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Commons Chamber

Volume 774: debated on Monday 25 November 1968

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House Of Commons

Monday, 25th November, 1968

The House met at half past Two o'clock


[Mr. SPEAKER in the Chair]

Oral Answers To Questions

Employment And Productivity

Blind Persons


asked the Secretary of State for Employment and Productivity if she is satisfied with the arrangements by which blind people are employed in industry and with the assistance which her Department gives to the blind to find employment and to retrain them; and if she will make a statement.

There are 30 blind persons resettlement officers and six blind persons training officers who specialise full time in assisting blind persons to find employment in industry. There is close co-operation with welfare authorities and voluntary organisations and, whilst I am satisfied that these arrangements are working well, continuous efforts are being made to improve the service. The number of blind persons placed in ordinary employment has been increasing recently and the training facilities provided by my Department are at present under review to ensure that they keep abreast of employers' requirements.

Is my hon. Friend aware that his Answer is most welcome? Is he also aware that many blind people are capable of highly-skilled work? Is he satisfied that employers are making sufficient use of the work of blind people and that his Department is sufficiently publicing the work that blind people are capable of doing?

We are well aware of their capacity. To show how up to date we are in that respect—my hon. Friend will be glad to know that we have blind people who have been trained in computer programming. Most of those who have had training have been placed, and some have had promotion since they were placed.

Young Persons (Scotland)


asked the Secretary of State for Employment and Productivity what was the number of young persons unemployed in Scotland in October, 1968, the number of vacancies for young persons at the same date, and the corresponding figures for October, 1967.

At mid-October, 1968, 3,392 young persons were registered as unemployed at youth employment offices in Scotland and there were 5,828 unfilled vacancies for young persons. The corresponding figures for October, 1967, were 4,460 and 4,723 respectively.

Is this favourable comparison due to fewer school leavers, or is it a real improvement?

We could say that this is a real improvement, because there were over 2,000 more school leavers last July-August than in the corresponding period last year.

I recognise that the position for Scotland as a whole has improved dramatically, but can my hon. Friend say whether the Government bear in mind the special problems of drift from the rural areas of Scotland, and from the Highlands in particular? What steps has he in mind for improving this situation?

I would have thought that my hon. Friend would appreciate that the whole of the Government's development area policy is designed to prevent this drift, which has now been taking place for over a quarter of a century.



asked the Secretary of State for Employment and Productivity what percentage of boys leaving school took up apprenticeships in the last full year for which figures are available as compared with 1964.

42·6 per cent. in 1967 compared with 36·4 per cent. in 1964.

Can my hon. Friend say whether this very gratifying improvement is general throughout the economy, or are some industries lagging behind? If there are laggards, what steps are contemplated for improving their performance?

The improvement is general for those industries for which industrial training boards have already been created as a stimulus to such efforts. Two industries whose performances are not so gratifying—the clothing industry and the footwear and leather industry—will have industrial training boards formed in the near future, and we hope that they will then respond in the same way.

I welcome and recognise that this is evidence of the growing effectiveness of the Industrial Training Act, but is the hon. Member also aware of the need for moving away from the traditional concept of apprenticeship as a once-for-all training for life, and is he keeping a special watch on this?

I am conscious of that, and am also conscious of the progress in this field made by the Engineering Training Board, numerically the largest of the training boards. It is my right hon. Friend's wish that the progress that that has made should be reflected in other industries.

Young Persons (Unemployment)


asked the Secretary of State for Employment and Productivity how many school leavers and young people were unemployed at the latest date for which figures are available; and what was the corresponding number of vacancies.

At mid-November. 1968, 23,316 young persons were registered as unemployed at youth employment offices, including 3,554 school leavers, and there were 73,230 unfilled vacancies for young persons.

I thank my hon. Friend for those figures, which show some progress and a considerable improvement since October. Does he agree that unemployment among young people at the start of their careers is a serious matter? I hope that these figures will not give rise to any complacency in his Department but, rather, will spur it to greater efforts.

My hon. Friend may rest assured that I shall never be complacent about unemployment among young people, because I know what the cost will be if they become anti-social as a consequence. I can, however, say that there are 4,000 fewer unemployed school leavers in November this year as compared with November last year.

Can the Minister say how many more he expects to be unemployed because of the Chancellor's latest measures?

All that I can say to the hon. and learned Gentleman is that perhaps his hopes in that respect will be as disappointed as his hopes were following the April Budget.

Development Areas (Training Grants)


asked the Secretary of State for Employment and Productivity to what extent assistance is being given by her Department by way of training grants to encourage the provision of additional jobs in development areas.

Up to the end of September, 1968, the direct grants paid out by my Department for this purpose amounted to £2,619,000.

Grants are also available from my Department through the industrial training boards towards the training of semi-skilled workers, apprentices and technicians in the development areas.

Is my hon. Friend satisfied that there is sufficient incentive to firms and that the community is receiving the best possible value for this expenditure?

I am certainly satisfied about the second part of the question. As to the first part, my hon. Friend will be aware that the rate of direct grant was doubled just over a year ago. I hope that he will be reassured to know that, during the last year, there have been 960 applications as opposed to 520 in the preceding year, which I at least take as evidence of the fact that sufficient stimulus is now available.

Will the hon. Gentleman accept that the unemployment figures in the Northern Region are now higher than in any November for many years? As this development area groans under the possible effect of the Chancellor's latest decisions, will he do everything possible to increase the number of available new jobs?

The Government's entire regional policy is intended to stimu- late jobs in areas like the one the hon. Gentleman represents. I hope that he will be conscious of the effects of the Regional Employment Premium and welcome its beneficial effects in the North-East.

Government Training Centres (Places)


asked the Secretary of State for Employment and Productivity what increase has taken place in the number of Government training centre places in development areas between October, 1964, and October, 1968.

The number rose from 1,340 in October, 1964, to 3,574 in October, 1968.

This is a very welcome increase. Is my hon. Friend satisfied that it is sufficient to cope with areas, for instance like my constituency, where there is a total run-down of the mining industry?

This would not be sufficient, were it all that the Government have in mind. I hope that my hon. Friend is reassured by the knowledge that over the next three years Government training places in the development areas will increase to 5,700. This is only part of the training programme, much of which in development areas, as in other parts of the country, must be run by the industrial training boards.

Is the hon. Gentleman aware that a number of new industrialists in the Northern Region are dissatisfied with the type of training course available? Will he take note of my request to his right hon. Friend recently to instigate an inquiry among these industrialists to determine the kind of training courses they require?

We are in close touch with the industrialists in the development areas, particularly in relation to their demands upon Government training centres. We have issued a general invitation for local employers to talk to our G.T.C. managers about the sort of training they would like to see. There has been a good response to that invitation and I hope it will continue.

Remploy Limited (Labour Force)


asked the Secretary of State for Employment and Productivity the average number of registered disabled persons employed by Remploy Limited in each year from 1964 onwards.

In the last five financial years Remploy's severely disabled labour force has averaged 6,406; 6,687; 6,893; 6,852 and 7,017. The forecast average for 1968–69 is 7,390, which would be the highest ever.

While thanking my hon. Friend for giving news of this gratifying trend in the employment of the disabled, may I ask whether there is any possibility of even further expansion?

It is the Ministry's objective to expand the service. First of all, we want to increase production and sales. We hope in 1971–72 to have the labour force of disabled people up to approximately 8,000.

Can my hon. Friend state what is the average wage paid in Remploy factories?

I cannot say what the average wage is, but as my hon. Friend has a Question down about the hourly rates, I will be giving him them later.

Industrial Training, Sheffield


asked the Secretary of State for Employment and Productivity how many Government industrial training places are now available in Sheffield; how many are currently taken up; and what are the main trades covered.

On 11 th November, 1968, 183 training places were available at the Sheffield Government Training Centre, of which 156 were occupied. The main trades covered are brick-laying, carpentry, electric welding, motor repairing, contractors' plant repair and maintenance, heating and ventilating fitting, general fitting, capstan setting/operating and milling setting/operating.

While thanking my hon. Friend for that welcome information, may I ask whether he is aware that Sheffield is a natural training centre for men displaced from the South Yorkshire coalfield? Will he therefore refrain from resting content, and have a further plan ready for the expansion of training, particularly in engineering and electronics, if possible?

Further plans are ready. My hon. Friend already knows that by mid-1969 the Sheffield training centre will expand to 263 places. As to the South Yorkshire coalfield, there will be another centre to meet its demands, in Wakefield, which we anticipate will be finished in about 1970.



asked the Secretary of State for Employment and Productivity what estimate she has made of the number of new jobs which will be provided in the Humber area during the construction of the Humber Bridge.

No estimate has been made of the total number of new jobs, but the construction of a Humber Bridge would be likely to require on average about 250 workers, over a period of about five and a half years.

As no decision has yet been taken on whether to build this bridge, nearly three years after the right hon. Lady the First Secretary of State misled the citizens of Hull about it at a by-election, will it now be made even more remote by the economic freeze, which the right hon. Lady was unable to foresee at Bassetlaw a short time ago?

The hon. Gentleman has been here long enough to know that the question of fixing a date for the building of the Humber bridge is not one to be addressed to me.

We all know that this is the usual political gimmick of a staggering, stagnant and moribund Opposition—it cannot even win by-elections. However, may I ask the Minister whether he is aware that, with unemployment on Humberside, we are at a disadvantage in competing with development areas, particularly in shipbuilding? Will he please turn his mind to this question of getting industries to Humberside, particularly to Hull?

I am well aware of the real problems of Humberside. As my hon. Friend knows I have received a deputation, including my hon. Friend and his colleagues, and I have also met the local employment committee. We will do what we can to help in the circumstances he has outlined.

Are we to understand that the Government no longer believe that the Humber Bridge is important for the development of employment in this area?

The right hon. Gentleman is not to understand that. He knows perfectly well that building bridges is not a matter for the Department of Employment and Productivity, but for the Minister of Transport.

Employment (Scotland)


asked the Secretary of State for Employment and Productivity what have been the reasons for the reduction in the total number of jobs in Scotland since 1964.

It is provisionally estimated that the number of employees in employment in Scotland decreased by 35,000 between June, 1964, and March, 1968. Some of this decrease may be seasonal. In several sectors the number of jobs has been reduced as a result of technical advance. This effect has been reinforced in agriculture by the consolidation of farms, in coalmining and transport by some fall in demand and in the distribution trades by rationalisation.

Is the Minister aware that up to the end of 1964, on the Government's own figures, the number of jobs in Scotland was increasing? Will the latest economic measures, known as the "touch on the tiller", have the effect of causing additional unemployment in Scotland?

The hon. Gentleman knows that if the previous Administration had been as generous in financial grants and as determined to solve the deep-seated, long-standing unemployment problems of the development areas as this Administration, he would have no need to ask that question.

Can the hon. Gentleman explain then how it was that in the last four years of the Conservative Government the number of actual jobs in Scotland increased by 30,000 whereas in the last four years the number has gone down by over 30,000?

I think that it is obvious that some of the measures which we have had to take have affected Scotland, but the significant point is that Scotland has been affected less by these measures than has the nation as a whole. In other words, unemployment has grown less in Scotland than in the rest of the country.

Is the hon. Member aware that the only credit which the Government can claim for success in respect of employment is in creating a vast number of new jobs in the Civil Service?

If the noble Lord believes that, he needs a new pair of spectacles so that he may see what is being done in Scotland, as I saw it the weekend before last.


asked the Secretary of State for Employment and Productivity what were the unemployment figures for Scotland in the years 1952 to 1968, respectively, for October; and if she will provide a breakdown of the figures for male, female and juvenile unemployment in each year.

As the reply consists of a table of figures, I will with permission circulate it in the OFFICIAL REPORT.

Does my hon. Friend not agree that if we consider unemployment in Scotland in the past, the least that we can say is that my hon. Friends on this side of the House have not cultivated the bad habits of hon. Members opposite? Is he aware that in 1963 under the Conservative Government there were 136,000 unemployed in Scotland?

I am well aware of what my hon. Friend said. It is one of the unpleasant facts which hon. Members opposite like to forget.

Will the Minister indicate whether in his opinion the figures for unemployment in Scotland between now and next October will go up or go down? Is he aware that as a direct consequence of the Government's policy of increasing the petrol duty so savagely there will be a particularly harsh effect on employment in Scotland?

I am aware that the hon. Gentleman thought that the last Budget would send the unemployment figures up. Indeed, some of his hon. Friends suggested that they would rise to between 750,000 and 800,000. Their hopes in this respect have not come about. I have a feeling that expansion in Scotland will continue because we are now laying a firm industrial base—something which should have been done when the Conservatives were in power.

13th October, 195239,9041,18325,2401,81168,138
12th October, 195335,2771,20719,4621,17157,117
11th October, 195432,4911,29917,6781,11652,584
10th October, 195528,5211,24615,04996345,779
15th October, 195630,2301,04416,62095848,852
14th October, 195731,7471,03214,75291448,445
13th October, 195858,0082,80723,3041,69885,817
12th October, 195959,7403,38921,9331,55586,617
10th October, 196051,3842,07217,9081,14572,509
16th October, 196144,5961,78117,6661,24165,284
15th October, 196258,2703,41420,9242,18984,797
14th October, 196361,4563,92523,1182,25390,752
12th October, 196448,1042,63618,9371,57171,248
11th October, 196540,8051,84015,7081,23359,586
10th October, 196648,3842,27915,2011,41667,280
9th October, 196760,5142,66618,8591,79483,833
14th October, 196860.0412.11815,7201,27479,153

Miners, West Lothian (Retraining)


asked the Secretary of State for Employment and Productivity how many applications she has received for retraining from miners who are being declared redundant from Riddochhill Colliery, Blackburn, West Lothian.

Is my hon. Friend satisfied that the National Coal Board lets his Department know of these redundancies in advance and at the earliest possible opportunity?

There are problems for the National Coal Board in these cases, some of which are exemplified in this colliery. Some of them concern the fact that so many of the men who are made redundant are, in fact, retired early on substantial pensions or are offered employment at other collieries. But we need to

Would the hon. Gentleman explain what he means by expansion in terms of employment, since when replying earlier he said that the number of jobs in Scotland were now 35,000 less than the number four years ago? What sort of expansion is this?

The right hon. Gentleman should understand that many jobs have been lost in coal mining and various other industries. If many of them had not been replaced by jobs in other industries, the position would have been immeasurably worse. If he does not understand that, he does not understand anything about the subject.

Following is the information:

liaise very early with the National Coal Board and we are pursuing the operation of that policy.

Engineers (Pay)


asked the Secretary of State for Employment and Productivity whether she will now make a further statement on the threatened national engineering strike.

Executive representatives of unions affiliated to the Confederation of Shipbuilding and Engineering Unions are meeting this afternoon to give further consideration to their attitude in the light of the offer made by the employers on 18th October.

Is it not a fact that the right hon. Lady has given her blessing to this proposed settlement? If so, will she explain to the House whether she regards it as a model settlement and, if so, why she will not grant, on less favourable terms, the application of the banks' employees and operatives? Why is she straining at a gnat and swallowing an elephant?

The hon. Member should know that until the Confederation executive has decided its attitude this afternoon there is no final proposal in front of me. But it is a fact that I personally hope that the Confederation will accept this offer, as the A.E.F. National Committee did last Friday. I hope that it will accept it, because it is within the ceiling and is accompanied by productivity concessions which make it acceptable.

Is it not true that my right hon. Friend's efforts have met with a large measure of success for which she deserves our thanks? Does she realise that the trouble with hon. Members opposite is that they are very disappointed by that fact?

I entirely agree with my right hon. Friend that hon. Members opposite are undoubtedly bitterly disappointed that once again we have avoided a strike.

Will the right hon. Lady answer the first part of my hon. Friend's supplementary question: is this settlement in line with the incomes policy and, if so, can it be taken as a model by other industries?

As the right hon. Member knows, this is a settlement covering 31 years. If an agreement is reached on the lines of the employers latest offer, it would be at the rate of 11½ per cent. over 3½ years and would be accompanied by very tough productivity conditions. The problem in the case of the banks was that the settlement for men was twice the ceiling and that for women three times the ceiling, without it being possible exactly to cost the productivity return. That is why reference is to be made to the Board.

On a point of order. Will the right hon. Lady tell the House whether a reference has been made to the Board—

Prices And Incomes Policy


asked the Secretary of State for Employment and Productivity to what extent in applying the Government's prices and incomes policy she takes account of the need to reduce personal consumption.

Individual prices and incomes cases are assessed in the light of the criteria and considerations set out in the current White Paper on productivity, prices and incomes policy.

Cannot the right hon. Lady now grasp the fact that every time she bullies a manufacturer into freezing his prices she is undermining the Chancellor's strategy of lowering the standard of living? Because she continues in that policy, is she not personally responsible to a very large measure for the additional £250 million of taxation imposed by the Chancellor on Friday?

I hope that one day the hon. Member will realise, in face of the repetition of this point both by myself and by the Chancellor, that the Government's policy on prices and incomes has a prices side to it and that that side is intended to see that price increases which are unjustified do not take place. On that the Government are united. It is an integral part of our economic strategy.

Is it not extraordinary that only a few days ago in this House, in the light of the supposed prices policy, arguments were being advanced to restrain the public bar prices charged by brewers in Wolverhampton, and yet this week those prices will inevitably have risen as a result of Government action?

It is equally obvious that the prices side of the policy has been extremely effective.

Productivity Agreements


asked the Secretary of State for Employment and Productivity how many of the productivity agreements which formed part of an increased pay agreement in the last 12 months have failed to come up to the agreed level of productivity.

Information is not available in the form requested. It is the practice of my Department to make inquiries to see how experience corresponds with forecasts but productivity improvements often represent only a part of the benefits flowing from a comprehensive agreement embodying other desirable features.

I thank the Minister for that long piece of gobbledegook. May we not have details, as I requested, of how many of these productivity agreements are being kept? Surely that is the essence of the incomes policy. Cannot the Ministry wake up and do something about this and tell the House about it?

The Ministry are anything but asleep on this matter, contrary to the implication in the hon. Member's question. The Ministry's procedures ensure that the agreements are kept. It is not always appropriate or necessary to do the follow-up for which the hon. Member asks, but we follow up where necessary.


asked the Secretary of State for Employment and Productivity how many productivity agreements have been notified to her Department since its creation; how many have been verified, modified, and rejected, respectively; and how many civil servants have been employed in such work.

A total of 988 productivity cases have been dealt with by the Department since it was formed in April this year. In 964 cases the proposals were approved, often after modification in consultation with officials of the Department; in 24 they were rejected. Twenty-three headquarters' officers are engaged entirely on the examination of pay claims and settlements. A number of other headquarters' officers and about 60 staff in the regions may spend varying proportions of their time on such work.

When one compares the figures of those employed on this task and the number of agreements examined, is it not clear that all the solemn Ministerial talk about productivity agreements has been so much of a gigantic hoax? Is that observation not borne out by the fact that the right hon. Lady the Minister informed me a few days ago that not one additional officer would be employed to look after the productivity agreements negotiated under the engineering settlement a settlement which this afternoon the right hon. Lady said has involved some very tough productivity agreements?

I can only tell the hon. Gentleman that. whether or not the productivity policy has been effective, between 1st October, 1967, and 1st October, 1968. productivity went up by 7 per cent.

Would my hon. Friend agree that in industry today over an increasingly wide front people are realising that, if wages are to increase, productivity must also increase? Has not one of the latest examples of this been achieved among shipbuilders on Clydeside?

There is, without question, a growing awareness of the need for productivity as a justification for wage increases. If the policy has achieved nothing other than to establish the atmosphere of this awareness, it has achieved a considerable amount. I suggest that it has achieved that and very much more besides.

Occupational Pension Rights


asked the Secretary of State for Employment and Productivity what plans she has made to ensure that rights accrued under private occupational pension arrangements are made fully transferable on changes of employment by the beneficiaries; and whether she will make a statement as to the method by which such rights are to be valued.

The White Paper on the new earnings-related pension scheme will outline the Government's proposals for the safeguarding of occupational pension rights. I cannot anticipate what will be said in that White Paper.

Why are the Government taking so long to act about this urgent matter? Will the Minister undertake that, when these steps are finally introduced, he will clarify the position between transferable pensions and frozen pensions and go the whole way to transferability?

I can assure the hon. Member that I shall clarify the two positions. I am afraid that I cannot give the House any assurance as to which of those two positions the Government favour

Industrial Retraining (Scotland)


asked the Secretary of State for Employment and Productivity what representations she has had about the administration and organisation of industrial retraining in Scotland; and what reply she has sent.

There have been no recent representations about the running of Government Training Centres in Scotland. I have, however, written to my hon. Friend about his constituent who raised questions about a course at an industrial rehabilitation unit.

Is my hon. Friend aware of the need for confidence in the training methods being adopted at the various establishments? Considering the difficulties faced by people wishing to readapt themselves to new techniques, will he give consideration to these people in the retraining programme?

I agree with every word of that supplementary question, and I hope that my hon. Friend will accept my assurance that that sort of rule operates in Scotland, as elsewhere.

Is the Minister now denying that the object of the measures announced last Friday was to increase the pool of unemployment, presently 560,000, until it reaches the Government optimum figure of 750,000 for the entire United Kingdom?

I am neither denying nor confirming that—[Interruption.]—mostly because it has nothing to do with the Question.

Vickers' Shipyard (Dispute)


asked the Secretary of State for Employment and Productivity whether she will intervene in the 16-week old dispute over apprentices at Vickers' Barrow-in-Furness shipyard.

Officers of my Department, who have been in close touch with the company and the union since the dispute began, had discussions with both sides last week. A basis for settling the apprentices' dispute has been worked out, but this dispute has become linked with a demarcation issue at the same plant between A.E.F. and the plumbers' union, as a result of which 2,000 engineering workers are on strike. Efforts are now being made to refer this issue to a demarcation court to be set up by the parties, and my Department will continue to give every assistance in settling the outstanding difficulties.

I am glad to hear that the right hon. Lady's Department is now busily trying to sort out this strike, but would not she agree that this is one of the most fatuous examples of imbecility and stupidity in industrial relations, stretching over 18 weeks, that this country has experienced for a long time? Will she conduct a full inquiry into the whole circumstances of it and publish a White Paper so that all may know how badly conducted this exercise has been?

What the hon. Gentleman has suggested would not be exactly helpful, particularly as we believe that a settlement is now possibly within reach. Of course, one deplores the loss of production as a result of protracted disputes. However, I believe that hopeful developments are now taking place; and I do not want to say anything which might jeopardise them.

Low-Paid Workers


asked the Secretary of State for Employment and Productivity what steps she is taking to secure regular and reliable information about low pay and its causes in particular industries.

A new type of survey of earnings of a random sample of one in every 200 individual employees was launched in September. This will provide information on the incidence of earnings below particular weekly or hourly levels within particular industries, occupational groups and regions, with some indications of special factors, such as income in kind or physical handicap, effecting earning capacity. The question of obtaining such information in this way on a regular basis will be determined in the light of the experience gained in the present survey.

In view of the importance of giving priority, wherever possible, to the lower paid, will this survey reveal the causes of low pay in individual cases?

It is because my Department is anxious to tackle the problem of the lower paid and because it is essential for us to have more information to this end that the sample survey has been launched. While it will not explain why all workers are low paid, it will give an indication of the numbers who may receive low pay for certain reasons; for example, whether they are apprentices or trainees, whether they lack experience and whether they are mentally or physically handicapped. This information will be invaluable to us in helping to tackle this problem.

Is the right hon. Lady aware that a constituent of mine has just received one of these vast Domesday forms, which I hold in my hand, and that it will take him at least half-an-hour to answer all the questions on it, most of which are totally irrelevant? Would she instruct her Department to conduct a first-hand inquiry to discover the reaction of busy people when they receive these piles of nonsense?

My answer is, "Most emphatically no, Sir." Everybody concerned with the study of the problem of the low-paid worker is well aware that up to now we have had an inadequate breakdown of the incidence of low pay. Past surveys have merely provided information about average earnings but not about the spread of individual earnings around the average. If we are to tackle this problem—which the Labour Party cares about, even if hon. Gentlemen opposite do not—we must have more detailed information.

Retail Price Index


asked the Secretary of State for Employment and Productivity what is the estimated effect of the prices and incomes policy on the retail price index; and what this represents in additional available consumer expediture at annual rates.

It is not possible to make a precise estimate of the amount, nor of the policy's contribution to the policy of import substitution.

Cannot the hon. Gentleman confirm that the avowed intention of the Government's prices policy is that the retail price index should be lower than it otherwise would be if no such policy existed, even if only to give the Chancellor the occasion subsequently to put on consumption taxes to raise that index?

It is the intention of the prices policy to limit unnecessary and unjustifiable price increases. As I have explained, that is an integral part of our economic policy in terms of import substitution.

Has the hon. Gentleman forgotten the algebraic appendix to Mr. Aubrey Jones's last report which suggests that the policy has had no effect on prices?

I have not forgotten that, nor the hon. Gentleman's peculiar gloss on the appendix, nor the shouts from hon. Members opposite before he came in that the prices policy was being too successful.


asked the Secretary of State for Employment and Productivity what were the increases in the index of retail prices for nationalised industries, for food, for housing, for fuel and light, for durable household goods, for clothing and footwear, for transport and vehicles, for miscellaneous goods, for services and for all items in the index since October, 1964, since July, 1966, and since November, 1967, respectively, to the latest convenient date.

As the reply contains a table of figures, I will, with permission, circulate a statement in the OFFICIAL REPORT.

Do not the figures show that the £ in our pockets at the time of devaluation is now worth only 19s.?

As the hon. Gentleman is so certain of what the figures would show, I am not sure why he asked me the Question.

Following are the percentage increases:

13th October, 1964 to 15th October, 196819th July, 1966 to 15th October, 196814th November, 1967 to 15th October, 1968
Nationalised industries25·113·56·1
Fuel and light25·415·05·8
Durable house-hold goods11·77·25·1
Clothing and footwear8·43·82·1
Transport and vehicles18·210·26·2
Miscellaneous goods21·213·411·1
All items17·18·45·0


1. The items included under the heading "nationalised industries" are—

  • Coal
  • Coke
  • Gas
  • Electricity
  • Road and rail passenger transport
  • Postal and telephone services

2. These items are also included in other groups as follows:

  • Coal, coke, gas and electricity in Fuel and light.
  • Road and rail passenger transport in Transport and vehicles.
  • Postal and telephone services in Services.

Unemployment (Portsmouth Area)


asked the Secretary of State for Employment and Productivity what are the latest figures for the unemployment rates in the Portsmouth area, the South-East Region and the country as a whole; and what were the rates at the same time last year.

At 11th November, 1968, the percentage rates of unemployment in the Portsmouth travel-to-work area, the South East region and Great Britain were 2·9, 1·6 and 2·4, respectively. These figures are provisional. The corresponding rates for November 1967, were 3, 1·7 and 2·5.

While it is right to be concerned with the percentage of unemployment region by region, total numbers also matter, and in this respect the numbers for the South-East are disturbing. May we have an assurance that there will be full consultation with the Ministry of Defence about the implications to a city such as Plymouth of the forthcoming dockyard review?

I can give the assurance that when the review of the future of the dockyards is completed, the House, the local authorities and the trade unions will be informed and consulted.

Equal Pay


asked the Secretary of State for Employment and Productivity how many discussions she has initiated on equal pay for equal work; and if she will make a statement.

There is nothing I can usefully add to the statement supplied by my hon. Friend the Joint Parliamentary Under-Secretary on 8th November, 1968, in reply to a Question from the hon. Member for Clapham (Mrs. McKay).—[Vol. 772, c. 174–5.]

Is it still Government policy that equal pay for equal work will be reached in industry and commerce by June 1975? When will a start be made towards implementing the policy?

I announced to the House in June that we were proceeding to work out a timetable for the phased introduction of equal pay with both sides of industry. In accordance with that statement, I immediately started those discussions with both sides, and work on them is continuing.

Will my right hon. Friend look at the problems of towns like Great Yarmouth, where women find work much more easily than men and where it is essential that women's wages should be made more equal to men's so that men's wages are not depreciated?

I think that there is general realisation by men in industry that their interests can only suffer if women are discriminated against on the question of wages.

Will the right hon. Lady bear in mind that the move towards equal pay in the banks is being asked to be specially reported on by the Prices and Incomes Board, to which she has referred bank pay today?

The Board will be examining the whole of the settlement and how it conforms as a whole with the ceiling and with the policy. The relative distribution of increases between men and women within the ceiling and within the policy is a matter for the negotiating parties.

Employment (Edinburgh)


asked the Secretary of State for Employment and Productivity how many factories and workshops in the Edinburgh, Leith and Portobello Employment Exchange districts have reported to her that they expect to close their premises or to reduce permanently the scale of their operations in the course of the next year; and how many of these are associated with nationalised undertakings.

My Department has received reports from three manufacturing firms and is aware of nine others which expect to close their premises or reduce the scale of their operations in the course of the next year; none of these are associated with nationalised undertakings.

Is the hon. Gentleman aware that a black cloud of uncertainty in employment hangs over Edinburgh, almost entirely due to the wickedly unfair anomalies as a result of Government policy for development areas? Is he further aware that Edinburgh is the only place excluded from John o' Groats nearly to York?

I understand how the hon. Gentleman feels, but Edinburgh has an unemployment percentage of 2.1 as against Scotland's 3.7 and 2.4 for Britain as a whole. I want to see the figures for Scotland and for Great Britain brought down to Edinburgh's level.

We have always been told that the governing factor which has kept Edinburgh out of the development area has been its low unemployment rate. Is it not the case, however, that the unemployment rate there is now higher than that in a large number of places within development areas, and that it is rising?

Industrial Training Boards (Levies)


asked the Secretary of State for Employment and Productivity what industrial training boards already operate differential levies; and what consultation she is having with the Central Training Council concerning their extension.

Two boards operate differential rates on a sector of industry basis, and nine boards operate differential rates, sliding scales or exemptions based on the size of the firm. Other boards too are considering the appropriateness of differential arrangements for their industries. The Central Training Council has this and other questions concerning levy and grants systems under review.

Since in most industries the majority of firms employ fewer than 100 people, and since, therefore, their training needs are likely to be only modest, will the hon. Gentleman give special encouragement to the establishment of differential rates?

I am strongly in favour of a policy which does not ask from small companies levies out of proportion to their genuine training needs. But some small companies employing appreciably fewer than 100 people still have substantial training needs and, therefore, should make an appropriate contribution to their training boards.

Will the hon. Gentleman consider the extreme case of the one-man company in my constituency from which a training levy has been demanded?

I have already given the hon. Gentleman that undertaking, and, indeed, I intend to make a rather wider examination than that.


asked the Secretary of State for Employment and Productivity what proportion of the money raised in training levies is currently being spent on the administration of the various training boards.

For the year ended 31st March, 1968, 1.8 per cent. of total levy income was spent on administration and a further 1.9 per cent. on the provision of training services.

Will the hon. Gentleman watch this closely? Is there not a danger, with a multiplication of training boards, of some overlapping here? Does not he agree that the need it not to create a new bureaucracy but to get on with retraining in new skills?

I agree with the hon. Gentleman's judgment, and I hope that he in turn will agree that a new bureaucracy—in the pejorative sense of the word—is not in fact being created and that the boards are in the main doing the jobs he seeks that they should do.

Food Handlers (Protective Clothing)


asked the Secretary of State for Employment and Productivity if she will introduce legislation requiring employers to provide and maintain protective clothing for food handlers in the service, distributive and allied trades.

I have no evidence of the need for such legislation so far as the safety and health of food handlers is concerned. As regards the food hygiene aspects, my right hon. Friend the Secretary of State for Social Services and I have noted the point for consideration when the Food and Drugs Act is next amended.

This is an extremely disappointing Answer, which fails to meet the demands of the situation. Does not my hon. Friend agree that the interest of hygiene demands the introduction of new legislation now?

Under the safety, health and welfare legislation, my Department is only concerned with the protection of food handlers. The protection of public health is a matter for my right hon. Friend the Secretary of State for Social Services.

Disabled Persons


asked the Secretary of State for Employment and Productivity what proportion of private employers with a staff of over 20 employees is failing to meet their statutory obligation to employ their quota of 3 per cent. of disabled persons; and what action she proposes to take against them.

The figure on 31st May, 1968, the date of the latest count, was 53.7 per cent. Employers with less than their quota are not committing an offence but are subject to restrictions on the engagement of fit workers. They are contacted regularly to remind them of their quota obligations and action is taken as the circumstances warrant where failure to comply with the provisions of the Act is revealed.

Since the figure of unemployed amongst the disabled is four times above the national average, does not my hon. Friend agree that his Answer reveals a highly unsatisfactory and undesirable situation where half our employers are flouting their obligations? Although I accept his assurance that he is reminding employers of their obligations, with the present lamentable results, will he consider taking special action and if so, what kind of action?

I do not think that it is accurate to speak of employers flouting their obligations. The great majority go out of their way to cooperate. But it is not always possible for registered disabled persons who are unemployed to match up to the vacancies that exist, either because their particular disability makes them unsuitable, or because they lack the required skills or because of one of a variety of other reasons.


asked the Secretary of State for Employment and Productivity what proportion of Government employees is disabled; and what action she intends to take if it is below the statutory requirement of 3 per cent.

On 1st October, 1967, the proportion of registered disabled persons employed in Government Departments was 2.95 per cent. My officers lose no opportunity of bringing unemployed registered disabled people to the notice of Government Departments which have suitable vacancies.

Is my hon. Friend aware that the figure he has quoted is in agreeable contrast to that concerning private employers, but is a sad decline from the figure of 5 per cent. employed by the Government some 10 years ago? Will he tell the House whether this is due to a change in Government policy or simply to apathy?

No, the number of disabled has declined as a number of men who were wounded in the wars have passed away. I can assure my hon. Friend that the Treasury has written to all Departments reminding them of the Government's commitment to meeting the 3 per cent. quota whenever possible.

Standard Industrial Classification


asked the Secretary of State for Employment and Productivity what representations she has received concerning the publication of the revised version of the Standard Industrial Classification; whether it is proposed to adopt the new Standard Industrial Classification for the purposes of the Selective Employment Payments Act, 1966, in advance of the Reddaway Report; and if she will make a statement.

Since the publication of the revised edition of the Standard Industrial Classification on 7th November, we have received no representations about its adoption for the purposes of the Selective Employment Payments Act, 1966. It is our intention to adopt the revised classification as a basis for payments under the Act during the course of next year.

Is my hon. Friend aware that the revised S.I.C. by no means removes all the anomalies of this extremely controversial tax? Would it not be better to hasten the Reddaway Report and, if possible, to remove all anomalies or end the tax itself?

I am aware that the revised S.I.C. does not remove what are said to be anomalies by people who regard the tax as controversial. As to removing the tax, my hon. Friend will understand the benefit which the tax brings to the nation, not least to development areas, through the regional premium

Will the hon. Gentleman recognise that it is totally inadequate to refer to Professor Reddaway's investigation of this tax and that Professor Reddaway does not hold himself open to representation as to whether particular trades should be in- cluded under particular headings of Standard Industrial Classification?

If the hon. Member wants to ask a Question about that subject, he must put it on the Order Paper. I did not mention Professor Reddaway in my Answer.



asked the Secretary of State for Employment and Productivity if she will make a statement on the current unemployment situation.

The trend in the seasonally adjusted figures of wholly unemployed, excluding school leavers, has turned downwards since August. The figure has fallen by 56,000 over the past three months from 585,000 or 2·5 per cent. in August to 529,000 or 2·3 percent. in November. The total number of persons registered as unemployed on 11th November, the date of the latest count, was 561,000. The seasonally adjusted figure of unfilled vacancies for adults rose by about 16,300 between October and November, and now stands at 211,000. It has increased on average by about 10,700 a month in the three months August to November.

While I am glad that there is some progress in the figures and leaving aside the crocodile tears of hon. Members opposite, will my right hon. Friend accept that unemployment is of the utmost domestic concern to the Labour movement nationally and that there can be no complacency or acceptance of high unemployment figures by this side of the House?

Is not this about the twentieth month in 1967–68 when unemployment has been above 500,000? Can the Minister say what level of unemployment is acceptable to this Government within the meaning of the term "full employment"?

The hon. Member knows perfectly well that the purpose of our policy is to continue reduction in unemployment, which we are now glad to see taking place. [Hon. Members: "Oh."] The answer to his question is that a level of unemployment acceptable to me is the lowest possible level consistent with this country's survival on the balance of payments side.

The House will have been interested to hear the right hon. Lady say that the Government's policy is to continue a downward trend. Can she therefore confirm that the Chancellor's latest measures are calculated to bring about a continuance of the downward trend of unemployment?

The Chancellor's latest measures are designed to secure a sound foundation on which the expansion movement which has begun can continue. [Hon. Members: "Answer."] As the right hon. Member is perfectly well aware, the new measures will to a large extent reduce imports and set resources free for exports rather than reduce output and employment.

Norfolk (Industrial Training)


asked the Secretary of State for Employment and Productivity what organised training in practical skills has been established in Norfolk by the Agricultural, Horticultural and Forestry Industry Training Board.

This is primarily a matter for the Board. But I understand that courses of practical training have been arranged for Norfolk agricultural workers both off the job and on the job. Instructors have been trained and are now giving practical instruction on their holdings. To help the smaller employer the Board has encouraged the formation and growth of group training schemes.

Is my hon. Friend aware that many Norfolk farmers complain that they are not getting value for the levy and that it is more worry and bother than it is worth? If he disagrees with that attitude, will he say why?

I fundamentally disagree with that attitude, not least because of the great deal of time I have spent investigating complaints from Norfolk and other farmers in the recent past. There is a great need for improved and extended industrial training in the industry, and the Agricultural Training Board is a cheap and effective way of providing it.

Building Industry (Labour-Only Sub-Contracting)


asked the Secretary of State for Employment and Productivity if she will announce the Government's intentions in relation to the Phelps Brown Report on labour-only sub-contracting in the building industry.


asked the Secretary of State for Employment and Productivity what is her policy regarding the Report of the Committee of Inquiry into labour in the building and civil engineering industries; and whether she will make a statement.

The important and diverse recommendations of the Phelps Brown Report are being taken up with those concerned through appropriate channels. In particular, the Government are consulting with the industry about the proposal for legislation to regulate self-employment.

Is the right hon. Lady aware that the Report gives as one of the causes for the increase in labour-only sub-contracting the Selective Employment Tax? Will she now consider giving that too a touch on the tiller?

It is perfectly correct that the Phelps Brown Report has suggestions for dealing with Selective Employment Tax in the context of the industry, and this is one of the proposals which will be examined.

Is not the Secretary of State aware that the Phelps Brown Committee states quite plainly that Selective Employment Tax is one of the causes of the increase in labour-only sub-contracting? Is not that yet another jolly good argument for abolishing S.E.T. at once?

The hon. Gentleman should read paragraph 436 of the Phelps Brown Report, which makes the point that the matter could be dealt with by making S.E.T., or an equivalent amount, payable in respect of the self-employed no less than the employed, which is an entirely different picture from that which he has been trying to give.

Is my right hon. Friend aware that, whatever the Phelps Brown Report may say, when in 1964 I took over the Ministry of Works labour-only sub-contracting was already an evil in this industry and was growing long before S.E.T. appeared on the horizon?

My right hon. Friend is absolutely right. That is why it is important for us urgently to study the proposals in the Report, as we are, to see what we can do to meet this evil.

Livestock (Public Roads)


asked the Attorney-General if he will make a statement on his plans for changes in the law of liability in relation to livestock straying on public roads.

The Government accept the need for legislation in this branch of the law and are in general agreement with the Law Commission's proposals. However, as my noble Friend the Lord Chancellor stated in another place, the prospects of the Government's introducing legislation for England and Wales on this subject must depend on the Bill's acceptance as a Second Reading Committee Bill.

Has the Attorney-General gained any estimate of the staggering increased cost to agriculture if a Bill on these lines were implemented? Will he confirm that it will not apply to Scotland, and has he the agreement of the N.F.U?

There have been discussions with the National Farmers' Union. The proposals by the Law Commission seem to be both reasonable and practicable. As for the Scottish position, I understand that the Law Reform Committee of Scotland has made proposals similar to those of the Law Commission for amending the law of Scotland, which are now being reviewed by the Scottish Law Commission whose report my right hon. Friend the Secretary of State for Scotland is awaiting.

Why is my right hon. and learned Friend not bringing in legislation to implement the Law Commission's proposals, particularly in view of the fact that a number of Bills have been presented to this House on this subject and he could very easily implement part if not the whole of the Report?

The answer, I fear, is lack of Parliamentary time and the fact that this proposal, important as it is, cannot claim any particular priority.

Bill Presented

Education (Scotland)

Bill to amend the law relating to education in Scotland, and for connected purposes, presented by Mr. William Ross; supported by Mr. Bruce Millan and Mr. Harold Lever; read the First time; to be read a Second time Tomorrow and to be printed. [Bill 15.]

Business Of The House (Supply)


That this day Business other than the Business of Supply may he taken before Ten o'clock.—[The Prime Minister.]

Orders Of The Day


[3RD Allotted Day]


Motion made, and Question proposed, That this House do now adjourn.—[ Mr. Grey.]

Economic Situation

I understand that it is the general wish of the House that the subject of the debate should be the economic situation and not that shown on the Order Paper.

3.32 p.m.

Last week, some of us sensed an air of unreality about the debates on the House when outside in the world at large there was obviously a grave financial crisis, when the foreign exchanges were closed here and in the European capitals and we were devoting our time to debating electoral reform and the reform of the House of Lords. It is an unreality which has persisted in the House since the introduction of the last Queen's Speech which, as we said at the time, appeared to bear almost no relation to the real problems facing the country.

That air of unreality was perhaps dispersed when the Chancellor of the Exchequer rightly came to the House on Friday afternoon at a late hour and made his statement. Her Majesty's Opposition thought that it would be right, in these circumstances, to revert to the original proposal, announced by the Leader of the House last Thursday afternoon, to have a debate today on our economic affairs. It is, therefore, today that we have to deal with reality.

This debate on the Adjournment is the opportunity for the House to condemn Her Majesty's Government and the Chancellor of the Exchequer, in particular, for their handling of the country's economic affairs. How quickly the erstwhile admiring headlines have changed from "Roy's the Boy" to "Roy the Unready"! We condemn the Government's incompetence in their handling of our economic affairs; we condemn them for their failure to tell the country the true position; we condemn the Government for their deception.

The Prime Minister is not to take part in this debate. I do not complain of that; it is characteristic of him. He will explain his position tonight to his party meeting upstairs, where he feels very much more at home. He has deputed his charge to the Chief Secretary, who, on Thursday afternoon, displayed such an ignorance of the currency regulations which he has to enforce that he is quite unsuited to take part in any debate of this kind. If the Prime Minister had been able to take part, the explanation for these misadventures would have come from his own mouth. We would have been "turning the corner", "guided by an economic miracle", "got blown off course", giving a "touch on the tiller", said to be "steady as she goes", and finally capsized.

But the great merit of the Chancellor's statement on Friday was that he pre-empted all such excuses. It was honourable of him to do so and to take the full blame upon himself, and in so doing he prevented the Prime Minister from taking part in the debate. He announced that the measures were prepared before the international crisis and had nothing whatever to do with the Bonn meeting.

Of course, the timing of the measures is of great interest to the House. Perhaps the Chancellor would tell us exactly when they were prepared. Was it after pressure on sterling developed some 10 days ago and before the European crisis arose, or did the Chancellor want to bring in these measures some three weeks ago to deal with the situation, but was prevented from doing so by the statement of the Secretary of State for Employment and Productivity that there was not to be another economic freeze?

In any case, the Chancellor of the Exchequer endorsed her words. Perhaps he was accurate in saying that he had a blinding revelation at Bonn that
"the events of the past week have demonstrated dramatically the urgency of our achieving and maintaining a surplus in the balance of payments … "—[Official Report, 22nd November, 1968; Vol. 773, c. 1792.]
It took the international crisis and the meeting at Bonn to persuade the Chancellor of the Exchequer that he had to take action when the situation was becoming critical. That in itself is a condemnation of the Chancellor of the Exchequer for his complacency and incompetence. The need for these measures if the Government's policy were to be effective was widely discussed in the Press and elsewhere and in the House three weeks ago, but he took no action and he himself said that there would be no freeze.

The Chancellor's forecasts have all been proved wrong. Now he has a new line. He says, "So many of my forecasts have been wrong because I make so many forecasts", and he has, therefore, invited the House to congratulate him on making so many forecasts even though they proved to be so wrong. His action has certainly shown this time that the forecasts he gave were wrong.

The Chancellor's policy was based on one fundamental—a reduction of consumer expenditure and that public expenditure could go on increasing. His strategy was that there must be a substantial reduction of consumer expenditure if, in his own words, devaluation was to be made to work. On the other hand, public expenditure could go on increasing. This policy was to be brought about by a brutal increase of taxation in the last Budget of £923 million, together with the prices and incomes policy. These were the two means by which he was to carry out his strategy. He required a drop of nearly 2 per cent. in consumer expenditure by this August. This was not just a forecast; this was a requirement.

But, instead of this requirement being brought about, exactly the reverse has occurred. Consumption is up between 2 and 3 per cent., and it makes a difference of nearly £500 million. That is the first thing that has gone wrong with the Chancellor's strategy. The second is that the Government's prices and incomes policy has not served their purpose. The Chancellor himself admitted this in that optimistic article in the People only eight days ago, the Sunday before last. He was optimistic about imports—yes, per- fectly all right—exports could go on increasing. He was perfectly optimistic about the level of consumer expenditure—yes, we could hold it there, and all was well.

The Chancellor went on to say that wage rates were up 5 per cent. and earnings by much more. This is true. Earnings are up by 8 per cent. and prices by 6 per cent. This is another condemnation of the failure of the Government's prices and incomes policy.

The Prime Minister has always been in a dilemma over the prices and incomes policy. The Chancellor wanted prices to go up so as to enable devaluation to work. Politically, the Prime Minister wanted to show that prices were not going up so that he could keep his word in his devaluation broadcast and he did not incur political odium. That is the dilemma which has always faced him. But today it is clear that consumer expenditure has not been kept down and that wages and earnings have risen faster than prices.

I doubt that the Prime Minister ever wanted the prices and incomes policy to succeed. The present Secretary of State for Employment and Productivity was put there to save the Prime Minister from the real rigours of the incomes policy as the Chancellor wanted it carried through. This has been the contradiction inside the Government all the time.

Now let us look at another aspect of the Government's failure, namely, in trade and the balance of payments.

As the right hon. Gentleman himself has bitterly opposed any attempt to establish an incomes policy, would not matters have been much worse if he had been in charge?

I can understand the hon. Gentleman's view. He said publicly this weekend, I understand, that what the Government are at present doing is extremely good for the Labour Party. If he holds that view, I respect it.

I now come—[Hon. Members: "Answer."] I wish now to deal with the question of exports and the balance of payments. [Hon. Members: "Answer."] The Prime Minister has spoken of a 25 per cent. increase—

On a point of order, Mr. Deputy Speaker. I asked the right hon. Gentleman a question—[Hon. Members: "Not a point of order."] How do hon. Members know that it is not?

Order. I hope that the House will allow me to hear the point of order.

It is a point of order, Mr. Deputy Speaker. The first part of my point of order is that everyone has a right to be heard. Second, I asked the right hon. Gentleman a question. He did not answer, but made an inaccurate observation about what I said on Saturday. May we not have him answer the question which was put?

I was about to deal with the question of exports and the balance of payments.

The Prime Minister has spoken of an increase of 25 per cent. in exports. What is the real position of exports from the standpoint of the balance of payments? Taking the second and third quarters of 1967 together—I take the two because of the problems over strikes—and comparing them with the third quarter of 1968. the improvement in exports in foreign currency terms is 3 per cent. That is the real export position which has to be taken into account into relation to our balance of payments, and it is misleading to speak of 25 per cent., a figure which bears no relation to the country's problems.

Next, the foreign currency cost of imports is 8 per cent. up. This is the problem confronting us, for, despite all the efforts of British Business and industry, the value of our exports has risen by 3 per cent. and the cost of imports has risen by 8 per cent.

Finally, on this aspect of the matter, in the context of an increase in world trade, we are only just holding our own, going slightly better than the increase in world trade. This means that we have gained nothing from devaluation in the proportion of world trade, unless, of course, the Government are now prepared to say that the situation before devaluation was even worse than they told the country it was. If the situation was becoming worse even more rapidly than they said, they could claim that devaluation has done something more than just enable us to hold our own in world trade; but if matters were as they declared, we have only just held our own. That is all.

Those are the main characteristics of our economic situation and the Government's policy. The attempt to deal with the post-devaluation period by forcing down consumer expenditure has failed. The attempt to hold the level of wage rises below that of prices has failed. The attempt to earn more in exports than the increase in our imports has failed. The attempt to secure a larger share of world trade so as to be able to repay our debts has failed. That is the condemnation of the Government's policy.

This situation has existed for some time. The spending spree has been going on ever since devaluation, because the right hon. Gentleman the present Home Secretary, either because of his own or the Government's judgment, was not prepared to take action which he ought to have taken immediately after devaluation. The spending spree slowed a bit after the Budget, but then regained momentum and is now faster than it has ever been.

Yes, at this moment. The right hon. Gentleman has only to read the Press this weekend to see the impact which his own measures have had on the spending spree. It is there for all to see.

I am sorry, no. I usually give way a great deal, but there is much to be said.

The realities of the economic situation have been smothered by the Government in a rosy glow of optimism. Both the Prime Minister and the Chancellor of the Exchequer are to blame for this. The Prime Minister gave us, first, his devaluation speech, then talk of the economic miracle, then the optimism of his speech in Wales, then his speech on the Address—everything going fair—and finally, 10 days ago, his now famous interview with Mr. John Dickinson, when he gave his views on how splendidly everything was going.

I shall quote a short passage. Mr. Dickinson said:
"Certainly, he looked fitter and more relaxed than he had at the start of the year, and I told him so. After a couple of puffs on his pipe, the Prime Minister said 'If you feel that things are going to work out right, you are obviously more relaxed; and there is evidence that policies are beginning to work through'."
Just a couple of puffs between the Prime Minister, the country, and disaster.

The Chancellor of the Exchequer, in his Mansion House speech, in his speech on the Amendment to the Address and in his interview published in the People only eight days ago, spoke to the same effect—all was going well.

Last Friday, we had the latest measures.

There was plenty of warning to the Government of what was happening. At the time of devaluation they were warned of the danger that they would fritter away time and the country's resources. Last summer they were warned about the debt which the country had incurred and what this was doing to our economy for the future. We warned them about the crisis which led to the Basle Agreement—and how the Prime Minister pooh-poohed that. The real crisis was revealed in the Chancellor's White Paper about the Basle Agreement. How right we were in all those warnings.

What lies behind the Government's failure in attempting to deal with the problem as they have? The consumer is not prepared to bear the full brunt of the Government's measures. That is now absolutely clear. It is the silent revolution of the consumer, and it is based on a philosophy which have grown up over these post-war years of rising expectations of life. They see it happening in every industrial country in the West. [An Hon. Member: "Like France?"]. That is the psychological background to what has been going on in this country since devaluation.

The people have been determined to maintain their standard of living even if it means pressures on wages, even if it means withdrawals of savings. They are endeavouring at all costs to maintain their standard of living. They do not understand the relevance of the Govern- ment's measures to their own activities, or to the prosperity of the country, or to its position in international affairs. Because of the repeated action of the Government, none of it satisfactory to produce the result which is required, they have now lost confidence in the Government's measures.

The people have allied with their determination to maintain their standard of living a determination to break compulsory wage control. That has been the reaction of people over the last year. They believe that they are unable to change it individually in their work or in any other way, and that is what has led to their frustration and their disillusionment. They see that it can only be done at their work by those who organise industry, whether management or unions, and by the policies which the Government themselves put forward. The Government must face this reality, because to go on with policies which are based on the assumption that they will work can lead only to increasing progress towards disaster.

In that context, let us look at the measures which the Government took last Friday. The regulator—another £250 million additional taxation, a total this year of £1,173 million, 30s. for every family in the country, a total since the Government came into power of £2,280 million, or £3 for every family per week. That is the burden. [Interruption.] Yes, per week—30s. per week this year in additional taxation, and during the Government's total period in office £3 a week.

We now have a credit squeeze which is more than a freeze. It is cutting back credit to a very considerable extent. It will mean damage to many firms, particularly the smaller and the family firms. [An Hon. Member: "Ah."] I do not understand why the hon. Gentleman opposite should say, "Ah". These small and family firms provide employment for the greater part of the workers of the country. The import deposits, too, will greatly damage the smaller firms because they are the ones who are without the liquid resources, of which the Government constantly talk, to enable them to deal with the additional 50 per cent. charge on imports.

On the question of import deposits, I would like to put some questions to the Chancellor of the Exchequer. We have sometimes asked him to examine this proposal and to tell the House what were the pros and cons of having the import deposits. Hitherto, he has always said that they were impracticable. We would like to know from the Chancellor what has now made them practicable.

I understand that firms will be allowed credit of some kind until March, 1969 but that after that the whole 50 per cent. will have to come out of their own resources by a reduction in the imports which they obtain. It means that the compulsory balances, or the balances paid compulsorily to the Government, under the two schemes of the import deposits and the Selective Employment Tax will amount at the end of the period to roughly £1,000 million. That is the amount which the Government are taking out of industry, obviously without paying any interest on it and using it for their own resources through these two devices.

Those are the measures which are being taken against the background I have described. What they will do is to push up the cost of living still further. They will push up industrial costs still further and decrease, therefore, the advantages which can be gained from devaluation which was carried through a year ago. This is the same approach as the Chancellor has had throughout his period in office. It has already failed for the reasons I have given, and all he can do is to go on pursuing the same policies.

The omissions are startling. There is nothing in these measures to induce savings. The Government themselves are constantly stating that people are withdrawing savings to cope with the present situation. If savings are to be dealt with, there must be a realistic scheme with a high inducement to people to break the vicious circle of personal expenditure and to persuade them to save once again. We have put forward our own schemes; they may not be the best. If the Chancellor has better ones, let him come forward with them. What is required urgently, however, are schemes to induce people to stop withdrawing savings and to make fresh savings.

There is nothing on the question of Government expenditure. The Chancel- lor must face the analysis which I have given him, whatever his views about Government expenditure, if he is to secure a response from the people. They are not prepared to see Government expenditure continue at the rate it has been going on, nor are they prepared to see it continue at the present level.

In 1963–64, Government expenditure —the total of public expenditure—was £12,067 million. In 1968–69, it is £19,386 million, an increase of 60 per cent. [An Hon. Member: "What about east of Suez?"] Let right hon. and hon. Members opposite first recognise that Government expenditure has increased by 60 per cent. over what we were spending in 1964. For that, the Government and the Chancellor are responsible.

I have not done so, but I will give way to the right hon. Member for Easington (Mr. Shinwell).

This is a very important point. It is the substance of the Opposition case on public expenditure. Will the right hon. Gentleman be good enough to furnish details, perhaps, on defence, on health and on housing? May I remind him that almost every day, from his side of the House, demands are made for more schools, more roads and extra public expenditure?

Yes, I will do so. I ask the right hon. Gentleman to recognise that under the Administration he supports it has increased by 60 per cent. during this period of four years, and for that the Government are responsible. [An Hon. Member: "What would the right hon. Gentleman do?"] I will say where I believe that Government expenditure should be dealt with. The first place is in agriculture—[Hon. Members: "Oh."]—because I believe that it is right that the present agricultural support price system should be changed to bring in levies to the Chancellor, to save the subsidies to the Chancellor not the production grants—[Interruption.]

It is quite clear that right hon. and hon. Members opposite do not want to hear the answer and are not prepared to hear it.

The advantage of this would have a direct impact on our balance of payments by reducing food imports. Why the Chancellor of the Exchequer has never insisted on this being brought about in this situation, I cannot imagine. It is one of the main places where food imports could be saved, where the British farmer could expand, where the Chancellor could save Government expenditure and gain income, and where it would be possible—

Order. The hon. Gentleman must not persist. The right hon. Gentleman is not giving way.

I do not mind how much right hon. and hon. Members opposite shout. I shall put forward policies which should be carried through in the interests of the country. If the Prime Minister and the Chancellor of the Exchequer will not tell the people the truth, I am going to tell them.

The hon. and learned Gentleman will have the opportunity to catch Mr. Speaker's eye.

I have reviewed our policies, and these are the right ones in present circumstances. If people on low incomes are particularly affected by any increase in the price of food, they can be helped through the social services—[Hon. Members: "Oh."]—but the saving will be substantial.

The right hon. Member for Easington asked about defence. I have proposed that there should be jointly maintained by the five Commonwealth countries a presence in Singapore, Malaysia and the Gulf. This is a specific proposal. Nothing could be further from the truth than the distortion of the Secretary of State for Defence about its cost. The cost would be less than the amount which the Government are still spending in the Far East. What is more, our Commonwealth partners want to see a small British presence maintained there, and so do the Rulers of the Gulf.

The next place where Government expenditure should be dealt with is in the general administration of government. Everybody knows, including hon. Members opposite, that the whole attitude to Government expenditure is wrong. There is not the desire to see the smallest resources used for any particular objective. There is not the desire to cut waste wherever it may be found. This will not only save money; it will give an example to the rest of the country, and the people would at least begin to feel that the Government have their own affairs under control.

The next place where money should be saved is in the reorganisation of the housing subsidies, so that those with large incomes living in local authority houses who are able to pay a fair rent do so and the subsidies go to the old people, the disabled, slum clearance and to those who cannot afford to pay a fair rent. This, too, would lead to a reduction in Government expenditure.

Let the right hon. Gentleman consider those, to begin with. Let him consider, too, the area in which the Prime Minister is so proud of pouring money into industry regardless of whether it produces results. It has become a shibboleth that for industrial development in the areas where there is unemployment one simply has to pour out Government money regardless of its effects; and I think that the Prime Minister will find that very soon the Hunt Committee says the same thing.

Let the Government judge, on a cost effectiveness basis, whether they are getting value for their money in these areas. I see right hon. and hon. Members opposite gloating over something which they think will be to their political advantage. I am suggesting this because it is essential for the economic health of the country—and the Chancellor of the Exchequer, if he is an honourable man, will recognise it.

This debate is being held against the international background of last week, which itself was the result of, in the beginning, the sterling devaluation, the gold crisis and then the sterling crisis of last July and the Basle settlement. I wish to say a few words about the outcome of Bonn. There was, I suppose, a temporary tiding over of that particular problem. It is much too early yet to say to what extent the cracks were papered over. But there was no permanent outcome from Bonn, and the House would be wise to recognise that. The problem about all such international crises is that in the heat of the crisis something can be done temporarily and that in between crises nothing is done permanently. It is this position with which the Chancellor of the Exchequer and his colleagues are confronted.

There are some who say that there should be a conference. It may be that a conference of the Ten, or even on a wider basis, can help to produce a longer term settlement. All I ask is that it should not be a repetition of the world economic conference of 1933. Nobody is looking for another Ramsay Macdonald to take the chair at a conference of this kind. Unless it is thoroughly and properly prepared, and the industrial powers know the solution to which they are working, any world conference will be disastrous for the stability of the countries concerned.

I ask the Government to take account of the national positions over currency. To judge from the Press, they seem to have taken singularly little notice of them so far. I believe that what people want above all—and people of all countries—is a stable economy [Laughter.] The hon. Gentleman may laugh, but if he talks to his constituents they will tell him that they want a stable currency. Throughout history it has been the desire of people to have a stable currency. The problem today is that they require a stable currency together with full employment and a rising standard of living at the same time. The problem which faces international financial statesmen is how they are to bring it about.

There is no point in saying that the Germans should revalue, that the French should devalue, or that the Americans should change the price of gold when the national position of those currencies supports the attitude which they are adopting. There is a long history behind the determination of the Germans not to change, even upwards, the value of their currency. There is a long history behind the French and the American positions. I should very much doubt whether the new American Congress would be prepared to change the price of gold.

Let the Chancellor of the Exchequer take these facts into consideration when he is looking at the international scene. It seems to me that the economic commentators are not doing so. They are discussing these matters purely in economic terms—as if a change in currency value was a purely technical matter, as if a floating exchange rate was purely a matter of agreement under the International Monetary Fund, as if any of these aims could be fulfilled with the full approval of people in different countries without considering the individual national backgrounds. I therefore suggest to the Chancellor that, if he is thinking in terms of an international gathering to deal with the long term problem, he must at least take these views into account.

The questions which I wish to pose to the Chancellor are these. Was he really so inept, or was the Prime Minister so inept, as we read, in handling the German situation at this conference? Did the Prime Minister really summon the German Ambassador after midnight and threaten to withdraw British forces from Europe in order to make them revalue? [Hon. Members: "Why not?"] How much reliance do hon. Members below the Gangway think other people will place in us as an ally if the Prime Minister adopted such tactics over the currency question? There is much too much truth in the reports from Bonn about the Chancellor's attitude of hectoring and lecturing to overlook them entirely. How inept are the Government to handle a critical situation in this way!

Is it really true that at the E.F.T.A. Ministerial meeting on Friday there was no discussion with them about the import deposits and their impact? [Hon. Members: "Oh."] If the President of the Board of Trade or the Chancellor discussed it with them, let them say so. It is reported in the Press that there was no discussion, and the Danish Finance Minister has said that there was no consultation. Was there, or was there not, consultation?

If the right hon. Gentleman will read the E.F.T.A. communiqué, he will discover that we had a special session all Friday afternoon to discuss the import deposits.

The right hon. Gentleman knows that that was not consultation with E.F.T.A., because the Chancellor of the Exchequer told the House that he had already made up his mind about the package. That was not consultation with E.F.T.A.; that was informing E.F.T.A. what the Chancellor intended to do.

In overseas affairs, as in home affairs, we see that the Government are inept and incompetent. We have condemned the policies and we now condemn the Government for failing to carry through even their own avowed policies and for failing to deal with the real problems of the country. We condemn them, too, for their deception, which goes back to the General Election of 1966.

We have just heard the real truth about the present Home Secretary's Budget of May, 1966. In March, 1966 there was to be no general increase in taxation. Then, in May, 1966, what was it—£254 million. "Oh," said the Chancellor, "it was my advisers." Are we to believe that in March the advisers said no increase in taxation, and in May they said yes, more than £250 million increase in taxation? That is the deception of the Government. We have heard the deception of the Prime Minister, "The £ in the pocket will not be devalued."

The right hon. Gentleman, yet again, has deliberately falsified the words I used. [Hon. Members: "Oh."] I asked him a fortnight ago—[Interruption.] He can check the words he then used, the words he has now used and the words that I used. He knows that I did not use those words. He knows that I said prices would rise. I now ask him to withdraw.

The Prime Minister had better read his own broadcast again. Had he taken part in this debate he would have had the opportunity to explain everything. He just had not got the guts to do so. The people are disillusioned and disheartened, and have lost all confidence in the Government. There is only one thing they ask for and that is to bring the Government to an end.

4.16 p.m.