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Economic Affairs

Volume 721: debated on Thursday 25 November 1965

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Regional Planning Councils

1.

asked the First Secretary of State and Secretary of State for Economic Affairs what action he is taking to ensure that regional planning councils are adequately apprised of the needs of the people of their region.

Members of councils are widely representative of different types of experience within their regions. In addition, councils obtain information from the economic planning boards, and from their many contacts with local authorities, industry, trade unions, social service councils and other bodies.

While thanking my hon. Friend for his reply, may I ask whether he will not agree that the effectiveness of the operations of the planning councils and the public interest in their work would both be improved if it was possible for part of their membership, at any rate, to be directly elected?

That does not arise from the Question. The important thing is that these councils are working extremely well and are getting on with the job for which they were appointed. They will be judged by results.

Rates

2.

asked the First Secretary of State and Secretary of State for Economic Affairs if he will refer to the National Board for Prices and Incomes the impact of rates upon the householder.

The First Secretary of State and Secretary of State for Economic Affairs
(Mr. George Brown)

No, Sir. We are tackling this problem in other ways.

Will the right hon. Gentleman inform the House whether he thinks that we can expect trade unions or employers to accept the implications of the incomes policy when rates alone increased last year by over 14 per cent.?

I fear that this has been a feature of life for a long time. The present Government, unlike their predecessors, have already announced that they are about to introduce a rating Bill which will help householders very much and give overdue assistance.

Dividends

5.

asked the First Secretary of State and Secretary of State for Economic Affairs if he will refer to the National Board for Prices and Incomes the current trends in the payment of dividends, either in general terms or in specific cases.

18.

asked the First Secretary of State and Secretary of State for Economic Affairs whether he will refer recent dividend increases to the National Board for Prices and Incomes for their investigation.

The trend of dividend payments is one of the questions which will be studied by the N.E.D.C. in the course of their forthcoming review of the general movement of prices and money incomes of all kinds.

Is my right hon. Friend aware that that Answer does not inspire any kind of confidence? Is he further aware that this is a matter of urgency? Is it not the case that he will not get the agreement of ordinary manual workers unless and until some reference is made to the Board of dividends and profits? Will my right hon. Friend, in particular, look at the profits and dividends of the building materials industry which I think is worth close investigation?

I think I must have misheard my hon. Friend's first sentence. As to the second part of the supplementary, may I draw his attention to the figures I gave about the movement of dividends in the second quarter of this year after I had issued a warning, as compared with the first quarter. As to the third part of the supplementary, we have in mind the question of building materials as a possible subject. I am thinking here not so much of dividends as prices and costs.

Migration, Scotland

6.

asked the First Secretary of State and Secretary of State for Economic Affairs what factors were taken into account in arriving at the estimates in Appendix A of the National Plan that 206,000 people would migrate from Scotland in the next seven years and that the population of working age would fall by 86,000 in that period.

In fact, a net migration of 178,000 people over seven years is anticipated in the Plan. The Government's policies are aimed at ensuring a steady fall in the annual loss from the peak of over 40,000 achieved in 1963–64.

Does the hon. Gentleman accept that these figures have caused great concern in Scotland where, although migration problems have existed for many years, we have never planned to create them? Are these figures in the Government's plan? If not, why are they included?

I believe that people in Scotland are glad to know that we are now moving away from the accelerating rate of migration which was characteristic of the period up to the peak of 1963–64. I am satisfied that the Government's policies will keep the reversal of this trend well maintained.

Regional Development

7.

asked the First Secretary of State and Secretary of State for Economic Affairs to what extent his plans for regional development have been affected by the selectivity of the Government's recent cuts on capital spending.

The effect of this selectivity has been to protect the less prosperous regions and will help to correct regional imbalance.

Is the hon. Gentleman aware that his right hon. Friend said in debate on the National Plan that Scotland had been exempted from the Chancellor's financial restrictions? Is he further aware that only last Wednesday the Secretary of State for Scotland indicated that capital borrowing for the third quarter had been down by one-third, that house building this year had been cut by over 2,000 and that the road programme had been slashed? Is this exemption? Should not the Minister come to Scotland and see what is happening?

What is happening in Scotland is that, for the first time, Scotland is cushioned against the consequences of the need to restrict pressure elsewhere. My own experience is that the people of Scotland are very satisfied.

Will the hon. Gentleman give me an assurance that hydroelectric schemes submitted by local authorities to the Water Resources Board under the Water Resources Act will be exempted from capital restrictions where they apply to development districts?

Departmental Staff

8.

asked the First Secretary of State and Secretary of State for Economic Affairs what increase or decrease there was in the staff of the Department under his control in the period 16th October, 1964 to 15th October, 1965; and what increase or decrease he anticipates in the period up to 15th April, 1966

When the right hon. Gentleman considers the size of his Department and other Departments, notably the Ministry of Technology, does he consider that the country is getting all the government for which it is paying, or does he feel that people ought to be glad that this is not the case?

Rents

9.

asked the First Secretary of State and Secretary of State for Economic Affairs whether he will refer rents to the National Board for Prices and Incomes.

Since the Minister has indicated by his replies so far this afternoon that he intends to adopt a wholly protective attitude towards the Prices and Incomes Board, does he not consider that rents form so high a proportion of the average workman's outlay that it is really anomalous that this should be excluded from the purview of our major anti-inflation mechanism?

I am sorry. The problem is that the hon. Gentleman has not really observed what is going on. We are dealing with rents in a slightly different way, but we are dealing with them and that is why we have legislation before the House.

Pay Claims (Early Warning)

10.

asked the First Secretary of State and Secretary of State for Economic Affairs how he intends to get early warning of pay claims in industries where there are no trades unions.

As is explained in paragraph 21 of Command Paper 2808, where there is no trade union or staff association, which is available, claims of any importance should be notified by the employer.

In that case can the right hon. Gentleman say why he does not use the employers to inform him on all occasions and why he has been so inconsistent in getting employers to do so on some occasions and trade unions on the other? Would it not be more sensible to use the employers throughout the whole operation?

We obviously considered that. It may be so to the hon. Gentleman, but I can assure him that it was not the same to the employers.

Foodstuffs (Prices)

11.

asked the First Secretary of State and Secretary of State for Economic Affairs what action the National Board for Prices and Incomes propose to take in view of the increase in some basic foodstuffs; and if he will make a statement.

This is a matter in the first instance for the Government. The action we are taking to deal with increases in food prices is described in Command Paper 2808, laid before the House on 11th November.

Is my right hon. Friend aware that recently lower grade eggs were advertised at higher grades and, as a result, at higher prices? Can he say whether there is any temporary measure which might be adopted to stamp out that type of unjustified increase so far as prices and incomes are concerned?

We have had this particular issue in our minds and watched it carefully. We do not think that this was a case for reference to the Board.

National Plan

13.

asked the First Secretary of State and Secretary of State for Economic Affairs if he will provide input/output tables which show the relationship between the various industries covered by the National Plan and reconcile the figures given for each industry.

Yes, Sir; a paper will shortly be published by the Department of Economic Affairs describing the techniques used in drawing up the Plan, and this will contain the input/output tables for 1970.

14.

asked the First Secretary of State and Secretary of State for Economic Affairs why the questionnaire which forms the foundation of the National Plan did not ask businessmen, who were providing answers on the basis of an arbitrary assumed rate of growth in the economy, whether they considered the figures they gave for their sectors were feasible.

Would the right hon. Gentleman not agree that the questionnaire did not contain this question specifically? Would he further agree that the figures produced on the assumption that they were feasible have not been substantiated?

I would not have answered "It did" if the answer should have been "It did not". It did. Industries were asked, and now I quote:

"To take account of all reference to difficulties likely to be encountered in reaching the estimated level of output."
That obviously refers to feasibility.

Does the First Secretary realise that the questionnaire was subjected to very serious criticism by all commentators, both for what was in it and for what was left out? If, as we understand from the debate on the Plan, he is not going to have a questionnaire next year, what form of inquiry does he propose shall take its place?

It was criticised severely by commentators who had not read it, less severely by those who had, and hardly at all by industry, which was asked to fill up the questionnaire. Only yesterday I was present at one of the economic development committee meetings, attended by one of our largest industries. I can assure the right hon. Gentleman that he is quite wrong. On the question of what we are going to do this year we are not, as I explained in the Plan debate, going to roll the whole exercise forward. We shall be filling in those parts which were not as full in the first year as we would have liked them to be. We shall be taking account of changes in the year, and the necessary questions for that purpose will be asked.

16.

asked the First Secretary of State and Secretary of State for Economic Affairs what are the other means, referred to in the National Plan, which the Government may use to make sure that total national profits do not get out of step with wages and salaries, taking one year with another.

Would the right hon. Gentleman not agree that he is more likely to gain general acceptance of the National Plan is he stresses its positive aspect, which is to increase productivity, and that productivity will not increase unless it is profitable to increase it? Rather than seeming to decry profits, would it not be wiser to concentrate upon the uses to which they are put? Does he not agree that one of the most useful purposes is that of reducing prices?

I welcome the conversion of the hon. Gentleman, and I commend what he has said to the attention of the right hon. Member for Wolverhampton, South-West (Mr. Powell).

South-East Study

15.

asked the First Secretary of State and Secretary of State for Economic Affairs whether he will now make a statement on the South-East Study.

I would refer the hon. Member to my answer to the hon. Member for Banbury (Mr. Marten) on 26th October.

Will the Joint Under-Secretary not recognise that his party's pledge to scrap the South-East Plan was a piece of empty and foolish rhetoric? Will he not now get on with it and recognise that many of the assumptions in the South-East Study made by the last Administration may form the basis for a development plan of this region?

It is not quite clear what the hon. Member means when he says "get on with it." Does he mean we ought to scrap the plan because he takes the view, as we do, that in a number of cases the assumptions made in it were wrong? We are reviewing the previous Government's study and we have announced some conclusions. We will announce the others when we are ready.

Do the Government expect to have a Plan for the South-East before they go out of office?

We are developing plans for all parts of the country, and we have a long time ahead of us in which to do so. This will not be used as an excuse for delay.

Greater Teesside

17.

asked the First Secretary of State and Secretary of State for Economic Affairs to what extent his current regional planning takes account of the proposed creation of a Greater Teesside authority.

We are aware of the importance of the proposal for a Greater Teesside and will take full account of its consequences for economic development in formulating our plans for the Northern Region.

Will my hon. Friend do all that he can to co-ordinate the work of different Departments to ensure that the full development possibilities of Teesside are realised and to minimise transitional difficulties in, for instance, the field of education?

Yes, Sir. Our Economic Planning Council and Planning Board are looking at the future of Teesside as part of their review of the problem of the Northern Region as a whole.

Merseyside

19.

asked the First Secretary of State and Secretary of State for Ecnomic Affairs if he will make a statement on the document, The Problems of Merseyside.

The report on tie Problems of Merseyside is being studied by the North-West Economic Planning Council in preparing their proposals for the Region as a whole. I shall be visiting Merseyside myself next month to look at the problems on the spot.

While appreciating the reply of my hon. Friend, I wonder if he would agree, having regard to the fact that the National Plan envisages very rapid economic growth on Teesside, and having regard to the report of the North-West Study, that this matter might well be debated in this Chamber?

This is not a matter for me. All I would say is that we are certainly fully aware of the need to make full use of under-utilised resources of manpower, such as there are on Merseyside, in order to achieve the objectives of the Plan.

Yorkshire And Humberside Region (Study)

20.

asked the First Secretary of State and Secretary of State for Economic Affairs what are the reasons for the delay in publication of the study of the Yorkshire and Humberside region.

The Yorkshire and Humberside Economic Planning Council started virtually from scratch in April and the assembly and analysis of the information takes time.

Is my hon. Friend aware that the interval for preparation of this study is longer than that of the studies of the North-West, East Midland and West Midland regions? Is he further aware that the absence of the information contained in such a study is inhibiting the advisory council in its work? Would he ensure that when the study is made, it spells out clearly the economic consequences of the establishment of a new city centre for the Humberside?

On the final point, we are certainly very fully aware of the potentialities of Humberside for growth. On the earlier point, we wish we could have been farther advanced, but we had to start with the material which we found when we came into office, and this was very little indeed.

I should like to ask my hon. Friend if he can give any indication to the House when this report will be published?

We are going ahead as fast as we can, but it would be premature to announce a date now.

Overseas Expenditure

21.

asked the First Secretary of State and Secretary of State for Economic Affairs how the estimate, given on page 75 of the National Plan, for Government expenditure abroad for 1970 of £510 million at 1964 prices is composed as between military, aid, and other expenditure abroad.

I regret that it is not possible to give more than a broad indication about the level of Government expenditure overseas in 1970 since the Defence Review is not yet completed; moreover, as we said in the National Plan, the level of overseas aid will be reviewed periodically in the light of the progress we make in overcoming our economic problems.

If the right hon. Gentleman wants the Plan to be accepted as a national and not a party document, will he publish those estimates, even those which conflict most startlingly with pre-election promises, and will he confirm that on whatever reading of those paragraphs of the National Plan, despite the fact that many forms of aid involve no balance of payments costs, it is none the less the intention to reduce the proportion of our national income which is given in aid overseas?

The answer to the second part of the question is "No, Sir." The answer to the first part is that the Plan is accepted everywhere except on the benches opposite as a national plan.

Did the right hon. Gentleman take into account the purchase of some islands in the Indian Ocean and the consequent expenditure on them over the next few years, and will he say what other possible purchases by Her Majesty's Government in Colonial Territories are envisaged in the next few years?

There are obviously figures that one works out for the purpose of doing the job, but does not necessarily publish in that kind of detail. I repeat that the Defence Review is now proceeding, and I would invite the hon. Gentleman to await its outcome.

Would the right hon. Gentleman help the House? We have this overall figure, but it is evidently impossible to break it down because we have not got the estimates from the Defence Review. How was the overall figure obtained, and, as the aid is not variable, why can he not give the House the figure for the aid?

If the hon. Gentleman thinks about it, he will realise that there are many reasons why I should not give the figures in that detail to the House and, therefore, the world outside. He may take it that in coming to our decisions we had the figures before us. I do not propose to go any further in public. But on the general question of defence expenditure, I repeat that we must await the outcome of the Defence Review.

New Industry, West Durham

23 and 24.

asked the First Secretary of State and Secretary of State for Economic Affairs (1) what steps he is taking to ensure that the Economic Planning Council for the Northern Region is giving priority to the need for new industry in the part of Durham which is west of the Great North Road;

(2) what plans he has for the establishment of new public enterprises in those parts of West Durham affected by pit closures.

26 and 28.

asked the First Secretary of State and Secretary of State for Economic Affairs (1) what estimate he has made of the extent to which the economic recovery of the Northern Region will be retarded when the recently announced programme of pit closures is completed;

(2) if, in view of the uncertainty in the coal mining industry following the announcements of further pit closures, he will now increase capital investments in the Northern Region in order to establish alternative publicly-owned industries.

The Northern Economic Planning Council is urgently considering the implications of the pit closure programme in the light of the remedial measures the Government have already put in train and in order to ensure that the present prosperity of the region is maintained.

Will my hon. Friend bear in mind that the policy initiated by the previous Administration on the North-East, which classified West Durham as a "travel to work area", not only caused bitter resentment throughout the whole of West Durham but has had disastrous consequences so far as attracting industry is concerned, and that we now believe that positive measures by the Government for public enterprise are essential to that part of the country?

Yes, we are very fully aware of what are the special problems of the west part of the County of Durham, and we are taking full account of them in preparing our plans for the region.

Does my hon. Friend appreciate the shattering impact that the recent news of pit closures has had throughout the coal industry? Secondly, will he also recall that the Plan itself, so far as closures are concerned, means a [most a compulsory mass migration from the Northern Region into other coalfields in different parts of the country, thereby increasing the difficulties with regard to new jobs and capital investment which is needed to a far greater extent, despite the efforts of my hon. and right hon. Friends in the Board of Trade to provide jobs in these last few months?

We are fully aware of the acute social problems that the necessary decisions about pit closures have produced, but I am sure that we can deal with them both in personal and welfare terms and also make sure that the Northern Region contributes increasingly to national prosperity by making full use of the manpower in it at the present time.

Is the hon. Gentleman aware that the National Plan adopts the conception set out in the Hailsham Plan growth areas, and, in consequence, will he realise that the National Plan in this respect is sensible, as it is only to growth areas that industrialists will go?

We recognise that some places have a greater potential for growth than others, but this is no reason why we should neglect the real human problems in areas like the west part of the County of Durham.

Will the Minister give the House a categorical assurance that it is not the intention of the Government to establish entirely new nationalised industries as envisaged in these two Questions?

Jam (Containers And Price)

25.

asked the First Secretary of State and Secretary of State for Economic Affairs if he will refer to the National Board for Prices and Incomes the increase in jam prices which has followed from a decrease in the size of jam jars.

According to my information, no such increase has in fact occurred.

In view of the fact that jam in 12 oz. jars is sold at the same price as jam in 1 1b. jars, which means an increase of a third in the price per 1b., and that there is no indication on the label of better quality, as the manufacturers claim, is it not clear that the public needs protection against such an increase in price without clear labelling? If my right hon. Friend has no information on this, will he institute a full inquiry, because I can assure him that it has happened and I think there is a danger that other manufacturers will follow suit?

I think not. The hon. Lady is clearly referring to the report of the Chief Inspector of Weights and Measures into which we looked very closely. I am told that only a few manufacturers are selling jams in 12 oz. jars. These are special kinds which are more expensive to produce, and all have been selling in the same way for more than a year. We have no evidence at all that ordinary jam is being sold in the smaller jars, except in one case into which we inquired, where it is also being sold at a lower price.

Retail Price Index

27.

asked the First Secretary of State and Secretary of State for Economic Affairs what change has occurred in the Retail Price Index since the setting up of the National Board for Prices and Incomes.

Is my right hon. Friend aware that this represents a distinct improvement on the previous six months, when there was a rise of just over 3 points? It also represents a distinct improvement on the corresponding period in 1964 when one allows for the change in the business cycle, and this presumably points to the growing effectiveness of the Board for Prices and Incomes.

Yes, I agree entirely with my hon. Friend. Since the policy has been working, since the Board has been in operation, prices have stopped rising as they did under right hon. and hon. Gentlemen opposite. I do not know whether that is why hon. Members opposite laugh.

Can the right hon. Gentleman assure us that steps are being taken for this happy position to continue? After all, as he well knows, the first statement was on bread, and we are now faced with the position that there may well not be bread to go with the hon. Lady's jam. Is he satisfied that steps are being taken?

The difficulty of answering questions from hon. and right hon. Gentlemen opposite is that one is never quite clear whether they believe it is a good thing that this should happen, a sad thing when it happens or a wrong thing. If the hon. Gentleman puts down his Question in the terms that he means, I will do my best to answer it.

Is the right hon. Gentleman aware that a comparison of the last six months with the previous six months is a ludicrous one, because in the previous six months there came the Budget in which prices were increased overwhelmingly and all the costs that we still have to bear were increased by the right hon. Gentleman's colleagues in the Government?

Where we increased prices because we introduced taxation increases, it was for reasons of deliberate policy which we explained to the House, which we explained to the country and had the courage to defend. If the right hon. Gentleman does not want a comparison with the previous six months, perhaps he will look at some of the years when he was a distinguished Member on the Government Front Bench. In particular, will he look at 1957, 1961 and 1964 and see whether he wants to come up again for air.