NATIONAL FINANCE
Sporting Organisations
25. Mr. Rose
asked the Chancellor of the Exchequer whether he will review the present anomalous position of sporting organisations with regard to their recognition as charities.
The Chief Secretary to the Treasury (Mr. John Diamond)
I do not know what anomalies my hon. Friend has in mind. In order to be recognised as charities, sporting organisations, like any other bodies, have to show that they are established for charitable purposes only.
Mr. Rose
Is my right hon. Friend aware that the classification in respect of charities concerning sporting organisations is hopelessly outmoded? Will he look into this with a view to stimulating participation in the amateur sports other than riding and shooting?
Mr. Diamond
I cannot share my hon. Friend's view, which I would like to. As an ex-Member for Blackley, I would like to support everything that my hon. Friend says. I cannot share his view that this is outmoded. The Recreational Charities Act, 1958, which deals with these matters, is a fairly recent piece of legislation.
Mr. Philip Noel-Baker
Will my right hon. Friend represent to the Chancellor that many sporting organisations are gravely embarrassed by present taxation, and that this is defeating the whole policy of the Government over sport, to which we give such strong support?
Mr. Diamond
It is right that we should support sport and that we should do it in the way in which we are doing it, namely, by direct grants. Giving support by way of Income Tax relief on the grounds that it is a charity is an entirely different matter.
[column 1131]Mr. Lubbock
Can the right hon. Gentleman say what representations have been made to the Government by the Sports Council about the effect of S.E.T. and whether the increase in grant made in the present year is more than sufficient to offset the increase in costs imposed by this new tax?
Mr. Diamond
No such representations have been brought to my attention.
National Savings
26. Mr. Alan Lee Williams
asked the Chancellor of the Exchequer, in view of the importance of national savings in the present economic difficulties, if he will set up an inquiry into the work and structure of the National Savings Movement, and include in its terms of reference the possibility of handing over the work of national savings to the new Public Corporation which is to be responsible for the work of the General Post Office.
The Chancellor of the Exchequer (Mr. James Callaghan)
I do not think that a specific inquiry into the work of the National Savings movement is called for. My right hon. Friend the Postmaster-General made a statement on 15th November about the future of the Post Office Savings Department.
Mr. Williams
Would my right hon. Friend agree that the great bulk of national saving is done through trustee savings banks and the General Post Office? Is there any need to have a separate Government Department employing many people responsible for national savings? Should not my right hon. Friend be encouraging the voluntary element?
Mr. Callaghan
The National Savings Movement is largely a voluntary element, and I think that it commands widespread praise for the ability with which it has adapted itself to changing conditions. I do not think that my hon. Friend would cast any aspersions on the work which it is doing.
Sir C. Osborne
Would the right hon. Gentleman agree that the best way in which he can help the National Savings Movement would be to tie repayment to the cost of living and so offset the evil effects of inflation on savers?
[column 1132]Mr. Callaghan
No, that would be a quite wrong thing to do. Our object as a nation should be to overcome inflation and not relate increasing payments to the possibility of it.
38. Mr. William Hamilton
asked the Chancellor of the Exchequer if he is satisfied with the current rate of savings; and if he will make a statement on future policy.
Mr. Callaghan
The general level of savings in the first half of the year remains high. As I attach great importance to this I am always ready to consider ways of increasing the flow.
Mr. Hamilton
Is my right hon. Friend satisfied that all sources of small savings are being tapped and that the institution of a State public unit trust would not tap this source, which is probably quite large?
Mr. Callaghan
The question of a State unit trust has been frequently considered, and by the National Savings Movement, and I understand that views about its efficacy are changing. I am ready to keep it under consideration, but I would not want to reach a final conclusion on it now. There is evidence that small savings are forthcoming to a large extent through the medium of National Savings and also the Post Office savings investment accounts.
Captain W. Elliot
Would not the Chancellor agree that even if current savings are high they are very much lower than they were? Does he not think that urgent action should be taken to rectify this?
Mr. Callaghan
I am not sure about that. I do not think that they have fallen away very much. [Hon. Members: “Oh.” ] Let us wait and see. My own recollection is that national savings are keeping up quite as well as they have been over recent years.
£ Sterling
27. Mr. Winnick
asked the Chancellor of the Exchequer whether he will introduce legislation to enable Her Majesty's Government to take action against those British companies which sold sterling in large quantities earlier this year and thus created the run on the £ sterling.
[column 1133]Mr. Callaghan
No, Sir.
Mr. Winnick
Is it not a fact that it was British companies which in the main sold hundreds of millions of £s earlier this year and not so much Continental firms? Would not my right hon. Friend agree that at a time when British workers are refused wage increases because of the national interest they should know that there are numerous British banking firms which sold Britain short a few months ago?
Mr. Callaghan
No, that is not my information. United Kingdom residents cannot indulge in outright speculation. Their spot transactions are strictly limited by exchange control. They are allowed to buy or sell forward only in order to cover general trading or commercial transactions. [Interruption.] I would get on much better without your help.
Mr. Speaker
Order. I am not trying to help the right hon. Gentleman.
Mr. Callaghan
You are invaluable, Sir.
I have had a careful examination made into this, and, although there have been strong reports to the contrary in the newspapers, it is not my information that this selling took place to any large extent by British residents. [Interruption.] My hon. Friend may not agree, but I have examined the facts; I am not aware that he has. We do not get anywhere by pursuing will o' the wisps which do not exist.
Government Expenditure
28. Mr. Ridsdale
asked the Chancellor of the Exchequer what action he is taking to reduce the growth of Government spending.
37. Sir J. Eden
asked the Chancellor of the Exchequer what directives he has given to Government Departments to undertake a specific and formal cost reduction programme.
Mr. Callaghan
Departments have been instructed to conduct a searching reconsideration of the need for every part of their proposals for inclusion in the Estimates for 1967–68, which I shall lay before the House in due course.
Mr. Ridsdale
But why are the Government continuously trying to kill the goose [column 1134]which lays the golden egg? Surely the high level of Government spending is a direct cause of the fall in industrial production. How can we have new wealth for the social needs unless we are able to increase industrial production? Will the right hon. Gentleman stop being so complacent about this?
Mr. Callaghan
That comes very ill from a former Minister in a Government under which defence spending was quite unrestrained. We have succeeded in curbing and reining back unnecessary expenditure to a degree never undertaken by our predecessors. It is not right to say that the general level of taxation is higher than it is in other countries. The average level of taxation in this country is well in line with that of our competitors overseas.
Mr. Orme
Would my right hon. Friend recognise that any attack which he makes, particularly on Government military expenditure overseas, will have the fullest support of many Members on this side of the House?
Mr. Callaghan
It is the Government's declared policy to reduce overseas military expenditure, which has been too high in relation to the total burdens which we carry, and we shall continue to pursue that aim.
Mrs. Thatcher
Would James Callaghanthe right hon. Gentleman say whether at the level of Government expenditure which he is contemplating for next year he will have to take an increasing proportion of the gross national product in total taxation?
Mr. Callaghan
When the Estimates are laid, I am sure that the hon. Lady will want to examine them. But I can tell her that we have been able to prune back a great deal of the luxuriant expenditure which her Government left behind.
Public Employees
29. Mr. Ridsdale
asked the Chancellor of the Exchequer what has been the increase in numbers of public employees in both Government and local government service since 15th October, 1964.
Mr. Diamond
The increase in the Civil Service, both industrial and non-industrial, excluding the Post Office, between 1st October, 1964, and 1st July, 1966, was 9,000. Including the Post [column 1135]Office, the increase was 26,000. As regards local government, there was a rise of 159,047 in the two years.
Mr. Ridsdale
As these are such serious figures, would the right hon. Gentleman say what the increase in Government spending is to pay for these additional employees?
Mr. Diamond
The simplest way of calculating the figure is to allow about £1,000 per civil servant. But in order to put the figures in perspective, I should say that the proportionate increase among centrally employed civil servants in the last nearly two years is broadly in line with the increase over the first four years of this decade.
Mr. Frank Allaun
While appreciating that if we increase the social services we need more civil servants, is it not wrong that with 440,000 men in the Forces we have 350,000 civil servants looking after them?
Mr. Diamond
My hon. Friend rightly points out that if we increase services we have to increase our manpower to carry them. The House will recollect that, in addition to increased work, there has been a reduction in Civil Service hours of work.
Mr. Hogg
Do not the figures given by the right hon. Gentleman reveal a certain amount of luxuriant growth which might be a suitable subject of pruning?
Mr. Diamond
I am grateful for what the right hon. and learned Gentleman has said in relation to the figure which I gave for increases in the number of local government employees. This is a matter which one should look into very carefully.
Mr. Shinwell
Is there any indication that when we have a sufficient supply of computers we shall have fewer civil servants?
Mr. Diamond
I think that that is a rather different question.
Customs and Excise Officers
30. Mr. Mathew
asked the Chancellor of the Exchequer if he will review the sight standards for applicants seeking to be appointed as officers of Customs and Excise.
[column 1136]Mr. Diamond
A review is already in train. I will write to the hon. Member as soon as a conclusion is reached.
Civil Servants
(Drawing Office Grades)
32. Mr. Driberg
asked the Chancellor of the Exchequer how soon negotiations with civil servants in the various drawing office grades are to be resumed and completed, in accordance with the assurance contained in a letter dated 26th September, 1966, from the official staff side of the Whitley Council.
Mr. Diamond
As soon as practicable after the White Paper on the criteria to govern increases in incomes during the period of severe restraint has been published, and after discussions with the staff side of the National Whitley Council on its application to the Civil Service have been completed.
Mr. Driberg
Is my right hon. Friend aware that that does not quite answer my Question? I was asking him when the discussions between the official side and the staff side would be resumed and completed. May we take it that we do not have to wait for the period of severe restraint for them at least to re-start?
Mr. Diamond
I thought that I had given that precise answer to my hon. Friend by saying “as soon as practicable … after the White Paper has been published” . The White Paper is expected very shortly.
Mr. McMaster
Is the right hon. Gentleman aware that this group of civil servants has been unfairly treated compared with other grades in the Civil Service who have had a Whitley Council rise? Will he give a guarantee that the rise of at least a 4½ per cent. cost of living bonus will be retrospective?
Mr. Diamond
These are matters for discussion.
Immigrants
33. Mr. John Hall
asked the Chancellor of the Exchequer what estimates have been made of the effect on Great Britain's balance of payments of the large-scale in-flow of immigrants into Great Britain.
Mr. Callaghan
This depends on many factors and there is no complete answer. [column 1137]However, the current study being made by the National Institute for Economic and Social Research will, I hope, go some way to answer the hon. Gentleman's question.
Mr. Hall
Would not the Chancellor agree that, in the absence of considerable spare capital capacity, large-scale immigration leads to excess domestic demand and thus creates a worsening in the balance of payments position? Should not this factor be taken into consideration when deciding the scale on which immigration is allowed?
Mr. Callaghan
This is what the study is now trying to evaluate. I would hope that our immigration policy would never be determined purely on balance of payments considerations. But there are a number of factors to be put on both sides. There is clearly a long-term gain from the work of the immigrants who arrive here. Against that must be set some of the factors which the hon. Gentleman has enumerated. I think that this study will provide some valuable information.
Mr. Rose
Would not my right hon. Friend agree that the supplementary question of the hon. Member for Wycombe (Mr. John Hall) was deliberately misleading and mischievous and that, in computing this, one must recognise the enormous contribution which immigrants have made to the economy of this country and in a number of respects?
Public Office Rules
36. Mr. John Hall
asked the Chancellor of the Exchequer when the revision of the Public Office Rules will be completed.
Mr. Diamond
I hope soon to consult the staff interests about revised Public Office Rules. When their views have been considered, a Statutory Instrument will be made.
Mr. Hall
Would not the Minister agree that these rules have been under revision for more than 18 months? Does he not appreciate that in some cases pensions are dependent upon the publication of the new regulations, because no decision can be made until they are published?
Mr. Diamond
I recognise that these matters are complicated and need very [column 1138]careful consideration, but I think that the Answer I have given should satisfy the hon. Member.
Gold Coins
39. Mr. Higgins
asked the Chancellor of the Exchequer whether the policy of the Government is still to give people further time to hand in gold coins under S.I., 1966, No. 438.
Mr. Diamond
Yes, if there is good reason for the delay in complying with the Order.
Mr. Higgins
Statutory powers having been taken, who decides whether a person retaining, say, half-a-dozen gold coins should be prosecuted, and what criteria are applied?
Mr. Diamond
The position is the normal one: the Treasury is interested in the matter, but the person who decides whether a prosecution should take place is the Director of Public Prosecutions.
Dividends
40. Sir C. Osborne
asked the Chancellor of the Exchequer in how many cases dividends have been reduced since the wages and incomes policy was imposed on 20th July.
Mr. Callaghan
206 publicly quoted companies have announced reduced dividends.
Sir C. Osborne
How many have been increased? Would not the Chancellor agree that most directors of public companies have tried to play ball with him in his policy?
Mr. Callaghan
Yes, Sir. About 880 dividends have been announced. About 570 have been published as being the same, 206 have been reduced, and there is a balance of 108, some of which have increased dividends within the policy or under consideration by the Treasury.
Computers
41. Mr. David Price
asked the Chancellor of the Exchequer what techniques of investment appraisal are used by his Department in determining the economic viability of any proposal for a new computer in any part of the public service.
[column 1139]Mr. Diamond
All Government Departments submitting proposals for the purchase of automatic data processing equipment are required to demonstrate their economic viability using the discounted cash flow technique wherever this is appropriate.
Mr. Price
Will the right hon. Gentleman recognise that we are very pleased that the Treasury is now using the d.c.f. approach? Will he also take into account that there is that part of viability of the computer that is not economically measurable but is of importance in decision-taking?
Mr. Diamond
We will, of course, take into account the matters which the hon. Member has mentioned. I would simply add that the d.c.f. technique has been well known to the Treasury for a great number of years.