Speeches, etc.

Margaret Thatcher

HC PQ [Economic Affairs]

Document type: Speeches, interviews, etc.
Venue: House of Commons
Source: Hansard HC [740/1798-1818]
Editorial comments: MT spoke at cc1800 and 1808.
Importance ranking: Minor
Word count: 7787
Themes: Conservative Party (history), Pay, Public spending & borrowing
[column 1798]

ECONOMIC AFFAIRS

Prices and Incomes Policy

1. Mr. Marquand

asked the First Secretary of State and Secretary of State for Economic Affairs with what administrative machinery, and according to what social and economic criteria, he intends to administer the Government's prices and incomes policy after July, 1967.

9 and 10. Mr. Channon

asked the First Secretary of State and Secretary of State for Economic Affairs (1) if he will now publish a White Paper dealing with the future of the Government's prices and incomes policy;

(2) if he will now state the Government's policy towards wage increases after July.

12. Mr. Christopher Rowland

asked the First Secretary of State and Secretary of State for Economic Affairs what progress he has made in his discussions with the Trades Union Congress and the Confederation of British Industry on an effective long-term prices and incomes policy.

13. Mr. Biffen

asked the First Secretary of State and Secretary of State for Economic Affairs if he is satisfied that Parts I, II, and III of the Prices and Incomes Act give him sufficient legislative sanctions to influence the movement of prices and incomes after 31st July; and if he will make a statement.

38. Mr. Ridley

asked the First Secretary of State and Secretary of State for Economic Affairs when he will now make a statement on the Government's incomes policy to follow the end of the period of severe restraint.

The First Secretary of State and Secretary of State for Economic Affairs (Mr. Michael Stewart)

My right hon. Friend, the Minister of Labour and I have had further meetings with the C.B.I. and T.U.C. this week. The consultations have covered the norm criteria. machinery and possible statutory powers after the end of severe restraint. The two sides are considering the Government's views on these various topics and further consultations will be taking place.

Mr. Marquand

Can my right hon. Friend at least give an assurance that [column 1799]he has no intention of returning to a wholly voluntary incomes policy after July, since experience has shown that a voluntary policy is equivalent to no policy at all? Secondly, what does he intend to do after July about the lower-paid workers and will he specifically look at the proposal for a national minimum wage, at least equivalent to the standards laid down by the Supplementary Benefits Commission?

Mr. Stewart

I will certainly look at the proposal contained in the last part of my hon. Friend's supplementary question, as I am already looking at this and other suggestions. To answer the first part of his supplementary question, that is exactly one of the matters now under discussion.

Mr. Channon

Is it not a disgrace that this House has not yet been told about the Government's plans for the period after July? When will the First Secretary let the House know, as well as the T.U.C. and the C.B.I., what the Government are proposing?

Mr. Stewart

I hope to give that information to the House as soon as possible, but I do not believe that there is anything objectionable—and this is frequently done—in the Government beginning by putting certain ideas and possibilities forward to particular parties before stating those ideas in the form in which they should be presented to this House.

Mr. Rowland

Would my right hon. Friend indicate along which lines his mind and that of the Government are working? Is it that there may be no price change at all—whether it be the price of labour, goods or services—without the prior approval of the Government, or that there may be price changes, subject to delay and to possible Government intervention afterwards? If it is the former, may I say that I would object not so much on doctrinal grounds as on practical grounds?

Mr. Stewart

Without pre-empting the result of discussions, I think that I agree with my hon. Friend about that.

Mr. Biffen

Before endorsing the advice offered to him by his hon. Friend the Member for Ashfield (Mr. Marquand), will the right hon. Gentleman bear in mind the considerable hostility that will be expressed, not only in this House but [column 1800]throughout the country, if the drift to compulsion in this policy is intensified rather than ended?

Mr. Stewart

It would be idle to suppose that any solution to this problem could be reached without there being opposition to it from some quarter or other. It is a difficult problem, in the consideration of which many pros and cons must be weighed. That is why I am now having consultations. As I said, I hope that before long the Government will be in a position to speak to this House about it.

Mr. Ridley

Is the right hon. Gentleman aware that authoritarianism is often more successful than liberty, but that our economic freedom to determine wages and prices is something which we cherish very much indeed? Will he, therefore, hesitate severely before extending compulsion in this matter?

Mr. Stewart

The hon. Gentleman says that authoritarianism is often more successful than liberty. I should have thought that that was true only in the very short term. The argument here is not between authoritarianism and liberty. There are a great many subjects on which we have laws, but they have to be laws which are broadly in line with public opinion. What we have to consider now is exactly what part voluntary action and Government action should play.

Mr. Orme

Is my right hon. Friend aware that a considerable number of hon. Members on this side of the House, including trade union Members, are opposed to any extension of compulsion after July? Would he not consider that the proposals made by the T.U.C. for a temporary scheme are more acceptable to the Government than the previous suggestions?

Mr. Stewart

There is certainly a great deal in the proposals put forward by the T.U.C. with which I would agree and with which I think anyone who has studied this problem will agree, but before any of us take up rigid positions on this we ought to allow the consultations to proceed a bit further.

Mrs. Thatcher

Would Michael Stewartthe right hon. Gentleman agree that when the powers were introduced he did take up a rigid position on this? The White Paper said [column 1801]that the powers would be purely temporary, that they would lapse automatically, and could not be renewed. Is he saying that the nation can put no faith whatever in that promise?

Mr. Stewart

No. It is perfectly clear that the powers contained in Part IV of the Prices and Incomes Act do lapse, actually, I think, on 11th August this year, but my right hon. Friends, in saying this, pointed out that if it were ever considered desirable to ask for any other powers, they would, of course, require fresh legislation and the consent of this House.

Mr. Raphael Tuck

Will my right hon. Friend at least give an assurance to the House that if controls are to continue—and I hope they are—he will maintain just as strict and rigid control over prices and profits as he does over incomes?

Mr. Stewart

I do not think we ought to use too freely these words “strict” and “rigid” . This is not what is in issue. This is a question whether we can get, and what is the best method of getting, sufficient stability in our prices and wages to enable us to sustain rapid growth in the economy, but quite certainly, whatever is decided on that, one has got to make it apply both to prices and to incomes.

Mr. Hugh Fraser

Will the right hon. Gentleman confirm the comparative failure of his policy so far, as 1,100 prices have gone up and 165 have gone down and the cost of living since July has gone up 1.7 per cent.?

Mr. Stewart

When the hon. Member talks like that I think he fails to under-stand what the purpose of the policy is. If he will study the White Paper, he will find that it was to see that during the periods of standstill and severe restraint neither incomes nor prices went up unless there were certain specified justifications for them. That policy has been carried out.

Mr. Heffer

Will my right hon. Friend give an assurance that he will not follow the advice of lawyers and university teachers on this question but will accept the advice of the Trades Union Congress, which is involved in the day-to-day negotiations for wages in this country?

[column 1802]

Mr. Stewart

I have clearly got to pay very great weight indeed to any advice given to me by the Trades Union Congress. I have to bear in mind, however, that this is a matter which affects the right and standard of living of everybody in this country and I have received advice from a great variety of quarters. Not all trade unionists are agreed on the advice they give me, and not all university teachers are agreed either.

Mrs. Knight

Is not the right hon. Gentleman aware that what matters to the people of this country is not so much the purpose as the result of his policy and that the result has been that many increases have taken place in the nationalised industries? Would he not agree that this is a rather unfortunate result, whatever the purpose started out to be?

Mr. Stewart

I think the hon. Lady is again making a purely selective choice of evidence. If she has a look at what has happened to the Price Index as a whole and the reasons and justifications there have been wherever increases either of prices or of incomes have occurred, she will see that the policy is being carried out.

Mr. Crawshaw

Is my right hon. Friend aware that some hon. Members are concerned at the tremendous pressures which are being brought to bear on both sides of industry without any apparent concern for the general public? Will he bear in mind that we as Members of Parliament represent the general public and not a sectional interest? Will he ensure that this is thought of when the legislation is brought forward?

Mr. Stewart

Yes, indeed. Indeed, it is, of course, the Government's part in this matter—the part of the Government and the House—to represent the general interest. On any question requiring legislation, of course, this House would properly have the last word.

2. Mr. Marquand

asked the First Secretary of State and Secretary of State for Economic Affairs what steps he is taking to ensure that the recommendations contained in the Report of the National Board for Prices and Incomes on productivity and pay during [column 1803]the period of severe restraint, Command Paper No. 3167, will be carried out.

The Chancellor of the Duchy of Lancaster (Mr. Frederick Lee)

The Government have welcomed this valuable guidance to all concerned in the negotiation of productivity agreements, and the Board's recommendations are being taken into account in the examination of proposals for pay increases under paragraph 27 of Cmnd. 3150. The Government themselves are considering the Board's recommendation that it should receive a reference relating to systems of payment by results.

Mr. Marquand

Does my right hon. Friend agree that perhaps the most important of the points made by the Report mentioned in my Question is its insistence that the benefits of the productivity agreement should accrue to the whole community in the form of lower prices? Will he say specifically what he is doing to achieve that?

Mr. Lee

I quite agree with my hon. Friend. This to me also is one of the important factors. It is one of the reasons why one cannot merely talk of a productivity agreement, so-called, and give assent to it without finding whether the national interest is being preserved by it.

Sir C. Osborne

Can the right hon. Gentleman tell the House when he expects that we shall have greater national productivity? In view of the fact that only this morning it was shown that in steel production there has been the greatest fall since 1963, is it not time that the right hon. Gentleman did something about it, or allowed someone else to do something about it?

Mr. Lee

I should have thought that the hon. Member would have noticed from what the Chancellor of the Exchequer had said that the tendencies are all in that direction.

21. Mr. St. John-Stevas

asked the First Secretary of State and Secretary of State for Economic Affairs whether he will now revise Government policy disallowing discretionary wage and salary increases to employees.

Mr. Frederick Lee

No, Sir, as far as the period of severe restraint is concerned.

[column 1804]

Mr. St. John-Stevas

Does the Minister not agree that the present system works great injustice by linking wage increases to the purely arbitrary criterion of job classification? Does he realise that that is bitterly resented, not least among employees of the Marconi factory in my constituency at Chelmsford?

Mr. Lee

Where a commitment to review was in existence on 20th July last year, it is covered by paragraph 34 of the White Paper, Prices and Incomes Standstill; Period of Severe Restraint, Cmnd. 3150.

Mr. Ford

Is my right hon. Friend aware that whilst it is comparatively easy for employees working under payment by results schemes to increase their earnings, employees labouring under systems of personal assessment, with earnings related to productivity, are at a severe disadvantage?

Mr. Lee

Yes, Sir, I am. I have recognised that from the days when I used to negotiate for them. This is not brought about by anything in the present restraint period; it is one of the weaknesses of bargaining in the old sense.

Import Surcharge

3. Mr. Raphael Tuck

asked the First Secretary of State and Secretary of State for Economic Affairs what steps he has taken since the removal of the import surcharge to secure the reduction of prices, particularly those of petrol, which were increased by reason of the surcharge; and whether he will make a statement.

Mr. Frederick Lee

A special approach has been made by Government Departments to the trades chiefly concerned to ensure that they are fully aware of the need to reduce prices wherever possible. Petrol prices were not affected by the surcharge.

Mr. Raphael Tuck

Is not this most unsatisfactory? Does not my right hon. Friend remember the bland assurances given at the time that the import surcharge was announced that the price increase would be only temporary until the import surcharge was taken off? Does he not further remember the Secretary of State for Economic Affairs, on 1st December last, saying that there was a [column 1805]duty to reduce prices in appropriate cases? Is this not becoming a public scandal?

Mr. Lee

I expect there will be more reductions in prices as stocks run out. In fact, there have already been important reductions, in fibre board containers, cameras and wines and spirits, and, as I said, there are still price reductions to come.

National Plan

4. Mr. Onslow

asked the First Secretary of State and Secretary of State for Economic Affairs whether, in compiling statistics for the preparation of a revised version of the National Plan, he will seek to establish how many staff in the private sector of the economy are wholly or mainly employed with work which is directly connected with the compilation and rendering of official returns and forms, with the collection of taxes, and with other similar activities performed on behalf of the Government.

The Joint Under-Secretary of State for Economic Affairs (Mr. Peter Shore)

No, Sir.

Mr. Onslow

Why on earth not? Is the Minister afraid to ask industry how many men have to be employed in this way, or does he not know the answer?

Mr. Shore

The information would obviously have some interest, but it would hardly be essentially relevant to an industrial inquiry designed to help revise the National Plan. I think if one put this further obligation upon industry it would be one that many firms, at any rate, would certainly not welcome.

19. Mr. Higgins

asked the First Secretary of State and Secretary of State for Economic Affairs if he will place in the Library a copy of the input/output tables which show the relationship between the various industries covered by the National Plan and reconcile the figures given for each industry.

Mr. Shore

No, Sir.

Mr. Higgins

The First Secretary's predecessor said that the tables existed and would be published. The present First Secretary then said that it would cost too much to produce them. Do they exist or not, and will the hon. Gentleman place whatever tables exist [column 1806]in the Library so that we can carry out a post mortem on the National Plan?

Mr. Shore

As my right hon. Friend explained on 25th November last year, the tables are based on the projections in the National Plan, which are no longer considered practicable for 1970. Therefore, work on the tables has not continued. There is also the problem that some of the figures might give a misleading impression of Government policy.

Mr. Higgins

What happened to the actual figures for the base year? Were they ever reconciled or not?

Mr. Shore

I can assure the hon. Gentleman on that point.

Mr. Higgins

Were they ever reconciled?

Mr. Shore

Yes, Sir.

25. Mr. Edward M. Taylor

asked the First Secretary of State and Secretary of State for Economic Affairs to what extent the forecasts contained in the National Plan will be affected by the increase over the past 28 months in the numbers of people employed in the Civil Service and local government service; and if he will make a statement.

Mr. Shore

The increases are consistent with the relevant figures in the National Plan.

Mr. Taylor

Would the hon. Gentleman explain how it assists rapid and sustained growth in the economy to redeploy 38,000 additional civil servants into the Civil Service in a period of two years?

Mr. Shore

Those additions reflect changes in the population structure and the services that are required to meet it, particularly the Government's policy of improving certain social services. The great majority of the increase in people employed by local government comes under the headings of education, health and welfare.

Industrial Production

5. Mr. Eldon Griffiths

asked the First Secretary of State and Secretary of State for Economic Affairs how he accounts for the fall in the index of industrial production, as published by his Department, to its lowest level for two years.

[column 1807]

20. Mr. Stratton Mills

asked the First Secretary of State and Secretary of State for Economic Affairs if he will make a statement on the fall in the index of industrial production for November to 129, the lowest level for two years; and if he will forecast the trend for 1967 as a whole.

Mr. M. Stewart

The level of the index in November reflects mainly the downward adjustment resulting from restrictions to correct the balance of payments foreshadowed in my reply to the hon. Member for Harwich (Mr. Ridsdale) on 1st December [Vol. 737, c. 601–3]. It was also depressed by industrial disputes in the motor industry.

I am confident that with exports in the lead, industrial production will be rising this year.

Mr. Griffiths

A few minutes ago the First Secretary described this state of affairs as “sustained growth” . Is it not a fact that the National Plan and many of the social programmes that flowed from it were founded upon the assumption of higher production? As this higher production is not forthcoming and the National Plan is a flop, how can anyone put any credit on any promises by the Government?

Mr. Stewart

I think that what I said earlier was that a prices and incomes policy must be sought which makes sustained growth possible. That is certainly true. The reason why there has been this down-turn is that which I gave in reply to the earlier Question. The hon. Gentleman's statement that the National Plan is a flop is not an opinion shared by people in industry generally. [Laughter.] It is perfectly true that the objectives there mentioned will take longer of realisation, but I do not regard that as a subject for rejoicing, as apparently it is to hon. Members opposite. With exports in the lead, we have reasonable hope of rising industrial production this year and I hope we shall get back again to those objectives.

Mr. Stratton Mills

Are not the figures shown in Question 20 the inevitable result of two years of doctrinaire Socialism? Would the right hon. Gentleman explain the fall of six points in the index since August on a seasonally adjusted basis, [column 1808]which is the heaviest for very many years and which seems to occur mainly in manufacturing industry rather than in service industries, which is exactly the opposite to the policy of redeployment?

Mr. Stewart

I have already given the reasons for the down-turn. The measures taken in July were, as is well known, the result of the need to correct the balance of payments. If the hon. Gentleman wants to look for the causes of difficulty in the balance of payments, he must make a more profound historical research than the last two years.

Mrs. Thatcher

Will Michael Stewartthe First Secretary also make a profound historical research and consider the policies of Mr. R. A. Butler, who, when faced with a deficit running at the rate of £800 million a year, was able to turn it into a balance within two years and introduce tax incentives as well?

Mr. Stewart

If there was that degree of talent in the party opposite, it is surprising that we inherited the position we did in 1964.

Industrial Reorganisation Corporation

6. Mr. Wingfield Digby

asked the First Secretary of State and Secretary of State for Economic Affairs on what other occasions besides the case of Rootes he has insisted on the Industrial Reorganisation Corporation making an advance, without leaving the initiative to the Corporation.

Mr. M. Stewart

The Industrial Reorganisation Corporation Act does not give me power to insist that the Corporation should make particular investments.

Mr. Digby

Is it not a fact that it was made perfectly clear that the right hon. Gentleman has put a lot of pressure on the Corporation already? Does he think that it is the best way to launch the Corporation to make it appear the mere creature of his Department?

Mr. Stewart

The hon. Gentleman says, first, in his Question that I “insisted” , which is not true and which could not be true. Now he says that I have put pressure on the Corporation, which again is incorrect. In accordance with my powers under the Act, I made a [column 1809]request which it was open to the Corporation to refuse or accede to. It was its own choice to accede to it.

Roehampton Hospital (Limb Fitters)

7. Mr. Boyd-Carpenter

asked the First Secretary of State and Secretary of State for Economic Affairs why he has taken steps to prevent the payment to limb-fitters working at Roehampton Hospital of the wage increase agreed by their employers; and what, on an annual basis, is the sum involved.

Mr. M. Stewart

The agreement, which is for a pay increase of £100 a year for each limb-fitter from 2nd January, is not obviously reconcilable with the criteria for pay increases in the period of severe restraint and was therefore referred to the National Board for Prices and Incomes for examination. In view of the refusal by the parties to defer payment of the increase pending the Board's report, the Government considered it necessary to make an Order prohibiting further payment of the increase.

Mr. Boyd-Carpenter

Is not the total amount involved absolutely trivial in terms of the national economy or in relation to the amounts at stake in respect of electrical contractors and the agricultural workers? As these men are specially skilled men, limited in number, who do a vital job of work for disabled people is it not very petty to invoke this great instrument with criminal penalties to stop the increase which their employers want to give them?

Mr. Stewart

It is true that a very small number of men are involved. That really is the point, because the great majority of workers are accepting the general tenor of the policy at present. Therefore, it would not be right to let particular groups act in clear opposition to that policy.

Mr. Hugh Jenkins

Does not my right hon. Friend agree that there are special circumstances in this case which would have justified allowing this increase? Does he not agree, further, that by intervening at this stage and preventing the payment of the increase he has conditioned the situation and made it extraordinarily difficult for the National Board for Prices and Incomes to reach a fair and unbiassed conclusion in the matter?

[column 1810]

Mr. Stewart

No, I do not think this is so. I would agree that there are special circumstances in this case, but there are many groups of workers who could have advanced that plea. It was because there were special circumstances that I thought it right to refer the case to the Board. I would have thought that it was reasonable for both parties to have refrained from making the increase until the Board had reported. To insist on making the increase before the report, was really an attempt to pre-judge the Board's decision. I did not think that could be accepted.

Northern Regional Economic Planning Council

8 and 23. Dame Irene Ward

asked the First Secretary of State and Secretary of State for Economic Affairs (1) what requests for action in the region by the Northern Regional Economic Planning Council have been received; what they were; and what decisions have been taken;

(2)if he will give a detailed progress report to be related to the subheadings in each of the main divisions requiring Government action on the recommendations contained in the “Challenge of the Changing North” Report of the Northern Regional Economic Planning Council.

Mr. Shore

The first four pages of the regional study published by the Northern Economic Planning Council gave a summary of its findings and recommendations. Those proposals which were addressed to Government covered a wide range of topics. They are now being carefully considered by the Departments concerned.

Dame Irene Ward

As the Northern Economic Planning Council is dominated by this miserable Government, would not the Joint Under-Secretary agree that it is very important that the public records shall show whether the Government are really taking any action, or, according to the hon. Gentleman's reply, just sitting on their behinds considering, about which I am absolutely sick?

Mr. Shore

I do not see why the hon. Lady should be quite so censorious in her tone. This is a serious Report. A serious Report deserves and requires serious study. That is what it is getting.

[column 1811]

Mr. Bob Brown

Is my hon. Friend aware that, unlike the hon. Lady, northern Members on this side of the House are greatly impressed by the vigour and drive of the Northern Economic Planning Council under the great leadership of Dan Smith? Is he aware, further, that we expect the Government to implement the recommendations contained in the Planning Council's Report?

Mr. Shore

I think that the whole House, certainly all those who have come into contact with the leaders of the Northern Economic Planning Council, have been greatly impressed by the quality of the men concerned, and, indeed, by the excellence of the Report they have produced.

Dame Irene Ward

Not me, anyhow.

Mr. Blenkinsop

Is my hon. Friend doing something to ensure that the different Ministries involved in the carrying out of these recommendations are brought together so as to ensure that there is a reasonably active follow-up of these recommendations?

Mr. Shore

Yes. Consultations are taking place.

Atlantic Free Trade Area

11. Mr. Marten

asked the First Secretary of State and Secretary of State for Economic Affairs if he will make a statement on the Government's policy towards an Atlantic Free Trade Area.

Mr. M. Stewart

I have nothing to add to what my right hon. Friend the Foreign Secretary said in the debate on the European Economic Community on 16th November, 1966.—[Vol. 736, c. 448.]

Mr. Marten

Does the First Secretary of State agree that the Atlantic Free Trade area proposal is an alternative way of organising Britain's future? Are the Government studying it and giving it consideration?

Mr. Stewart

The Government, before embarking upon their present step, considered all relevant considerations.

Mr. Jennings

Does not the right hon. Gentleman agree that this is the soundest alternative to entry into the Common Market? Does not he agree also that [column 1812]probings of a similar nature to those which are now taking place would be good policy for the approach of the United States, Canada, E.F.T.A. and the Six, including ourselves, into such an Atlantic economic union?

Mr. Stewart

The answer to the second part of the supplementary question is, “No. Sir.” We are at present engaged in discovering whether there is, as we trust, a basis for negotiations for entry into the European Economic Community. I do not think that much point would be served by trying to weigh up the comparative merits of different alternatives to that policy.

Mr. Roebuck

Is it within my right hon. Friend's recollection that the proposal for an Atlantic Free Trade Area was particularly warmly advocated by the Prime Minister in 1962? Has my right hon. Friend any information on whether the Prime Minister has changed his mind?

Mr. Stewart

I think that my right hon. Friend's policy is well known. It has been repeatedly stated.

East Anglian Regional Economic Planning Council

14. Dr. Gray

asked the First Secretary of State and Secretary of State for Economic Affairs what is his policy with regard to the undertaking by the East Anglian Planning Council of physical and land use planning and the decisions upon growth points within the region.

Mr. Shore

The Planning Council's job is to advise on a general framework for the future economic development of East Anglia within which sensible planning decisions can be taken by all concerned.

Dr. Gray

Apart from assurances to the local authorities of full consultation, will my hon. Friend give an assurance that such powers as local authorities have on physical planning will not be diminished or taken from them and transferred to this unrepresentative and non-elected body?

Mr. Shore

Yes, Sir, I give that undertaking. There is no intention to take from local authorities their planning powers. If I may put it in this way, the Regional Planning Council's concern is the broad strategy of economic and [column 1813]physical planning, not detailed and physical land use planning which properly belongs to the local authorities.

Low-paid Workers

15 and 16. Mr. Ashley

asked the First Secretary of State and Secretary of State for Economic Affairs (1) what immediate steps he is taking to improve the standards of the lowest-paid workers;

(2) if he will undertake a survey of the full distribution of earnings in order to locate and give long-term assistance to low-paid workers.

22. Mr. St. John-Stevas

asked the First Secretary of State and Secretary of State for Economic Affairs what concrete steps the Government propose to take to raise the standard of living of low wage earners.

Mr. Frederick Lee

As my right hon. Friend the First Secretary of State explained in the debate on 22nd November, 1966, it must be accepted that the problem of removing poverty amongst the worst off cannot be dealt with by looking at wages alone. The Government are, therefore, looking at measures designed to meet family needs. It has also been thought right to include in the Severe Restraint White Paper, Cmnd. 3150, a criterion justifying exceptional treatment for the lowest-paid workers. The application of this criterion is in the first place a matter for the parties to wage negotiations, taking into account their particular circumstances and the need to ensure that the benefits are genuinely confined to the lowest-paid workers.

Mr. Ashley

I thank my right hon. Friend for that helpful Reply. Is he aware that, although successful implementation of the productivity, prices and incomes policy will assist lower-paid workers, there is an urgent need for short-term assistance to them at once?

Mr. Lee

My hon. Friend will know that even now many of these wage applications are being met. But, as I said in my original Answer, one cannot completely meet the problem of the lower-paid worker by wage increases alone. My right hon. Friend the Minister of Social Security has instituted the family expenditure survey which gives regular information about the distribution of [column 1814]earnings and incomes, and a full-scale survey of distribution of earnings was carried out in 1960 by a Member of the party opposite, which also is helpful in this respect.

Mr. St. John-Stevas

Would not one of the most effective ways to help these workers, who constitute the new poor, be a substantial increase in family allowances linked to a simple incomes test?

Mr. Lee

This is the kind of possibility one has in mind. Obviously, one cannot meet the problem by mere increases in the earnings of lower-paid workers, and the kind of thing the hon. Gentleman has in mind I have in mind, too.

Mr. Will Griffiths

Does my right hon. Friend recall that it used to be the policy of the party to which he and I belong that it is desirable to create greater egalitarianism, a greater equality in our society? Have he and his colleagues in the Government abandoned that object now?

Mr. Lee

Not in the least, Sir. I think that over the past seven months, because of the comparative stability which we have brought into the economy, lower-paid workers have gained far more than those with higher wages.

Mr. David Howell

Will the right hon. Gentleman give a definite assurance that there is no question of raising family allowances and at the same time penalising taxpayers through reductions in child allowances?

Mr. Lee

The hon. Gentleman should address that question to my right hon. Friend the Minister of Social Security.

Mr. Roy Hughes

Will my right hon. Friend bear in mind that incomes legislation, as outlined on numerous occasions in the House by my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley), is proving in practice of little benefit to lower-paid workers?

Mr. Lee

One cannot generalise on this. I am pretty sure that one could show that lower-paid workers have, in fact, gained more by the stability in the economy to which I have referred.

Sir H. Harrison

Will the right hon. Gentleman keep in mind particularly the [column 1815]agricultural workers and make representations to the Minister of Agriculture, during the present Price Review, to increase farmers' returns sufficiently to enable them to pay a higher reward to agricultural workers for their good work?

Mr. Lee

The National Board for Prices and Incomes has considered the pay of agricultural workers and its Report is now available. It is now preparing a report on the retail drapery trade, and this also will be of value.

Mr. John Hynd

Did I understand my right hon. Friend to commit the Government to an incomes test in relation to family allowances? Will he correct or confirm that?

Mr. Lee

I did not commit the Government to anything of the sort. I said that this was the kind of issue which could not be resolved merely by increasing the wages of lower-paid workers.

Regional Planning

17. Mr. Blenkinsop

asked the First Secretary of State for Economic Affairs what action he is taking to strengthen the regional planning machinery established by his Department.

Mr. M. Stewart

The planning councils and boards have made good progress since they were established, and, while I keep their operation under continual review, I have no present plans for making changes in their functions or organisation.

Mr. Blenkinsop

Is there not an urgent need for a close link between economic and physical planning, and does not my right hon. Friend feel that some of the Ministries, at least on a regional basis, are at present inclined to carry on their own activities in their own way without adequate co-operation?

Mr. Stewart

I agree about the need for the link my hon. Friend mentions, but I would not agree with his other point. This is one of the matters which I watch when paying attention to the work of councils.

Mr. Dean

Does the right hon. Gentleman realise that there is a growing feeling that the Government are trying to make these councils the passive partner of Whitehall rather than a really [column 1816]effective voice for regional development? Will he ensure that that feeling is overcome? Otherwise, this hopeful development could easily founder.

Mr. Stewart

I am sure that it is not a widespread feeling. I shall do my best to see that there is no justification for such a view, and there are many instances when Ministers have been influenced by the valuable advice we receive from councils.

24. Mr. Edward M. Taylor

asked the First Secretary of State and Secretary of State for Economic Affairs if he is satisfied with the success of his policies relating to regional development; and if he will make a statement.

Mr. M. Stewart

The Government's policy on regional development has got off to a good start with the setting up of the regional councils and the steady preparation of their first reports. Our regional problems are, however, wide ranging and complex and cannot be solved overnight. Nevertheless, I hope for steady progress.

Mr. Taylor

How can the Minister be satisfied with the situation in Scotland when we have six unemployed men and women for every vacant job, and unemployment is increasing at twice the rate of the rest of the country? How does that fit in with his assurance that the regions would be sheltered from the freeze?

Mr. Stewart

I did not say that I was satisfied with the position in Scotland, but the hon. Member will know that the Government have taken a wide range of measures to help those regions likely to be in most difficulty.

Dr. John Dunwoody

Would my right hon. Friend not agree that it is a matter of urgency that the regional reports that have not yet been published should come out as soon as possible? Will he take every step to see that that is done?

Mr. Stewart

Yes, Sir.

South-West Regional Economic Planning Council

18. Mr. Nott

asked the First Secretary of State and Secretary of State for Economic Affairs how many members of [column 1817]the newly-appointed Council of the South-West Regional Economic Planning Council come from Gloucestershire, Bristol, Wiltshire, Dorset, Somerset, Devon and Cornwall.

Mr. Shore

Including those recently, appointed, the membership of the Council, which was established in April, 1965, is, by county, as follows: Gloucestershire 3, Bristol 9, Wiltshire 2, Dorset 1, Somerset 3, Devon 8, Cornwall 2.

Mr. Nott

First, will the Minister consider greater Cornish representation on the Council—he has written to me about it—and will he do so as soon as possible? Second, will he give an assurance that, when the report for the South-West is published—it is nearing completion now—the Government will not have changed, altered or amended it in any way and it will contain the opinions of the Council, not Government policy?

Mr. Shore

I can give the second assurance without any difficulty. On the first point, the hon. Gentleman knows that the appointment of members is not an easy matter. The basis of representation is not territorial. It has to be the selection of individuals who, we believe, can contribute most to the region. But I shall bear the point in mind.

Mr. Wingfield Digby

Why is Dorset so miserably under-represented, with only one member? On what basis was the final selection made? Will the hon. Gentleman give an assurance that political considerations did not come into it?

Mr. Shore

The hon. Gentleman could not have heard my reply to the previous supplementary question. I said that the basis of selection for membership of the Regional Council was not a territorial one. I can assure him that it is not a party political one either.

Doncaster Area

27. Mr. Harold Walker

asked the First Secretary of State and Secretary of State for Economic Affairs what action he is taking to give effect to that part of the recently published study of the Yorkshire and Humberside economic region which urges speedy development of the growth potentialities of the Doncaster area.

Mr. Shore

The proposals from the Yorkshire and Humberside Economic [column 1818]Planning Council, including those for Government action to stimulate industrial development generally in the region, are under consideration.

Mr. Walker

Is the Minister aware that the Report was published several months ago, and that in the meantime the rate of unemployment has grown very considerably in an area that has been designated by the Planning Council as one that is ripe for rapid development? Is there not a contradiction here?

Mr. Shore

The Report produced by the Yorkshire and Humberside Economic Planning Council makes suggestions that have important implications for general national policy. They must be considered, and considered carefully.

South-West Regional Economic Planning Council

28. Mr. Nott

asked the First Secretary of State and Secretary of State for Economic Affairs how many people with practical experience of Cornish agriculture and horticulture are represented on the Agricultural Sub-Committee of the South-West Regional Economic Planning Council.

Mr. Shore

None, Sir.

Mr. Nott

Is the Minister aware that there is great dissatisfaction amongst the farming community in the South-West that there is not a single person with practical farming experience on the Agricultural Sub-Committee, particularly from Cornwall, and that it is preparing a report on the future of agriculture in the South-West? Will he look into this straight away?

Mr. Shore

I am always willing to look at this, but it is not practicable, within the limited membership of a Regional Council, to cater for every industry and every interest in every county. To make the point a little stronger, although agriculture is a very important part of the Cornish economy, it accounts for only about 7 per cent. of the total employed.