8. Mr. Gwilym Roberts
asked the Chancellor of the Exchequer what proportion of the national income in 1966 went to rent, interest and profit; what proportion went to wages and salaries; what were the corresponding figures for 1960 and 1963; and what steps he is taking to orientate national income to wage and salary earners.
Mr. Callaghan
As the Answer contains a number of figures, I will, with permission, circulate it in the Official Report. As regards the last part of the Question, the Government's economic policy is designed to ensure fairness in the distribution of incomes between the various groups.
Mr. Roberts
Would not my right hon. Friend agree, however, that it is time to speed up redistribution and that we should try to replace the crude and outdated instrument of Income Tax by a system of direct taxation, coupled with higher Surtax and higher death duties—[Interruption.]—allied to considerably increased social welfare benefits, not forgetting the claims in this direction of the lowly paid workers?
Mr. Speaker
Order. We must not have Budget speeches at Question time.
Mr. Callaghan
My hon. Friend has raised a number of interesting topics, but I doubt whether I could encompass a reply within terms which would meet with your approbation, Mr. Speaker.
Sir S. McAdden
Without seeking to introduce a sense of nostalgia to the right hon. Member for Easington (Mr. Shinwell), is it not a fact that rent, interest and profits have always been decried by hon. Gentlemen opposite? While the Government are doing everything possible to abolish profits, when will they do something about rent and interest?
Mr. Shinwell
If the hon. Gentleman——
Mr. Callaghan
I think that the supplementary was directed at me. The proportion of the total gross domestic income devoted to profits and incomes, including rent, declined from 33.4 per cent. in 1960 to 30.5 per cent. 1966.
Mr. Shinwell
Not enough.
Mr. Callaghan
Income from employment increased from 66.6 per cent. to 69.5 per cent.
Mr. Biffen
Would the right hon. Gentleman say whether it is the objective of the Government's prices and incomes policy, in which the C.B.I. has been asked voluntarily to co-operate, that the share taken by wages and [column 277]salaries shall go up while that taken by dividends shall fall?
Mr. Callaghan
That is not related to the Question I am answering and should be addressed to the First Secretary. [Hon. Members: “Answer.” ] The answer, from the point of view of a mixed economy, is that which I gave clearly in my Budget speech, and I do not think that I could improve on the language I used there.
The Mint
9. Sir G. Nabarro
asked the Chancellor of the Exchequer whether he has yet reached a decision on the siting of the new Mint which will produce the 9,000 million coins required for change to decimal currency four years hence; and whether he will make a statement.
Mr. Callaghan
I cannot at present add to the reply given to the hon. Member for Newcastle-upon-Tyne, North (Mr. R.W. Elliott) and my hon. Friend the Member for Newcastle-upon-Tyne, East (Mr. Rhodes) on 7th March. [Vol. 742, c. 235.]
Sir G. Nabarro
When is the Chancellor expecting to make a decision on this matter of massive industrial importance? Would not he agree that it is desirable, first, that new plant should go to the development areas and, secondly, that it should not be fragmented, making the same mistakes that were formerly made with the fragmenting of the large new strip mill, part in Scotland and part in South Wales?
Mr. Callaghan
I take note of the hon. Gentleman's view. As to the period of time, I think that I will be able to stand by the Answer I gave on 7th March, when I said that I hoped to make a statement within two months.
Mr. E. Rowlands
Would the Chancellor give an assurance that if the Mint is moved from London the development areas will be given priority, especially in [column 278]view of the high unemployment rate in South Wales? Will he bear these matters in mind when considering moves of this sort, particularly the unemployment problems of this and similar areas?
Mr. Callaghan
I believe that it would be better for me to make a comprehensive statement at the time when a decision about the future of the Mint is taken.
Sir Knox Cunningham
Would the right hon. Gentleman consider a site in Ulster?
Mr. Campbell
While it is desirable, where practicable, for establishments to be moved from London to the regions, does the right hon. Gentleman recognise that considerably fewer coins would be required if the 10s. system were adopted instead of the Government's present proposal?
Civil Servants
10. Sir J. Langford-Holt
asked the Chancellor of the Exchequer by how many he expects the number of non-industrial civil servants will increase by the end of 1967; and how this will compare numerically and as a percentage with December, 1964.
Mr. MacDermot
The Estimates for 1967–68 provide for an increase of about 7,500. By the end of March 1968 the total increase since December 1964 will be about 4,600 or 11 per cent.—all these figures excluding the Post Office.
Sir J. Langford-Holt
Would the hon. and learned Gentleman bear in mind that it is highly desirable that this percentage is watched extremely carefully? Can he say what level in his view is an acceptable level, in view of the fact that it appears to be getting excessively high?
Mr. MacDermot
I agree that it must be closely watched, and I assure the hon. Gentleman that that is done. The question of the level must depend on the policies and decisions of the Government. If the hon. Gentleman finds these figures surprising, I would remind him that in the last four years of Conservative Administration the number of non-industrial civil servants went up by 33,500.
[column 279]Mr. Macleod
In giving the main Answer the Financial Secretary gave the figure of 4,600. Did not he mean to say 46,000?
Mr. MacDermot
I am sorry. It was indeed a slip of the tongue. [Hon. Members: “Oh.” ] I intended to say 46,000 and thought that I had done so. That is the figure which should be compared with the figure of 33,500.
Mr. William Hamilton
Can my hon. Friend say how many of these people are being used to watch, for example, Bristol Siddeley?
Mr. MacDermot
Not without notice.
Inland Revenue Stencil No. 85
11. Mr. Biffen
asked the Chancellor of the Exchequer whether he will withdraw Inland Revenue Stencil No. 85 issued by Her Majesty's Inspector of Taxes, London Provincial 2 District, requesting details of taxpayers' assets; and if he will make a statement.
22. Mr. Nott
asked the Chancellor of the Exchequer why Inland Revenue Stencil No. 85 was used by Her Majesty's Inspector of Taxes, London Provincial 2 District, since no statutory authority existed for the information sought; and what action has been taken to prevent a re-occurrence of such incidents.
Mr. MacDermot
The stencil in question was withdrawn from use at the beginning of January.
Mr. Biffen
In view of the Government's unhappy tendency to require the public to regard White Papers as though they had the force of law, will not the hon. and learned Gentleman take this occasion to regret that this stencil, requiring submission by taxpayers for which there was no statutory obligation whatever, was ever issued by the Treasury?
Mr. MacDermot
I take this occasion to thank those hon. Members who have drawn my attention to this point. When the matter was last raised at Question Time I said that I would look at it to see whether any further instruction was required. I have done that, and was so satisfied. A circular has been issued to all tax officers making it clear that they should not give the impression that any [column 280]statutory authority exists for demanding these lists.
Mr. Nott
Surely there is some cause for regret, and should someone not be reprimanded in this case, where taxpayers have been asked to list their private possessions without statutory authority? Will the Financial Secretary express his regret in this respect?
Mr. MacDermot
There is no occasion for any apology. Many taxpayers and their advisers will think it a useful practice and will continue to supply the information. Certainly I have every intention of doing so myself.
Mrs. Thatcher
Will Niall Macdermotthe Financial Secretary clarify one of his answers. I understood him to say that he had asked inspectors not to give the impression that any statutory authority exists for the question. Is the question still being asked?
Mr. MacDermot
Only in those cases where there is reason to think that such a list has been prepared—[Hon. Members: “Oh.” ] It is perfectly common practice for accountants to prepare lists of this kind, and very often it is to the mutual convenience of both the taxpayer and the Inland Revenue for the Revenue to have a copy of that list. In those cases, there is nothing improper in asking for it, and inspectors will be authorised to do so. What is being made clear is that there is no suggestion that there is any legal requirement to supply it.
Mr. Barnett
Is my hon. and learned Friend aware that, in practice, this sort of thing has gone on for a very long time, to the mutual convenience of taxpayers and the professional men dealing with their affairs?
Mr. MacDermot
I am obliged to my hon. Friend. Of course, that is right.
Higher Income Groups (Salaries)
12. Mr. John Lee
asked the Chancellor of the Exchequer how many rises have occurred in incomes exceeding £10,000 and between £5,000 and £10,000; how many new occupations have been created with salaries in these two categories since Part IV of the Prices and Incomes Act, 1966 became operative; and how many rises have been prohibited under the provisions of that Act in respect of such categories.
[column 281]43. Mr. Cronin
asked the Chancellor of the Exchequer what increases have occurred in earned incomes exceeding £5,000; how many new appointments have been created in these categories; and how many increases have been prohibited since Part IV of the Prices and Incomes Act, 1966 became operative.
Mr. MacDermot
I regret that this information is not available.
Mr. Lee
Should it not be available? Is it not rather unsatisfactory, and how does my hon. and learned Friend expect us to have a fair incomes policy if we do not know what incomes there are in existence?
Mr. MacDermot
What we are concerned with is the collection of information of this kind as a result of analysing Income Tax returns. I am afraid that to try to extract this kind of information from tax returns would call for a quite disproportionate effort.
Mr. Cronin
Would the Financial Secretary not agree that, apart from the high income groups to which my hon. Friend referred, there has been extensive evasion of the wage freeze by employers and higher-paid workers on specious grounds of promotion or increased responsibility, very much to the detriment of lower-paid workers who are in well-defined categories and cannot get increases?
Mr. MacDermot
I am not aware of such evidence, and I believe that surveys which have been carried out by management consultants indicate that, in the salary sphere, the standstill and severe restraint policy has been fully respected. I think that this has been mainly concerned with salaries between £2,500 and £5,000 a year, but I have no reason to think that the same does not apply to salaries in a higher range than that.
Sir C. Osborne
Have back bench hon. Members who have been promoted to Ministerial positions objected to increases in salary?
Mr. Michael Foot
Is it not the case that under the Chancellor of the Exchequer's Budget proposals relief is given to certain Surtax payers, as compared with the previous situation, which will cost the Exchequer a considerable sum of money? How do the Government [column 282]justify that when they refuse reliefs to members of the population who are in difficult circumstances?
Mr. MacDermot
My hon. Friend is mistaken. There is no relief granted. My right hon. Friend the Chancellor confirmed that a one-year surcharge would be a one-year surcharge.
Privately-Owned Real Property
13. Mr. John Lee
asked the Chancellor of the Exchequer if he will issue a White Paper giving statistics from information available to him from tax returns and other sources of the distribution of privately-owned real property in the United Kingdom.
Mr. MacDermot
The available information is already published in the Annual Reports of the Inland Revenue.
Mr. Lee
Will my hon. and learned Friend arrange for this information to be more conspicuously displayed, because the gross inequality of wealth is one of the many things which hon. Members on this side of the House hope that the Government will put right?
Mr. MacDermot
I regret that there is not a great deal of information of the kind that my hon. Friend seeks. If it will assist him, such information as there is will be found in Tables 165 and 167 of the 109th Report.
Mr. Richard Wainwright
Is the hon. and learned Gentleman aware that the information which has been prepared or is likely to be prepared from this kind of source is bound to be distorted by the absence of information on industrial pension funds and other investments on behalf of wage earners?
Mr. MacDermot
As we are dealing with privately-owned real property, I hardly think so.
Ford Motor Company Limited (Dividend)
14. Mr. Bruce-Gardyne
asked the Chancellor of the Exchequer what representations were made to him about the decision of the Ford Motor Company Limited to pay an increased dividend to its parent company out of reduced profits; and what answer he gave.
[column 283]Mr. MacDermot
The dividend referred to was not subject to the standstill. It was declared and paid in April, 1966.
Mr. Bruce-Gardyne
Will the hon. and learned Gentleman tell the House whether such a dividend increase would have been approved if it had been paid by the company to United Kingdom shareholders?
Mr. MacDermot
The question does not arise. It is purely hypothetical, because this was outside the period of the standstill.
British Troops, Germany (Foreign Exchange Costs)
15. Mr. Bruce-Gardyne
asked the Chancellor of the Exchequer whether it is his intention to agree to the foreign exchange cost of British troops in Germany after the expiry of the current Anglo-German offered agreement being offset in whole or in part by a German commitment to hold medium- or long-dated United Kingdom Government securities in its reserves; and if he will define medium- or long-term borrowing for this purpose.
Mr. Callaghan
No, Sir. The second part of the Question does not arise.
Mr. Bruce-Gardyne
Can the Chancellor of the Exchequer confirm that his recent statement that, in one way or another, the foreign exchange costs of British troops in Germany would be met in full was after all an idle bluff? Can he tell us, further, whether the Government still believe that the offset costs of American troops in the United Kingdom should not be included in this calculation?
Mr. Callaghan
I do not know whether the hon. Gentleman is pleased or disappointed that we have recovered £72 million out of the £82 million. I suspect that it is larger than he thought and that that is the reason for his disappointment. As to the other parts of his supplementary question, the United States, Germany and ourselves have agreed to make statements on the same day. Therefore, I should prefer not to be drawn into details at the moment.
31. Mr. Frank Allaun
asked the Chancellor of the Exchequer what savings in expenditure in foreign exchange are to be [column 284]secured by the withdrawal of British troops from West Germany in the near future; how the balance is to be covered; and if he will make a statement.
Mr. Callaghan
I would refer my hon. Friend to my statement in my Budget Speech. As I explained then, I cannot give further details till the negotiations are complete.—[Vol. 744, c. 981.]
Mr. Allaun
Yes, but why have the Government retreated from their statement last year that they would require the offset to be in full? Is my right hon. Friend aware that bringing home only one brigade out of nine is not good enough and will leave a large deficit?
Mr. Callaghan
As I have already explained, we are covering £72 million out of the £82 million, approximately, by including the redeployment of some troops. This seems to me to be a satisfactory start to our long-term objective.
Mr. John Hynd
In assessing the financial effects of this withdrawal of troops from Germany, has the Chancellor of the Exchequer taken into account the amount of land which will be required in this country for our troop operations, the compensation for damage to that land, and so on?
Mr. Callaghan
Yes; these calculations have been made in assessing budgetary costs, but we are concerned also with balance of payments costs.
Sir T. Beamish
The Chancellor said in his Budget statement that part of the balance would be covered by American arms purchases in this country. Since all American arms purchases are already being offset against the cost of the F111 and other American aircraft, how can this be done?
Mr. Callaghan
I think that the hon. and gallant Gentleman must wait until I make a full statement when the three parties to the agreement have concluded their total negotiations.
European Economic Community
17. Mr. Boyd-Carpenter
asked the Chancellor of the Exchequer what consideration he is giving to bringing the level of direct taxation into line with that ruling in the countries of the European Economic Community, in order to [column 285]facilitate this country's entry into the Community.
Mr. Callaghan
As I said in my Budget statement—[Vol. 744, c. 1002]—preliminary work on these matters is in hand.
Mr. Boyd-Carpenter
If the Government are really serious about an early entry into the Community, ought not work to be very far advanced in modifying a position in which, according to the Financial Secretary, a man with a higher salary in this country keeps only one-third of what his European opposite number keeps?
Mr. Callaghan
It depends what is meant by a “higher salary” . At £5,000 per annum, for example, someone in this country would retain more than his opposite number in West Germany. But perhaps that is not a “higher salary” .
Mr. Shinwell
Do I understand, from what my right hon. Friend said about preliminary arrangements for the reorientation of direct and indirect taxation, that we are to take it that the Government are proposing some day to reduce direct taxation and increase indirect taxation, which will fall heavily on those with low incomes?
Mr. Callaghan
I do not think that that deduction could have been drawn from my Answer. Certainly I should think that the country ought to consider for a very long time before it alters its direct tax arrangements in the way proposed. It seems to me that some right hon. and hon. Gentlemen opposite are less concerned with getting into the Common Market than with getting reduced the tax burdens on their highly paid friends.
Sir T. Beamish
Has the Chancellor made any preparation for the introduction of an added value tax, in accordance with Common Market practice?
Mr. Callaghan
No, Sir. After all, we do not yet know whether we are going into the Common Market, not do we know whether a value added tax will be accepted by Common Market countries. Apart from putting preliminary work in hand to ensure what would be necessary, I think that it would be foolish of me to go further than that.
Mr. J.T. Price
Before my right hon. Friend the Chancellor allows himself to [column 286]be drawn into detailed arguments about adjustments in direct taxation to harmonise with the practice on the Continent, will he bear in mind that in E.E.C. countries indirect taxation is a much higher imposition on ordinary working people than in this country? The sales tax and things like that are a fundamental distinction, as against the practice in this country. I hope that he will not be led astray by people on the other side of the House who do not want to get into the Common Market as much as they want to get out of their tax obligations?
Mr. Callaghan
My hon. Friend seems to be repeating my previous answer. I am very ready to get into a discussion on this. I am not ready to see the substantial transfer of burdens from the wealthiest in this country on to the backs of others under the pretext of getting into the Common Market.
26. Mr. Allason
asked the Chancellor of the Exchequer what was the revenue from tariffs on imports from European Economic Community countries for 12 months to the latest convenient date.
Mr. MacDermot
Protective duty receipts are not identified by country of origin of the goods concerned and I cannot give a precise figure; but for 1966 it was of the order of £70 million.
Mr. Allason
Is it not rather important to ascertain this figure, since presumably this will be a direct loss to the Exchequer in the event of our joining the Common Market? Is it not likely that this will be a very much larger figure as the country of origin of imports will tend to switch from other countries to European countries?
Mr. MacDermot
I do not think that follows. It is one of the factors which will have to be taken into account, but there will be other offsets, including direct revenue ones, such as the additional tariffs on imports from other countries.
Land Sale Valuations
18. Mr. Boyd-Carpenter
asked the Chancellor of the Exchequer whether he has now considered the representations sent to him by the right hon. Member for Kingston-upon-Thames in respect of a practice adopted by certain valuation officers in the Midlands in respect of cases involving sale of land prior to 6th April, [column 287]1967; whether this practice had his approval; and what steps he is taking to compensate persons subjected as the result of this practice to partial payment of an impost not in force at the material time
Mr. MacDermot
Yes, Sir. My right hon. Friend wrote to the right hon. Member on 23rd March. I cannot accept that valuation officers have adopted the practice he describes and the question of compensation does not arise.
Mr. Boyd-Carpenter
I thank the hon. and learned Gentleman for his right hon. Friend's long, involved and rather entertaining letter. If I submit evidence to support this contention, in respect at any rate of one district valuer, will he take the necessary steps to have the decision reversed?
Mr. MacDermot
Yes, Sir.
Inland Revenue (District Valuers)
19. Mr. Brewis
asked the Chancellor of the Exchequer what is the establishment strength of Inland Revenue district valuers; and how far the number employed is below strength at present.
Mr. MacDermot
2,304 valuers were in post on 3rd April. There is no fixed complement.
Mr. Brewis
How many extra district valuers does the hon. and learned Gentleman think will become necessary as a result of Measures of the last two years like the Land Commission Act and Capital Gains Tax?
Mr. MacDermot
It is impossible to estimate the number until we know the weight of work which will arise from the Land Commission, but obviously an increase will be required and vigorous steps are being taken to recruit and train more valuers.
Mrs. Thatcher
Do the “vigorous steps” include the offering of higher salaries?
Mr. MacDermot
No, but they do include direct recruit to the main grade of more experienced qualified people.
Government Contracts
(Aircraft Industry)
20. Mr. William Hamilton
asked the Chancellor of the Exchequer what steps he intends to take to ensure that in all [column 288]contracts with the aircraft industry, Her Majesty's Government shall have access to the firms' accounts, both during and after any contract.
42. Mr. Cronin
asked the Chancellor of the Exchequer what is his policy with regard to obtaining access to contractors' accounts for Her Majesty's Government, both during and after any aviation contract.
Mr. Callaghan
It is the Government's intention to obtain the right to equality of information with the contractor when prices are being negotiated; and post-costing rights where these would be of material help in fixing fair and reasonable prices and in checking that the price-fixing system as a whole is working satisfactorily. Discussion is going on with industry on both points.
Mr. Hamilton
Can my right hon. Friend say how far the C.B.I. has come along to agree with his view and how soon he expects to make a decision on the matter, or is he waiting until the Public Accounts Committee and the independent inquiry report on the matter?
Mr. Callaghan
I hope that negotiations with the C.B.I. will be concluded successfully very shortly, but they are still going on and I cannot say more about the C.B.I.'s views at this stage.
Mr. Cronin
Will my right hon. Friend give some attention to the system of the Department of Defence, United States, which gives very effective incentives towards increased efficiency as well as safeguards against rascality?
Mr. Callaghan
Yes, Sir. I believe there is a close integration of exchange of information on these matters, but perhaps my hon. Friend will question the Secretary of State for Defence on this particular issue.
Mr. R. Carr
Will the Chancellor assure us that he accepts that equality of information, although extremely important, is but one of three links in this problem, the other two being calculations of overheads and profit formula, as was made clear in the Lang Report? Will he make clear that all three will be dealt with? Will he also give proper attention to developing good contracting procedures?
[column 289]Mr. Callaghan
While I am in favour of the last part of that supplementary question, I am not ready to relate to an agreement all post-costing rights to a revision of the profit formula. That is a separate issue which can be raised by industry at any time and discussed with the Government, but this information should be conceded in any case.
Mr. Lubbock
Is not one of the recommendations of the Lang Report that equality of information should be obtained by the Government? Why has it taken the Chancellor and his colleagues two years to get round to deciding on this matter in principle?
Mr. Callaghan
I think that is a fair question, and maybe we should have been more ruthless with industry than we have been. If we should have been, I acknowledge our defect in this respect, but we have tried to get their co-operation, and I trust that now we are going to get it.
Mr. Ellis
Will my right hon. Friend be ruthless now? Under the Ministry of Supply Act, 1939, he has power to ask for any books and papers to be made available, and then he has only to ask for a Ministerial Order. Will he make clear to the C.B.I. that he will use that power? Will he use it now?
Mr. Callaghan
This may have to be considered in suitable cases. The power is there if we cannot reach a satisfactory agreement with industry, but it is the job of the Government to work with industry if we can. I would therefore prefer to reach agreement than to use these powers. If it was impossible to get agreement with industry and I thought it necessary in the public interest to use these powers, of course they would be used.
Mr. R. Carr
Will the Chancellor answer my previous question about the calculation of overheads? When he speaks about being ruthless with industry, will he acknowledge that so far as this question was concerned it was February, 1966, before the Government began to get down to the job at all?
Mr. Callaghan
I do not think the hon. Member is right about the date, but if he wishes to have a debate on it I should be very happy indeed to do [column 290]so. As regards overheads, this might be looked at too. At the moment the Chief Secretary to the Treasury is having negotiations on my behalf. I am concerned to see that public access to information is made available. I stand on that and the other questions can be looked at at any time.
Central and Local Government Expenditure
21. Mr. Ridley
asked the Chancellor of the Exchequer what is the estimate of central and local government expenditure, excluding debt interest, but including net lending to public corporations, for 1967–68.
Mr. Callaghan
£14,893 million.
Mr. Ridley
Is the Chancellor aware that, even if he gets his 3 per cent. increase in growth this year, this will represent the highest proportion of our national product being taken by the central and local government in all our history? Is this the reason why his party's policies seem to be failing? Will he reverse this trend?
Mr. Callaghan
One day I hope to educate the hon. Member into seeing that public spending is not bad and private spending is not necessarily good. It depends on what it is spent on. That is what matters.
27. Sir J. Langford-Holt
asked the Chancellor of the Exchequer what estimate he has made of the effect which the steady rise in the expenditure of central and local governments will have on inflationary pressure in the economy.
Mr. Callaghan
I would refer the hon. Gentleman to my Budget statement.—[Vol. 744, c. 990.]
Sir J. Langford-Holt
Would the Chancellor agree that it is not a question of private expenditure being bad and Government expenditure being good, but that this increase is taking place in a sphere which by its very nature does not contribute in a major way towards exports, which is his main problem?
Mr. Callaghan
I think that is a fair point. That is why I am very anxious to see private investment grow, because it is in that sector—private investment is [column 291]about 27 per cent. of the total—that increased exports would come. I certainly accept that point.
Mr. Patrick Jenkin
If the Chancellor intends, as he said in his Budget Statement, to make room for the expected increase in private investment expenditure, what Government expenditure will he—to use his own words—rein back in order to make this improvement?
Mr. Callaghan
I do not want to continue last night's Budget debate now.
Personal Incomes
23. Mr. Dickens
asked the Chancellor of the Exchequer if he will state the percentage of total personal income distributed as wages and salaries, mixed income and property in 1966.
Mr. MacDermot
As the reply contains a table of figures, I will, with permission, circulate it in the Official Report.
Mr. Dickens
Can my hon. and learned Friend confirm that social inequality is in fact on the increase in this country, and has been so for the past decade or more? Is he aware that many hon. Members on this side of the House want to see the trend reversed in the course of the lifetime of this Parliament?
Mr. MacDermot
I can assure my hon. Friend that it has been reversed. I refer him to figures which I gave in the Budget debate. Compared with the previous year, in 1966, National Insurance benefits went up by 8½ per cent., wages and salaries by 6 per cent., income of self-employed was unchanged, while rents, dividends and interest went up by 2½ per cent.
Mr. Higgins
What percentage went to members of unions covered by the T.U.C.?
Mr. MacDermot
I am sure the hon. Member does not think that I have that figure in my head.
Following is the information:
The percentages of total personal income in 1966 attributable to each of the main types of income are shown in the table below. The table also shows the corresponding percentages for 1965, which have been revised since they were given in reply to a similar question by my hon. Friend on 17th May, 1966.
Following are the figures:
The percentages of total personal income in 1966 attributable to each of the main types of income are shown in the table below. The table also shows the corresponding percentages for 1965, which have been revised since they were given in reply to a similar question by my hon. Friend on 17th May, 1966.
[column 292]Overseas Travel (Foreign Currency Allowance)
24. Sir G. Nabarro
asked the Chancellor of the Exchequer what saving in foreign exchange during the year ended 5th April, 1967, resulted from the £50 foreign currency limit applied to British people travelling abroad outside the sterling area; and what reduction in overseas travel by Britons outside the sterling area resulted therefrom; and whether he will restore the £250 limit on 1st June, 1967, or earlier.
Mr. Callaghan
Travel statistics for the year mentioned are not yet available. The answer to the last part of the hon. Gentleman's Question is “No, Sir” .
Sir G. Nabarro
If these figures are not available, how did the Chancellor arrive at the conclusion in his Budget statement that the time was not propitious to be a little more liberal in allowances for British travellers outside the sterling area? Is he not aware that British travellers are now reduced to a humiliating position in Europe by his derisory allowances? Would he not be a little more liberal with a small “1” ?
Mr. Callaghan
A number of reasons enabled me to reach the conclusion I have reached, for example, the applications for additional allowances which are being reduced—I hope the hon. Member has not suffered—as well as the efforts by the travel trade to arrange cheaper holidays. All these have contributed to a useful saving. In present circumstances, when I am still working for a balance of payments surplus this year, I do not think it would be right that other countries should believe that we can let up [column 293]on a matter of this sort, when anybody can get a reasonable holiday abroad within the existing allowance.
Sir G. Nabarro
In view of the very unsatisfactory Answer from the Chancellor, I give notice that I shall raise the matter again at the earliest opportunity.
International Monetary Fund (Drawings)
25. Mr. Dickens
asked the Chancellor of the Exchequer if he intends to ask for an extension of the repayment period of United Kingdom borrowings from the International Monetary Fund.
Mr. Callaghan
As I said in my Budget speech, the first drawing will be paid by the due date. On present prospects, I have no reason to believe that we shall not be able to repay the second drawing also on the due dates.—[Vol. 744, c. 976–7.]
Mr. Dickens
Would not the Chancellor agree that the first task must be to get the bankers off our backs in order that we can resume economic expansion in this country and fulfil our election pledges? Will he not now consider making these payments this year by liquidating portfolio investments?
Mr. Callaghan
There is an arrangement now in which those who sell foreign securities pay a proportion of the foreign exchange into the Exchequer. That is producing a very useful income at present. I do not propose to carry it further than that now.
Mr. Stratton Mills
Does not the Chancellor find it intensely embarrassing when so many of his hon. Friends advocate devaluation and welshing on financial commitments?
Mr. Callaghan
I find that no more embarrassing than having to explain the policy of the hon. Gentlemen from Northern Ireland.
Fruit Machines
28. Mr. Ellis
asked the Chancellor of the Exchequer if he will seek power to place meters on one-armed bandits which would record the amount inserted and the return payments to the users, in order that the actual profits accruing to the [column 294]owners of such machines could be taxed accordingly.
Mr. MacDermot
No, Sir.
Mr. Ellis
Does not my hon. and learned Friend agree that it is time that we knew something about what was happening in this field? There are widely fluctuating reports of the amount of profit, ranging from single £s to many hundreds of £s per week from these machines. We should know what is going on as regards the operation of these machines.
Mr. MacDermot
My hon. Friend's proposal would be very expensive both in terms of equipment and of manpower, and I doubt whether it would work very satisfactorily.
Tax Form C.T.62
29. Sir H. Lucas-Tooth
asked the Chancellor of the Exchequer by what authority income tax form C.T.62 is issued; and whether he is aware that this and other forms are throwing a burden on companies, which interferes with their task of increasing production.
Mr. MacDermot
The form is issued by the Board of Inland Revenue under its general responsibility for the care and management of the Income Tax. The use of this form will help both the Department and companies to review their end year liability.
Sir H. Lucas-Tooth
Is the hon. and learned Gentleman aware that this form has every appearance of being a form required by Statute and that in the case of many companies, small companies in particular, the filling in of the form is throwing a very heavy burden on the available manpower?
Mr. MacDermot
I have looked at the form. I see nothing on it to bear out the hon. Gentleman's suggestion. As regards the burden on companies, I think that all that many companies, if not most companies, will be required to do will be in effect to answer the two simple questions in section one of the form.
Death Duties
30. Mr. Bryant Godman Irvine
asked the Chancellor of the Exchequer what percentage of the total revenue is obtained by taxes on inheritance.
[column 295]Mr. MacDermot
Death duties produced 3⅓ per cent. of total tax revenue in 1966–67.
Mr. Irvine
The Chancellor only last week was congratulating those who were capable of saving. Would not the hon. and learned Gentleman agree that one of the most important reasons for saving is to provide for one's widow? In those circumstances, should not the Chancellor at least have another look at this particular question?
Mr. MacDermot
I have no doubt that my right hon. Friend will pay attention to what the hon. Gentleman has said. There are provisions within the existing Estate Duty law to relieve the burden on widows.
