Prime Minister
(Broadcast)
Q1. Mr. Norman Lamont
asked the Prime Minister whether he will place in the Library a transcript of his interview on the television programme “Weekend World” on Sunday 11th May.
The Prime Minister (Mr. Harold Wilson)
I refer the hon. Member to the reply which I gave to the hon. Member for Blaby (Mr. Lawson) on 10th June.
Mr. Lamont
Is the Prime Minister aware that his criticism of Mr. Sevareid in his all-too-realistic analysis of Britain will seem extraordinarily complacent at a time of national crisis? What distinction does the Prime Minister's labyrinthine mind draw between Mr. Sevareid 's description of Britain sleepwalking to disaster and the description by the Secretary of State for the Environment of Britain being on a suicide course—or is the Secretary of State just another wet hen in the cocktail party circuit?
The Prime Minister
I answered a question last week on the serious speech made by my right hon. Friend the Secretary of State for the Environment. What Mr. Sevareid might have missed—as, indeed, have the Opposition—is the fact that in relation to our overseas balance of payments and the strength of the pound there has been the most remarkable recovery in the last five months in our balance of payments. Over the first five months of this year the deficit—including even [column 1186]oil, of which the Conservative Government never had to take account because it hardly entered into their last quarterly figures—is now 75 per cent. less than the monthly average for the same five months last year, and 50 per cent. less than the average monthly deficit of the last quarter of 1973, even though oil price increases had hardly begun to work through in that quarter. This is a remarkable achievement. It would be nice if the Opposition occasionally paid tribute to the exporters and those who have worked so hard to produce those figures.
Mr. McElhone
My right hon. Friend will be aware that page one of the transcript of the interview referred to the need to keep the country free from strikes, to boost production and exports. I support that view and the work of the Secretary of State for Employment, but will my right hon. Friend tell the House about the latest situation on the proposed strike on British Rail?
The Prime Minister
My hon. Friend and the House will be aware that there have been developments over the weekend on that topic and that further developments have taken place this morning. In the expectation that discussions will be taking place, I think that probably I should not add to anything that has already been made public on this important issue. The Government have made their position absolutely clear.
Mr. George Gardiner
Is the Prime Minister of the view that the improved balance of payments position makes it unnecessary for him to take further action to curb inflation?
The Prime Minister
Not at all. I said that it would be nice if Opposition Members occasionally paid tribute to the remarkable turn-round in our balance of payments. The need to curb the increase in inflation is due to the fact that we do not want to imperil the considerable success in our balance of payments so far achieved. I agree with the hon. Gentleman that if inflation continues at the present rate it will imperil improvements in the balance of payments in the present year.
Mr. Tomlinson
Has my right hon. Friend received any observations on his important comment in the broadcast, [column 1187]in respect of the desirability of pre-Budget consultations with interested parties?
The Prime Minister
My hon. Friend will be aware that the idea was welcomed by both the CBI and the TUC during that weekend. He may also like to know that reference was made to this matter in the meeting of NEDC this morning, when we discussed the future role of NEDC and the important paper produced jointly by the TUC and the CBI.
Mrs. Thatcher
Will Harold Wilsonthe Prime Minister bear in mind that during the last election campaign the Healey figure for inflation was 8.4 per cent., and that after eight months of Socialist Government it is now 53.1 per cent? Will the Prime Minister now say what action he proposes to take, if any, to arrest the daily decline of the pound?
The Prime Minister
The right hon. Lady will be aware that this question was answered yesterday by my right hon. Friend the Secretary of State for Prices and Consumer Protection. My right hon. Friend particularly referred to the Budget figures in the last month, but the right hon. Lady will be aware that a very high proportion of the increase in wages in the last year, which she regards as uniquely the cause of this problem, has been due to threshold payments introduced by her Government.
Mr. Thorpe
Does the Prime Minister recall that he said frankly in that broadcast that those who took more out of the economy than the nation could afford would face the Chancellor with the proposition either of clawing it back through taxation or of cutting down on social expenditure? Does he agree that the unfairness of that is that it hits people equally, whether they have settled within or outside the social contract?
The Prime Minister
Yes, Sir. I agree with the right hon. Gentleman's interpretation of what I said. I agree with his judgment of the colossal unfairness between particular groups within the country. I think that my right hon. Friend proved in the Budget what was said, both by the right hon. Gentleman and myself—that because there were some settlements which were consider[column 1188]ably outside the social contract, he had to do more in the way of taxation in the Budget than he would otherwise have done, at a time when the House would wish, not on cost inflation grounds, but on demand inflation grounds, to do something to increase the level of activity in this country because of the increase in unemployment.
Dr. Hastings Banda
Q2. Mr. Brotherton
asked the Prime Minister if he will seek an official meeting with Dr. Hastings Banda in the near future.
The Prime Minister
I have no plans at present to meet President Banda, though, as the House knows, I met him in April, when he was visiting this country.
Mr. Brotherton
Is the Prime Minister aware that that reply will be greeted with some regret? If he met Dr. Banda he would receive sound advice on the question of Rhodesia. Is the Prime Minister also aware that that advice would be to drop the monstrous idea of subsidising the Marxist régime in Mozambique, so as to persuade it to close the railway link, and so try to subjugate all the people of Rhodesia, black and white alike?
The Prime Minister
I do not agree with the hon. Gentleman. Nor do I agree with his attribution of such views to President Banda. President Banda, and Malawi, provided the occasion for the meeting of the African Presidents with Mr. Vorster, all of whom are now trying to find an early solution to the problem of Rhodesia.
President Banda is not associated with the reactionary doctrine put forward by the hon. Gentleman.
We have made it clear that if Mozambique falls into line with the United Nations' decision on sanctions, which I think is supported by the Opposition Front Bench—it has been supported by the Opposition from time to time, and it may still be supported by them today—it is right, as we have said, for us to help the economy of Mozambique in consequence.
[column 1189]Referundum
Q3. Mr. Hurd
asked the Prime Minister what changes in general Government policy he proposes to introduce following the outcome of the referendum.
The Prime Minister
We shall continue to pursue the policies set out in our manifestos and approved by the country in two General Elections last year.
Mr. Hurd
Will the Prime Minister please now turn his undivided attention to inflation? Is it true that the Government are pressing—as was reported by the Press and radio this morning—the board of British Rail to go beyond the highly inflationary arbitration award? If the Government are prepared to accept and finance a rail settlement above 27½ per cent., how on earth do they expect anyone to take them seriously on inflation?
The Prime Minister
As to the first part of the question, about giving my undivided attention to this matter, that is the case. We have had a series of meetings with the TUC and the CBI. Those meetings are continuing. I chaired the meeting of NEDC this morning. I shall be meeting the CBI this afternoon and the TUC tomorrow. These meetings will continue. We are seeking to reach agreement, in this democracy, on the basis of consent and not of confrontation. Any fool can obtain a settlement on confrontation. That does not last very long—as we saw. We are trying to get the basis of consent. I have already answered a question about the railways situation. I do not want to go beyond what I said this afternoon.
Mr. Heffer
Will my right hon. Friend give an assurance that, following the discussions with the CBI this afternoon, there will be no amendments to the Industry Bill beyond those which were agreed in Committee? I think that this is a matter of the greatest importance, and I hope that my right hon. Friend will give us his assurance.
The Prime Minister
My hon. Friend will be aware that the Government, as usual, are considering the Bill as it comes from Committee. We shall discuss it with both sides. The Bill, and the implementation of the Bill, will be in full accordance [column 1190]with the manifesto and with the White Paper. My hon. Friend will be the first to agree that where action can be taken by voluntary policies, that is the right approach. That is what he said on Second Reading last February.
Mr. Donald Stewart
Does the Prime Minister accept that any attempt to readjust the time scale of devolution, as a result of the outcome of the referendum, would prove to be a costly error for the Labour Party, in political terms? Will the Prime Minister give us an assurance that there will be no extension of the timetable originally promised?
The Prime Minister
I welcome the hon. Gentleman's concern for the future welfare of the Labour Party. There is no connection in the minds of any of us between the outcome of the referendum and the Government's proposals on devolution, which were set out clearly in a White Paper which was published last autumn. We are sticking to the terms of the White Paper.
It is known that I chaired a meeting on this subject yesterday. Despite Press rumours—I do not blame the Press because it gathers funny ideas from funny places—we are abiding by the White Paper. There is no change in the time-table. We have made that clear.
Mrs. Bandaranaike
(Meeting)
Q6. Mr. Tomlinson
asked the Prime Minister whether he will make a statement on his recent meeting with Mrs. Bandaranaike, the Prime Minister of Sri Lanka.
The Prime Minister
We discussed a number of matters of mutual interest, including the tea industry in Sri Lanka, my proposals on commodities made at Kingston, the future development of relations between the South Asian countries and the European Economic Community, and the meeting of the non-aligned nations in Colombo next year.
Mr. Tomlinson
Can the Prime Minister give us any indication of any measures which Mrs. Bandaranaike proposes to take to deal with the problems to which the Government have given [column 1191]urgent attention in relation to the tea plantations?
The Prime Minister
Some problems have been discussed, some of which are of a bilateral character, as some of the plantations are owned by British interests. I have pressed that any changes made there should be accompanied, as is the usual and universally agreed practice, by compensation in cases where they are taken over.
On the question of tea and commodities generally, Mrs. Bandaranaike—when she visited London, as well as in Jamaica—gave wholehearted support to the initiative which I took on commodities and felt that it was relevant to the problems of Sri Lanka in relation to tea and rubber.
Dr. J. Dickson Mabon
In view of the Prime Minister's distinguished record in support of War on Want, which is deeply concerned with the position of the Tamils in Ceylon, will he tell us whether he raised the problem of these Stateless people, who are without votes, representation or sustenance in the tea estates, largely because of their political position?
The Prime Minister
I am aware of the problem. I did not raise the matter with Mrs. Bandaranaike because it must be regarded—whatever the feelings of my hon. Friend, or of War on Want, of which I was a founder—as an internal affair of the Sri Lanka Government.
Pay Negotiations (Prime Minister's Speech)
Q7. Mr. Sandelson
asked the Prime Minister if he will place in the Library a copy of his public speech at Poplar on Monday 19th May on pay negotiations.
The Prime Minister
I did so, Sir, on 20th May.
Mr. Sandelson
Is the Prime Minister aware that he said—and I quote—[Interruption.] I withdraw the personal quotation. The Prime Minister said that the big battalions should show restraint in the use of their industrial muscle during this period of unparalleled economic difficulty. Will he now say something about the vexed question of differentials, the solution of which would go some way to relieving the position of the lower paid?
[column 1192]The Prime Minister
What I said about differentials I said to the TUC last year. I know from Questions put by the Leader of the Liberal Party this afternoon that this is a matter about which we are all deeply concerned. I answered a Question about differentials last week. The subject has been considered by the Economic Committee of the TUC and will be considered by the General Council in the light of proposals for a flat-rate increase on which I commented last week. The problem has been that when low-paid workers have received a flat-rate increase on a given poundage it has been translated into percentages, and people who are far better off—not only manual workers but white-collar and managerial workers—have said that they wanted the same percentage to maintain differentials. By maintaining the percentage differential they vastly increase the differential in cash terms. This is a problem to which the Government and the TUC are devoting a great deal of attention.
Mr. Prior
Apropos the Question answered earlier, may I suggest to the right hon. Gentleman that it would be more accurate, in view of the Government's record, to say that any fool can get a settlement with surrender? What is the Government's policy towards the railway dispute?
The Prime Minister
It is exactly as we have explained it to the union and the board. I do not believe that it would help at this stage—[Interruption.] We have made it clear—we did this at the weekend—that we cannot possibly go along with the union's claim or with negotiations related to getting anything like that. We have made this very plain. We have explained to the union that although the consequences of a strike in support of the claim would be costly to the country at home and abroad, particularly for the travelling public and the movement of essential goods, the acceptance of a doctrine which would involve agreeing to the claim would be even more damaging.