OVERSEAS REPRESENTATION
Q2. Mr. Madden
asked the Prime Minister whether he has received the report of the CPRS on overseas representation.
The Prime Minister (Mr. James Callaghan)
The report is still in draft. I expect to receive it shortly.
Mr. Madden
When my right hon. Friend receives the report, will he give an assurance that, whatever response he makes to the rumoured recommendation that we should streamline our overseas representation, he will resist any recommendations to reduce the BBC Overseas Service, which many believe to be a most effective means of transmitting Britain's point of view and which is also most helpful in giving impartial information to those who are living under régimes where censorship of the news is a practice?
The Prime Minister
I have not yet seen the report and, therefore, I am not [column 229]aware whether it contains any recommendations of that nature. I would say to my hon. Friend that from my previous experience as Foreign and Commonwealth Secretary I know that the Overseas Service of the BBC is very much valued and is listened to by a variety of overseas leaders in other countries. We should therefore have to give serious consideration before it was cut down.
Mr. Michael Morris
Is the Prime Minister aware that rumour has it that the report criticises the cut-back in the British Overseas Trade Board's activities? Does he not agree that it makes nonsense to cut back this service if, as he has stated in the House, exports are a priority?
The Prime Minister
Again, I must say that these are rumours and that I do not know what the report contains. It would be better to read it and see what case is made, if any is made, about the overseas trade service and its future.
Mr. Carter-Jones
Will my right hon. Friend mind if I twist the Question and link it to Question No. Q1 and ask——
Mr. Speaker
Order. Only last week the House asked me to see that supplementary questions were relevant to the Question on the Order Paper.
Mr. Carter-Jones
This is relevant, Mr. Speaker. Has my right hon. Friend received representations from overseas people that, maybe when he goes home at night to his home and his wife, he should route himself via the Phipps Ward of the South-Western Hospital and see there what can be done for disabled persons from overseas?
Mr. Speaker
That is a blatant example of where the House has asked me to see that questions are relevant.
PRIME MINISTER (SPEECH)
Q3. Mr. Pattie
asked the Prime Minister whether he will place in the Library a manuscript of his remarks on inflation made in Tunbridge Wells on 30th April 1977.
The Prime Minister
I did so on 2nd May.
Mr. Pattie
Does the Prime Minister recall that in that speech he said: [column 230]
“We are now winning the battle against inflation” ?
As inflation, on the Chancellor's formula, was 8.4 per cent. in September 1974 and after two and a half years this Government had got inflation up to 19.9 per cent., why should anyone believe him?
The Prime Minister
I do not know whether that question is worth answering. Any question which ends “Why should anyone believe him” hardly deserves an answer, because no one would believe it anyway. Therefore, I wonder why I should bother to reply. The answer I have given regularly is that the forecasts and the policies that have been carried through show that there will be a turn-down in the rate of inflation, which will continue during the second half of this year and the first quarter of next year. That is a forecast that I accept because it is genuinely based. I invite the hon. Gentleman to believe it, too.
Mr. Ron Thomas
Does my right hon. Friend agree that two of the major factors in inflation are Britain's membership of the Common Market and the devaluation of sterling? Will he therefore issue an ultimatum to the Common Market that unless it scraps the CAP Britain will get out? Will he comment on the Bank of England's handling of sterling, because it is refusing to allow it to reach a higher level than it is at the moment?
The Prime Minister
No, I do not think that I can comment on the last part of the question. I believe that that would take too long. We cannot deal with an important issue of policy of that sort in answer to a supplementary question. The answer to the second part is “No” , because I do not believe that delivering an ultimatum to the Common Market in that sense would serve any particular purpose.
Mr. Michael Latham
Was not my hon. Friend's point about not believing the Prime Minister a perfectly fair one, since the performance of the Chancellor of the Exchequer and other Ministers on inflation has been a long series of terminological inexactitudes?
The Prime Minister
Inflation is declining and will continue to decline. Since the period of the pay policy—and I take it that, whatever they may think about the future, the Conservatives accept these [column 231]figures, which I have explained on a number of occasions—[Interruption.] It makes me wonder whether the Conservatives ever listen. Because of the events last autumn, we are in a period of a temporary bump——
Mr. Fell
Three years.
The Prime Minister
A bump can go both ways. If I were to hit the hon. Gentleman, he would quickly become concave, but he could equally become convex. There is no reason to doubt that if the forecasts are borne out—and no one has cast doubt on them yet—inflation will turn down. We should not discourage the people, nor should we discourage the negotiations which are going on about the future of pay policy. The future of all the country is bound up in winning this battle. The Government have taken some tough decisions on it which have resulted in considerable loss of popularity. That we have to withstand. But I see no reason why the Opposition should not admit that these policies are necessary if the country is to avoid hyper-inflation, and I should be glad if they were to do that once in a while.
Mr. Anderson
Does my right hon. Friend agree that the large number of frenetic attacks recently by the Opposition suggest that they at least accept that the turn-round is coming?
The Prime Minister
It is worth noting that last Friday there was published news of record trade figures, although it did not receive too much space in some portions of the Press. The whole House will welcome the surplus of £111 million on current account. That turn has come sooner than was anticipated and it follows a surplus and a small deficit in the previous two months. In the last quarter, therefore, this country has been running a surplus on its balance of payments. This is associated with considerable strength of sterling and follows a fall in interest rates which was followed by a reduction in mortgage interest rates. Let us acknowledge some of the things that are going right.
Sir David Renton
Is the Prime Minister aware that in each of the last three years the Prime Minister of the day or the [column 232]Chancellor of the Exchequer—or both—has given the House and the country an indication that inflation would fall, but that it did not fall in any of those three years? Why should the right hon. Gentleman's statement today be accepted more readily than the statements made previously?
The Prime Minister
I think that the right hon. and learned Gentleman is incorrect in his recollection. The rate of inflation was halved between 1975 and 1976 and I would hope that it might be halved again. I am not sure whether it will be. If the right hon. and learned Gentleman does not wish to believe the forecasts, that is his right, but let us wait and see what happens.
Mr. Pardoe
Does the Prime Minister accept that, even for those of us who hope that the rate of inflation is falling, forecasts of the rate of inflation are an extraordinarily chancy business? Is he aware that a fall is by no means as certain as he indicated this afternoon? Would he say that unless the Government are successful in obtaining a severe and stringent pay policy his forecasts will inevitably be proved wrong? Are the Government doing anything like enough to obtain that pay policy?
The Prime Minister
I would put it the other way round and say that a further round of pay policy will help us to get inflation down. I would not put it the way the hon. Gentleman does, namely, that if we do not get it, everything has failed.
Mr. Skinner
That is nearer the correct line.
The Prime Minister
I am very happy to find myself in agreement with my hon. Friend. I described what I believe to be the real position. The impact of the current pay policy under phase 2 will be felt during the second half of this year and the first part of 1978, because agreements are only now being entered into and these will last until May 1978. If sterling maintains its strength with the policies we are following, I can say with a reasonable degree of confidence that the forecasts are acceptable. I do not rely on them, but it is fair to say that I hope they will come true.
[column 233]WEST MIDLANDS
Q4. Mr. Hodgson
asked the Prime Minister when he next plans to visit the West Midlands.
The Prime Minister
I have at present no plans to do so.
Mr. Hodgson
Since the Prime Minister cannot visit the West Midlands, will he explain to the people there the logic of his Government's position whereby one set of people—the judiciary—are criticised for carrying out their duties while another set of people—the Post Office workers—are to be legally exempted from the consequences of failing to carry out theirs?
The Prime Minister
I am not aware of any criticism of Her Majesty's judges. I understand that there was a historical exegesis which my right hon. Friend the Leader of the House entered into when addressing a trade union conference. Frankly, I do not think that he went far enough. He should have said something like this: that the
“trade union organisations” ,
were
“being enmeshed, harassed, worried and checked at ever step and at every turn by all kinds of legal decisions” .
If only my right hon. Friend had used Sir Winston Churchill 's language, I might have been more in agreement with him.
Mr. Robinson
Is my right hon. Friend aware that many Labour Members will be disappointed that he has no plans to visit the West Midlands? Is he further aware that we need an urgent and positive approval of British Leyland's plans, including the new Mini, in the interests of the economy both of the West Midlands and of the United Kingdom as a whole?
The Prime Minister
I am well aware of the importance of British Leyland's investment future. I understand that the matter is now being studied, but I am not aware of the exact position that discussions have reached. I shall, however, convey my hon. Friend's comments to my right hon. Friend the Secretary of State for Industry.
Mrs. Thatcher
May I return to the supplementary question asked by my hon. [column 234]Friend the Member for Walsall, North (Mr. Hodgson)? I do not know which reports James Callaghanthe Prime Minister has read, but is he not aware that, according to some which purport to be verbatim, Michael Footthe Lord President's remarks went further even than the question of the trade unions? I shall paraphrase what he said since I am not permitted by the rules of order to quote, but I intend to give an accurate representation of the words used. The right hon. Gentleman said that if the freedom of the people of this country had been left to the fairmindedness of judges, we should have precious little freedom in this country. That is meant to be a paraphrase from The Guardian. I believe it to be accurate and I believe that the comment should be wholly repudiated. It was a totally disgraceful remark to have made.
The Prime Minister
I am satisfied, as one who has been a trade unionist all his life, that my right hon. Friend was referring to the attitude of judges to the trade union movement in the past. Let me remind the right hon. Lady, if she is unaware of the history, that after the repeal of the Combination Laws men were sentenced and transported to Australia, and that in the middle of the century there was a judgment by the courts—[Hon. Members: “Which century?” ] I am referring to the last century, which is what my right hon. Friend was referring to. In the middle of the nineteenth century there was a judgment by the courts which pretty well left it to any trade union official to abscond with the funds. There was the Taff Vale Railway case in 1901, and then there was the Osborne judgment. The right hon. Lady and the Conservative Party had better understand that the trade union movement knows where it stands on these matters.
Mrs. Thatcher
Is the Prime Minister aware that I think his remarks will satisfy very few people in view of some of the other comments that have been made in the past by the Lord President in this House about Her Majesty's judges? Therefore, may I ask the Prime Minister whether he and every member of his Government have total confidence in the impartiality of the judges and value their total independence?
[column 235]The Prime Minister
The judges of today were not referred to by my right hon. Friend [Interruption.] I shall answer the question in my own way and in my own time. As I said, my right hon. Friend did not refer to the judges of today in his remarks, and any attempt to try to suggest that he did is totally false. Anybody who knows the history of the trade union movement and the relation between it and the courts knows the situation. As to the position of today, my right hon. Friend was casting no reflection on judges at all. That was made clear by the Lord Chancellor in the House of Lords yesterday and I make it clear again today. This is really just another red herring——
Mr. Raphael Tuck
It is a blue herring.
The Prime Minister
But this is the sort of thing that we shall get more and more from now on.
Mr. Powell
Does the Prime Minister agree that one of the most fruitful and important aspects of the sovereignty of this House is its right to alter the existing law as established by the decisions of the courts at any time? This is one reason why a Bill of Rights is incompatible with the free constitution of this country.
The Prime Minister
Yes, I understand that, and I agree with the right hon. Member for Down, South (Mr. Powell). What was encased in the examples I quoted, and it is burned deep in the hearts of trade unionists who have been brought up in the movement, is that it has been Parliament that has had to be brought in on every occasion in order to deal with interpretations of the law that the judges have given.
Several Hon. Members
rose——
Mr. Speaker
I shall call one more hon. Member.
Mr. Mellish
I revert to the original Question. Will the Prime Minister have second thoughts and go to the West Midlands to discuss with those who voted Tory and who are employed in the car industry how it was possible to do so? It should be borne in mind that had it not been for a Labour Government there would not be a car industry at all in the West Midlands.
[column 236]The Prime Minister
Yes, I would be ready to do that if I went to the West Midlands. I would also point out that the present temporary hon. Member for Walsall, North (Mr. Hodgson) has a singular lack of understanding of the trade union movement.