who indicated that it was his view that he would not be held responsible for failures of the Government? Can the right hon. Lady say which failures she thinks the Government have had and why the right hon. Gentleman should be allowed to escape from his collective responsibility?

I assure the right hon. Gentleman, in case he is seeking it, that the inflation figure to be announced tomorrow is not likely to go up to anything like the level that the Government of which he was a member achieved.

Is my right hon. Friend aware that in her first year of office it has come as a surprise to some—a very good surprise—that she has turned out to be such an outstanding leader—[Interruption.]—

Order. I cannot hear what the hon. Gentleman is saying.

Thank you, Mr. Speaker. I was saying that my right hon. Friend has turned out to be an outstanding leader in international affairs. Having stopped a war in Rhodesia, will she now use her great influence in Washington and Europe to ensure that we do not slide into one in South-West Asia?

I am always glad to receive compliments, even when they are a bit back-handed, as is sometimes the case. I am grateful to my hon. Friend. We shall use our good offices and influence wherever and whenever we can.

Now that the Prime Minister has confirmed that the rate of inflation to be announced tomorrow will go higher still, will she now answer the question about what action she proposes to take over pensioners, whose benefit will increase by only 16 per cent. in November, and others, such as invalidity pensioners, whose benefits will increase by only 11½ per cent. in November? What action will she take about that?

The right hon. Gentleman must wait and see. The time for action is not now.

asked the Prime Minister if she will list her official engagements for 15 May.

I refer the hon. Gentleman to the reply I gave earlier to the hon. Member for Cardigan (Mr. Howells).

If the right hon. Lady plans to see her Ministers, will she make sure that she sees the Secretary of State for the Environment and asks him what is happening about homelessness in London, which is getting worse? Will she ask him to invite the Bishop of London and Cardinal Hume to see him as quickly as possible in order to do something about that situation, which his present policies are only making very much worse?

I do not believe that the policies of my right hon. Friend are making matters worse at all. He and I are very concerned about the number of empty houses in London. If we could get those into occupation, things would be very much better. He is also improving the situation a great deal as a result of the shorthold provisions in the. Housing Bill.

Is my right hon. Friend aware of the threat today—[HON. MEMBERS: " Reading."] Well, at least it shows that I can read. Is ray right hon. Friend aware of the threat of closure to the Daily Star—I emphasise that it is the Daily Star and not the Morning Star, whose closure would not disturb me at all—which is the direct result of the sulking of SOGAT at the legal right of Express Newspapers Ltd. to produce—[Interruption.]

Order. It is not fair to any hon. Member who is asking a question to have to fight to be heard.

I am very much obliged, Mr. Speaker, for your consideration. I was asking my right hon. Friend whether she would point out to the officials of SOGAT that their activities today are likely to lead to unemployment in the newspaper industry, which, sadly, would involve the hon. Member for Bassetlaw (Mr. Ashton)?

The Daily Star was started comparatively recently. It is always a great event when we get a new newspaper. I hope that it will continue to survive and that it will soon be back in print.

Will the Prime Minister today find time personally to examine the case of Anwar Dittar, whose three children are held in Pakistan? She is a British subject. They should be allowed to enter the United Kingdom. Will she look at the case herself?

I must respectfully ask that individual cases go to my right hon. Friend the Home Secretary, who is in charge of the Deparment, and I am sure that he will give his personal attention to them.

Does my right hon. Friend regard the announcement yesterday by TASS the Soviet news agency, that Afghanistan now wishes to discuss neutrality as a timely gimmick to influence next week's decision about sending teams to the Olympic Games? Will she now confirm that, to be acceptable to the West, any arrangements for the neutrality of Afghanistan must include the total withdrawal of Soviet influence from that country, the holding of free and fair elections and a respect for human rights and fundamental freedoms in Afghanistan?

We observed that the current proposals about Afghanistan, which came out this morning, were not very different from those that were published on 17 April. Nevertheless, we shall look at them. We also noted that they did not make provision for the withdrawal of Soviet troops from Afghanistan, which is what most of us would regard as the minimum circumstance and condition before we could consider going to the Olympics in Moscow.

Does the right hon. Lady think that there will be a convenient opportunity at the meeting of the Foreign Ministers at the weekend to consider carefully the proposal that has been made, to see whether a response could be made that could lead to further negotiations? The Foreign Secretary has often made that statement. Will the right hon. Lady answer in that sense?

The Foreign Ministers are at present in Vienna in connection with the twenty-fifth anniversary of the Austrian Treaty. They are doubtless discussing the matter. When my right hon. Friend the Foreign Secretary arrived, he observed that the proposal did not seem very different from those that we had heard of previously. He will, of course, look at them. We also observe that they do not make provision for the withdrawal of Russian troops from Afghanistan.

asked the Prime Minister if she will list her official engagements for Thursday 15 May.

I refer the hon. Gentleman to the reply I gave earlier today to the hon. Member for Cardigan (Mr. Howells).

Has the Prime Minister seen reports that Scottish teachers are outraged that their current wage offer is 14 per cent. for this year? As inflation is running at more than 20 per cent., and as senior civil servants have been offered about 24 or 25 per cent., why is it that the teachers of our children in Scotland have been held back to that figure?

The Prune Minister:

The negotiation of teachers' pay is a matter for the appropriate negotiating committee in Scotland. I very much deplore any strike action that has taken place. It is an extremely bad example to the children, especially at a time when they are approaching examinations.

Will my right hon. Friend acknowledge that the fact that so many people ignored the TUC's call yesterday owes quite a lot to the Government's judgment of employment legislation, which is about right? Does it not show that the Government have widespread support among trade unionists?

That is absolutely right. Yesterday also showed that people will have no truck with political strikes. They would rather get on with the job.

Will the Prime Minister find time today to send me a second letter amending the first one in which she resisted my plea to swap surgeries because our constituencies are close? Will she amend the point that she made before by giving me the figures for the homeless, those waiting for transfers and the numbers on the waiting list in Finchley, as compared with the numbers that I have in Brent, South.

I am prepared to swap figures, but I really do not think that my constituents would think that the hon. Member's other suggestion was much of a swap.