asked the Secretary of State for Prices and Consumer Protection what representations have been made to him about the Price Commission Bill since it was published.

The Bill received its Second Reading on 27th April. Discussions are continuing with interested parties on the detailed operation of the proposed new powers.

Will the Minister explain, however, what is to happen to a firm that is just starting up which has a low reference margin of profit? How is it to increase its profitability? In that connection, will he accept that the proposals do nothing towards the Government's aims of restoring profitability to industry and keeping down prices?

The objectives of the Bill are directed both at investment and at keeping prices down. The question of a new firm would be a subject for discussion on the new Price Code, on which discussions will start taking place quite shortly.

What representations has the hon. Gentleman received from small firms which have been much oppressed by the outrageous bureaucratic burden placed upon them by the Price Commission? Is he aware that one firm of which I know received a 29-page questionnaire? Will he take notice of these complaints?

Small firms have no monopoly of complaint about the information which they have to give to the Price Commission. We appreciate that difficulties exist. These are under consideration.

By what criteria were firms selected for investigation, and what plans does the Minister have to modify the arbitrariness of selection in the Bill? Secondly, what safeguards will the Secretary of State introduce in the Bill to protect the position of firms during the period of the freeze?

In respect of the hon. Member's first supplementary question, the criteria contained in the Bill were selected with a view to both certainty and a certain degree of flexibility. On the question of safeguards, one of the clauses in the Bill obliges my right hon. Friend to publish information on safeguards. Clearly, those must be the subject of consultation first, but my right hon. Friend will make an announcement on the matter as soon as consultations are completed.

asked the Secretary of State for Prices and Consumer Protection what effects he expects the Price Commission Bill to have on the retail price index in the 12 months from its enactment.

I would refer the hon. Member to the speech I made on Second Reading of the Price Commission Bill on 27th April.

The Secretary of State's expectations of dramatic reductions do not seem very high. Is he satisfied that the whole exercise is worth while, bearing in mind the enormous administrative difficulties and costs imposed on industry in dealing with even routine inquiries, let alone the new investigatory type of inquiries? Is he satisfied that it is possible to obtain the quality of staff that will be required for the Price Commission to carry out investigations of that sort, which are based on totally unquantified criteria and which call for a totally different set of qualifications from those possessed by the present Price Commission staff?

I have no doubt that we shall be able to obtain both the quality of staff and the quality of Commission membership to carry out the policy in a sensible and positive fashion. On the subject of the administrative burden placed on industry, perhaps we have not made sufficient of the point that we propose to ask industry to supply less information. In the crude form, that means filling in fewer forms and providing fewer statistics than was the case under the old 1973 Act—an Act which, I think, the hon. Gentleman supported but an Act which certainly imposed far too much of a bureaucratic burden on industry. That bureaucratic burden will be lifted after 1st August.

In his efforts to keep down the index of retail prices, is my right hon. Friend aware that he needs far more help in trying to find out the real profits of some of the companies involved? Is he aware that Brooke Bond Oxo has increased the price of tea in many of the supermarkets in my constituency by up to 300 per cent. in the past six months? When is the Price Commission's report on tea and coffee to come out?

When the Price Commission has completed it. It would be wrong of me to require it to do a half-rate or shoddy job because politics required a quick report which was less than conclusive. I said that I understood the strong feelings of many consumers about the increased prices of these basic commodities. But it would be dishonest of me to pretend that there was very much that the Government could do about increased prices as these commodities enter the ports. If the Price Commission reveals that some companies have been exploiting that situation, given the powers we shall take action, but until then it would be wrong to pretend that any other course was open to us.

Is there any truth in the peculiar rumour that the recent cement price increase application was turned down by the Price Commission because of the pending Price Commission Bill? If not, will the Secretary of State say why the Price Commission turned down the application from the cement industry for what looked to be a reasonable price increase?

The answer to the direct question is essentially one for the Price Commission, and the hon. Gentleman should refer it to that Commission. But it seems to me inconceivable that it should have done that in anticipation of a new Bill. That is really something of a question mark against the integrity of the Commission. I do not believe that the Price Commission behaves in that way.

Does my right hon. Friend agree that a significant factor is sheer profiteering on the part of retailers—certain retailers, not all of them—including some large companies which are paid to increase their prices week by week, and sometimes day by day, quite irrespective of the original commodity price? Does my right hon. Friend think that the measure now proposed will put an end to that kind of abuse?

I think it is easy for consumers to note increases in individual prices and not relate them to the overall profitability of the companies from which those commodities are purchased. The margin control which was introduced in 1973 and which, if the Bill is passed, will be continued in the new Price Commission Bill ought to prevent—and, I believe, in general does prevent—unreasonable profits being made across the entire enterprise by individual retailers. If, however, there are cases where this happens, the new powers will enable us to take more specific action against them, and I shall not hesitate to do that.

As the latest Price Commission report reveals that there has been an unusually high level of price notifications, and that there is now serious doubt about whether price increases on the six-monthly level are likely either to stabilise or to fall, can the Secretary of State comment on the validity of the Prime Minister's statement at the weekend that the Government are winning the battle against inflation, particularly as the Price Commission's commodity index is rising by over 49 per cent. on an annual basis?

I have already done so, but I shall gladly repeat it for the hon. Lady. There is no question at all but that the index of retail prices will remain at or about its present level for the next three or four months. It will then begin to reduce from autumn onwards, and that will continue through the winter and into 1978. That is what I have been saying for the past six months. That is what the hon. Lady has been denying for the past six months, and during that time I have been proved right month by month by month.

asked the Secretary of State for Prices and Consumer Protection what is the most recent increase over a period of six months of the retail price index of all items excluding seasonal foods.

8·9 per cent.

Does the right hon. Gentleman recall that in an answer to me on 7th February he pooh-poohed the Price Commission Chairman's forecast of 19 per cent. inflation by the spring? Now that both spring and 19 per cent. inflation are with us, what answer has the right hon. Gentleman to the Price Commission Chairman's latest forecast last Thursday that prices will continue to rise well into the summer?

I hope that I did not pooh-pooh what the Chairman of the Price Commission said. What I said then, and I repeat it now, is that the idea of 19 per cent. inflation—which the following week the hon. Lady the Member for Gloucester (Mrs. Oppenheim) said would be 20 per cent.—was not only wrong but demonstrably wrong as soon as the retail price index was published. My forecast had been consistent for six months. Inflation will continue at or about the present level until the late summer, when there will be continual though gradual decline in the RPI.

Is my right hon. Friend aware that many of us on the Government Benches were very pleased to read his speech over the weekend? It was perhaps a belated conversion but no less welcome for that. Does he not agree that the biggest single factor now affecting food prices in this country is our membership of the EEC, together with the common agricultural policy? Is he further aware that this is due more directly to the steps that have to be taken in relation to the CAP and indirectly to world prices as a whole?

Talk!

I am grateful for my hon. Friend's support. I hope that that support will not be moderated when he discovers that one newspaper said yesterday that I began my criticism of the CAP by saying that I continued to believe that Britain's future lay, and ought to lie, within the EEC. Although the CAP has been in existence a long time, I believe that it needs radical change and substantial adjustment. I hold that view strongly, and my hon. Friend will recall that my right hon. Friend the Minister of Agriculture has done his best to make marginal adjustments to the surplus policy in relation to the CAP. I hope that we can do more in the years that lie ahead.

I recognise that the CAP is one factor in the increase in food prices, but does not the right hon. Gentleman agree that the main reason is our appalling domestic inflation, for which the right hon. Gentleman's Government are largely responsible? Can he confirm to as many of his hon. Friends as appear to be unaware of it that items such as coffee and tea are not grown in EEC countries?

The hon. Gentleman must decide which point he wants to make. I have always said that there are three reasons for our rate of inflation. One reason was the depreciation of sterling, the second was the drought of last year, and the third was increased commodity prices. The hon. Gentleman is right to say that commodity prices, coffee and tea in particular, lie outside the control of the EEC. They are also outside the control of the British Government, and I hope that the hon. Gentleman will not blame us for them.

In fairness to my right hon. Friend the Secretary of State, may I ask him to accept my congratulations on having caught up with what everyone else has been saying for 10 years?

That is the point—he has not.

As that is the nearest I have ever got to a compliment from my right hon. Friend, I had better accept it gladly.

I congratulate the Minister on part at least of his speech. Does he recall referring in that speech to a severe and fundamental change needed in the CAP? From his experience as Minister of State at the Foreign Office in charge of European affairs, does he think that there is a real chance of any fundamental changes or merely of the marginal changes to which he has just referred?

I am trespassing on the ground of others, but I believe that the prospects for a fundamental change are there, because an agricultural policy which creates surpluses intentionally, and increases them when they already exist, is in the interests of none of the member States, including the agricultural States. Sooner or later, I have no doubt, the entire nine members—and, perhaps more importantly, in four or five years the 11 members—will come to realise that that is true.

While it is true that the prices of tea and coffee are outside my right hon. Friend's control, is it not an unfair practice for some firms in London which sell coffee to insist on selling quantities of not less than half a pound at a price of £1·19? Is that not an unfair practice which his Department ought to look into?

One of the unfortunate features of the commercial life of some parts of our country is that when commodity prices increase a minority of firms seek to take advantage of them. I emphasise "a minority". It is because of that that we have asked the Price Commission to look at the margins on both those commodities, and I hope that the Price Commission will be able to report in the not-too-distant future.

asked the Secretary of State for Prices and Consumer Protection what is the most recent increase in retail prices over three months, expressed at an annual rate.

asked the Secretary of State for Prices and Consumer Protection how much retail prices have increased over the most recent 12-month period.

asked the Secretary of State for Prices and Consumer Protection what is the latest rise in the retail price index.

The latest monthly rise is 1 per cent. and the latest year-on-year increase is 16·7 per cent. The latest three-monthly rise is 4·6 per cent. That could be said to produce an annualised figure of 19·9 per cent., though it would not be statistically valid as an indication of the trend. [Interruption.] I really think that the hon. Member for Gloucester (Mrs. Oppenheim) is the most ill-mannered Member of the House. No doubt she will have a chance to ask a question in a moment. This brings the increase since February 1974 to 72·9 per cent.

Is not the Secretary of State aware that these ever-increasing prices are literally becoming intolerable, particularly for the poor and the elderly, or have the Government completely lost touch with the realities of life facing these people?

Of course, we have not lost touch with that reality. What we have done is produce a policy, against which the hon. Gentleman voted last Wednesday, which, associated with our general anti-inflation strategy, will produce a fall in the RPI, to which I have already referred. What the Conservative Opposition have to decide is whether they wish to continue to draw attention to obvious facts or whether they want to advance an obvious alternative. Up to now they have failed to do the second, and they will continue to be descredited until they say something positive about prices rather than draw attention to them.

Is it possible that the figures that the Minister has just given us were responsible in part for the by-election result which, in the early hours of Friday morning, rendered the right hon. Gentleman untypically speechless? Can he tell us how he reconciles those figures with the claim that his Government have halved the rate of inflation?

There is no doubt that the recent by-election losses which my Government have sustained have been largely the result of price increases. No one in his right mind would choose to deny that. However, it is not our policy to make sudden panic changes in our policy to adjust to a temporary situation.

Temporary!

I am equally sure that when the rate of inflation begins to improve, as it will in the autumn, we shall reap the benefit of that. Our intention is not to change policy every time there is a by-election reverse but to go on doing what is right for the country and for the economy.

In view of my right hon. Friend's weekend criticism of the common agricultural policy, a policy which has largely contributed to the enormous increases in the price of food, have the supporters of the Common Market at last seen the error of their ways? Will my right hon. Friend continue on this road to Damascus and back up his fine words with some action to end this dear food policy of the Common Market, which has robbed every housewife in the country?

Not only do I not see the error of my ways but I fear that I see the error of my hon. Friend's facts. The error inherent in his supplementary question is the suggestion that the common agricultural policy has played a substantial part in the inflation that we have suffered in the past three years. It has played a part, but it is not half as great a factor as are others. The Government are working on all those things and will, I believe, put them right. My criticism of the CAP was that it was economically wrong in itself, not that it played a substantial—let alone majority—part in the present rate of inflation.

Does not my right hon. Friend think it is time that he stopped listening to the Tory hypocrites on the Benches opposite who are complaining about price increases whilst at the same time voting against the Price Commission Bill and becoming scared when people such as Jack Jones talk about a freeze on prices? Is he aware that if he wants to reverse results such as that at Ashfield last week, and if he wants to save the hundreds of Labour councillors who will be thrown on the scrapheap this week, it is time that he introduced a freeze on prices, because although he will then have antagonism from the Benches opposite and from the CBI we shall go on to election victory?

On a point of order, Mr. Speaker. I object to being described as a hypocrite.

Order. We all object to that, but I am able to rule when it is directed to an individual. I gather that the remark was addressed to the world at large.

On a point of order, Mr. Speaker. Is it not a fact that only five or six weeks ago you ruled me out of order because I wanted to raise a point of order during Question Time?

The hon. Gentleman is quite right, and I ought to have asked the hon. Member for Cambridge (Mr. Rhodes James) to wait until the end of Questions. I am glad to see the hon. Member for Derbyshire, North-East (Mr. Swain) back in his place.

asked the Secretary of State for Prices and Consumer Protection what progress has been made on the preparation of legislation to control estate agents.

I have nearly completed consideration of the representations we have received and I hope shortly to put forward firm proposals for early legislation.

Is my hon. Friend aware of the time that has elapsed since the matter was first raised and since my hon. Friend the Member for Ipswich (Mr. Weetch) embarked upon his admirable campaign to seek to lower the cost of house buying and give greater guarantees to home buyers? Is it not high time that we had action? Will he take every possible step to ensure that legislation is introduced at the earliest possible opportunity?

As a private Member, I put forward my own Bill and I should like the legislation to go through as soon as possible. I am deeply grateful for the Private Member's Bill of my hon. Friend the Member for Ipswich (Mr. Weetch). It will act as an important catalyst and shows the general support for legislation on this subject, not only from the general public but from the professions as well.

Will the Minister take this opportunity of confirming that the majority of estate agents are honest and trustworthy and that they would be at the forefront in wishing legislation to be introduced to take care of the minority who are not? Will he also confirm that self-regulation may be the best basis of legislation when it is introduced?

Of course the majority of agents are honest and reputable, and that is why they want the legislation as much as do the general public. On the second point, I have reconsidered the licensing system and I should hope to base legislation as far as possible on self-regulation, although that leaves problems with certain unattached estate agents.

When my hon. Friend is considering legislation, will he introduce a provision to enable local authorities to enter into this type of business, because it would be of advantage to house owners and house sellers if local authorities could undertake that type of work?

I shall certainly give consideration to my hon. Friend's suggestion.

asked the Secretary of State for Prices and Consumer Protection by how much food prices have risen since February 1974.

The food index rose by 84·8 per cent. between February 1974 and March 1977.

Is the Minister aware that that is a pretty appalling figure? Is he further aware that in recent months the prices of basic foods, such as bread and cheese, have risen frighteningly for the housewife? Is he further aware that the housewife has no confidence that his Price Commission Bill will do any good whatsoever? Why do not the Government be honest and say that they have failed to control inflation?

The hon. Gentleman's question has three parts. Certainly some food prices have increased extraordinarily over the past year—coffee by 190 per cent, and tea by 120 per cent., for example. Those increases have contributed to the index and are wholly outside the Government's control.

My hon. Friends were delighted to read my right hon. Friend's weekend speech about the need for reform of the common agricultural policy. Will he accept that many of us who deal weekly with our European counterparts in the European Assembly recognise that they will not allow us to change the common agricultural policy in any way? Will he also accept that if there is to be any structural reform or any marginal reform it is essential that Consumer Protection Ministers sit as of right with the Common Market Agriculture Ministers when they make their annual price reviews?

I disagree with my hon. Friend about the prospects of changing the CAP; I think that some marginal adjustments have already been made. Certainly, some holes have been punched in what were once the sacrosanct principles of the CAP. That has been done in the lifetime of this Government.

Is the right hon. Gentleman aware that, although there is room for some improvement in the CAP, the very large increase in food prices that he has announced this afternoon has been due almost entirely to the devaluation of the pound and the internal inflation of this country? Will he restrain his hon. Friends who criticise the CAP and tell them that our food prices are not due to that cause?

Not only am I aware of that fact, but I stated it before the right hon. and learned Gentleman arrived.

Would not my right hon. Friend agree that the devaluation of the pound is very much influenced by our membership of the Common Market? Would he not also agree that ill manners can be matched by a certain amount of arrogance, and that in that respect pro-Marketeers should look in the face those of us who have been against the Common Market and accept that they have been totally wrong and that we have been right?

Austin Mitchell knew which card to play.

I hope that "Sayings of the Week" will include my hon. Friend's assertion that arrogance is wrong, followed by the assertion that he is right and everybody else is wrong. I have never claimed that the common agricultural policy is anything but bizarre—the word I used on Saturday. I agree with my hon. Friend that had we not been in the Common Market the problems of sterling that we encountered in September and October would have been different. In my view, they would have been very much worse. The run on the pound that we endured in the autumn of 1976 would have been infinitely greater had we not been supported by the powers of the EEC, under articles contained in the Treaty of Rome, that would have come to our aid in extremis.

Will the Secretary of State agree that the price increases for tea and coffee to which he referred are indicative of what can happen to the price of an internationally-traded commodity when a surplus becomes a comparative shortage, largely because of increased consumption in the countries of origin? Is that not also indicative that a policy which is designed to increase and encourage European farm production is in the long run likely to be in the consumer's interest?

The hon. Gentleman ought to draw a distinction between the policy, which the Government certainly promote, of increasing domestic farm production—food from our own resources—and the EEC policy of encouraging overproduction. I find it difficult to justify a prices policy that is meant to produce more of a commodity which has already been produced in such quantity that it cannot be sold.

asked the Secretary of State for Prices and Consumer Protection what representations he has received from consumers about nationalised industries' prices since the beginning of the year.

Since the beginning of 1977 I have received about 70 representations on various aspects of nationalised industry prices. Most of these were from individual members of the public.

Is the Secretary of State aware that most consumers feel that the Government have a direct responsibility for the prices being charged by nationalised industries, that they are bewildered by the succession of increased charges for rail fares and for gas and electricity and that they feel bewildered by the calculations, which seem to be designed to baffle them and to persuade them that price increases are justified?

If they are bewildered, I hope that the hon. Gentleman will join me in enlightening them. Nationalised industry prices have risen during the past three years because the Government which preceded this one chose artificially to keep down nationalised industry prices, irrespective of the effect on public expenditure, the rate of inflation and the public sector borrowing requirement. We put that right with the support of the more economically sophisticated hon. Members on the Opposition side.

I recognise the force of the point made by my right hon. Friend, but does he recognise that our attack upon inflation does not appear credible to people who have had their gas prices and postal charges put up when in neither case was it necessary for economic viability in the industry concerned and it was simply a reflection upon the general economic policy of the Government? At least, at this stage the Government could have said that those two prices need not have gone up.

Let us consider the gas price for a moment, which I described at the time as a regrettable necessity. Had we not increased gas prices in the way that we did, £100 million would have been added to the public sector borrowing requirement, which would have had to be raised in some other form if we were to discharge our obligations to the IMF. We chose to do it in that way. I know that one can argue that there are other ways and that some of them might have been less socially and, indeed, politically damaging, but I have no doubt that the general pattern, of which gas was a part, is the policy that will produce a real improvement in the inflation rate towards the end of the year.

Is the Secretary of State aware that the latest Price Commission report, on page 11, again confirms that nationalised industry prices have risen far faster over the past three years than those of the private sector, and that that is not, as he claims, because of price restraint in the past, because they have been more than compensated under the Statutory Corporations Act? Will he, therefore, give an undertaking that it will be the first priority of his new Price Commission to examine and investigate all aspects of nationalised industries' prices?

I fear that the hon. Lady did not hear or did not understand my answer to the previous question. Nationalised industry prices have gone up over the past three years because the Government which she supported chose in the previous four years to hold them down in an artificially and economically damaging way.

No.

As far as the Price Commission's intentions are concerned—the hon. Lady now confirms that she does not understand the Bill—the decisions as to what would be investigated are for the Price Commission, not for me.

Whatever the merits of the Secretary of State's answer, does he not now recognise that it is high time that the nationalised industries came under the same investigation and the same directions as industries in the private sector?

I am always encouraged by criticisms which begin by an hon. Member referring to "whatever the merits" of my answers. I am even more encouraged by the second half of the hon. Gentleman's question. The Price Commission Bill, which he clearly has not read either, imposes on nationalised industries exactly the same obligations as those imposed on the private sector.

asked the Secretary of State for Prices and Consumer Protection what were the factors employed in determining the composition of the new Consumer Protection Advisory Council and what remuneration each member of the Consumer Protection Advisory Council receives.

In appointing members to the Consumer Protection Advisory Committee, I aim to ensure that they have between them a wide background of experience. The Fair Trading Act requires specifically the inclusion of members with knowledge and experience of the production or supply of goods, of enforcement of consumer protection legislation, and of consumer organisations or consumer protection activities. The members of the committee do not at present receive any remuneration.

Will the Minister either confirm or deny that the legal adviser to the committee is a law student and is not fully legally qualified? Therefore, is this not a rather ridiculous situation when one has counsel having to deal with very complex points of law?

I am afraid that the hon. Gentleman has been misinformed. One of the members of the committee is a law student, but she is not a member of the committee by virtue of the fact that she is a law student. She is there because of her experience with the Citizens Advice Bureaux. The legal expertise on the committee is provided by Professor W. A. Wilson, a Scottish academic lawyer, and by Mr. Keith Devlin, also an academic lawyer. The person whom the hon. Gentleman has in mind is not on the committee in a legal capacity.

asked the Secretary of of State for Prices and Consumer Protection when action is going to be taken on the basis of the Price Commission's report on the prices charged for soft mixer drinks in licensed premises.

The report has been circulated to trade and consumer organisations, from which we have invited comments. When these are received, we hope to discuss the contents of the report with interested parties.

Will my right hon. Friend please note that the public are getting impatient for action on this matter? The brewers are not prepared to await the outcome of the beer reference, because, despite their high profits, they have already shown, by raising the price of beer, what they think about that.

I understand the impatience that people feel, particularly when they consider the frequency with which prices have been increasing in this industry and when they consider some of the profits. However, we have a reference to the Price Commission which I asked the Price Commission to undertake, without implying any necessary judgment about the performance of the industry. I hope that that report will come to me before the summer. My hon. Friend will recall, however, that, even if the report implies the criticisms which he suggests, at present the Government do not have the power to deal with that situation. If we carry the Price Commission Bill, we shall have the power, and if using that power appeared appropriate I should not hesitate to do so.

asked the Secretary of State for Prices and Consumer Protection what progress is being made on the reference to the Consumer Protection Advisory Committee on value added tax-inclusive pricing.

I expect to receive the committee's report on the reference by 18th May.

Does my hon. Friend agree that it would be easier for consumers to see what they were being charged if "plus VAT" was not printed in tiny letters at the bottom of price notices? Will he press for this practice to be changed?

There is a great wish by consumers that prices should be stated clearly, and the words "including VAT" are helpful. But there are difficulties. That is why the Consumer Protection Advisory Committee looked at a reference from the Director General, and I hope that once the committee has reported there will be no delay in implementing its recommendations.

asked the Secretary of State Prices and Consumer Protection when he next plans to meet representatives of the National Consumer Council.

My right hon. Friend has no immediate plans to do so. At its invitation, he last met the full council on 14th February this year and has since had discussions with the council chairman.

When the Secretary of State next meets the National Consumer Council, will he draw its attention to the speech that he made this weekend on the common agricultural policy? Is the Secretary of State aware that the Department is entitled to give to the National Consumer Council a remit to examine certain problems—approximately two a year, I believe? Will he also consider making a study of the changes that are needed in the common agricultural policy, so as to make it more consumer-oriented, as one of this year's remits to the council?

I am sure that my right hon. Friend's speech has attracted so much attention that there will be no need for him specifically to draw the attention of the NCC to it. However, there is certainly no reason why my right hon. Friend should not consider the matters proposed by my hon. Friend, and even if he made no reference to the NCC I am sure that the NCC is capable of looking at the matter for itself.

Is my hon. Friend aware that he is quite right in saying that great notice has been taken of my right hon. Friend's speech? But the speech itself will not be enough. What the housewives of this country are interested to know is when there are to be real efforts to hold prices. Will my hon. Friend tell my right hon. Friend that he has a vital rôle to play in helping the Government to achieve phase 3 of the social contract, and that it could well be that his failure in his job could jeopardise that endeavour?

My right hon. Friend has no intention of failing in his job. He intends to achieve success. One of the contributions to that success will be the passage of the Price Commission Bill, against which the Opposition voted last Thursday although they have no alternative to put in its place.

But as most of the Tory Opposition voted for the European Communities Bill, will my hon. Friend explain to the National Consumer Council that all pro-Marketeers are hypocrites?

asked the Secretary of State for Prices and Consumer Protection what are the rules governing the overruling of a recommendation by the Price Commission; and what bodies or persons have the power so to overrule.

Under paragraph 6 of Schedule 2 to the Counter-Inflation Act 1973, a Secretary of State has power to permit a price increase when the Price Commission has used or is contemplating using its powers under Section 6 of that Act to restrict a price or charge. This may be done where, having consulted the Price Commission, the Secretary of State is satisfied that there are exceptional circumstances which justify an intervention. These are the only circumstances in which the Price Commission can be overruled.

Does not the Secretary of State think that it is rather ludicrous to have an expensive, complicated and bureaucratic machine like the Price Commission which can be overruled at the whim of a Minister? Is it for real or is it not?

That expensive and complicated bureaucratic machinery was something which the hon. Lady voted for five years ago—

No, I did not.

and I voted against. But, putting that aside, I think that there are occasions when one would want to use a Minister's power to prevent the normal operation of the Price Code. The example I gave, without being prompted, was a gas price increase some months ago which was necessary to the economic package we put together in December. I have do doubt that in the end the wisdom of that decision will be demonstrated.

Will my right hon. Friend give a little more thought to this ministerial power of veto and overruling, which in the public mind can only diminish the status and authority of the Price Commission and call in question its responsibility in exercising its power?

My hon. Friend makes a strong point for the future. I am examining the possibility—I am not sure whether it is practical and legally possible—of ensuring in the new Price Commission Bill that when industries or companies are excluded there is some element of parliamentary control over that exclusion. If I can incorporate that in Committee, I shall certainly do so.

But is not the Secretary of State failing in his prime responsibility to protect the consumer by allowing the imposition of a special tax on two out of three householders who use gas in order to offset its competitive advantage over other fuels and to keep the coal miners, with their poor productivity record, in business?

The hon. Gentleman sees these matters in too simple terms. We have always said—I think that this is agreed on both sides of the House—that the real way to combat inflation is to build a stable and expanding economy. The short-term measures we took to bring that about are in the interests of the consumer. That is why I supported them in December.

asked the Secretary of State for Prices and Consumer Protection if he will make a statement on his present policy of price display of goods and services, including unit pricing.

Price display can be an important aid to the consumer and encourage competition. We wish to encourage it more generally and intend to take statutory action to require it where appropriate. The Price Commission Bill accordingly provides for the extension of our powers so that orders could be made to require price display for any goods or services.

Will my hon. Friend be a little more specific on unit pricing? Will he accept that, while they are no adequate substitute for a proper price freeze, clear price display and especially unit pricing are nevertheless helpful to consumers?

I agree, but unit pricing is not always appropriate. Sometimes standardised quantities would be better. But we hope shortly to lay before Parliament orders covering virtually all sales of meat from butchers' shops and a wide variety of cheeses. Following initial consultation with trade organisations, a further draft order covering all sales of wet fish and competing prepacked frozen fish is being prepared. I shall certainly consider the case for other orders to be made as well.

What happened to all the surplus red triangles?

Will my hon. Friend advise his right hon. Friend to move into the jungle in the retail outlets of motor fuel throughout the country, where petrol prices vary by as much as 12½p per gallon? Will he try to introduce some conformity in the way in which prices are displayed so that we do not have "9p off," "30-fold Green Shield stamps" and all that sort of thing? Will he move in heavily armed with the new powers which the Act will give him?

I thank my hon. Friend. I have anticipated his pressure upon me, and only a few days ago I published a draft order for clear petrol price display at garages. I hope that that will have the support of the House and of the country.

asked the Secretary of State for Prices and Consumer Protection if he has received any recent representations regarding the proposal for an international standard system of 16-amp plugs.

Yes, Sir.

Can the Minister tell me whether acceptance of this international standard will require the rewiring of domestic and business premises? If so, over what sort of period are we likely to be able to absorb it, and what will be the total cost? Has the Minister any estimate?

May I make clear, first, that the Government have not taken a firm view on this issue, and I am glad to have representations from Members of Parliament on it. If the international standard were adopted, it would not require the rewiring of any premises. It would need to be implemented over a period of, perhaps, up to 60 years and would not, therefore, involve any additional cost. It would simply be swapping over to a new system with the rewiring or reconstruction of premises.

Does the hon. Gentleman really believe that this is a small matter? He shrugs it off as though it is of no significance. It is a matter of the greatest importance which will involve cost for every household. Does the hon. Gentleman know the cost of a plug now? This will cost every household many pounds. Will he, therefore, be very careful?

I certainly take the matter seriously. Otherwise I should not have told the House that I do not yet take a view, and neither should I have told the House that I am anxious to hear representations from Members of Parliament. But adoption of the standard would not involve an obligation on anybody with existing wiring to rewire, and the two systems would exist alongside for a long time. Perhaps the hon. Gentleman would like to send me some more considered representations.

if my hon. Friend is seriously saying that this can conveniently be done over a period of 60 years, what on earth is the need to do it at all?

I am putting forward the view of the International Standards Organisation, not my own view. There are certain advantages for British manufacturers in having international standards, and I shall want to consider that aspect of the matter along with representations by consumers.

Will the Minister reconsider his answer? As I understand it, he has just told the House that a 16-amp point would cost no more than a 13-amp point. Surely, that is crazy.

I think that the hon. Gentleman must have misheard me. I said nothing of the sort.

asked the Secretary of State for Prices and Consumer Protection what estimate he has made of the likely percentage increase in total food prices during the current year as a consequence of EEC arrangements.

As my right hon. Friend the Minister of Agriculture, Fisheries and Food announced on 27th April, the outcome of the recent CAP price negotiations could add about ⅓ per cent. to average retail food prices in the year up to 1st April 1978. The two remaining transitional steps which we are committed to take under the Treaty of Accession will add about a further 1 per cent. to food prices in this period. The effect on the British consumer of the 2·9 per cent. green pound devaluation will be more than offset by the butter subsidy which we have negotiated.

Is the right hon. Gentleman aware that, in the light of a falling trend of domestic food consumption, his words to the Federation of Young Farmers at Blackpool this weekend were particularly timely and his indictment of the common agricultural policy will be welcomed in many quarters of the House? Can the right hon. Gentleman further confirm that Commissioner Tugendhat has indicated that a Community scale system of food subsidies would bankrupt the Community budget, and can he therefore say that it is his view that the fundamental reform of the common agricultural policy which he seeks must turn upon the prices that are paid to agricultural producers themselves?

Yes, I agree with that exactly. Because of the differences between the amount of agricultural employment in one Community country and another, I do not believe that we could ever expect the Community to return to the sort of agricultural financing that we enjoyed in this country for so many years. What we ought to expect the Community to do is not to increase the support prices for commodities which are already in structural surplus. That I regard as a radical change, and I believe that the House as a whole would regard it as a change for the better.

As previous attempts to secure fundamental changes in the Common Market's agricultural policy have failed lamentably, why does my right hon. Friend believe that present conditions are more favourable? As the accumulated cost of the Common Market to British housewives has been quite staggering since we joined, why does he not knock a few more holes in the CAP, let it sink gracefully, and let Britain withdraw?

One of the signs of hope is the success of the negotiations which my right hon. Friend the Minister of Agriculture had 10 days ago, when he obtained a deal which was better in British terms and better in terms of reforming the CAP than anything else that had happened during our period within the Community. My other hope stems from my belief that other members of the Community, particularly the industrialised countries of the Community, must sooner or later realise what a vested interest they have in reforming the CAP. Representatives of other Governments have already made speeches supporting that sort of view, and I believe that eventually common sense will prevail and the sort of reforms for which I hope will come about.

Is the right hon. Gentle man aware that the figures he has just given are gross underestimates? For example, they have not taken into account the appalling burden on our meat producers of having to pay import levies on feeding stuffs, which now amount to £40 or £45 a ton, when the cost of feeding stuffs can amount to as much as 75 per cent. of the cost of meat production.

The point that the hon. Gentleman makes is open to dispute, but what is not open to dispute is that the analysis I have just given of the cost to the British consumer of the deal done 10 days ago is as I have described it. I do not think that any reputable authority would argue with those figures.

asked the Secretary of State for Prices and Consumer Protection if he proposes to publish a White Paper on consumer safety.

My Department is currently reviewing the suggestions set out in the consultative document entitled "Consumer Safety" published in February 1976, Cmnd. 6398, taking into account the many comments received. I hope to make firm proposals for new consumer safety legislation later this year, possibly by means of a White Paper.

In view of public disquiet about the safety of some imported items such as toys and electric light bulbs, will the White Paper contain special reference to items of that kind?

I do not think that it will contain special reference to those items where we have already acted with regulations for electrical goods, electric lamps and toys. What it will do is address itself to more effective methods of getting unsafe goods off the market or preventing them from appearing on the market in the first place.

Since my right hon. Friend the Secretary of State sought to justify the increase in gas charges a little while ago by the need to reduce the borrowing requirement, and since the Treasury now admits that it had the estimate of the borrowing requirement wrong by £2,000 million, could the consumer now be protected against Treasury economists?

asked the Secretary of State for Prices and Consumer Protection how many consumer advice centres are now open and being grant-aided by his Department.

Our present estimate is that there are about 120 centres, all of which will be grant-aided by my Department in 1977–78. I intend to announce further details about the grant scheme very shortly.

I congratulate my hon. Friend on this undoubtedly outstanding achievement of the Department in expanding the number of consumer advice centres, but will he guarantee that when he is discussing the financial arrangements in future with authorities being grant-aided, such as the London borough of Havering, he will ensure that they are not just riding on the back of the Government and the taxpayer but are maintaining the quality of service which was established when the centres were first set up, usually by their Labour predecessors?

I regret that some Conservative authorities have either disbanded centres or shown very much less enthusiasm for them. The way in which the centres are run and the initiatives to open them are for local decision, but I hope that all the centres which are now open will try to maintain their previously well-established high standards of service.

Is there not scope for the saving of public expenditure by getting the consumer advice centres, wherever possible, to join forces with the citizens' advice bureaux? I suggest that that would especially apply in the smaller towns.

Of course, the consumer advice centres and CABs work closely together. I have been to one or two recently where they are both housed in the same building. It is not always easy to get a High Street shop consumer advice centre and combine it with a CAB. That must be a matter for local decision.

Is my hon. Friend aware that the main plank in the Conservative Party manifesto for the county elections on Thursday in Derbyshire is to do away with the consumer advice centres? Will he be prepared to make a Press statement tonight to tell the people of Derbyshire and the country what an excellent job consumer advice centres are doing on behalf of the people?

I bitterly regret it if any local party or authority promises the electorate that it will close down consumer advice centres, particularly as during the course of this year the entire cost is covered by the central Government.

Will the Minister reconsider my earlier plea for travelling advice centres or centres at which telephone inquiries can be made and for advertising the information of advice centres in local papers? As the Minister well knows, people in rural constituencies need that sort of help very badly.

I fully understand that people in remote rural areas are not readily able to find their way to a CAC and I am pleased to encourage schemes for freepost inquiries, telephone access to CACs, mobile advice and so on. Although we encourage and give aid, what is needed in any remote rural locality must be a matter for local decision.

Will the Minister ensure that the staff of CACs are properly briefed and trained in giving proper advice on the real rate of interest applicable to personal and hire-purchase loans?

Yes. The CACs should now have the consumer credit tables published by the Director General of Fair Trading. People I have spoken to have found them extremely useful in giving advice to the general public and to Traders.

I congratulate the Department on the way it has gone ahead, setting up advice centres that are deeply appreciated by consumers. However, will the Minister ensure that there is a feed back from the advice centres to the Government so that if there are numerous complaints on specific items of consumer protection the Government can take legislative action to deal with the problem?

I regard CACs as being the eyes and ears of my Department When a pattern of complaints emerges, the facts are made available in my Department. Matters such as the petrol price display order have come about partially through the feelings expressed through CACs.

asked the Secretary of State for Prices and Consumer Protection what effect on future investment plans in the brewing industry he expects his inquiry into beer prices will have; and what consultations he has had with other Government Departments.

I would not expect investment plans to be significantly affected by the inquiry now being undertaken by the Price Commission. Before any reference is made to the Commission, it is the practice to undertake such consultations within Whitehall as may be appropriate.

Is not the Secretary of State aware that many brewers have expressed to me the view that his recent announcement on prices will have a substantial effect upon their investment plans? If he believes that there will be no effect, will he take urgent steps to talk to one or two brewers so that they may tell him how his announcement is having a direct effect upon the creation of more jobs in the brewing industry?

They may have said that to the hon. Gentleman, but that does not alter the fact that Allied Breweries is continuing with its £164 million investment programme over the next two years. I am advised that Courage, Whitbread, and Scottish and Newcastle are all building new breweries, or contemplating doing so, and there has been no indication that the Price Commission reference has changed their minds in any way.

Is my right hon. Friend aware—and I know that he is—of the widespread concern expressed by the working men's clubs in my area at the massive profits being made, particularly by the brewery just mentioned, when the price of beer has been disproportionately increased?

I am very conscious of that. It was with that in mind that I made the reference to the Price Commission, whose report will, I hope, be with us in a month or two.

asked the Secretary of State for Prices and Consumer Protection what percentage return on capital employed he believes to be adequate profits for the purposes of Clause 2 of the Price Commission Bill.

The adequacy of the return on capital depends on many factors, including the cost of the capital, the business risk and the need for further investment, all of which vary from company to company. For this reason it is impossible to give a figure as an indication of adequate profits which applies generally throughout the economy.

If the Government really believe in a profitable private sector, it is no good leaving it at that. Will the Minister tell the House whether he means real profits, profits computed on the old, or on the new inflationary basis, and whether the profits that he thinks acceptable are adequate in terms of a percentage return? Otherwise he is relying on the gentlemen in Whitehall knowing best, which is the usual recipe for disaster.

I certainly mean profits calculated after proper allowance has been made for inflation. Without that allowance, the profits are a spurious and inflated figure. In future, however, we have to be less concerned with the level of profits and more concerned with their use. The new Price Commission Bill, against which the hon. Gentleman voted last Wednesday, is intended to help industry to choose to invest its profits in new plant and new machinery and to produce more jobs and better exports.

Does my right hon. Friend agree that investment has been encouraged by Government action to bring clown the minimum lending rate from 15 per cent. to 8¼ per cent., which is lower than it was when the Conservative Government left power?

It is substantially lower than when the Conservative Party left power. All the indications from the CBI survey, as well as from the Department of Trade investigations, suggest that investment will improve during this year. The substantial reductions in the minimum lending rate to which my hon. Friend referred will accelerate that process, which is central to economic recovery.

Order. I have been advised during Question Time that the hon. Member for Rochester and Chatham (Mr. Bean) was in his place when Question No. 2 was called, but because of a hearing infirmity he was not aware that his Question had been reached. In these circumstances, and without setting precedents, I know that the House would expect me to call the hon. Gentleman.

asked the Secretary of State for Prices and Consumer Protection when he proposes to discuss the most recent firework injury statisics with the firework manufacturers.

I met representatives of the Firework Manufacturers' Guild on 21st April. The firework injury statistics for October-November 1976 were among the matters discussed.

The statistics are very encouraging, but there is no doubt that most of the injuries are still caused through bangers. Will my hon. Friend consider meeting the firework manufacturers again and discussing with them the possibility of prohibiting fireworks, or certainly bangers? In view of the forthcoming Silver Jubilee celebrations, is this not a matter of some urgency?

I have already discussed bangers with the manufacturers. They reduced their production by 25 per cent. last year and propose to reduce it by at least 25 per cent. again this year. In June I shall discuss arrangements for 1978.