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Social Contract (Chancellor's Speech)

Volume 885: debated on Thursday 30 January 1975

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asked the Prime Minister whether the public speech at Leeds on 10th January by the Chancellor of the Exchequer on the economy, unemployment and the social contract represents Government policy.

I have been asked to reply.

I would refer the hon. Gentleman to the reply which I gave to the hon. Member for Chingford (Mr. Tebbit) on Tuesday 28th January.

If the Lord President has finished abusing Parliament for exercising its free right last night in deciding issues of importance for the nation, will he give a simple "Yes" or "No" answer to the following question? Will he confirm that strict adherence to the terms of the social contract necessarily implies for the majority of people a decline in real standards of living over the forthcoming year?

It does not necessarily do so, but we hope very much that trade unions and employers—it takes two parties to make an agreement—will adhere to the social contract during the coming year.

Referring to the speech of my right hon. Friend the Chancellor at Leeds, may I ask the Lord President to take into account the fact that the decisions taken in the last Budget were allegedly designed to offset the possibility of high unemployment and that unemployment running at a level of 750,000 is a completely unacceptable figure? Will he bring it to the attention of his right hon. Friend that the Labour Party manifesto was designed to combat the problems that the Budget evidently has not combated?

The unemployment figure in Britain is the lowest in the developed world and it is rising much more slowly than anywhere else. As to the Budget, my right hon. Friend took massive steps to prevent unemployment this year. He will have increased consumer demand by the middle of this year by about £600 million and he gave enormous help to firms with cash difficulties.