PRIME MINISTER
(ENGAGEMENTS)
Q1. Mr. Nicholas Winterton
asked the Prime Minister if he will list his official engagements for 19th January 1978.
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 further meetings with ministerial colleagues and others.
Mr. Winterton
I am grateful to the Prime Minister for that reply. Will he, as Leader and major spokesman of the present Government, indicate whether his Government are still determined later this year to return to free collective bargaining?
The Prime Minister
I shall not be discussing that among my official engagements today.
Mr. Gould
Has my right hon. Friend seen today's reports that the EEC Commission believes that the temporary employment subsidy is contrary to the Treaty of Rome? Does he accept that that subsidy is far and away the most valuable and effective measure to protect jobs introduced by the Government? Will he give an assurance that they will resist that interference?
The Prime Minister
That was not on the agenda, but it was in this morning's newspapers, so I prepared for the supplementary question. I was very pleased to see that the Commissioner said that he wanted an amicable and constructive solution to this problem. So do I. We want one that will enable us to keep in jobs those whom the temporary employment subsidy is helping. That is what we shall insist on.
Mrs. Thatcher
Will James Callaghanthe Prime Minister answer the question of my hon. Friend the Member for Macclesfield (Mr. Winterton)? The Prime Minister will be aware that he has made a large number of pronouncements about free collective bargaining. In February he said that free collective bargaining meant free collec[column 656]tive chaos. In July he said that we had returned to free collective bargaining. He then said that we had 10 per cent. annual wage increases plus blacklisting. Now he seems to be working towards 5 per cent. wage increases plus blacklisting. Is he not really saying to the trade unions that as long as he is Prime Minister there will be no return to the traditional rôle of free collective bargaining?
The Prime Minister
I am very grateful to the right hon. Lady for her careful study of my remarks. I hope that she will continue it. As regards the position of collective bargaining, I am also very happy to see the Conservative Party espousing this cause—[Hon. Members: “Does the right hon. Gentleman?” ]—which is, of course, in marked contrast to some of the statements that appeared in “The Right Approach” when it was published last year. But I shall not linger on that.
If the right hon. Lady wishes to peruse my statements on this and all the texts, I hope that she will also remember that I said that free collective bargaining was a very poor weapon—or words to that effect—for securing justice. But I said that up to that moment—perhaps she will remember this as she goes on with the quotations—no one had suggested a better system, and I did not know one.
Mrs. Thatcher
The Prime Minister will recollect that he said that free collective bargaining was a test of the wisdom of democracy. Therefore, is free collective bargaining his policy or not?
The Prime Minister
I think that it is a test of the wisdom of democracy. That is why I constantly seek to persuade—[Interruption.] The Opposition are really fairly irrelevant in this debate. I constantly try to persuade and convince trade unionists, with a fair degree of success, that moderate wage claims based on productivity are more likely to produce a real improvement in the standard of life than are exaggerated and runaway wage claims. If the right hon. Lady disagrees with that, perhaps she will say so.
Mr. Atkinson
I appreciate that the Prime Minister would not normally fix an official meeting with the Leader of the Opposition, but will he say whether she has indicated to him her views about the Conservative-controlled local authorities [column 657]throughout the country, particularly the GLC and those in the Greater London area, which have now declared their intention to bring about a drastic reduction in the number of people employed by local authorities? This could have a serious effect on employment levels in the public sector. If the Leader of the Opposition has not indicated whether she agrees with such a policy throughout the country, will my right hon. Friend tell her that the Government will do everything possible to resist this butchering of local authority staffs?
The Prime Minister
No, Sir, I have not received any approach from the right hon. Lady, but I should be happy to have conversations with her at any time. The staffing arrangements of local authorities are a matter for them and must remain a matter for them. But I hope that staffs will be maintained at a level which will provide the essential infrastructure of our social and other public services.
FRANCE
(PRIME MINISTER)
Q2. Mr. Marten
asked the Prime Minister when he will next be having a meeting with the French Prime Minister.
The Prime Minister
The hon. Gentleman may recall that he put the same Question on the Order Paper for answer last Tuesday. I gave him a reply then, and the answer is still the same.
Mr. Marten
Nevertheless, may I take this opportunity of asking the Prime Minister to confirm whether direct elections have been postponed, very sensibly, until next year? If that is so, could he consult the French Prime Minister and others on the proposition that direct elections should not take place until Spain, Portugal and Greece have joined the Common Market?
The Prime Minister
I assume that the last part is the equivalent of postponing them till the Greek kalends. No date has yet been finally fixed for the direct elections. It will depend upon the progress of legislation in the various countries.
Mr. Noble
When my right hon. Friend meets the French Prime Minister, will he explain to him and to any other Prime Ministers from the Common Market countries that an amicable solution to the [column 658]problem of the temporary employment subsidy will be found only when the jobs of workers in the North-West are secured either by this subsidy or by an alternative which is acceptable not only to all of us on this side of the House but also to the Labour movement in the North-West?
The Prime Minister
At the moment, 186,000 jobs are being supported by the temporary employment subsidy. As the Treaty of Rome was drawn up at a time when the world was expecting the market economy to dominate and growth to continue, it only goes to show, in my view, one of the weaknesses of having written constitutions of this sort, because the conditions now are entirely different. Of course, this must be pointed out to anybody who would ask the British Government—nobody has yet done so and I assume that nobody will, because if he does he will get a pretty serious rebuff—to put 186,000 people on the dole.
Mr. Maurice Macmillan
Will the Prime Minister seek to discuss with the French Prime Minister and, indeed, with other European leaders as soon as possible the situation in the Horn of Africa and see what European countries can do to provide such support as they can, including the supply of arms, to those who are defending themselves against Soviet imperialism in Africa, which constitutes a threat to the United Kingdom and to the whole of Europe?
The Prime Minister
There were very full exchanges on this matter yesterday in the House between the Foreign Secretary and a number of hon. Members. I have nothing to add on the rather complex issue to which my right hon. Friend gave answers then.
TUC AND CBI
Q3. Mr. Skinner
asked the Prime Minister what recent meetings he has had with the TUC and CBI; and if he will make a statement.
The Prime Minister
I refer my hon. Friend to the reply which I gave to my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley) on 10th November.
Mr. Skinner
Has my right hon. Friend seen the remarks made yesterday by the [column 659]friend of the CBI, the Governor of the Bank of England, when he talked about the bailing out of the secondary and third-rate banks and the multi-million pound cost that ensued, some of it for the British taxpayer? Why can these so-called entrepreneurs take risks in a so-called private enterprise system and then, when they run into trouble, be bailed out by the Bank of England and the taxpayer? Can we be assured that these albatrosses will not be allowed to spread their wings in the future and that we can manage quite well without them?
The Prime Minister
The actions that the Bank of England took at that time were, as the Governor of the Bank of England put to the Select Committee yesterday—I do not know how far I am in order in referring to proceedings of that sort—taken in the interests of preventing a collapse throughout the monetary and financial system, which would have had grave dangers for the employment of millions of people.
Mr. Skinner
I do not believe that.
The Prime Minister
My hon. Friend may not believe it, but that is the view of the Governor of the Bank of England and I accept that view. We have seen what can happen when currencies gyrate wildly. As to whether losses are incurred, I have inquired about this and I know that my hon. Friend will be happy to hear that so far the losses incurred are being more than made up by the interest payments that the Bank of England is now receiving in respect of some of the institutions that were taken over. So—who knows?—the Bank may even make a profit out of the matter. I do not know. I am told that it will take some years for this to work itself out. We shall have to see at the end of the day.
I would say one other thing, if my hon. Friend will allow me. He refers to the Governor of the Bank of England as being the friend of the CBI. The Governor of the Bank of England is a public servant who works very closely with all Governments, including this Government.
Mr. Molyneaux
Are the Prime Minister and his right hon. Friends aware of the importance of GEC's maintaining the level of activity at its Larne factory in the interval before work commences [column 660]on the new Hong Kong contract announced today?
The Prime Minister
Yes, Sir. I am very happy indeed that we have secured this contract with the Hong Kong Gas and Light Company. Securing this order was due to excellent co-operation between industry in this country and the Department of Industry. The order will be of great benefit not only to Larne but to many workers in other parts of the country.
Mr. Henderson
When the Prime Minister meets the leaders of the CBI, will he make it clear that he will view with disfavour any attempt to flood Scotland with money during the forthcoming referendum in order to make reality of their reactionary views? Will he remind them that in this day and age the Scots will not be bought and sold for English gold?
The Prime Minister
I shall, of course, take any suitable opportunity of conveying those views to any appropriate authority, but perhaps the hon. Gentleman might care to do it himself.
Mr. Buchan
While we are having a question and answer session, may I also take this opportunity to thank my right hon. Friend for the work that has been done by his own departments in relation to the jobs that have come through the Hong Kong order? In my area, a very troubled area, this will give security to 300 to 400 workers for the next three years.
The Prime Minister
I am much obliged. I can only repeat that this was an operation that started last March and has been very successful. It has shown that our power plant industries can compete in the world and are able to make a very good bid for a project which could have widespread repercussions, including repercussions on trading relations with China.
Mr. Adley
The Prime Minister tried to dodge the question about free collective bargaining on Question No. Q1 on the basis that it was not relevant. Does he agree that the question is extremely relevant to his discussions with the TUC and CBI, and will he finish Question Time by answering the question which he has so far refused to answer—namely, is it his [column 661]Government's policy to return to free collective bargaining at the earliest opportunity?
The Prime Minister
There is free collective bargaining now.
Mr. Ashley
On the general question of talks with the TUC, does my right hon. Friend support or reject the public speeches of Ministers who have said that a voluntary pay policy is vital? Has not the time come when every Minister should be advocating a voluntary pay policy?
The Prime Minister
I am not aware that anybody is not advocating a voluntary pay policy or, indeed, free collective bargaining, or something between the two, which, I gather, was rather the position taken up by “The Right Approach” until modified by the right hon. Lady's speeches in Scotland. “The Right Approach” indicates that the Government must take a view, as I remember it—and it has very distinguished authors—on the level of wages in any year and that level cannot remain secret from those who are concerned with bargaining. Therefore, “The Right Approach” wisely concluded that the Government would be drawn into these issues. I do not know whether the right hon. Lady will ever have any more than a theoretical experience of this, but I am bound to tell her that “The Right Approach” is right.