PRIME MINISTER
(ENGAGEMENTS)
Q1.Mr. Ashley
asked the Prime Minister if he will list his official engagements for 18th May.
The Prime Minister (Mr. James Callaghan)
This morning I presided at a meeting of the Cabinet. In addition to my duties in this House, I shall be holding meetings with ministerial colleagues and others. This evening I hope to attend a reception being given by President Seretse Khama of Botswana.
Mr. Ashley
If my right hon. Friend finds time to consider last night's televised tour of the archives by the Conservatives, will he agree that it was a lament for the past by a party which offers old, simple solutions for new, complex problems and that, although incentives may be important, there is a danger that if they are peddled as a panacea, as they are being peddled by the Opposition, the incentive society many become the insensitive society, as many of us have good reason to believe?
[column 768]The Prime Minister
I regret that I did not have the good fortune to watch this broadcast. I am not sure whether the commercialising and packaging of party political views is in the best interests of the party concerned, but that is for it to judge.
Mrs. Thatcher
If James Callaghanthe Prime Minister did not have time to see the broadcast last night, which I completely and totally accept, has he had time to look at the report issued by the Treasury yesterday, which shows that wages are going up faster here than elsewhere and that the growth in output has seldom been worse? Does he accept that this makes us much less competitive than similar industrial nations and that that is the result of his economic policies over the last four years?
The Prime Minister
The right hon. Lady is correct to call attention to these facts, some of which are good and some of which are not so good. It is good that earnings should be going up faster than prices, because that will improve the standard of life of our people. What is not so good is if production does not increase correspondingly. I am glad to say that there are signs of improvement there. I am told that the increase in industrial production in the first quarter of 1978 over the last quarter of 1977 was 1.7 per cent.
However, I agree with the right hon. Lady that we should call attention to these factors. They are saying no more than I consistently say at the Dispatch Box. We shall endeavour to keep production, inflation and wage levels in line so that this country can be as competitive as anyone else.
Mr. Arthur Latham
Does my right hon. Friend realise that some rents are going up much faster? Could he find time to look into his duties and responsibilities as an ex officio Church Commissioner? Does he realise that the Church Commissioners are inflicting unacceptable rent increases on many tenants in my constituency? Does he not find it embarrassing, as a nominal member of the Church Commissioners, that they should increasingly behave more like Freshwater and less like Christians?
[column 769]The Prime Minister
I fear that the duties of Church Commissioner do not take up as much of my time as perhaps they should. I shall certainly see that the matter is looked into, even though I am only ex officio.
Mr. Anthony Grant
Has the Prime Minister had a chance to reflect today on his recent meeting with the President of Turkey? If so, will he give the House his view of the effect on NATO of the continued United States arms embargo on Turkey, which is our partner?
The Prime Minister
No. I would not want to give my views about that because it is not the responsibility of the Government; it is the responsibility of the American Administration. The Turkish Government have asked whether it is possible for some European countries to assist them in their armaments programme, but most of the conversation between the President of Turkey and myself, which did not take place today, was concerned with the problems of Cyprus. I asked the President to be more flexible in his approach.
Mr. Pardoe
Will the Prime Minister amplify his earlier remarks about keeping earnings in line with output? Does he accept that earnings are bound to rise by about 14 per cent. over this pay round, that output cannot possibly rise by more than 3 per cent., and that the balance must be paid either by inflation or unemployment? What will he do to bring the two things in line for phase 4?
The Prime Minister
A little more help from the hon. Member for Cornwall, North (Mr. Pardoe) would not come amiss. What I intend to convey is that all these matters must bear a relation to each other, not that they should be strictly in line with each other, which, clearly would not be accurate. The hon. Member knows my views about this almost to the point of boredom.
Mr. Heffer
I recognise that my right hon. Friend has little time to read the speeches of the Leader of the Opposition, but could he find time to read the speech that she made in a church in the City of London recently, and an article which she wrote in The Daily Telegraph? Is it not clear from that speech and the article that the right hon. Lady and her friends intend to undermine the National Health [column 770]Service, to impose charges and to undermine the whole concept of the Welfare State as we understand it?
The Prime Minister
It is not part of my responsibility to read these speeches or article, but I did read the article in The Daily Telegraph. The right hon. Lady's emphasis on and concern for the welfare of the family was set out in that article and I found that I was largely in agreement with it. It is a theme that I have taken up because it is of great importance. For that reason I am deeply sorry that the Opposition should find it necessary to make a party matter of it.
CBI
Q2. Mr. Corbett
asked the Prime Minister when he last met the CBI.
The Prime Minister
I met representatives of the CBI on 6th February. Further meetings will be arranged as necessary.
Mr. Corbett
Against the background of rising industrial output and rising investment owing to the success of many of this Government's policies, what conversations will the Prime Minister be having with the CBI to get it on the side of making it easier for small businesses to be set up and for those in business to expand in order to provide many of the new jobs which are so urgently needed?
The Prime Minister
The Government's policy towards small firms is well known. As the small firms recognise, the Budget made a number of improvements, including improvements in value added tax limitations, capital transfer tax, capital gains tax and corporation tax. All these have been of great assistance to small firms. I find that members of the CBI appreciate this.
Mr. Crouch
Does the Prime Minister consider that his dinner with the CBI the night before last was a useful meeting? Does he remember that the president of the CBI then said that it was the CBI's aim to drop the phrase “the two sides of industry” ? What is the Government's view of that initiative?
The Prime Minister
The hon. Member was there and he enjoyed the dinner as much as I and many other hon. Members did. I thought that I gave an [column 771]adequate, full and acceptable reply on that occasion.
Mr. Greville Janner
Can my right hon. Friend confirm that the CBI next week is due to receive a high powered trade delegation from the Soviet Union headed by Academician Kirillin? Will he express the deep disgust and distress of this House at the travesty of the trial of Yuri Orlov and the savage sentence imposed? Will he point out to the Russians that this is the worst possible way to achieve either detente or improved relations between our countries?
The Prime Minister
The whole House will agree that if the sentence has been passed on Mr. Orlov in respect of his attempt to monitor the Helsinki agreement, there can be no justification for a sentence on that account. The Government's view has been and will be made entirely clear on that matter. Certainly I shall lose no opportunity of making it so.
At the same time, I also wish to make clear, because there must be good State relations, that, whilst I am strongly in favour of individual groups and hon. Members such as my hon. and learned Friend the Member for Leicester, West (Mr. Janner) making their passionate distaste and dislike of this type of thing clear, we must not cut off relations with the Soviet Union. I know that my hon. Friend was not suggesting that. But, sometimes, not what my hon. Friend says but what others say seems to shade off into that. This is one of the two great States of the world. We either live with her or we die with her. State relations must be conducted on a different basis from that of hon. Members and individual citizens in this country, who properly express their disgust at what is taking place.
Mr. Bulmer
When the Prime Minister next meets the CBI, will he explain to its members why he believes that it is in the interests of trade unions, let alone the nation, that neither the nationalised industries nor British companies should be allowed to compete in the international market with the best management available because of the high tax rates that rule in this country?
The Prime Minister
The CBI has expressed its views to me about this. We discuss it from time to time. I shall [column 772]consider whether it should be on the agenda at the next meeting.
ABERDEEN
Q3. Mr. Fairgrieve
asked the Prime Minister when next he intends to visit the Aberdeen area.
The Prime Minister
I have at present no plans to visit the Aberdeen area.
Mr. Fairgrieve
I regret that the Prime Minister has no immediate plans to visit the oil capital of Europe which makes an inestimable contribution to our balance of payments. But, when he does visit the area, will he ensure that his staff route him by rail, air or sea from the central industrial belt of Scotland to Aberdeen so that he does not have to travel on the most congested and important single carriageway road remaining in the United Kingdom?
The Prime Minister
I am not sure that I fully understand the import of that question. But I do not intend to walk; I can promise the hon. Member that. If he is saying that there is need for a substantial improvement in the road communications, that may well be so. With respect, I wish that Opposition Members, including the hon. Member for Aberdeenshire, West (Mr. Fairgrieve), would not constantly press for additional public expenditure, on the one hand, and seek to reduce taxation on the other.
Mr. David Steel
When the Prime Minister next goes to the Aberdeen area, will he try to find out what has happened to the declaration of Perth?
The Prime Minister
I fear that the Conservative Party is losing itself in the Scottish mist over devolution. I think that they will suffer retribution for it.
Mr. Ron Thomas
When my right hon. Friend visits the fair city of Aberdeen, will he make it clear to the people of Aberdeen that Members of the Scottish National Party went into the Lobby with Members of the Tory Party in order to give massive handouts to the wealthy people in our community at the expense of the sick and elderly and the mass of working people?
The Prime Minister
Yes. I have already noticed in my postbag and other [column 773]communications that it has not gone unnoticed in Scotland and elsewhere that the Scottish National Party voted with the Conservatives on that issue.
Mr. Henderson
Is the Prime Minister aware that what has not gone unnoticed in Scotland, particularly in the North-East where the oil and gas is coming ashore, is that the local community is having to pay for the roads and services without adequate help from central Government? Will he reconsider this position and reprimand the Secretary of State for Scotland for failing to take action?
The Prime Minister
The hon. Member is not correct. A substantial sum of public expenditure has rightly been made available to Scotland for a great many functions, including the saving of jobs. That is well appreciated by the Scottish people.
Mr. Flannery
When my right hon. Friend goes to Aberdeen, by whatever means other than Shanks' pony, will he ruminate on the fact that not only the people of Aberdeen and Scotland but the people of England, Northern Ireland and Wales will all suffer as a result of what happened this week when the Opposition tried to take £1,100 million from the ordinary people to give to their wealthy friends? Will he underline the message that if the Opposition had their way they would have a disastrous effect on the economy?
The Prime Minister
There is a growing understanding in the country that there must be a balance between public expenditure and taxation. People understand that a great deal of public expenditure has helped to save jobs in industries which, although they are efficient, are suffering a temporary recession because of the world recession. I believe that the country understands that and that that is why there is growing support for our Government.
Mr. Buchanan -Smith
Is the Prime Minister aware that, in addition to the real advantages brought to the North-East of Scotland by oil, there have been problems for indigenous industries which have emphasised the need to broaden the industrial base of the area in order to prepare for when the oil comes to an end? In those circumstances, was it [column 774]defensible to reduce the industrial development status of the area?
The Prime Minister
The Aberdeen area unemployment rate has been well below the national average for some time, and it therefore seemed appropriate that the status should be altered. However, I agree with the hon. Gentleman's analysis that we should use oil revenues not to reduce taxation, as his party wishes to do, but to provide the alternative sources of energy that will be required, and to regenerate Scottish and British industry. The Scottish Development Agency is engaged on that task now.