asked the Secretary of State for Prices and Consumer Protection if she will make a statement on progress in the issue of licences under the Consumer Credit Act.

The Act imposes on the Director General of Fair Trading the duty of administering the licensing system. He has informed me that, up to 20th May, some 4,800 applications have been received—a sizeable proportion within the last few days—and 216 licences have been issued.

Can the hon. Gentleman say what proportion this represents of the people who needed to apply by the end of this month? Does he agree that, if the number is as small as some Press reports have suggested, an entirely chaotic situation could arise if a large number of arrangements become unenforceable?

The Director General estimated that about 17,000 applications ought to be received on the first licensing round. These relate to such things as credit reference, debt counselling and debt collection, and the effect of non-licensing would not be to invalidate agreements.

Has it been decided whether it would be possible to arrange for block grant licences for such people as the Building Societies Association, for example, or the Corporation of Insurance Brokers, or will it be necessary for each building society and each insurance broker to have separate licences?

I understand that first building society mortgages are outside the licensing arrangements. As to the professions, three group licences have been issued so far, to solictors in England and Wales and to those in Scotland and Northern Ireland. As I do not want to prejudge the matter, all I would say is that it is open to other professional associations to discuss with the Director General the possibility of obtaining group licences.

asked the Secretary of State for Prices and Consumer Protection what new plans she has to revise the Price Code.

asked the Secretary of State for Prices and Consumer Protection if she proposes to amend the Price Code.

asked the Secretary of State for Prices and Consumer Protection whether she will now take steps to relax the control of prices.

asked the Secretary of State for Prices and Consumer Protection whether she will make a statement on progress on revisions of the Price Code following the completion of the Chancellor of the Exchequer's negotiations on pay policy.

asked the Secretary of State for Prices and Consumer Protection if she will make a statement on the future of the Price Code.

The Government's proposals will be set out in detail in a consultative document to be published next month. Profit and cost controls will be retained. Changes will be made, particularly to encourage investment and jobs.

While waiting for the Green Paper, can the right hon. Lady say how she sees the restructured Price Code leading to manufacturers increasing their capital investment in the United Kingdom? Is it not more likely that capital investment will still be held up—in fact, strangled—to judge by the web of controls and by further TUC demands for smaller profit margins?

With regard to the first part of the question, it is not a Green Paper that will be produced but a consultative document—under the terms of the Counter-Inflation (Temporary Provisions) Act 1972 that is what is required—and it will be debated in the House of Commons.

Does my right hon. Friend accept that any amendment to the Price Code which will allow price rises to be greater next time round than they were this time and which are announced after the TUC meeting on 16th June will be seen to undermine the policy for the vast majority of workers, who will consider that their leaders have been sold down the river by the Government?

No. Sir. My hon. Friend will appreciate that the discussions between the Government and other organisations about the Price Code include the TUC—very much so—which is as concerned as we are about the effects on investment and jobs where the Price Code can be pointed to. Therefore, what we have to do is to walk what may be a difficult line between the maximum restriction and unnecessary increases in prices and the necessary measures that have to be taken to encourage investment and new jobs.

Does the right hon. Lady realise that the Government have to walk the plank? Is it not true that if more profitability were allowed for reinvestment this would be in the self-interest of the employees, because those concerned would be able to reinvest more in plant and equipment and there would be more jobs? Secondly, will the £5 million limit be raised, because it was fixed before a lot of this inflation took place?

The hon. Gentleman, with his usual subtlety, replaced my tightrope with his plank, but I insist on replacing his plank with a tightrope since a tightrope has another end to it, whereas a plank ends in the sea. Having said that, I go on to say that there are certain sectors where the return at present is below the cost of borrowing money to invest. It is that kind of thing to which we are turning our minds, which I am sure the entire House will, on consideration, recognise is not in the national interest or in the interests of full employment.

Despite the carefully orchestrated campaign of big business to dismantle all the arrangements in the Price Code, will my right hon. Friend give an assurance that there will be safeguards to ensure that retained profits are channelled into investment, particularly in manufacturing industry? Will she also understand that price controls hold the only hope there is of getting the acceptance of working people for incomes policies?

I hope my hon. Friend will give us a little more credit than that suggests. The investment relief is directly tied to relief in domestic manufacturing industry and in commercial vehicles. It is indeed our intention that any improvement in investment shall be directed towards the domestic economy and not dissipated in either investment in property or investment abroad.

Can the Secretary of State say whether it is also her intention to amend the code in order to remove the present disincentives to increased efficiency and productivity, and, if so, what form her proposals will take?

I can tell the hon. Gentleman that both these matters are under consideration, but I cannot go further than that for the obvious reason that the discussions on this entire subject have only just begun.

Although we accept that her intentions are good, can my right hon. Friend say what actual guarantees will come from the Government to ensure that such increases in prices, leading to increased profits, will be used for the necessary investment which is required?

Yes, I will indeed. In the first year of the investment relief—1975—there was approximately £380 million-worth of relief which was associated with £1,955 million-worth of investment. All this was closely monitored by the Price Commission. The commission has informed me that it is satisfied that the investment relief went directly on investment which benefited the domestic economy, in particular manufacturing. That is indeed precisely in line with the policies of the Government and the Labour Party.

Does not the Minister realise that British industry has been subjected to price control in one form or another for the last five years while wage costs have shot ahead? How will these meagre proposals redress that damaging imbalance?

They will do so along the lines I have indicated. The hon. Member for Romford (Mr. Neubert) will be fair-minded enough to agree that it is important to assure those who are being asked to engage in a very harsh form of incomes restraint that there will not be unnecessary increases in prices and that where prices are increased it will be in order to benefit investment and jobs.

Is my right hon. Friend aware that only last week in the Financial Times there was evidence of massive increases in profits? To the ordinary housewife there does not seem to be any dramatic reduction, or indeed holding, of prices. Is my right hon. Friend further aware that, when she receives supplications from the Conservative Party to allow prices to rise, official Shadow spokesmen tell us that she is pretty frightful to allow prices to rise and that this is a bad thing? My right hon. Friend ought not to take too much notice of this but should take heed instead of the TUC's request to hold prices as much as she can.

I am well aware of the fact that, regardless of almost anything I do on prices, it will be wrong as far as the Opposition are concerned, but that is the nature of their particularly destructive contribution to the policy. With regard to the first part of my hon. Friend's question, let me say right away that the return on capital in real terms, allowing for inflation, has fallen from approximately 11 per cent. 10 years ago to 7 per cent. in 1970 and to 4 per cent. in 1974. I do not think it is unreasonable to say that, whatever else has benefited over the last couple of years, it has not primarily been profits.

While congratulating the right hon. Lady in setting out with vigour on the tightrope or the plank, may I ask whether she can be a little more encouraging to those who believe that the restrictions of the Price Code have been the major disincentive to the economy at the present time? Would she not agree that to remove the Price Code altogether would increase the Retail Price Index by only something like 1 per cent. or less? Would she not agree that in the present economic climate—I stress this—this would do more for jobs and investment than the tinkering with the code which she is proposing?

I think the hon. Gentleman would also agree that one of the major factors in returning confidence has been the slowing down of the rate of inflation. I do not think it is reasonable to suggest that there can be a very tight control over incomes without any form of control over prices. Having said that, I believe that the TUC will fully accept that, where relaxations in prices are directly related to domestic investment improvements—they frankly were not between 1972 and 1974—there is a consensus for making these changes.

asked the Secretary of State for Prices and Consumer Protection if she will make a statement about the operation of the Price Check Scheme.

asked the Secretary of State for Prices and Consumer Protection what proportion of total family expenditure is currently covered by the Price Check Scheme.

asked the Secretary of State for Prices and Consumer Protection whether she plans to include any additional commodities in the Price Check Scheme.

asked the Secretary of State for Prices and Consumer Protection how many reports the Price Commission has made to her Department in exercise of its responsibility for monitoring the Price Check Scheme; and what was the substance of those reports.

The Price Commission has reported encouragingly on the prices of items in the Price Check Scheme, which is now half way through its six-month life. Of 43 groups of products covered by the scheme, the prices of four had increased, but less than 5 per cent.; 33 had remained stable within half of 1 per cent.; six had actually fallen during the two months of the scheme. This picture is confirmed by information gathered from leading retailers by the Retail Consortium.

I thank my right hon. Friend for that encouraging report. However, does she not accept that many housewives simply do nut understand what the red Price Check triangle means, and that by and large retailers have not done enough to ensure that their staff can explain the scheme to the public? In any future development of voluntary price restraint, will she bear in mind the paramount importance of ensuring that the buying public understand what it is all about?

I accept that in some shops there is no indication of precisely what lines and ranges the scheme covers, although my Department has made every possible attempt to persuade the trade associations of the importance of this. I think that my hon. Friend will have seen considerable improvements in the past few weeks. I would stress that, with anything like the Price Check Scheme, with every month that passes the scheme becomes more valuable to the housewife, because it guarantees stability of prices.

Would the Secretary of State agree that, with every month that passes, it becomes more confusing to the housewife? Is it not a fact that, with the withdrawals of beer, cigarettes and bread from the scheme, it does not really cover, as was originally intended, the full 20 per cent. of goods, but that the rules have been altered in such a way that the right hon. Lady can claim that it does? Is it not a fact that the scheme covers only about half of what was originally intended? If it is half a glass of rather indifferent wine, does she not agree that there is naught but the lees to brag of?

The hon. Gentleman always tries to be fair, so I think he will agree that there was no attempt by me to prevent the brewers from withdrawing from the scheme and that, as a result of the Budget, requests came from the brewers to remain within the scheme because, they said, there would have to be increases in their prices, apart from tax, otherwise. It was in that light that we kept them in the scheme, excepting tax, which was understood by them. The same is true of cigarettes. It has been made quite clear by the Brewers Society that it restricted its prices more than it would have done if the scheme did not exist and that the increases will be due to the tax and not to increases on their own part.

Has the Secretary of State any evidence that the changes and the variation of prices which she has announced would not have happened without the Price Check Scheme? Did these manufacturers whose prices have stabilised give any indication of increases in their prices if there had been no Price Check Scheme? The sum of £1 million has been spent on this very expensive scheme. Has the Secretary of State any evidence to show that it is actually contributing one jot to the control of prices?

The hon. Gentleman cannot have been listening, because I gave the example of the Brewers Society, which shows exactly what he has asked me. The CBI and the Retail Consortium have both indicated that firms have come within the scheme as a result of anticipating falls in labour costs which would not have occurred had there not been such a scheme. I think that the hon. Gentleman should accept both the CBI's and the Retail Consortium's willingness to cooperate rather than make the remarks he has just made.

I think that we all realise that, if there is to be a restraint in incomes, we must tackle the problem of inflation and that this scheme has obviously worked. Will my right hon. Friend therefore continue to strengthen the scheme in the months and years ahead and reject the sabotage which the Opposition attempted when it was introduced?

A situation in which 39 out of 43 items have either fallen in price or increased in price by less than ½per cent. is one which my hon. Friends would do well to applaud and, indeed, to publicise.

asked the Secretary of State for Prices and Consumer Protection if relaxation of the provisions of the Price Code will apply to the pricing policies of public corporations.

I would ask my hon. Friend to await the publication of the consultative document on the Price Code.

But is my hon. Friend aware that the irresponsible behaviour of the management of public corporations in slamming on price increase after price increase without regard to the social or commercial consequences is now producing a backlash from the unions whose members are employed by those corporations as well as from consumers? Is he aware that the British Steel Corporation in two months is proposing an increase of 35 per cent. on the price of mild steel, with all the consequences for domestic apparatus which that will produce? What action will his Department take about the public corporations instead of simply shuffling off responsibility on to other Government Departments?

First, I cannot accept all the premises of my hon. Friend's question. It is true that since 1974 the nationalised industries have had to absorb large increases in costs, but there is every reason now to expect that the industries' prices will moderate. I am afraid that I cannot anticipate the results of discussions over the Price Code. I must ask my hon. Friend to be patient on these matters.

On the Price Code, could the Minister answer the question, which I think his right hon. Friend forgot to answer, of whether the £5 million turnover threshold will be raised? Are the Government considering raising it in the paper which is to be issued?

Those limits are under discussion at the moment.

Does my hon. Friend agree that it is hardly fair to blame his Department for the problem of public corporation price increases but that the fact that Jack Jones has raised this matter in the recent discussions with the Government is nevertheless of great importance? Is he aware that all of us on this side are looking for more steps to be taken towards the effective control of electricity and gas prices in particular in the present discussions with the trade union movement?

I do not, as my hon. Friend says, accept the blame, but I do say that my Department has a responsibility to look at the consumer interest side of these matters. Certainly, one is prepared to consider such things as the recommendations of the Sub-Committee of the Select Committee on Nationalised Industries and other publications which will be available soon about the cost of energy for poor consumers.

Is it not a fact that if wage increases had not been so phenomenal in 1974 we should not now face the kind of gas and electricity price increases that we do face?

The increases in the price of energy have emanated from the Middle East as well as from pay settlements.

Would not my hon. Friend agree that the gas and electricity boards could follow the example of British Rail and freeze their prices for a year? That would certainly help people on lower incomes. Should not British Rail be congratulated on a determined attempt to retain passenger and freight services by freezing its prices?

The price of gas has been included in the Price Check Scheme and is being held down for six months in that respect.

It will go up in the winter.

The price of electricity for low-income families is now under urgent consideration.

asked the Secretary of State for Prices and Consumer Protection if she will seek to make it a legal obligation to show quantity marking on bottles of sherry and other fortified wines.

My right hon. Friend intends to do so as soon as we change over in this country from the "minimum" contents system to the "average" system.

I am grateful for that information. Is my hon. Friend aware that there is a growing practice of reducing both the amount in the bottle and the alcoholic content? Do not these practices constitute disguised price increases from which the disguises ought to be removed?

There is a number of problems related to that matter which are being considered by the Working Party on Metrological Systems Control which will be reporting shortly.

asked the Secretary of State for Prices and Consumer Protection what action she is taking in the interests of consumers to ensure the accuracy of tyre pressure gauges provided by garages for the use of motorists.

My Department is developing proposals for a tyre pressure gauge testing scheme which can be nationally recognised and will take advantage of the voluntary testing service already offered by many local weights and measures authorities. We have no powers to deal with this under existing legislation.

Is my hon. Friend aware that the London borough of Lambeth recently conducted a test which showed that a large proportion of these tyre gauges were wildly inaccurate and that, therefore, it is fair to assume that thousands of motorists must be driving around with incorrect tyre inflation, which must be a contributory cause of accidents?

I am aware of the Lambeth research, which has been extremely useful. The advice which has to be offered to motorists is that they should not only concern themselves about the pressure of inflation but should keep an exact balance between left and right.

asked the Secretary of State for Prices and Consumer Protection what has been the increase in the Retail Price Index over the past 12 months to date.

asked the Secretary of State for Prices and Consumer Protection what is the latest rise in the Retail Price Index; and if she will make causes of inflation instead of simply a statement.

asked the Secretary of State for Prices and Consumer Protection what is the latest Government estimate of the current rate of inflation.

asked the Secretary of State for Prices and Consumer Protection what is her estimate of the current rate of inflation.

Over the 12 months to April 1976, the Retail Price Index increased by 18·9 per cent.

Is the right hon. Lady aware that there is a certain superficial attraction in that answer but that many of the steps taken or not taken by the Chancellor of the Exchequer have led to a devaluation of the pound which will inevitably contribute dramatically to increased retail prices in the coming year? Has she instituted conversations with her right hon. Friend to help upvalue the pound and to take any necessary steps to do so?

I do not deny that the recent unexpectedly sharp decline in the exchange rate may mean some delay in the achievement of the single-figure target that the Government have set for the winter of this year. Indeed, I said as much in the last Parliamentary Questions that I answered, in reply to a Question by the hon. Member for Gloucester (Mrs. Oppenheim):

"I do not deny…that the decline in the value of the pound in recent months will rather slow down the achievement of the target."—[Official Report, 12th April 1976; Vol. 909, c. 887–8.]

Does not the fact that prices are still rising considerably faster than wages disprove the theory that wage increases are the major cause of price inflation? What steps are the Government taking to identify and attack other expecting workers to make all the sacrifices?

Although it is true that in some past months prices have run ahead of earnings, my hon. Friend will be glad to know that in April the paths crossed the other way and earnings are now ahead of prices. But one factor over which none of us has any direct control is what is happening to import prices. There is no doubt that there is a hardening of raw material and food prices in the rest of the world because of the greater recovery of the world economy.

Would the right hon. Lady agree that these protestations that the pound has fallen too far simply show how little confidence there is abroad in this Administration? What estimate has she made of the effect on the Retail Price Index of the fall this year in the value of the pound?

The fall in the value of the pound over the last month would add about two and a half points to the Retail Price Index. The hon. Gentleman appears to be rather less devoted to this country than the Deputy-Chairman of the German Bundesbank, who took the view that the pound was heavily undervalued.

Will my right hon. Friend ignore the gloating by Conservative Members at the fall in the exchange rate and tell the workers why she is currently negotiating for a productivity criterion to be extended to the Price Code, whereas productivity criteria are excluded from pay settlements?

I do not think that my hon. Friend has got it quite right. At present, any increase in the volume and any fall in the unit costs of industry is penalised, in the sense that it has to be directly reflected in prices. We are seeking to give industry some incentive to improve the turnover and reduce the margin, which in the current Price Code is a very difficult thing to do. But I appreciate that such incentives must go across the board.

I thank you, Mr. Speaker, for allowing me to catch your eye again. May I ask the right hon. Lady once more what conversations she has instituted with the Chancellor of the Exchequer to make him take steps to reduce Government borrowing and Government expenditure so that the fall in the value of the pound is not reflected in an addition of two and a half points to the Retail Price Index next year?

The hon. Gentleman has again made the point which is frequently made by the Opposition: they want an immediate cut this year in public expenditure regardless of the effect on employment. That is not the view of the Government or of the Trades Union Congress.

While appreciating the work done by the Chancellor of the Exchequer, may I ask my right hon. Friend to comment on the feasibility of keeping to the Chancellor's targets and to say whether they are likely to be reached within the time scale envisaged? To many of us, that is the most critical thing of all.

It is very critical. As I said to the hon. Member for Lewes (Mr. Rathbone), we expect there to be a slippage of about two months in achieving our earlier target owing to the unexpectedly sharp decline in the exchange rate, but it is possible that the exchange rate will recover when the news about the levels of inflation, which are beginning to decline, gets across.

Will the right hon. Lady confirm or deny that prices have risen by 50·9 per cent. since February 1974, when the Government came to power, that this is a horrifying indictment of the Government's record on prices, and that, as this is largely a result of a combination of profligacy on the part of the Government and past excesses on the part of certain trade unionists, a certain amount of humility and repentance rather than arrogant boasting would be more appropriate? Will she also confirm that the fall in the value of the pound is a vote of no confidence not in this country but in the Government's policies?

We have now had the hon. Lady's much-heralded attack.

"The domestic inflation rate which is now down to about 13½ per cent…"

Order. The Minister is not quoting from a newspaper, is she?

I am referring to a leader in the Financial Times today, Mr. Speaker, which indicated that, in that newspaper's view, the current inflation rate, correctly estimated, was down to 131½per cent. compared with 35 per cent. in the first half of 1975. It serves nobody's interests, including the interests of this country, continually to underestimate the Government's massive achievement in fighting inflation.

asked the Secretary of State for Prices and Consumer Protection when she intends to pay another visit to the Dudley Consumer Advice Centre.

I have no plans to do so.

Will the right hon. Lady add a further statistic to the statistic which she has given from a newspaper from which she may or may not have been quoting? As one of the few economically-informed members of the Cabinet, will she say precisely what proportion of the fall from 35 per cent. to 13½ per cent. was, in her opinion, due to price control and the Price Code?

It would be difficult to estimate exactly how much was due to that. I would certainly give the major credit to the wages agreement reached in August 1975.

Does my right hon. Friend accept that devaluation means that wage earners must face increased costs? Does she agree that every Labour Government face the crisis of capitalism and that devaluation and the movement of sterling are an indictment of capitalism and the free market in currency? Is it not time that the Government met this challenge with tighter exchange control?

I agree with my hon. Friend that if the patriotism shown by the great majority of our people was shown by some of those who indulge in currency speculation we should be even further on the way to recovery than we are.

Does not the right hon. Lady agree that the continuing decline in the external value of the pound will go on unless and until the public sector borrowing requirement is cut dramatically?

No, I do not think so. I have noticed that there is in the leading articles of many of the most responsible newspapers abroad, including the New York Times, a recognition of the extent of the achievement of the people of this country in accepting a degree of restraint on incomes which was regarded as unprecedented and, indeed, impossible of achievement only a year ago.

Should my right hon. Friend go to Dudley again, will she point out that what is happening in the House of Commons is that Tory Members are running out of their reserves of chagrin because of the success of the Government and that nobody should take too much notice of what they say because they do not really count?

When I next go to Dudley, it would give me more than satisfaction to point out. if given the opportunity, that hon. Gentlemen and hon. Ladies of the Opposition continually attack the Government's prices policy but oppose food subsidies, rent subsidies and the Price Check Scheme, that they appear to want the Price Code to be abolished, and that it would be nice to get something positive from them.

Will the Secretary of State give an explanation of her remark to an elderly lady on the occasion of her visit to Dudley, just before being shouted down by an angry crowd of shoppers, that if we kept going at the present rate we could get prices down to the levels which the lady knew when she was a young woman, which would signify a rate of inflation of about 1 per cent. a year? Will the right hon. Lady say when she expects that forecast to materialise? Or is this another Labour Party election promise, or is she now given to wild and irresponsible forecasts—

Order. Supplementary questions are getting very long again.

What the hon. Lady says is a perfectly fair assessment of the way in which the programme was edited. I should be happy to send her a transcript of what was said at length, which would indicate that what I was talking about was the rate of increase per year. I said that I hoped that over a period—which might be a long period—we would get down to the rates of increase which we had seen in the past.

asked the Secretary of State for Prices and Consumer Protection by how much the food index has increased over the past 12 months to date inclusive of seasonal foods; and by how much it has increased over the past three months on the same basis.

The food index, which includes seasonal food, increased by 19–9 per cent. between 15th April 1975 and 13th April 1976 and by 5·7 per cent. between 13th January and 13th April 1976.

In spite of the banter across the Floor of the House, is the hon. Gentleman aware that the housewife is desperately worried about the increasing cost of food? Will he consider the price of potatoes, which has increased by 11p in the past three months? Will he have discussions with the Minister of Agriculture about the working of the Potato Marketing Board, which I do not think is doing a very good job?

There is a separate Question on potatoes, which I shall answer when we reach it. However, on the question of food prices generally, it would be very helpful if the Opposition would make clear whether they propose the immediate abandonment of food subsidies.

Does my hon. Friend agree that the proportion of lower incomes spent on food is very much higher than it has been for many years? In fact, there has been a step back to the position in the early years of this century. Does not that strengthen the case for retaining food subsidies, which are opposed by the Conservative Party?

The less-well-off spend a larger proportion of their income on food, but some encouragement should be taken from the fact that the food index, less seasonal foods, shows that the rate of increase of 27·9 per cent. in April last year had fallen to 13·8 per cent. this year. If we include seasonal foods, which have been affected seriously by what has happened with potatoes, the fall is from 26·6 per cent. to 19·9 per cent. Therefore, some progress is discernible.

asked the Secretary of State for Prices and Consumer Protection what is the value of food subsidies per person per week in the average family of four persons comprising two children over 11 years of age and two adults.

The estimated average value for a typical family of two adults and two children is about 18p per week per person.

I thank the Minister for his reply. Can be confirm that, as a direct consequence of the Chancellor's increase in indirect taxation, the average weekly cost to a family is 50p? Will he tell the House whether that rather curious choice of priorities was agreed in any discussions with the Trades Union Congress?

The hon. Member raises questions which are wide of the Question on the Order Paper.

Does the Under-Secretary's answer include subsidies on school meals?

It does not.

Does my hon. Friend agree that the need for food subsidies might be somewhat less if we were not saddled with the idiocy of the common agricultural policy? Is he aware of the racketeering which is now going on in beef, which is going into intervention stores, coming out cheap and then being sold at exaggerated profits? Is this matter to be investigated by his Department?

My Department was recently represented by myself at the discussions of the EEC on the future of the common agricultural policy. Membership of the EEC has some beneficial impacts in that at this time, when the fall in the value of the pound sterling is affecting imported food prices, that fall is to some extent cushioned by monetary compensatory amounts.

Does not the Under-Secretary agree that, given the background of 50·9 per cent. inflation during this Government's term of office against a record annual rate last August of 26–9 per cent. and the most recent rate of annual inflation of 18·9 per cent., food subsidies that provide relief of 0·9 per cent. on the Retail Price Index are as significant as a pimple on a baby's bottom?

The present value of food subsidies on the food index is 4.9 per cent. The Opposition must come to terms with the fact that their advocacy of the abolition of the Price Code, their non-support for the Price Check Scheme and their proposal that we should end food subsidies add up to Substantial additions to the Retail Price Index. They must make up their minds what they want.

asked the Secretary of State for Prices and Consumer Protection if she will take steps to meet representatives of the transport users' consultative committee in the near future to discuss increases in bus fares.

Following the Transport Acts of 1953 and 1962, the transport consultative committees are not empowered to consider bus services or fares and charges. I shall, however, be discussing with them the Government's consultative document on transport policy, which refers to both these subjects.

When the Minister discusses this subject with the transport users' consultative committee, will he look into the operation of concessionary fares? These fares are operating very unfairly in various parts of the country. Will he also say whether it is possible for retirement pensioners to have a half-fare concession, as they do on the railways?

I should be happy to discuss those matters and even happier if a guiding light could be shown by some Conservative local authorities which refuse concessionary fares.

Will the Minister listen carefully to the idea which has been put forward and recognise that there is great unfairness between local authority areas? It is not always a question of the local authorities. If the Government would get together with the National Bus Company to see whether a scheme similar to the British Rail scheme could be devised, with a card that pensioners could purchase, they would rightly earn themselves considerable gratitude throughout the country.

There is always a balance to be struck between local autonomy and uniformity which brings a benefit both in custom and to users, particularly those who are vulnerable. I shall be very happy to discuss this matter.

Will my hon. Friend take a special look at concessionary fares for those disabled by blindness? Is he aware that the National League for the Blind has a number of special problems and that it would be helped considerably if there could be a meeting of transport providers, both road and rail?

Yes, I am willing to discuss this matter.

asked the Secretary of State for Prices and Consumer Protection what steps she is now taking to control the price of potatoes; and if she will make a statement.

As I have explained on a number of occasions, price controls cannot overcome the shortfall in potatoes. If we try to hold down prices artificially, we shall discourage the imports on which we must increasingly depend until the new home crop is lifted.

Then what is all this "phoney" war between the two Front Benches? Is my hon. Friend aware that an old lady in Bolsover said to me when I was out canvassing that a Government who believed in planning should be able to do something about the price of potatoes? The sooner the Government Front Bench apply their minds to that very fact, the sooner we might start not losing elections but winning them.

If my hon. Friend's Question had been about a visit to Bolsover I might have been able to answer his point about his constituent. I can offer him some news which I think may be of encouragement to him. The National Federation of Fruit and Potato Trades last week reported retail prices to be about 13p a pound for old potatoes and from 16p upwards for new potatoes. which is about 4p below the peak levels at the beginning of the month.

As some families when they eat their potatoes on Sunday can now occasionally afford some beef with the potatoes, can the Minister answer the supplementary question asked earlier by his hon. Friend the Member for Sheffield, Hooley (Mr. Heeley) on Question No. 14 about the racket in beef prices which has been disclosed—the selling of beef out of intervention at very high prices indeed?

The hon. Gentleman's attempt to mix beef and potatoes has created something of a hot-pot, and I do not propose to follow it.

asked the Secretary of State for Prices and Consumer Protecton how many letters she has received suggesting the abolition of the Price Commission.

None in recent months.

If the cost of the Price Commission in the current year is £6·6 million, does not the Minister think that it would be in the public interest for this monstrosity to be abandoned forthwith?

The hon. Gentleman's view may be shared by Tory members, but it is not shared by those who are seeking to make our counter-inflation policy work. The CBI, the Retail Consortium and the TUC are united in agreeing that there must be a continuation of the pricing policy during the next period of extremely stringent wage inflation.

Is my hon. Friend aware that during the period of potato shortage the price of rice appears by some coincidence to have risen very rapidly? What has the Price Commission been doing about that?

The Price Commission monitors fresh food prices regularly. If my hon. Friend will table a specific Question, I have no doubt that I shall be able to answer it.

Will the hon. Gentleman bear in mind that for category 1 companies it is estimated that about £35 million is spent in administering the Price Code? Is not this an indication that the Price Code should be abolished?

The Price Commission does a very important job in monitoring and controlling allowable cost increases, and it would be wholly wrong at this time to depart from the existing technique of price control. If the hon. Member is advocating that on behalf of the Opposition, I hope that he will make it plain that that is what he is doing. The Price Commission fulfils other purposes and was established in perpetuity by the Act, for which the Tory Government were responsible, to enable pricing policy to be examined.

Will the Minister now say exactly what effect the abolition of the Price Code would have upon the Retail Price Index?

My right hon. Friend has already explained the precise elements involved.

No.

Yes. If the hon. Lady refers to Hansard, she will see a full answer on this question.

Will my hon. Friend give the House some information about investigations by the Price Commission into the price of potatoes? Is he aware that ordinary small and large retailers, greengrocers and people such as fish-and-chip merchants are getting tired of having to explain the steep increases and that there is increasing suspicion on the part of the public that farmers and wholesalers have been making a killing? If the Price Commission investigates these matters, the public will be assured that the blame lies fairly.

The Price Commission investigates distributors' margins, and two such reports are in the House of Commons Library. A third report will be available shortly. They make it plain that distributors are not profiteering on the shortage of potatoes. It is true that farmers have done rather well out of the potato shortage, by and large, even though there are variations. It is true also that farmers' profits vary from season to season and from commodity to commodity. Any further questions on farmers' profits would be better addressed to my right hon. Friend the Minister of Agriculture, Fisheries and Food.

asked the Secretary of State for Prices and Consumer Protection if she is satisfied with the current level of prices.

The current level of inflation represents a considerable improvement on the level a year ago, but I shall not be satisfied until our rate of inflation is brought down to the level of our competitors or even lower.

Is my hon. Friend aware that in the successful battle which the Government are now waging to bring down the rate of inflation and in which they are hampered by the Conservative Opposition, who want to damage the pound, to hold down public spending and let private spending via prices go through the roof, the linchpin of the Government's agreement is the holding of prices, together with reducing unemployment?

I fully agree with my hon. Friend that the control of prices remains a vital part of the Government's battle against inflation and that this has been so throughout the first year of our counter-inflation policy. I am glad that the CBI and the TUC jointly recognise that that will remain true during the next year.

Would not the hon. Gentleman agree that, apart from the falling value of the pound, the forward cost of imported raw materials and semifinished goods into this country is increasing at a rate which will make it impossible to reduce the inflation rate to single figures by the end of the year? Does he believe that he will be able to do that even by the end of 1977?

I agree that there has been some hardening in commodity prices due to the upturn in world trade, but I do not believe that the Government's counter-inflation targets will not be reached.

Will my hon. Friend consider the rise in the price of a tin of skimmed milk from 25p to 45p in the last few months? As so much of this is given to cattle, is it not possible that those who wish to avoid cholesterol should pay a cheaper price for skimmed milk?

I shall be very willing to consider that.

Is not the hon. Gentleman aware that his remark about a considerable improvement in the rate of inflation is a diagnosis similar to that which would be given to a man who had been jumping from the thirtieth floor of a skyscraper every day and landing on his head but was now jumping from the fifteenth floor and still landing on his head?

I am at a loss to understand what object the hon. Gentleman thinks would be served by seeking to diminish the impact of the counter-inflation policy in which the country is engaged.