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T H I S D O C U M E N T IS T H E P R O P E R T Y O F H E R B R I T A N N I C M A J E S T Y ' 8 G O V E R N M E N T
Printed
CM.
for the Cabinet.
December
1963
(63)
40
Copy N o .
12th Conclusions
CABINET
of a Meeting
of the Cabinet
on Thursday,
12th December,
CONCLUSIONS
held at 1G Downing
Street,
1963, at 10.30 a.m.
S.W. 1,
Present:
T h e R i g h t H o n . Sir A L E C D O U G L A S - H O M E , M . P . , P r i m e M i n i s t e r (Items
The
Right
Hon.
R.
A.
BUTLER, M . P . ,
The
Right Hon. L O R D DILHORNE,
Lord
The
Right Hon. E D W A R D HEATH,
M.P.,
Right
Hon.
SELWYN LLOYD,
M . P . , L o r d P r i v y Seal (Items
The
Right
Q.C.,
M.P.,
Minister
of
Fisheries and F o o d
Hon. J O S E P H GODBER,
M.P.,
M i n i s t e r of L a b o u r The
Right
Hon.
C h a n c e l l o r of t h e D u c h y of L a n c a s t e r
M . P . , Chief S e c r e t a r y t o t h e T r e a s u r y
and Paymaster General
The
Hon.
Sir
EDWARD
BOYLE,
The Right Hon. A N T H O N Y BARBER, M.P.,
M i n i s t e r of H e a l t h ERROLL,
Right
Hon.
GEOFFREY
RIPPON,
M . P . , M i n i s t e r of P u b l i c B u i l d i n g a n d
Works
M . P . , M i n i s t e r of P o w e r
T h e Right Hon. W I L L I A M D E E D E S , M.P.,
Right
M . P . , M i n i s t e r of E d u c a t i o n
The
FREDERICK
REGINALD MAUDLING,
The Right Hon. JOHN BOYD-CARPENTER,
S e c r e t a r y of S t a t e f o r S c o t l a n d
T h e Right
Hon.
C h a n c e l l o r of t h e E x c h e q u e r
The Right Hon. VISCOUNT BLAKENHAM,
Agriculture,
T h e Right Hon. M I C H A E L NOBLE, M . P . ,
QUINTIN HOGG, Q . C . ,
M . P . , M i n i s t e r of D e f e n c e
1-6)
Hon. CHRISTOPHER SOAMES,
1-5)
The Right Hon. PETER THORNEYCROFT,
S e c r e t a r y of S t a t e for I n d u s t r y , T r a d e
and
Regional
Development
and
P r e s i d e n t of t h e B o a r d of T r a d e
The
Right
M.P.,
Chancellor
The
Hon.
M . P . , L o r d P r e s i d e n t of t h e C o u n c i l
a n d M i n i s t e r f o r Science
S e c r e t a r y of S t a t e for F o r e i g n Affairs
(in the Chair for Items
6-7)
The
Right
The
Minister without Portfolio
Right
Hon.
LORD
CARRINGTON,
Minister without Portfolio
T h e following were also present:
Mr.
JOHN
TILNEY,
M.P.,
Joint
Parlia-
The
Right
Secretariat:
Sir B U R K E T R E N D
Mr.
A. L. M . G A R Y
M i s s J. J.
Hon.
MARTIN
M.P.,
Parliamentary
Treasury
m e n t a r y U n d e r - S e c r e t a r y of S t a t e f o r
Commonwealth Relations and for the
C o l o n i e s (Item 6)
NUNN
REDMAYNE,
Secretary,
CONTENTS
Minute
No.
Subject
1
Parliament
2
F o r e i g n Affairs
Federal German
Page
3
3
Republic
North Atlantic Council: Ministerial Meeting in Paris
3
T r i b u n a l s of I n q u i r y
...
...
...
4
4
P a y of M e m b e r s of P a r l i a m e n t a n d M i n i s t e r s
...
...
4
5
White Paper on Public Expenditure
6
F u t u r e A g r i c u l t u r a l Policy
...
...
...
. .
...
6
7
Industrial Disputes
...
...
...
...
..
8
London Bus Crews
...
...
...
...
5
C M . 1 2 (63)
Parliament
1. T h e Cabinet were i n f o r m e d of the business to be taken in the
H o u s e of C o m m o n s in the f o l l o w i n g week. Parliament w o u l d adjourn
for the Christmas R e c e s s o n 20th D e c e m b e r and w o u l d reassemble
o n 14th January.
Foreign
Affairs
2. The Foreign Secretary
i n f o r m e d t h e C a b i n e t t h a t d u r i n g his
r e c e n t visit t o B o n n a n d B e r l i n h e h a d a s c e r t a i n e d t h a t t h e F e d e r a l
G e r m a n Government would probably be prepared to support a
r e n e w e d initiative by t h e U n i t e d K i n g d o m G o v e r n m e n t to r e d u c e
E a s t - W e s t t e n s i o n . B u t they w o u l d prefer s u c h a n initiative t o b e
d i r e c t e d t o w a r d s a c h i e v i n g a g r e e m e n t o n the e s t a b l i s h m e n t of
o b s e r v a t i o n p o s t s as a s a f e g u a r d a g a i n s t s u r p r i s e a t t a c k ; a n d t h e y
r e m a i n e d o p p o s e d to a n y a t t e m p t t o c o n c l u d e a n o n - a g g r e s s i o n p a c t
between the N o r t h Atlantic Treaty Organisation ( N A T O ) and the
States m e m b e r s of t h e W a r s a w P a c t , o n t h e g r o u n d t h a t it w o u l d
t e n d f o r m a l l y to p e r p e t u a t e t h e division of G e r m a n y .
Federal
German
Republic
(Previous
Reference:
C M . (63) 9th
Conclusions,
Minute 3)
T h e F e d e r a l G o v e r n m e n t a p p r e c i a t e d o u r r e a s o n s for s u p p o r t i n g
Malaysia against I n d o n e s i a ; they h a d not e x p o r t e d , and would n o t
export, arms to the Indonesian G o v e r n m e n t .
Economic relations between the Federal G o v e r n m e n t and the
F r e n c h G o v e r n m e n t c o n t i n u e d t o b e s t r a i n e d , p a r t i c u l a r l y in t h e
c o n t e x t of a g r i c u l t u r a l p o l i c y .
In d i s c u s s i o n it w a s suggested t h a t , if t h e F r e n c h G o v e r n m e n t
failed t o r e a c h a g r e e m e n t w i t h t h e F e d e r a l G o v e r n m e n t
on
a g r i c u l t u r a l policy, t h e y m i g h t w i t h d r a w f r o m the E u r o p e a n
E c o n o m i c C o m m u n i t y ( E E C ) . W e s h o u l d b e p r e p a r e d , in t h a t e v e n t ,
to t r y t o d e v i s e s o m e m e a n s of a s s o c i a t i n g t h e o t h e r five m e m b e r s of
t h e C o m m u n i t y w i t h o u r s e l v e s a n d o u r p a r t n e r s in t h e E u r o p e a n F r e e
T r a d e A s s o c i a t i o n . W e s h o u l d also b e r e a d y t o c o n s i d e r t h e
i m p l i c a t i o n s for o u r s e l v e s if t h e F r e n c h G o v e r n m e n t , i n s t e a d of
withdrawing from the E.E.C., sought to prevent further participation
by t h e C o m m u n i t y in t h e n e g o t i a t i o n s o n t h e K e n n e d y R o u n d in t h e
G e n e r a l A g r e e m e n t o n Tariffs a n d T r a d e .
The
Cabinet—
(1) I n v i t e d t h e F o r e i g n S e c r e t a r y , in c o n s u l t a t i o n w i t h o t h e r
M i n i s t e r s c o n c e r n e d , t o a r r a n g e for early e x a m i n a t i o n of
t h e action w h i c h m i g h t n e e d t o b e t a k e n if t h e F r e n c h
G o v e r n m e n t failed t o r e a c h a g r e e m e n t w i t h t h e o t h e r
m e m b e r s of t h e E u r o p e a n E c o n o m i c C o m m u n i t y o n t h e
C o m m u n i t y ' s future economic policy.
North
Atlantic
Council:
Ministerial
Meeting in
Paris
(Previous
Reference:
C C . (62) 32nd
Conclusions,
Minute 2)
The Foreign Secretary
i n f o r m e d t h e C a b i n e t t h a t , d u r i n g his
f o r t h c o m i n g visit t o P a r i s to a t t e n d t h e M i n i s t e r i a l C o u n c i l of N A T O ,
he p r o p o s e d t o d i s c u s s w i t h t h e F r e n c h G o v e r n m e n t r e c e n t
d e v e l o p m e n t s in S o u t h - E a s t A s i a . I t w o u l d b e n e c e s s a r y t o c o n s i d e r ,
in c o n s u l t a t i o n w i t h t h e U n i t e d S t a t e s G o v e r n m e n t , w h e t h e r it w o u l d
b e in o u r interest t o s u p p o r t t h e p r o j e c t e d i n t e r n a t i o n a l c o n f e r e n c e
on t h e p r e c a r i o u s s i t u a t i o n w h i c h w a s d e v e l o p i n g in C a m b o d i a .
The Cabinet—
(2) T o o k n o t e of t h e s t a t e m e n t b y t h e F o r e i g n S e c r e t a r y .
3. T h e C a b i n e t h a d b e f o r e t h e m a m e m o r a n d u m b y t h e L o r d
C h a n c e l l o r , t h e H o m e S e c r e t a r y a n d t h e S e c r e t a r y of S t a t e for
S c o t l a n d ( C P . (63) 29) o n t h e T r i b u n a l s of I n q u i r y ( E v i d e n c e ) A c t ,
1921.
The Lord Chancellor
said t h a t , i n a c c o r d a n c e w i t h t h e d e c i s i o n
of t h e C a b i n e t a t t h e i r m e e t i n g o n 1 4 t h N o v e m b e r , a d e b a t e h a d
been a r r a n g e d in t h e H o u s e of L o r d s i n o r d e r to a s c e r t a i n w h e t h e r
t h e r e w a s a n y d e m a n d for an i n d e p e n d e n t i n q u i r y i n t o t h e o p e r a t i o n
of t h e A c t . A l t h o u g h e v e r y s p e a k e r h a d e x p r e s s e d d i s l i k e of s o m e
a s p e c t of t h e p r o c e d u r e s w h i c h its use e n t a i l e d , t h e r e h a d b e e n g e n e r a l
a g r e e m e n t o n t h e n e e d t o r e t a i n this m e a n s of i n v e s t i g a t i o n a n d t h e
d e b a t e h a d s u g g e s t e d t h a t t h e r e w a s n o c u r r e n t p r e s s u r e for a n y
r a d i c a l a m e n d m e n t o r r e v i e w of the A c t . T h e m o s t i m p o r t a n t of t h e
p r o p o s a l s p u t f o r w a r d for i m p r o v i n g t h e p r o c e d u r e s i n v o l v e d r e l a t e d
t o t h e p a y m e n t of t h e costs of i n d i v i d u a l s a p p e a r i n g b e f o r e a t r i b u n a l .
H e h a d t h e r e f o r e r e m i n d e d t h e H o u s e of t h e a r r a n g e m e n t s m a d e
for t h e ex gratia p a y m e n t from p u b l i c f u n d s of t h e c o s t s of i n d i v i d u a l s
w h o h a d b e e n a l l o w e d t o b e legally r e p r e s e n t e d b e f o r e t h e T r i b u n a l
of I n q u i r y i n t o m a t t e r s arising o u t of t h e Vassall c a s e . It s h o u l d b e
sufficient for G o v e r n m e n t s p o k e s m e n i n t h e f o r t h c o m i n g d e b a t e in
t h e H o u s e of C o m m o n s o n t h e R e p o r t of L o r d D e n n i n g ' s I n q u i r y t o
indicate that, while there was n o case for an inquiry into the Act,
t h e G o v e r n m e n t w o u l d c o n s i d e r a n y p r o p o s a l s p u t f o r w a r d for
procedural improvements.
I n d i s c u s s i o n t h e r e w a s g e n e r a l a g r e e m e n t w i t h t h e s e views.
T h e r e might b e advantage, however, in indicating that
the
G o v e r n m e n t w e r e p r e p a r e d to p u r s u e , in c o n s u l t a t i o n w i t h t h e L e a d e r
of t h e O p p o s i t i o n , t h e p r o p o s a l a d v a n c e d earlier in t h e y e a r b y t h e
P r i m e M i n i s t e r of t h e d a y , M r . H a r o l d M a c m i l l a n , M . P . , for t h e
a p p o i n t m e n t of a s t a n d i n g S e c u r i t y C o m m i s s i o n t o i n v e s t i g a t e cases
i n v o l v i n g n a t i o n a l s e c u r i t y w h i c h it m i g h t b e c o n v e n i e n t t o e x a m i n e
b y a less e l a b o r a t e p r o c e d u r e t h a n t h e A c t r e q u i r e d . If so, t h e t e r m s
of r e f e r e n c e of this b o d y w o u l d n e e d t o b e f u r t h e r c o n s i d e r e d . A s
r e g a r d s t h e c o s t s of p e r s o n s w h o a p p e a r e d b e f o r e t r i b u n a l s a p p o i n t e d
u n d e r t h e A c t , it w a s a r g u a b l e t h a t t h e G o v e r n m e n t s h o u l d p a y in
full r e a s o n a b l e c o s t s i n c u r r e d b y p e r s o n s p e r m i t t e d b y t h e t r i b u n a l
t o b e legally r e p r e s e n t e d o n t h e g r o u n d t h a t their c o n d u c t w a s
i m p u g n e d or that their reputations were e n d a n g e r e d ; and the
G o v e r n m e n t s s p o k e s m e n in t h e f o r t h c o m i n g d e b a t e s h o u l d b e in a
p o s i t i o n t o m a k e a clear s t a t e m e n t of p o l i c y i n this r e s p e c t .
The
Cabinet—
(1) I n v i t e d t h e L o r d C h a n c e l l o r , in c o n s u l t a t i o n w i t h t h e H o m e
Secretary, the Chief Secretary, Treasury, a n d the Secretary
of S t a t e for S c o t l a n d , to p r e p a r e a s t a t e m e n t o n t h e c o s t s
of p e r s o n s p e r m i t t e d to b e legally r e p r e s e n t e d b e f o r e
t r i b u n a l s a p p o i n t e d u n d e r t h e T r i b u n a l s of I n q u i r y
( E v i d e n c e ) A c t , 1 9 2 1 , for t h e use of
Government
s p o k e s m e n in t h e f o r t h c o m i n g d e b a t e o n t h e R e p o r t of
Lord Denning's Inquiry.
(2) T o o k n o t e t h a t t h e P r i m e M i n i s t e r w o u l d give f u r t h e r
c o n s i d e r a t i o n t o t h e c o m p o s i t i o n a n d t e r m s of r e f e r e n c e
of t h e p r o p o s e d Security C o m m i s s i o n .
4. T h e C a b i n e t r e s u m e d t h e i r d i s c u s s i o n o n t h e d e s i r a b i l i t y of
enlisting i n d e p e n d e n t advice o n t h e p a y of M e m b e r s of P a r l i a m e n t
a n d M i n i s t e r s , o n t h e a s s u m p t i o n t h a t t h e a m o u n t of any i n c r e a s e
s h o u l d p r e f e r a b l y n o t b e m a d e p u b l i c l y k n o w n until after t h e G e n e r a l
Election but that b o t h the G o v e r n m e n t and the O p p o s i t i o n would
c o m m i t t h e m s e l v e s in p r i n c i p l e t o t a k e t h e n e c e s s a r y a c t i o n at t h e
o u t s e t of t h e n e w P a r l i a m e n t .
n o
&a
C M . 12 (63)
I n d i s c u s s i o n it w a s s u g g e s t e d t h a t a d v i c e m i g h t b e s o u g h t e i t h e r
f r o m t h e N a t i o n a l I n c o m e s C o m m i s s i o n ( N . I . C . ) o r f r o m a n ad hoc
b o d y , w h i c h m i g h t c o n s i s t of t h e c h a i r m a n a n d a few m e m b e r s of
N . I . C . , r e i n f o r c e d by P r i v y C o u n c i l l o r s o r b a c k - b e n c h M e m b e r s of
t h e H o u s e of C o m m o n s . I n f a v o u r of t h e f o r m e r c o u r s e it w a s
r e p r e s e n t e d t h a t it w o u l d b e p r e f e r a b l e t o r e m i t t h e issue to a b o d y
w h i c h d i d n o t i n c l u d e a n y i n d i v i d u a l h a v i n g a p e r s o n a l i n t e r e s t in
t h e o u t c o m e of t h e i n q u i r y . M o r e o v e r , P a r l i a m e n t , h a v i n g a p p r o v e d
t h e e s t a b l i s h m e n t of N . I . C . as a n i m p a r t i a l s o u r c e of a d v i c e o n w a g e
c l a i m s a d v a n c e d b y o t h e r s e c t i o n s of t h e c o m m u n i t y , s h o u l d b e willing
t o s u b m i t t o t h e C o m m i s s i o n t h e q u e s t i o n of t h e p r o p e r r e m u n e r a t i o n
of its o w n M e m b e r s . O n t h e o t h e r h a n d a c o n s i d e r a b l e b o d y of
o p i n i o n h e l d t h a t P a r l i a m e n t s h o u l d be p r e p a r e d to d e c i d e o n its o w n
r e s p o n s i b i l i t y an issue w h i c h w a s of p e c u l i a r c o n c e r n t o its M e m b e r s —
t h e m o r e so since t h e n a t u r e of P a r l i a m e n t a r y d u t i e s w a s u n i q u e a n d
M e m b e r s of P a r l i a m e n t m i g h t h a v e insufficient c o n f i d e n c e in o p i n i o n s
e x p r e s s e d b y a b o d y n o n e of w h o s e m e m b e r s h a d p r a c t i c a l e x p e r i e n c e
of political life. F o r t h e s e r e a s o n s it m i g h t b e p r e f e r a b l e t h a t t h e
q u e s t i o n s h o u l d b e r e m i t t e d t o a n ad hoc b o d y , w h i c h m i g h t c o m p r i s e
a few m e m b e r s of N . I . C . b u t s h o u l d also i n c l u d e i n d i v i d u a l s with
p e r s o n a l e x p e r i e n c e of service b o t h in P a r l i a m e n t a n d in i n d u s t r y
a n d t h e p r o f e s s i o n s . I n a n y e v e n t it w o u l d b e n e c e s s a r y to e n s u r e
a d e q u a t e r e p r e s e n t a t i o n of t h e interests of t h e H o u s e of L o r d s .
The Prime Minister,
s u m m i n g u p t h e d i s c u s s i o n , said t h a t t h e
b e s t m e t h o d of o b t a i n i n g i n d e p e n d e n t b u t i n f o r m e d advice o n t h e
issues i n v o l v e d m i g h t b e t o r e m i t t h o s e issues t o a small b o d y ,
c o n s i s t i n g of the C h a i r m a n of N . I . C . , s u p p o r t e d b y t w o m e m b e r s
of t h e C o m m i s s i o n a n d , p o s s i b l y , a t h i r d i n d i v i d u a l selected b y v i r t u e
of special k n o w l e d g e of P a r l i a m e n t a r y a n d c o n s t i t u t i o n a l q u e s t i o n s ,
o n t h e u n d e r s t a n d i n g t h a t this b o d y w o u l d l o o k for d e t a i l e d
i n f o r m a t i o n o n t h e r e s p o n s i b i l i t i e s of political life t o a n a d v i s o r y
p a n e l of M e m b e r s of P a r l i a m e n t a n d P e e r s , w h i c h w o u l d n e e d t o b e
s p e c i a l l y c o n s t i t u t e d for this p u r p o s e . H e w o u l d discuss this p r o p o s a l
f u r t h e r w i t h t h e L e a d e r of t h e O p p o s i t i o n a n d , if a g r e e m e n t w e r e
r e a c h e d , w o u l d e n d e a v o u r t o m a k e an a p p r o p r i a t e a n n o u n c e m e n t in
Parliament before the Christmas Recess.
The
White Paper
on Public
Expenditure
(Previous
Reference:
C.C. (63) 52nd
Conclusions,
Minute 5)
C a b i n e t -
T o o k n o t e t h a t t h e P r i m e M i n i s t e r w o u l d discuss w i t h t h e
L e a d e r of t h e O p p o s i t i o n t h e d e s i r a b i l i t y of a r r a n g i n g a
r e v i e w of t h e p a y of M e m b e r s of P a r l i a m e n t a n d M i n i s t e r s
on t h e lines i n d i c a t e d in his s u m m i n g u p of t h e i r d i s c u s s i o n .
5. T h e C a b i n e t h a d b e f o r e t h e m a m e m o r a n d u m b y t h e
C h a n c e l l o r of the E x c h e q u e r ( C P . (63) 32), to w h i c h w a s a p p e n d e d
a d r a f t W h i t e P a p e r o n P u b l i c E x p e n d i t u r e in 1 9 6 3 - 6 4 a n d 1 9 6 7 - 6 8 .
The Chancellor
of the Exchequer
said that during the D e b a t e
o n the A d d r e s s h e h a d a n n o u n c e d e s t i m a t e s of p u b l i c e x p e n d i t u r e in
1 9 6 7 - 6 8 o n t h e basis of t h e G o v e r n m e n t s p r e s e n t policies. A s a r e s u l t
t h e G o v e r n m e n t h a d been challenged to publish a W h i t e Paper giving
a m o r e c o m p r e h e n s i v e p i c t u r e of t h e g r o w t h of p u b l i c e x p e n d i t u r e .
It w o u l d be a d v a n t a g e o u s t o a c c e p t this c h a l l e n g e b y p u b l i s h i n g a
W h i t e P a p e r of this k i n d b e f o r e C h r i s t m a s . T h e d r a f t a n n e x e d t o
his m e m o r a n d u m h a d b e e n a p p r o v e d b y t h e E c o n o m i c P o l i c y
C o m m i t t e e ; a n d , subject to f u r t h e r c o n s i d e r a t i o n of p o i n t s of d e t a i l ,
it w a s p r o p o s e d to p u b l i s h it o n 19th D e c e m b e r .
In discussion there was general agreement with this p r o p o s a l .
T h e following points were m a d e :
(a) I n t h e t a b l e o n p a g e 5, c o m p a r i n g p u b l i c e x p e n d i t u r e i n
1 9 6 3 - 6 4 a n d 1 9 6 7 - 6 8 , t h e d e c r e a s e in e x p e n d i t u r e o n t h e i t e m
d e s c r i b e d as " A s s i s t a n c e t o a g r i c u l t u r e , i n d u s t r y a n d t r a n s p o r t "
might be misunderstood to imply that assistance to agriculture was
e x p e c t e d t o decline, w h e r e a s t h e r e d u c t i o n w a s in fact a t t r i b u t a b l e
t o t h e d e c r e a s e in t h e s u b s i d y t o b e p a i d t o t h e r a i l w a y s as a r e s u l t
of t h e p r o g r e s s i v e r e d u c t i o n of t h e B r i t i s h R a i l w a y s B o a r d ' s deficit.
T h i s m i s u n d e r s t a n d i n g m i g h t b e a v o i d e d if the o r d e r of t h e w o r d s in
t h e d e s c r i p t i o n of t h e i t e m w e r e r e v e r s e d .
(b) E x p e n d i t u r e o n o v e r s e a s aid w o u l d be liable t o a p p e a r s m a l l
in c o m p a r i s o n with o t h e r i t e m s ; a n d t h e fact t h a t t h e e s t i m a t e d
i n c r e a s e w a s c o n s i d e r a b l e in p r o p o r t i o n t o t h e t o t a l m i g h t usefully
b e e m p h a s i s e d if it w e r e e x p r e s s e d in p e r c e n t a g e t e r m s either i n a n
a d d i t i o n a l c o l u m n t o t h e t a b l e o r in t h e e x p l a n a t o r y text.
The
Cabinet—
(1) I n v i t e d t h e C h a n c e l l o r of t h e E x c h e q u e r t o give f u r t h e r
c o n s i d e r a t i o n , in t h e light of their d i s c u s s i o n a n d in
consultation with the Ministers concerned, to the draft
of t h e W h i t e P a p e r o n P u b l i c E x p e n d i t u r e in 1 9 6 3 - 6 4
and 1967-68.
(2) A u t h o r i s e d t h e C h a n c e l l o r of t h e E x c h e q u e r , in c o n s u l t a t i o n
w i t h the L o r d P r i v y Seal, t o a r r a n g e for t h e W h i t e P a p e r ,
a m e n d e d as n e c e s s a r y in t h e l i g h t of C o n c l u s i o n (1) a b o v e ,
to b e p u b l i s h e d b e f o r e t h e C h r i s t m a s R e c e s s .
Future
Agricultural
P o , i c v
6. T h e C a b i n e t h a d b e f o r e t h e m a m e m o r a n d u m by t h e M i n i s t e r
f A g r i c u l t u r e ( C P . (63) 31) o n t h e d e v e l o p m e n t of t h e G o v e r n m e n t s
a g r i c u l t u r a l policy.
Q
(Previous
ReferenceC.C. (63) 32nd
Conclusions,
Minute 7)
e
^
Minister
of Agriculture
said t h a t o n 1 6 t h M a y t h e C a b i n e t
h a d a u t h o r i s e d h i m to d i s c u s s w i t h t h e f a r m e r s ' r e p r e s e n t a t i v e s a n d
w i t h o v e r s e a s u p p l i e r s c e r t a i n p r o p o s e d c h a n g e s in t h e s u p p o r t
system for a g r i c u l t u r e , of w h i c h t h e m o s t i m p o r t a n t w e r e the
imposition
of
standard
quantities,
under
flexible
guarantee
a r r a n g e m e n t s , for h o m e p r o d u c t i o n a n d t h e n e g o t i a t i o n of v o l u n t a r y
a g r e e m e n t s w i t h o u r m a i n o v e r s e a s u p p l i e r s for t h e l i m i t a t i o n of
imports.
T h e initial r e a c t i o n of t h e f a r m e r s ' r e p r e s e n t a t i v e s h a d b e e n t o
seek a s s u r a n c e s a b o u t t h e m a i n t e n a n c e of f a r m i n g i n c o m e s a n d a b o u t
o p p o r t u n i t i e s f o r f u r t h e r g r o w t h . I n c o n t r a s t to t h e i n d u s t r i a l s e c t o r ,
w h e r e i n c o m e s a n d p r o d u c t i v i t y h a d m o v e d b r o a d l y in line, f a r m e r s
had increased their productivity w i t h o u t receiving any c o m p a r a b l e
benefit in t e r m s of i n c o m e s . O p p o r t u n i t i e s for i n c r e a s i n g f a r m i n g
i n c o m e s w o u l d b e still f u r t h e r r e s t r i c t e d if, u n d e r t h e n e w
a r r a n g e m e n t s , t h e r e w e r e t o be a fixed r a t i o b e t w e e n h o m e a n d
o v e r s e a s s u p p l i e s of a n y given c o m m o d i t y , w h e r e a s t h e f a r m e r s
c o n s i d e r e d t h a t t h e y w e r e e n t i t l e d g r a d u a l l y to i n c r e a s e their s h a r e
of a r i s i n g d o m e s t i c d e m a n d . H e h a d t h e r e f o r e p r e p a r e d , in
c o n s u l t a t i o n w i t h r e p r e s e n t a t i v e s of t h e i n d u s t r y b u t w i t h o u t
c o m m i t m e n t s o far as t h e G o v e r n m e n t w e r e c o n c e r n e d , a d r a f t
s t a t e m e n t of objectives (in t h e f o r m a p p e n d e d t o C P . (63) 31), w h i c h
m i g h t f o r m p a r t of t h e A n n u a l R e v i e w W h i t e P a p e r in M a r c h 1964,
a n d c o u l d b e u s e d , in t h e i n t e r i m , as t h e basis of t h e f u r t h e r d i s c u s s i o n s
w i t h o v e r s e a s u p p l i e r s w h i c h w o u l d n o w b e n e e d e d in r e l a t i o n to
b o t h cereals a n d m e a t .
Negotiations on cereals h a d reached a stage at which agreement
s e e m e d p o s s i b l e , t h e s i t u a t i o n b e i n g simplified b y t h e fact t h a t o u r
m a i n c e r e a l i m p o r t s — m a i z e and h a r d w h e a t — w e r e n o t of a k i n d
w h i c h c o u l d b e p r o d u c e d at h o m e . T h e o n l y s e r i o u s p r o b l e m , s o far
as t h e h o m e p r o d u c e r s w e r e c o n c e r n e d , w a s the level of t h e s t a n d a r d
q u a n t i t y . T h e f a r m e r s h a d a s k e d f o r 10 million t o n s , w h i c h w o u l d
p r o v i d e a d e q u a t e s c o p e for i n c r e a s e d p r o d u c t i o n i n the c o m i n g y e a r .
T r e a s u r y M i n i s t e r s , h o w e v e r , h a d s u g g e s t e d a l o w e r figure of 8£
m i l l i o n t o n s ; a n d it h a d b e e n e s t a b l i s h e d t h a t o v e r s e a s u p p l i e r s
w o u l d b e u n l i k e l y t o a g r e e v o l u n t a r i l y t o restrict t h e i r i m p o r t s if t h e
s t a n d a r d q u a n t i t y of h o m e p r o d u c t i o n w e r e set a t a h i g h e r figure
t h a n 9% m i l l i o n t o n s . I n o r d e r t o p r e v e n t i m p o r t s a t u n r e a l i s t i c p r i c e s
it w a s also p r o p o s e d to e s t a b l i s h a m i n i m u m i m p o r t p r i c e . T h e r e
w e r e g r o u n d s for h o p i n g t h a t o u r m a i n o v e r s e a s u p p l i e r s w o u l d accept
t h e s e p r o p o s a l s in p r i n c i p l e . If so, it w o u l d be n e c e s s a r y t o settle
t h e d e t a i l e d a r r a n g e m e n t s q u i c k l y if final a g r e e m e n t w e r e t o be
r e a c h e d b e f o r e t h e F a r m P r i c e R e v i e w in F e b r u a r y 1964.
T h e p o s i t i o n as r e g a r d s m e a t g a v e rise to g r e a t e r c o n c e r n . F o r
r e a s o n s c o n n e c t e d w i t h t h e n a t u r e of t h e t r a d e c o n t r o l of t h e m a r k e t
c o u l d n o t b e s e c u r e d b y t h e e s t a b l i s h m e n t of a m i n i m u m i m p o r t p r i c e
b u t w o u l d h a v e t o b e effected b y m e a n s of q u a n t i t a t i v e r e s t r i c t i o n .
I t w o u l d b e difficult, if n o t i m p o s s i b l e , t o secure t h e a g r e e m e n t of
t h e d o m e s t i c p r o d u c e r s t o a s t a n d a r d q u a n t i t y for m e a t , at least in
1964; and t h e opposition w o u l d be particularly strong in Scotland.
T h e f a r m e r s c o n s i d e r e d t h a t a n a t t e m p t at this s t a g e t o r e s t r i c t h o m e
p r o d u c t i o n w a s n o t justified b y a n y p r o s p e c t i v e s u r p l u s in w o r l d
p r o d u c t i o n a n d w o u l d u n r e a s o n a b l y d e p r i v e t h e i n d u s t r y of p r o s p e c t s
of f u r t h e r g r o w t h . So l o n g as h o m e p r o d u c t i o n r e m a i n e d u n c o n t r o l l e d ,
h o w e v e r , it w o u l d be i m p o s s i b l e to o b t a i n t h e a g r e e m e n t of o v e r s e a
s u p p l i e r s t o limit t h e i r o w n i m p o r t s ; a n d this s i t u a t i o n w a s f u r t h e r
c o m p l i c a t e d b y t h e fact t h a t , as a result of t h e w i t h d r a w a l of m e d i c a l
r e s t r i c t i o n s , i m p o r t s of m e a t f r o m c e r t a i n E u r o p e a n c o u n t r i e s w e r e
n o w to b e e x p e c t e d . I n t h e s e c i r c u m s t a n c e s t h r e e p o s s i b l e c o u r s e s
of a c t i o n w e r e o p e n to t h e G o v e r n m e n t . T h e first w o u l d b e t o i m p o s e
a s t a n d a r d q u a n t i t y o n h o m e p r o d u c t i o n w i t h o u t t h e a g r e e m e n t of
t h e f a r m i n g i n d u s t r y . T h i s w o u l d m a k e it p o s s i b l e t o s e c u r e a
v o l u n t a r y r e s t r i c t i o n of i m p o r t s , w o u l d s a f e g u a r d o u r o t h e r o v e r s e a s
t r a d i n g i n t e r e s t s a n d w o u l d effectively limit the c o s t of E x c h e q u e r
support. But
it w o u l d h a v e s e r i o u s
political
repercussions.
A l t e r n a t i v e l y , n o limit c o u l d b e p l a c e d o n h o m e p r o d u c t i o n a n d t h e
level of i m p o r t s c o u l d b e c o n t r o l l e d b y q u o t a s . T h i s c o u r s e , h o w e v e r ,
w o u l d b e liable t o d o serious d a m a g e t o o u r i n t e r n a t i o n a l t r a d e .
T h i r d l y , it m i g h t b e p o s s i b l e , a l t h o u g h n o t easy, t o g o as far in t h e
d i r e c t i o n of limiting h o m e p r o d u c t i o n as t h e f a r m e r s w o u l d
v o l u n t a r i l y a c c e p t a n d t h e n to invite o v e r s e a s u p p l i e r s to c o - o p e r a t e
in t h e p h a s i n g of t h e i r supplies t o t h e U n i t e d K i n g d o m m a r k e t . B u t ,
if t h e s e v o l u n t a r y a r r a n g e m e n t s b r o k e d o w n , the E x c h e q u e r w o u l d
b e at c o n s i d e r a b l e risk. M u c h w o u l d d e p e n d o n t h e e x t e n t t o w h i c h
t h e r e w a s a s u r p l u s of w o r l d m e a t p r o d u c t i o n in t h e f o l l o w i n g y e a r ;
it w a s a l r e a d y k n o w n t h a t h o m e p r o d u c t i o n w a s n o t likely t o i n c r e a s e
b y m o r e t h a n a b o u t 2 p e r cent a n d t h a t this w o u l d d o no m o r e t h a n
k e e p pace with the increasing d e m a n d .
In d i s c u s s i o n t h e following p o i n t s w e r e m a d e :
(a) A policy w h i c h c o u l d b e r e p r e s e n t e d as increasing p r o t e c t i o n
for t h e h o m e p r o d u c e r a n d r e d u c i n g o p p o r t u n i t i e s f o r t h e o v e r s e a
s u p p l i e r w o u l d b e liable to p l a c e at risk t h e g r o w t h of the i n d u s t r i a l
exports on which the United K i n g d o m economy depended. O n the
o t h e r h a n d it w o u l d b e socially a n d e c o n o m i c a l l y difficult t o d e f e n d
t h e d e l i b e r a t e r e s t r a i n t of d o m e s t i c a g r i c u l t u r e . A b a l a n c e w o u l d
h a v e t o b e s t r u c k b e t w e e n t h e s e conflicting c o n s i d e r a t i o n s ; a n d this
w o u l d n e e d t o b e reflected in a n y p u b l i c s t a t e m e n t of t h e
G o v e r n m e n f s policy.
(b) T h e h o m e p r o d u c e r c o u l d n o t b e g u a r a n t e e d a l a r g e r s h a r e
of t h e m a r k e t , o r e n c o u r a g e d t o e x p e c t s u c h an i n c r e a s e at e a c h
successive review, without d a m a g i n g our relations with oversea
s u p p l i e r s . O n t h e o t h e r h a n d it w o u l d b e u n a c c e p t a b l e to r e s t r i c t t h e
h o m e p r o d u c e r to a fixed a n d u n a l t e r a b l e p e r c e n t a g e of t h e m a r k e t
o r t o d e n y h i m t h e o p p o r t u n i t y t o c o m p e t e f o r a larger s h a r e if
h i s efficiency e n t i t l e d h i m t o e x p e c t it.
(c) I n v i e w of t h e i m p o r t a n c e of c o n c l u d i n g t h e n e g o t i a t i o n s o n
c e r e a l s it w o u l d b e n e c e s s a r y t o d e c i d e w i t h o u t d e l a y w h e t h e r t o o p e n
f o r m a l n e g o t i a t i o n s w i t h o v e r s e a s u p p l i e r s o n t h e basis of a s t a n d a r d
q u a n t i t y of 10 m i l l i o n t o n s , w h i c h m i g h t b e r e d u c e d in n e g o t i a t i o n
t o 9\ million t o n s , o r w h e t h e r to a d o p t l o w e r figures. If p o s s i b l e , a
d e c i s i o n s h o u l d b e t a k e n o n this p o i n t w i t h o u t p r e j u d i c e t o t h e
b r o a d e r issues of policy, w h i c h w o u l d r e m a i n f o r l a t e r d i s c u s s i o n .
The
Cabinet—
(1) T o o k n o t e of C P . (63) 31 a n d of t h e p o i n t s m a d e i n t h e i r
discussion.
(2) T o o k n o t e t h a t t h e F o r e i g n S e c r e t a r y w o u l d c o n s u l t t h e P r i m e
M i n i s t e r on t h e m o s t a p p r o p r i a t e m e a n s of s e c u r i n g a n
early decision a b o u t
t h e basis o n w h i c h
formal
n e g o t i a t i o n s s h o u l d b e o p e n e d w i t h o v e r s e a s u p p l i e r s of
cereals.
(3) A g r e e d t o r e s u m e t h e i r d i s c u s s i o n a t a s u b s e q u e n t m e e t i n g .
Industrial
Disputes
London Bus
Crews
(Previous
Reference:
C M . (63) 6th
Conclusions,
Minute 2)
7. The Minister
of Labour
said that he expected to receive
d u r i n g t h e d a y a n i n t e r i m r e p o r t f r o m t h e C o m m i t t e e of I n q u i r y u n d e r
t h e c h a i r m a n s h i p of P r o f e s s o r P h e l p s - B r o w n w h i c h w a s c o n s i d e r i n g
t h e p a y a n d c o n d i t i o n s of e m p l o y m e n t of b u s c r e w s e m p l o y e d b y t h e
L o n d o n Passenger T r a n s p o r t Board. T h e report, which would be
p u b l i s h e d o n 16th D e c e m b e r , w a s likely to r e c o m m e n d i n c r e a s e s in
p a y b a s e d o n t h e p r o p o s a l s p u t b e f o r e t h e c o m m i t t e e by t h e B o a r d .
The
Cabinet—
T o o k n o t e of t h e s t a t e m e n t b y t h e M i n i s t e r of L a b o u r .
Cabinet
Office, S.W.
12th December,
1,
1963.