D O C U M E N T IS T H E
P R O P E R T Y OF H E R B R I T A N N I C M A J E S T Y ' S G O V E R N M E N T )
C(66) 122
C O P Y N O.
67,
27th July, 1966
CABINET
PRICES AND INCOMES STANDSTILL,
M e m o r a n d u m by the F i r s t S e c r e t a r y of State and
S e c r e t a r y of State f o r E c o n o m i c A f f a i r s
I c i r c u l a t e f o r consideration by the Cabinet on 28th July
(a)
A r e v i s e d White P a p e r .
( b )
A note on the new clauses which it is proposed to
add to the P r i c e s and I n c o m e s B i l l .
G. B.
I
Department of E c o n o m i c A f f a i r s , S. W. 1. 27th July, 1966 DRAFT WHITE PAPER
PRICES AND
I.
.1.
In a statement
1966
the Prime
INCOM^^AMDSTILL
INTRODUCTION
i n t h e House
Minister
*f
drew a t t e n t i o n
money i n c o m e s h a v e b e e n i n c r e a s i n g
than &ould b e
for
justified
a standstill
by
on p r i c k s
way i n w h i c h i t
is
applied are
out i n t h e
2.
set
i n which p r o d u c t i v i t y
increases
in
is
can b e r e g a r d e d ,
to
for
the
paragraphs
Details
standstill
of
should be
below,
space
of
altogether.
a standstill
The f i r s t
severe
i n c o m e s may be
so f a r
half
restraint
justified,
reasons which
will
i n the f i r s t
convenience,
incomes w i l l
restraint
faster
the
secure
prices
compelling
far
and i n c o m e s .
twelve
can c a t c h up w i t h t h e
1966)
of
a rate
that
called
a breathing
o f December,
a period
t o the f a c t
months
excessive
incomes which have b e e n t a k i n g p l a c e .
broad i n t e n t i o n
or i n
at
20th J u l y
i n c r e a s i n g p r o d u c t i o n and
proposed that
The c o u n t r y n e e d s
Commons on
of
and
i n which i n c r e a s e s
as p o s s i b l e
will
be
where
justify
incomes.
there
are
them, but
who a r e
(which
t o the
end
in
avoided
be r e g a r d e d
i n w h i c h some i n c r e a s e s
be needed by a l l
determining p r i c e s
s i x months
as t h e p e r i o d
1967
The
as
in
particularly
exceptional
concerned
with
II.
1.
The i n t r o d u c t i o n
charges u n t i l
period
all
of
the
severe
of
a general
end o f
1966,
restraint,
standstill
on p r i c e s
t o he f o l l o w e d b y a
is
intended to
apply
effort
to absorb
stances
2,
extent
enterprises w i l l
increases
i n which t h e s e
This
standstill
that
because
whole
All
to p r i c e s
of
(i)
the c o s t
( i i )
costs
costs
of
(e.g.
subject
or
which
other
every
circum­
charges
to
the
may be
limited
necessary
c a n n o t be a b s o r b e d
in
materials;
in supply
for
reasons; a c t i o n by t h e Government,
such
taxation.
an e n t e r p r i s e
in price
where
may f e e l
it
finds
c o s t s over which i t
manufacturers
of bought-in components.)
economic n e e d s ,
compelled
it
cannot
exercise
a
full
high
Any such c a s e s w i l l
scrutiny
including
to
impracticable
whose p r o d u c t s i n c l u d e
t o t h e most r i g o r o u s
national
apply except
from changes
or
due t o
absorb i n c r e a s e d
proportion
the
imported
arising
an i n c r e a s e
control
whatever
in prices
I n some i n s t a n c e s
propose
in c o s t s ,
public
arise.
as i n c r e a s e d
3-
t o make
of
in
seasonal
(iii)
expected
marked i n c r e a s e s ,
or i n p a r t ,
or
be
period w i l l
increases
and
six-months'
g o o d s and s e r v i c e s w h e t h e r p r o v i d e d b y p r i v a t e
enterprise.
to
PRICES
in
the l i g h t
the requirements
be
of
of
export
trade.
The c r i t e r i a
for
price
the whole p e r i o d
are
thus much more
k-
out
Part
out
in
I,
the White Paper
paragraph 9 ) .
i n the White
Paper
increases
on P r i c e s
stringent
throughout
than t h o s e
and I n c o m e s P o l i c y
The c r i t e r i a
(ibid,
appropriate
for
price
(Cmnd.2639,
reductions
paragraph 10) w i l l
set
still
set
apply.
Type o f P r i c e
5.
Covered
Although, t h e paragraphs above r e l a t e
manufacturers'
prices
considerations
apply to p r i c e s
retailers,
for
possible
by i n c r e a s i n g
efficiency
increases
t h e home m a r k e t ,
who a r e e x p e c t e d ,
do e v e r y t h i n g
in their
to
cash
6.
the
to
same
general
charged by w h o l e s a l e r s
arid
i n common w i t h m a n u f a c t u r e r s ,
a v o i d any i n c r e a s e s
and,
in particular
in their
to
prices
by a v o i d i n g
any
margins.
E a r l y W a r n i n g Arrange^ment^s
Severe
primarily
or t h e
Per^ds^pX^
Restraint
The e a r l y
continue.
warning arrangements at
* But
t h e Government
should be e x t e n d e d t o
cover
consulting
and o t h e r
the C . B . I .
present
considers
a wider f i e l d
it
of
interested
in force
are
essential
to
that
i t e m s and w i l l
organisations
they
be
about
this.
7.
The s t a n d s t i l l
is
to apply
s e r v i c e s w i t h i n and o u t s i d e
Any m a n u f a c t u r i n g
exceptions
is
out
enterprise,
present
other
in proposing a price
in paragraphs
2 and 3 a b o v e
Government D e p a r t m e n t .
in price without
8.
the
It
receiving
no f u r t h e r
notification
( a )
in respect
items
will
of
listed
i s not
on t h e
be e x p e c t e d
to
on t h e
increase
and
scheme.
the
that
grounds
the
confirmation
it
set
appropriate
make no
from
is
the
increase
Govern­
required.
required:­
increases
in prices
in Part B of
2808 w h i c h w i l l
goods
which c o n s i d e r s
increase
written
to
e a r l y warning
should n o t i f y
standstill
Prior
however,
t h a n one t o w h i c h
i n paragraph 8 below apply,
justified
ment t h a t
equally,
continue
watch b y the M i n i s t r y
and F o o d i n a c c o r d a n c e
of
the
the Appendix
of
t o be k e p t under
of A g r i c u l t u r e ,
with the
terms
food
Cmnd.
constant
Fisheries
of
/paragraph
* W h i t e P a p e r on P r i c e s and I n c o m e s P o l i c y :
An " E a r l y W a r n i n g S y s t e m " (Cmnd. 2 8 0 8 )
paragraph 5 of
(b)
from
Cmnd.
enterprises
2808.
which a r e
warning arrangements
not
included
and w h i c h e m p l o y
i n the
less
early­
than
$00?
workers.
R e f e r e n c e g , jbo,,th.e W a t i o n a l
9.
The Government
during
the p e r i o d s
appropriate
for
will
of
cases to
Board.,..for,JPrices,and.Jhicomes
refer
standstill
as soon as p o s s i b l e .
expected to
defer
and i n t h e l i g h t
expected to
end o f
the
of
continue
the t w e l v e
for
price
increases
and s e v e r e r e s t r a i n t
the N a t i o n a l Board f o r
e x a m i n a t i o n and r e p o r t .
report
proposals
Prices
in
and
Incomes
The B o a r d w i l l b e r e q u i r e d
The e n t e r p r i s e
increase
until
the Board's
months.
SECRET concerned w i l l
the Board has
reported,
recommendations w i l l
t o h o l d the p r i c e
to
be
unchanged u n t i l
the
be
Rents
10.
The l e v e l
whole
of
within
of
rents
the p r i v a t e
the
housing
statutory
Government w i l l
under c l o s e
^Local
sector
framework
of
is
for
already
of
authority
on t e n a n t s ,
local
rents
If
are
already
increased
authority
- in a single
imposition
of
steps
as
Where i n c r e a s e s
costs
of
public
the
private
housing
are not
local
will
e.g.
New
of
from
also
a charge
two - r e n t
the
to take
and
the
end o f
1966
such
rent
increases.
t h e Government hope
make p r o v i s i o n f o r
making
inappropriate.
until
to prevent
means t h r o u g h r e n t
authorities,
the
would be
authorities
apply to rents
are
met
circumstances
standstill
are p o s s i b l e
limited
considerations
these
are u n a v o i d a b l e ,
authorities
tenants
In
standstill
the p r i c e s
the Government e x p e c t
local
determined
on a n o n - p r o f i t
tenants paying
payment.
a general
In the period, of
practical
the
watch.
t h e y must be r e c o u p e d f r o m r a t e s w h i c h
rates
virtually
the Rent A c t s , but
k e e p the movement o f r e n t s
and s u b s i d i s e d b a s i s .
rents
charged by landlords
that
the p r o t e c t i o n
rebate
schemes.
houses p r o v i d e d by
of
Similar
other
T o w n s 7 7 "
Raters
11.
Local
enter
rates
into
the whole
the c o s t
range
p r o v i d e d by
urged
/ 1 2 .
of
all
rents
of
effect
of
living,
services
to
taxation,
and a r e n e c e s s a r y
the
authority.
proper
although they
residents
Local
economies
in
of
for
a standstill
t h e Government
business premises
on p r i c e s
the
standstill
less
than t o
should take
of
are
goods
and o f
them f u l l y
of
into
to
apply
goods
to
area
have been
of
goods
in
all
and
the
l a n d have
The p r i n c i p l e s
such r e n t s
and s e r v i c e s
account
finance
Land
increases
agricultural
and s e r v i c e s , ,
expected
the p r i c e s
that
the
also
expenditure.
on t h e p r i c e s
recognise
to
authorities
B u s i n e s s , j g r e K i i s e s and o f A g r i c u l t u r a l
In c a l l i n g
services,
a form of
the l o c a l
to ensure
Rents of
are
and
an
of
no
landlords
J
/PrLce^s
/T3.
The p r i c e s
in almost
seller,
all
rates
individual
or by auction,,
Mortgages,
apply
to
such
made f o r
arrangements
and i t
would be
however,
the P r i c e s
charges
under
to
examination
and H i r e
the
loan
the National
It
therefore,
does
and
not
Purchase
of
money u n d e r
the g e n e r a l
inappropriate
to them.
determined
transactions^/
reflect
the s t a n d s t i l l
are
n e g o t i a t i o n between buyer
The s t a n d s t i l l ,
Bank O v e r d r a f t s
The c h a r g e s
similar
h o u s e s , b o t h new a n d e x i s t i n g ,
cases by
appropriately
/Th..
of
will
be
level
to apply
open t o
a n d Incomes B i l l
Board f o r
and r e p o r t b u t w i t h o u t
Prices
these
of
and
interest
the p r i n c i p l e s
the
to
Government,
refer
any
and I n c o m e s
imposition
of
of
a
such
for
standstill^/
III.
1.
As e x p l a i n e d
that
there
up t o
in para. 2 i t
is
t h e G-overnment' s
should be a s t a n d s t i l l
t h e end o f
severe
INCOMES
on a l l
forms
of
intention
income
1966, f o l l o w e d by a s i x - m o n t h p e r i o d
of
restraint,
-IffJjlox^ij^JL J- n c o me s
2.
The s t a n d s t i l l
is
pay and t o r e d u c t i o n s
that
the
standstill
conditions
to
3.
of
effect
it
for
for
A.
of
to cover
or o f
which a g i v e n l e v e l
It
regarded
includes
as a p p l y i n g
in addition
in the nature
other
likely
definition.
the
is
of
of
piece
pay,
pay,
rates
rates,
standstill
On
rates
of
etc.
s h o u l d be
specific
incurred,
e.g.
i n pay r e s u l t i n g d i r e c t l y
increased
output,
e.g.
on s a l e s ,
over-time,
compen­
travel
allowances,
Increases
piece-work
profit-sharing
SECRET from
earnings,
any n e c e s s a r y
increases
schemes^
a
work
payable.
to basic
the
for
to:­
and s u b s i s t e n c e
/""in
are
requires
r e d u c i n g t h e amount
expenditure
commissions
to
remuneration payable
i n payments made i n
sation for
proposed
arrangements which have
the
intended that
( i ) I n c r e a s e s
( i i )
itself
and w e e k - e n d w o r k i n g ,
is not
as t h e s e
of remuneration
allowances which are
overtime
i s not
in
costs.
in pay"
increasing
of work
"pay"
increases
It
i n so f a r
to labour
intended
either
this hasis
*f
except
"increases
is
g i v e n amount
in working hours.
service,
The t e r m
to
s h o u l d b e r e g a r d e d as a p p l y i n g
add s i g n i f i c a n t l y
Broadly
intended to apply
etc.
pay
(iii)
Increases
i n pay g e n u i n e l y
p r o m o t i o n t o work a t
the
same or
intention
defeated
if
of
is net'intended
fere
the
standstill
that
with
age,
juveniles,
o r b y means o f
according
increments
for
are
to age
pay f o r
w h o l e , which i s
or
the
Existing
5.
At
the
expecting
time
of
-
approximately
of
total
of
wage
nor
do
bill.
a commitment
employees
by the
or
to
experience;
as a
standstill.
statement
one w o r k e r
an i n c r e a s e
i n pay
or a r e d u c t i o n
during the next
twelve
months
agreement
some t i m e
in the past.
impossible
to
or
introduce
allowing these
future
or
equivalent
the Prime M i n i s t e r ' s
long-term
Apart
increasing
commitments
6 m i l l i o n workers
both)
a group
affected
inter­
a predetermined range
as such add t o
increase
should
increments
T h e y can t h u s be d i s t i n g u i s h e d f r o m
to
as a
pay.)
apprentices
regular
SUch a r r a n g e m e n t s
promotion
of
standstill
as w i t h
amounts w i t h i n
other
to regrade posts
the
with
w o u l d he
increasing rates
pay e i t h e r
scale.
whether
(On t h e
w i t h the normal arrangements
specified
from
level,
employer.
employers were
c o n c e a l e d method o f
( i v ) I t
a higher
a different
hand t h e
resulting
existing
other type
It
commitments
at
h a v e b e e n bound t o
standstill
from
the
to
present
jeopardise
outset.
the
have
it
of
made
-
was
(or
a
at
been
on i n c o m e s
while
go ahead unchecked.
other workers
exists,
i n hours
settlement
to
least
in three
as t h e r e s u l t
clearly
a standstill
from t h e u n f a i r n e s s
commitment
would
of
at
for
whom no
would i n
effectiveness
such
practice
of
the
6.
of
On t h e
o t h e r hand t h e Government
the need t o
wider
with
restrict
economic
workers
or their
freely
difficult
right
call
of
to
the
implementation
or
the
standstill.
the
types
It
of
conscious
of
employers
accept
and
accordingly
if
excep­
thinks
some
it
deferment
commitment
into before
the
interference
the Government
any d e f i n i t e
commitment,
with
In the present
concerned to
is
any
e n t e r e d i n t o by
s h o r t e n hours e n t e r e d
following
country
circumstances
upon a l l
pay
of
representatives.
tionally
deeply
t o t h e minimum c o m p a t i b l e
interests
obligations
is
to
increase
the beginning
proposed that
entered
into
of
the
on or
before
20th J u l y 1966 b u t n o t y e t i m p l e m e n t e d s h o u l d be d e f e r r e d by
s i x months f r o m t h e
( a ) a g r e e m e n t s
whether
original
operative
to increase
pay
f r o m an o p e r a t i v e
or
dates­
shorten
hours
date b e f o r e
or
after
due u n d e r
cost
20th J u l y , 1966;
( b ) pay i n c r e a s e s
sliding
and
w h i c h may be
scale
already
t o revievir pay
agreed
but not y e t
for
a statutory
pay
has been f i r m l y
20th J u l y 1966 o r
periodic
review;
the M i n i s t e r
of
but not y e t
Labour
embodied
or
in
order.
commitment
may b e d e f i n e d
or s h o r t e n h o u r s
a c c e p t e d by
c o n c e r n e d on or b e f o r e
20th J u l y
made on o r b e f o r e
submitted t o the M i n i s t e r
submitted t o
An e x i s t i n g
or hours from a date
on or b e f o r e
( d ) Wages C o u n c i l p r o p o s a l s
increase
20th J u l y 1966
arrangements between
s t a n d i n g commitments
to
living
30th June 1967;
( c ) commitments
7.
of
or
or
as any
any o f f e r
on b e h a l f
of
to
the
agreement
do so w h i c h
workers
20th J u l y , 1966.
/a.
8.
if
I t would c l e a r l y
the p a r t i e s
the intention
of t h e
standstill
c o n c e r n e d w e r e t o s e e k t o make g o o d i n
any i n c r e a s e s
quent n e g o t i a t i o n s
standstill.
defeat
Similarly
necessarily
involves
where these
apply.
foregone
the deferment
the deferment
subse­
as a r e s u l t
of existing
of
the
commitments
of r e t r o s p e c t i v e
dates
New- AgregjiLents^
It
9.
i s not the i n t e n t i o n
barred during the s t a n d s t i l l
no new a g r e e m e n t s
take
effect
entered
effect
c a n be j u s t i f i e d
they
into after
i n the f o l l o w i n g
as f a l l i n g
But
20th J u l y , 1966 s h o u l d
1967 a t t h e e a r l i e s t
s i x months
within
D u r i n g t h e s i x months p e r i o d
10.
(i.e.
tion
the f i r s t
s i x months
o f new p r o p o s a l s
White Paper
and
unless
the r e v i s e d
of n a t i o n a l
follows
that
criteria
during
even
criteria
be c o n s u l t i n g
of
severe
in order
and. s o c i a l
I
T.U.C.
will
of the
the
incomes
priorities.
must
t o be
stringent
justified
The Government
and o t h e r
the r e s t r a i n t
'
It
t h e s e more
are l i k e l y
restraint.
to secure
consider:
The g u i d i n g p r i n c i p l e
improvements
the C . B . I . ,
interest
will
interested
criteria
which t h e
demands.
the National
examination
consider
as z e r o .
for
i n pay and h o u r s
i n c a s e s which s a t i s f y
The Government
made o f
ike criteria
on t h e f o r m w h i c h t h e s e new and s t r i n g e n t
should take
national
restraint
s e t out i n P a r t
than those
economic
only l i m i t e d
the p e r i o d
parties
o f 1967)
severe
(Cmnd.2639) and f o r t h e t i m e b e i n g
norm must b e r e g a r d e d
that
of
f o r improvements
b e much more s t r i n g e n t
11.
s h o u l d be
out i n p a r a . 1 0 b e l o w .
set
be
negotiations
p e r i o d t o t h e end o f 1966.
1st J a n u a r y ,
before
should not take
that
intend
that
the f u l l e s t
Board f o r P r i c e s
of p r o p o s a l s
t o be j u s t i f i e d
u s e s h o u l d be
and Incomes
in the
f o r improvements which t h e
i n accordance
parties
w i t h t h e new c r i t e r i a .
12.
of
In
order
that
those
groups which have
i m p r o v e m e n t u n d e r commitments
he t r e a t e d
more s e v e r e l y
open t o
the p a r t i e s
subject
to
during
the
to
in accordance
expectation
existing
should
t h a n t h o s e w h i c h do n o t ,
existing
standstill,
the f o l l o w i n g
already
an
six
will
he
commitments
to
renegotiate,
agreements
to
take
their
months p e r i o d
w i t h t h e new
it
not
of
severe
effect
restraint
criteria.
Arbitration
13.
Arbitrators,
in negotiations
conform
to
reaching
the
their
settlements
subject
1h.
or
to
the
requirements
decisions;
other p a r t i e s
disputes,
of
are
expected
to
the national
interest
in
and a r b i t r a t i o n
voluntarily,
requirements
of
involved
are
awards,
intended
the periods
of
like
to
be
standstill
restraint.
the jp^l^ic secj or
in
-
- -
Employers
publicly-owned
to
tion
including
that
but
should apply
to
to
ments r e l a t i n g
referred
of
it
to
in his
and
as u n d e r
these
the
require­
income
and o t h e r
t h e normal
intended
as t o
in
that
other
forms
by
of
the
on 2 0 t h
remunera­
senior
same
companies
executives,
of
process
the
forms
of Parliament
statement
and
of
for
is
require­
emaluments
t o which the Prime
July.
It
introduction
statutory
of
collective
principles
income.
a Companies B i l l
disclosure
and s e n i o r
be r e g a r d e d
company d i r e c t o r s
is
session
services
community.
outside
these
public
accordance w i t h
salaries
incorporate
current
directers
the
fixed
bargaining;
intended
in
employment
Many i n d i v i d u a l
are
act
of
15.
executives
i n the
undertakings w i l l
ments as t h e r e s t
O t h e r .forfflg--Of
-
and w o r k e r s
same o b l i g a t i o n s
in the
than the
industrial
negotiated
and s e v e r e
Pay
no l e s s
of
Minister
1 6*
O t h e r money
^/"The Government
their
fiscal
have a l r e a d y
powers or
any e x c e s s i v e
All
incomes
other
pledged themselves to
appropriate
growth i n a g g r e g a t e
company d i s t r i b u t i o n s
companies a r e
subject
to
dividends
standstill
for
It
...............
is recognised
would be
that
there
strict
examination of
Companies a r e
such c a s e s
that
In important
cases the
the N . B . P . I .
for
17.
restraint
professional
over
power u n d e r
the P r i c e s
(i):
few
cases i n which
interest
to
permit
require
inform the Government/Treasury
the
it
cases^
justification
may b e
Government w o u l d r e f e r
self-employed
fees,
the twelve
on c h a r g e s made f o r
Footnote
paid
of
examined.
the matter
to
examination.
£ The i n c o m e s o f
forms o f
level
t h e Government w i l l
any such
requested to
in order
the n a t i o n a l
but
months
may b e a v e r y
in accordance with
an i n c r e a s e d d i s t r i b u t i o n ,
(i)
paid by
twelve
and s h o u l d n o t b e i n c r e a s e d a b o v e t h e a v e r a g e
i n the p e r i o d
prevent
profits.
including
the
means t o
use
persons,
are expected
months.
t o be under
to
impose a
all
similar
The G o v e r n m e n t w i l l
and I n c o m e s B i l l
professional
including
have
standstill
services^
The t a x r u l e s a p p l y i n g t o " c l o s e l y c o n t r o l l e d
c o m p a n i e s " may make i t n e c e s s a r y t o e x c l u d e
such c o m p a n i e s ' d i s t r i b u t i o n s f r o m t h e
standstill.
,
1 Prices,
I l,
Charges
IV.
and F e e s
/The Government
J standstill
to
all
PUBLIC SECTOR
of
Departments
Government
intend t o
prices,
apply the p r i n c i p l e s
charges
and f e e s
of
of
the
Government
I Departments^
I Nationalised
2.
Industries
/Jfhe n a t i o n a l i s e d
restraints
industries w i l l
as t h e p r i v a t e
sector
and i n c o m e s .
They w i l l be
provisions
the P r i c e s
of
of
the n a t i o n a l i s e d
of
their f u l l
The A i r
Transport
applications
in f a r e s
have
to
to the
The
a s s u r e d the
in implementing
the
to
that
it
will
take
routes,
the
same
prices
general
Chairmen
Government
L i c e n s i n g B o a r d , w h i c h has b e f o r e
air
the
standstill.
from B r i t i s h European A i r w a y s
the Government
of
also
and I n c o m e s B i l l .
on t h e L o n d o n - S c o t t i s h
Statement
subject
in r e l a t i o n
subject
industries
support
be
Prime
for
has
it
increases
assured
Minister's
20th J u l y i n t o a c c o u n t b e f o r e r e a c h i n g a
decision^
S t a t u t o r y P r i c e - F 1 xi njg J3odie s
i
3.
/jStatutorily
as t h e
Transport
are e x p e c t e d
of
standstill
-a
-
established price-fixing
Tribunal
or
to conform to
and s e v e r e
the T r a f f i c
bodies,
Commissioners,
the requirements
restraint^
such
of
the
periods
V .
27.
The G o v e r n m e n t ,
importance
Board f o r
the
to
the
the C . B . I .
c o n t i n u a t i o n of
circumstances
The B o a r d w i l l
considering,
of
referred
detailed
to
it
for
examinations w i l l
organisation w i l l
for
this
The B o a r d w i l l
to
examine r e f e r e n c e s
Government
National
and
in
standstill.
during the twelve
examination.
The
months
arrangements,
and i n c o m e s i n c r e a s e s
as
are
Board's
as p o s s i b l e
b e adcipted and s t r e n g t h e n e d as
continue
on m a t t e r s
productivity,
particular
importance
standstill
a manner
the
great
and
necessary
purpose.
29.
essential
attach
longer-term
b e c a r r i e d out a s r a p i d l y
Its
the
the
in the
in accordance with the above
prices
of
t h e work o f
be r e s p o n s i b l e
such p r o p o s a l s f o r
field
and t h e T . U . C .
P r i c e s and I n c o m e s , b o t h
special
28.
for
NATIONAL BOARD FOR PRICES AND INCOMES
to
made t o
of
prices
twelve
to
and i n c o m e s .
severe
for
the
period
national
follow7
the
of
following
when i t
incomes i s
PROPOSED STATUTORY POWERS
^Section to
in
the
This w i l l be
restraint
growth o f
months
time by
term s i g n i f i c a n c e
the growth o f
w i t h the
next
from t i m e
in preparing
ensure t h a t
V].
it
longer
and p e r i o d o f
consistent
during the
will
resumed
output.
be
in
PROPOSED
VI
In his
statement
STATUTORY POWERS
on 2 0 t h J u l y t h e P r i m e M i n i s t e r
said:­
" w i t h i n t h e main f i e l d o f c o l l e c t i v e b a r g a i n i n g
we s h a l l r e l y i n t h e f i r s t i n s t a n c e on v o l u n t a r y
action,
N e v e r t h e l e s s , i n order t o ensure t h a t the
s e l f i s h do n o t b e n e f i t a t t h e e x p e n s e o f t h o s e who
c o - o p e r a t e , i t i s our i n t e n t i o n t o s t r e n g t h e n t h e
p r o v i s i o n s o f t h e P r i c e s and I n c o m e s B i l l .
.......
M e a n w h i l e t h e Government w i l l n o t h e s i t a t e t o a c t
w i t h i n t h e p o w e r s t h e y e n j o y , o r may f u r t h e r s e e k ,
t o d e a l w i t h any a c t i o n i n v o l v i n g i n c r e a s e s o u t s i d e
and b e y o n d t h i s p o l i c y . ' '
1
2.
For
t h i s purpose
addition to
the B i l l
t h e Government
of
new c l a u s e s
containing purely
p r o v i s i o n s which would be o p e r a t i v e
Act
comes i n t o f o r c e
power o f
The p r o p o s e d p r o v i s i o n s
(a)
give
specified
i n the
order
on w h i c h t h e o r d e r
or r a t e s
shall
of
not be
takes e f f e c t
temporary
standstill
levels
remuneration
organisation
are
subject
Parliament)
directing
remuneration,
as may b e
without
consent
of
the
Ministerial
to
the e f f e c t
Government.
to r a i s e
will
consent.
impose a
of
w h e r e t h i s was n e c e s s a r y .
standstill
date
and c h a r g e s and on
(allowing for
or p e r s o n w i s h i n g
to the
after
(subject
i n c r e a s e d from the
on b o t h p r i c e s
i n normal working h o u r s )
the
will:­
T h e s e p o w e r s w o u l d e n a b l e t h e Government
of
automatically
t h e Government power t o make o r d e r s
or c h a r g e s ,
temporary
renewal.
n e g a t i v e r e s o l u t i o n b y b o t h Houses o f
such p r i c e s
the
f r o m t h e d a t e on w h i c h
but which would l a p s e
t w e l v e months w i t h o u t
3,
p r o p o s e d t o move
first
prices
changes
Any
o r pay
have t o
that
obtain
the
to
that
give
t h e G o v e r n m e n t power t o
implemented s i n c e
charge
level
is
specified
lower
Such p r i c e s
or
t o be r a i s e d
direction
in
days'
than t h a t
without
notice
power
employer
only
the person
itself
of rates
that
of
the
Before
affested
by the
for
offences
Bill,
require
Trade unions
protection
give
order
that
time.
A
similar
the
Government
a kind
described
than the r a t e p a i d b y
work b e f o r e
20th J u l y ,
i n the o r d e r ,
taken
without
days'
of
or t r a d e unions
for
offences.against
t h e s e p o w e r s will
under c l a u s e s
i n g s would., a s
the
making
by the
made w i t h i n
of
July.
any
or
the
or
higher
Government
notice
represen­
other
persons
order.
The s a n c t i o n s
i o n made u n d e r
affected
such an o r d e r was made l k
made b y e m p l o y e r s
in
But b e f o r e
any r e m u n e r a t i o n
w o u l d h a v e t o b e g i v e n and a c c o u n t
tations
20th
specified
pay waald e n a b l e
same k i n d o f
to a
would b e o b l i g e d t o
t o be
or
subsequently
could n o t be r e t r o s p e c t i v e .
t o an e x t e n t a u t h o r i s e d
approval.
on or b e f o r e
consent.
s h o u l d be no h i g h e r
for
t h a t any p r i c e
than t h a t
the M i n i s t e r
t o r e q u i r e by o r d e r
order
higher
t o he
s h o u l d bo r e d u c e d
any r e p r e s e n t a t i o n s
in respect
in the
direct
prevailing
Ministerial
to
and t o c o n s i d e r
increases
appropriate
c h a r g e s w o u l d t h e n n o t be a b l e
to a l e v e l
The d i r e c t i o n
The
the d i r e c t i o n
any s u c h d i r e c t i o n ,
lk
necessary.
w o u l d be empowered t o
not
or p a y
20th J u l y which a r e u n j u s t i f i e d
r e v e r s e d where t h i s
Minister
enable p r i c e
in
the case
the
consent
and
employees
offences
II
the B i l l .
Procecd­
under P a r t I I
w o u l d h a v e the
of t h e Bill.
and
statutory
(6)
and
direct­
sanctions
of the Attorney G e n e r a l .
c o n f e r r e d b y C l a u s e 16 ( 5 )
C l a u s e 17 i n P a r t
or
be t h e same as t h e
11 and 16 o f
of
any o r d e r
of
the
(c)
t o empower t h e M i n i s t e r
date
of
wages
regulation
A c t 1959, and t o v a r y
under
(d,)
orders
already
orders
the
to
delay
the
operative
made under t h e Wages
effective
date
Concils
of
pay
increases
(and
the
Secretary
made;
to
empower t h e M i n i s t e r
of
State for
regulation
of Labour
Scotland)
of A g r i c u l t u r e
to defer
the e f f e c t i v e
o r d e r s made b y t h e A g r i c u l t u r a l
date
of
wages
Wages B o a r d s
under
t h e A g r i c u l t u r a l Wages A c t 19^.8.
(e)
protect
to
from any l e g a l
the GovernEBnt's
withholds
As e x p l a i n e d a b o v e ,
temporary n a t u r e .
ment t h a t
controls
to r e l y
it
on v o l u n t a r y
selfish
these
of
powers would be o f
to introduce
and t h a t
co-operation.
Even
be u s e d v e r y
if
response
voluntarily
selectively,
a
in his
elaborate
though the
state­
statutory
t h e p o l i c y must
continue
temporary
they need
they a r e e f f e c t i v e l y
down i n t h e W h i t e
purely
clear
t o be
to d e t e r
co-operate
t h e m a j o r i t y who -are p r e p a r e d v o l u n t a r i l y
laid
in
employment,
m i n o r i t y who a r e n o t p r e p a r e d t o
reassure
policy
contract
and p r i c e s ,
wide-ranging
who,
a standstill,
The P r i m e M i n i s t e r Ejade i t
incomes
new p o w e r s w i l l
for
employers
t o w h i c h an e m p l o y e e may b e
was n o t p r o p o s e d
over
potentially
request
pay i n c r e a s e s
e n t i t l e d under h i s
h.
proceedings
and
any
to
to o b s e r v e
Paper.
27th J u l y ,
1966
the
PRICES AND INCOMES B I L L
New C l a u s e s
In his
t o Support
Statement
and i n c o m e s
the General
Standstill
on 2 0 t h J u l y a s k i n g f o r
standstill,
the Prime M i n i s t e r
a
prices
said:­
" w i t h i n t h e main f i e l d o f c o l l e c t i v e b a r g a i n i n g
we s h a l l r e l y i n t h e f i r s t i n s t a n c e on v o l u n t a r y
action.
N e v e r t h e l e s s , i n o r d e r t o ensure t h a t the
s e l f i s h do n o t b e n e f i t a t t h e e x p e n s e o f t h o s e who
c o - o p e r a t e , i t i s our i n t e n t i o n t o s t r e n g t h e n t h e
p r o v i s i o n s o f the P r i c e s and I n c o m e s B i l l , t o s p e e d
i t s p a s s a g e t h r o u g h P a r l i a m e n t and t o r e d e f i n e t h e
r o l e o f t h e N a t i o n a l B o a r d f o r P r i c e s and I n c o m e s .
M e a n w h i l e t h e Government w i l l n o t h e s i t a t e t o a c t
w i t h i n t h e p o w e r s t h e y e n j o y , o r may f u r t h e r s e e k ,
t o d e a l w i t h any a c t i o n i n v o l v i n g i n c r e a s e s o u t s i d e
and b e y o n d t h i s p o l i c y . "
2.
At
the
the B i l l
first
meeting of
on 2 6 t h J u l y ,
the Standing Committee
the F i r s t
Secretary
on
announced
that
t h e Government p r o p o s e d t o p r o c e e d b y a d d i n g a new
Part
IV to
the B i l l
containing purely temporary
which would l a p s e a u t o m a t i c a l l y
would not be
subject
t h e new c l a u s e s a s
3.
One p o s s i b l e
after
to renewal.
s o o n as
t w e l v e months
He u n d e r t o o k
amendment
to
the B i l l
is
s i x months,
period pending
Prices
award o r
period
the B i l l ,
s i x months,
c o u l d be
destroy
since
the
the
rather
than to
particular
if
so,
pending
to
in Part
enable
proposals
enable
so t h a t
the B o a r d ' s
Board
increase
philosophy
But
of
to
impose a g e n e r a l
to
should be r e f e r r e d
implementation
of
the
standstill
for
or
this
Fart
i n t e n t i o n would be t o use
t h e Government
their
II
t h e maximum
t w e l v e months.
existing
'barly warning"provisions
been
e x t e n d t h e t h r e e , months
on any p r o p o s e d p r i c e
settlement
effectively
which has
i n v e s t i g a t i o n by the N a t i o n a l
and I n c o m e s t o
standstill
of
and t o
table
a temporary p r o v i s i o n , to
e x t e n d t h e 30 d a y s ' b a r l y w a r n i n g " p e r i o d
to
to
and
possible,
c o n s i d e r e d b y t h e Government
Bill
provisions
II
the
standstill
consider
whether
to the Board
t o be
would
and,
deferred
report.
/Moreover
SECRET
Moreover,
provide
an amendment on t h e s e
an e f f e c t i v e
deterrent
not prepared to observe
Even i f
tory
the
the need t o b r i n g
consultation
*
lines
to
standstill
provisions
in Part
cannot be
justified
White Paper.
the
of
general
goodwill
the B i l l
under
the c r i t e r i a
w h i c h now - e x i s t s
in operating
well as
o r pay p r o p o s a l s
have d o n e .
For
cluded that
the best
as a l o n g e r
t e r m measure and t o
for
the p u r p o s e
A..
ive
these v a r i o u s
of
course
reinforcing
The new p o w e r s w h i c h i t
from
with
the d a t e
the powers
an O r d e r
Houses
in Council
begun.
to reinforce
II
of
This
t o be s e t
of
Part
II
take
the
to
the
reinforce
the
system
t o put
II
separate
to
but
the B i l l
intact
temporary
powers
take would be
force.
which can
affirmative
con­
standstill.
comes i n t o
the B i l l
of
for­
otherwise
the Government have
voluntary
since
contrasts
o n l y be used
t h e new p o w e r s
w h i c h has
not be
after
b y both.
are
already
automatically
and w i l l
effect­
This
resolutions
standstill
the A c t
in
than t h e y would
however l a p s e
of
out
which
t o undermine
to leave Part
a voluntary
the passing
of
the
an " e a r l y w a r n i n g "
is essential
The new p o w e r s w i l l
months a f t e r
20th J u l y but
i s proposed
involving
of Parliament,
required
sooner
on w h i c h t h e A c t
in Part
statu­
by b o t h Houses
encouraging people
reasons
is
are
basis.
t w e l v e months,
w o u l d a l s o be l i k e l y
on a v o l u n t a r y b a s i s , a s
who
could not be used t o r e v e r s e
on t h e p r o v i s i o n s
standstill
w a r d new p r i c e
the n e x t
implemented s i n c e
Reliance
of persons
on a v o l u n t a r y
resolutions
was t o be w a i v e d d u r i n g
o r pay i n c r e a s e s
to
i n an O r d e r i n C o u n c i l r e q u i r i n g
Parliament
price
w o u l d be u n l i k e l y
the m i n o r i t y
and a f f i r m a t i v e
II
183
twelve
subject
to
renewal.
5.
First
The p r o v i s i o n 4jci t h e new P a r t
S e c r e t a r y power
resolution
or r a t e s
of
t o make o r d e r s
by both Houses)
remuneration,
n o t be i n c r e a s e d from
without Ministerial
IV o f
the
directing
the B i l l
(subject
that
consent.
in
give
or
charges,
the o r d e r
on w h i c h t h e o r d e r t a k e s
These powers w i l l
the
negative
such p r i c e s
as may b e s p e c i f i e d
date
to
will
enable
shall
effect
the
/Government
Government
charges
to
and on l e v e l s
of changes
basis.
subject
20th J u l y .
to
further
the s t a n d s t i l l
Secretary
F u r t h e r powers a r e
powers w i l l
or c h a r g e s
than t h a t
shall
not
specified
i n the
notice
to
itself
7.
There w i l l
will
enable
remuneration
than the r a t e
before
of
p a i d by
increase
unless
to
by
be r e d u c e d
20th J u l y .
to
in
the
are
These
that
any
that
price
to a l e v e l
Such
not
prices
higher
consent.
must g i v e
time.
only
by o r d e r
order s h a l l
the
lh
days'
consi­
The
This
that
any
be no
same k i n d o f
consents
leveiL.
/Before
to
higher
work
t o an e x t e n t a u t h o r i s e d
the a p p r o p r i a t e M i n i s t e r
above t h i s
enable
t h e o r d e r and must
require
employer f o r
or h i g h e r
Minister.
a level
power on t h e pay s i d e .
Secretary
the
obtain
retrospective
direct
the M i n i s t e r
or
retrospective.
a kind described
20th J u l y ,
the o r d e r ,
w i l l n o t be
the F i r s t
have t o
20th July which
he may make w i t h i n
be a s i m i l a r
selective
needed t o
be r a i s e d t o
t o be a f f e c t e d
d e r any r e p r e s e n t a t i o n s
effect
d i r e c t i o n without M i n i s t e r i a l
making any s u c h d i r e c t i o n ,
the p e r s o n
first
and
prices
is necessary.
on o r b e f o r e
subsequently
or l e s s
not be
therefore
this
Before
direction
will
the d i r e c t i o n s h a l l
than t h a t p r e v a i l i n g
the
01* t h e a p p r o p r i a t e
e n a b l e any M i n i s t e r
in
for
to r a i s e
will
implemented s i n c e
t o b e r e v e r s e d where
charge s p e c i f i e d
on a more
impose s t a n d s t i l l s
or pay i n c r e a s e s
unjustified
lower
to
on b o t h p r i c e s
(allowing
or person wishing
of t h e F i r s t
The p o w e r
price
of remuneration
Any o r g a n i s a t i o n
the consent
to
standstill
i n normal working h o u r s )
pay t h a t a r e
6.
impose a t e m p o r a r y
an
in
Before
making such an o r d e r
1k d a y s '
of
notice
order
itself
affect
will
p a y m e n t s made a b o v e
made under t h e s e
offences
require
the
by Clause
9.
for
offences
powers w i l l
the c a s e
consent
and e m p l o y e e s
To e n a b l e
of
of
to
be
the
any o r d e r
same a s t h e
under P a r t
the
statutory
not
and C l a u s e
or
the
direction
sanctions
for
Proceedings
II
of t h e
Trade
protection
17 i n P a r t
Bill,
unions
conferred
II
of the
Bill.
t o be i m p o s e d on minimum r a t e s
statutory negotiating
empower
under
the M i n i s t e r
date
orders
( b )
to
"achinery,
it
of
the A g r i c u l t u r a l
Agricultural
any l e g a l
pay i n c r e a s e s
contract
made
and t o
vary
under
to
(and
defer
wages r e g u l a t i o n
orders
Wages B o a r d s u n d e r
the
the
the
made b y
19k8.
automatically
at the
end of
the
period.
it
is
necessary
proceedings
Governments
the
orders
of Agriculture
Scotland)
Wages A c t
T h e s e p-owers w o u l d l a p s e
delay
request
employers
for
to which
of
for
the B i l l
who,
in response
a standstill,
an e m p l o y e e
employment.
to p r o t e c t
to
voluntarily
may be e n t i t l e d
from
the
withhold
under
of
will
made;
State f o r
date
1959?
of pay i n c r e a s e s
empower t h e M i n i s t e r
effective
Finally,
Labour t o
of wages r e g u l a t i o n
date
already
Secretary of
months
of
t h e "Wages C o u n c i l s A c t
the e f f e c t i v e
his
will
on 2 0 t h J u l y b e f o r e
against
offences
a standstill
operative
10.
it
The
necessary:­
( a )
twelve
i.e,,
the A t t o r n e y G e n e r a l .
and ( 6 )
pay d e t e r m i n e d u i d e r
a l s o be
or
that p e r i o d .
11 and 16 o f t h e B i l l .
would have
16 ( 5 )
level
account
force.
under c l a u s e s
as i n
the
give
or trade unions
order within
n o t be r e t r o s p e c t i v e ,
The s a n c t i o n s
would,
by t h e
shall
and s h a l l t a k e
made b y e m p l o y e r s
affected
o r d e r comes i n t o
8.
Secretary
p u b l i s h e d i n the G a z e t t e
any r e p r e s e n t a t i o n s
other persons
the F i r s t
11.
they
Although
are
made i t
of
prices,
a purely temporary nature.
clear
introduce
t h e s e new p o w e r s a r e p o t e n t i a l l y
in his
elaborate
and t h a t
co-operation.
statement
statutory
the
policy
(Even i f
that
controls
this
were not
to
for
within
such c o n t r o l s
t h e new p o w e r s
new p o w e r s w i l l
are
to
last).
be used v e r y
potentially
wide-ranging
the
minority
selfish
to reassure
observe
12.
Provisional
was n o t
over
s e t up e f f e c t i v e
the t w e l v e
selectively,
they are
laid
drafts
on
voluntary
it
machinery
months
the
period
temporary
they need t o
effectively
to
to
of
be
deter
co-operate
who a r e p r e p a r e d v o l u n t a r i l y
down i n t h e W h i t e
to
i n c o m e s and
case,
Even though
Minister
proposed
to r e l y
the
who a r e n o t p r e p a r e d
the majority
the p o l i c y
if
The P r i m e
must c o n t i n u e
v/ould h a r d l y "be p r a c t i c a b l e
operating
it
far-reaching,
and
to
Paper.
t h e new c l a u s e s
are
attached.
27th J u l y ,
1966