Leader's speech, Blackpool 1972
Harold Wilson (Labour)
Commentary:Wilson opened this speech by giving an account of the worsening violence in Northern Ireland and called for all-party talks to address the situation. He then expressed support for the government’s policy of allowing Ugandan Asians to settle in the UK, but condemned its approach to Rhodesia. With regard to domestic politics, Wilson accused Heath of deceiving the public on prices and the cost of living, both of which continued to rise. He also attacked the Conservatives for exacerbating industrial unrest and unemployment, and criticised their policies on education, pensions and housing.
Mr. Chairman, Fellow Delegates, before I come to my main report to Conference there are three immediate issues to which I feel I must give priority.
The first is the deepening tragedy in Northern Ireland. After the Darlington Conference we seem further than ever from a peaceful, democratic settlement, and even the Government have deferred making their own proposals for another three months. In these past weeks the situation has degenerated, and in both communities there is a real fear of civil war, with British troops perhaps caught in the crossfire.
Against all the odds, we have to prove that violence will produce nothing but the seeds of future violence. Violence will never produce a united Ireland. All it can do is to destroy Ireland. It is not only that the democratic process is on trial. Democracy in our country is staked in a desperate race between the rule of reason and the rule of the gunman - on both sides now. Time is not on our side. Time has turned traitor.
We put forward our proposals last November. After months of delay the Government decided to put forward theirs. They included, as we had urged, a phased programme to end internment, and the transfer of security from Stormont to Westminster. When the Northern Ireland Government rejected these proposals, direct rule from Westminster was imposed. We supported that decision. Neither the Government nor we had sought direct rule, but we felt in honour bound to support the Government because direct rule had been forced on them by their acceptance of our conditions for a settlement. Regardless of any other political considerations we have supported their actions and we have supported the Army in the performance of a task with which no modern army has ever been charged by a democratic Government.
But now we face deadlock, irreconcilable deadlock. In two years, more than 150 soldiers have lost their lives. My own constituency - and this is true of so many others here - has shared in this suffering. I have just written to a tragic mother, a constituent, who lost her 18-year-old son in an ambush. Now she is widowed by the subsequent suicide of the father. This tragedy is not in a far-away country of which we know nothing. It is here; and there is no escape for us.
I fear a reaction which is growing, a demand that Britain withdraws her armed forces, a demand that, as too many are saying, ‘Let them cut one another’s throats.’ This is understandable. It is not the answer.
But - and on this I cannot remain silent - must our troops be subject to a virtually uncontrolled gun-law? On April 6, 1971, 18 months ago, in the anxious debate which followed the deposition of Major Chichester-Clark and the accession of Mr. Faulkner, I demanded that all gun licences be withdrawn, subject to a minimum issue for self-defence in remote areas, including the border. I demanded that, these apart, the holding of private weapons be no longer tolerated in Northern Ireland. (Applause) There are upwards of 100,000 licensed weapons in Northern Ireland, and God alone knows how many illegal ones.
I now warn Mr. Heath. The possession of private arms is not an inalienable human right. Public opinion in Britain will not for long tolerate the continued presence of British troops, unless firm action is taken to make illegal the holding of private arms. (Applause)
Add to that what is the law in our own country. Political uniforms must be banned - on both sides. (Applause)
Second, I call now - after all these lost months - or all-party talks with an open agenda. And on that agenda we shall again table our fifteen-point programme, as other parties will table their proposals. There will be no solution which does not provide for consideration, not only in the North, but on a tripartite basis between the parties of Westminster, Belfast and Dublin of our proposals for common action to consider the implications of a move spread over fifteen years to a United Ireland, based on consent, with the enactment and guarantee of full civic rights, and with full provision and protection of the religious, political, economic and social interests of all communities, majority and minority, in Northern Ireland and the wider Ireland. (Applause)
The second issue is Uganda, which was debated yesterday. We have pledged to the Government our support for their policy on the Uganda Asians, and for their reaction to the obscenity of Uganda’s military dictator.
Looking back a little further, I could have wished that Downing Street had not accepted with such evident satisfaction the military coup which deposed President Obote in January 1971. (Applause) But then that occurred during Milton Obote’s return from the Commonwealth Conference in Singapore, where he had had the effrontery to oppose Mr. Heath’s policy of arms for South Africa. (Applause) Mr. Heath cast his bread upon the waters and it was returned in the unpleasing shape of General Amin.
But in this situation, as our front bench spokesman made clear as soon as Mr. Rippon had returned from Kampala, we accept the implications of the obligation which successive British Governments have accepted. Holders of British passports have the right, if excluded from their home country, to residence here. We shall support the Government in their implementation of a policy which was theirs and ours. We shall support them too - as the N.E.C. statement has made clear - in every step necessary to prevent a still further concentration on areas whose social resources, in the widest sense, are strained to the utmost; in the longest possible phasing in time; and the widest possible distribution by area; and in the provision of maximum financial aid for the areas affected.
The Government will have our support in Parliament. I am aware of the thunderings from one part of Wolverhampton, which will be treated with the contempt I have always accorded them. (Applause) Mr. Heath has his Party problems; this is not one of ours. Powell without responsibility; the prerogative of the Enoch throughout the ages. (Laughter) So let Mr. Heath deal with him. After all, 15 of his Parliamentary seats in the Midlands - 30 on a division, more than his overall majority - he owes to Mr. Powell. You should be here next week. (Laughter)
We have been ready to support the Government on these two issues, but we have not been able to do so on Rhodesia. For Mr. Heath was committed to surrender the interests of this country, and our deeper, wider moral responsibilities to the majority in Rhodesia, to surrender all that to the dictates of his right wing, to which he has been too prone, throughout his leadership, to bow the knee. We condemned the unacceptable terms of his Salisbury surrender as soon as they were published, and then the results of the test of the fifth principle - acceptability to the people of Rhodesia as a whole confirmed our condemnation, as it confirmed the rightness of our action in insisting on all the principles we laid down. Mr. Heath should tell his conference here next week that the Smith-Home agreement is dead. He should stop his Government’s equivocation that it rests on the table ‘until it is accepted.’ For he knows that in Rhodesia that phrase means ‘until every articulate leader of African opinion is behind bars.’
I now move the Parliamentary Report for the second session of this Parliament - thanks to Mr. Heath, the Gagged Parliament.
Just as in the first session legislation centred on such obsessional Tory preoccupations as school milk and the Industrial Relations Act, so this one has seen Mr. Heath’s railroading of the Housing Finance Bill, the Scottish Housing Finance Bill, and - a measure without precedent in the centuries since autocracy yielded place to democracy - the totally anti-constitutional, anti-democratic European Communities Bill. (Applause) All of these three under guillotine, of course. It has become a routine instrument of Mr. Heath’s style of Government.
Last Thursday, Mr. Heath, in Nottingham, referring to the need for a policy against inflation, said this: ‘It is what the whole country longs for.’ He went on: ‘The people of this country have had enough of inflation.’ ‘The people of this country have had enough’ period. We have it on the authority of, of all people, the architect of the inflation which the British people are suffering.
He spoke, he said, ‘as the Government elected to represent the whole nation.’ The whole nation.
Two years ago, on the day he formed a Government, he pledged himself in these words: ‘Our purpose is not to divide but to unite and where there are differences to bring about reconciliation and to create one nation.’
That pledge he has deliberately broken, and that is why the. British people ‘have had enough.’
Whatever contradictions and policy-reversals we have seen without shame, without a blush, on one thing Mr. Heath has shown utter consistency, and let us not here rob him of his laurels. He has shown utter and systematic consistency in the breach of the solemn pledges, without which the Conservatives would never have become the Government. (Applause) His pledge on prices - on which, and on which alone, he won the election - has been so utterly dishonoured that the British people as a whole can form only one judgement. It is not that his policies have led to a regime of price inflation in total contradiction to his pledges. That could have been dismissed as incompetence.
But what the British people now realise is that all his pledges on prices and the cost of living were made by a man who knew when he made them that they could not be honoured. (Applause) So it is not a question of incompetence - it is a question of deliberate, calculated deceit. (Applause) And that, even more than incompetence, has been the distinguishing, continuing feature equally of his Government.
Mr. Heath will go down in history with this unique achievement. He has proved all the experts wrong, because for generations classical wisdom has taught that if you have inflation you do not have unemployment. We have been taught if you have unemployment - enough unemployment - you will end inflation. He presides today over a system of economic society where we have record inflation and record post- war unemployment at one and the same time. Rising prices, rising living costs - rising now at a yet faster rate - and registered unemployment still close to the million mark, real unemployment substantially above the million. In the forecast we read in the paper this morning by an authoritative body, unemployment may rise to a million and a quarter next February.
Now, faced with this inflation, he is appealing to both sides of industry to bail him out. What last week he offered the nation amounted to a total confession of failure. They are not only an abject admission that his election promises were a fraud, they are a confession that his policies over two years have been totally misdirected - his policies of fighting inflation by deliberately raising prices, and acting on incomes by deliberately staged confrontations with the trade unions.
Last Tuesday was not a step forward; it was an acknowledgement of defeat - designed to draw a veil over all that Heath and the whole Selsdon package stand for, abrasive, petulant, divisive.
By August, after 26 months in office, the cost of living under the Conservatives has risen by 18½ per cent; that means in old money the £ has lost three shillings of its value, in just over two years. We recall with contempt Mr. Heath’s election scare that the sixpence minimum fare after three more years of Labour would be a shilling. The G:L.C. put it up to one shilling in two months. Under two years of the Tories some of those minimum fares are now replaced by a two shilling, ten pence minimum. We recall more with pity than with contempt the complacency of Mr. James Prior, the Food Minister, over all these food prices. Last year we had the scandal of cattle exports to Europe. At the height of the crisis at the beginning of June he blandly told Parliament that this should be only a temporary situation; it would soon pass with the home killings. That has not been the case. And now we are told that we must expect still higher beef prices in the future. It is a sign of the times when the Daily Mirror and the Daily Express are singing in close harmony. The Daily Mirror shopping clock on Saturday was up to a new record; up 23½ pence in the £ from November 1971. The Daily Express shopping list on the same day was up 27 pence in the £ since January 1971. If those two agree it must be right.
Mr. Heath now talks as though inflation was uncovered at Chequers a week ago. Mr. Heath has been promoting inflation by a series of deliberate actions from the moment he became Prime Minister. He scrapped controls on prices. He scrapped the Prices and Incomes Board. He scrapped the Consumer Council. He scrapped Labour’s Rent Control Acts. He introduced his own Act, the Housing Finance Act, to increase rents. He restored the Corn Laws. He introduced the food levies to force food prices up. He fell over himself to negotiate terms in Europe which will force all our food prices up to intolerable levels. (Applause) And just in case anything was left out by any chance, he enacted the Value Added Tax.
All this time he was blaming increased prices on the trade union movement. And so we had the policy of the pitched battles and the set piece confrontations. I will not remind you of all of them. But, well, there was the dustmen and the other local authority manual workers. Edward’s finest hour. He fought them on the beaches, on the hills, on the refuse heaps and the sewage farms, until our cities were reeking with the stink of rotting garbage. (Applause) The delicate perfume of the better tomorrow. (Applause) And he lost. Then we had the electricity workers, where Wilberforce snatched a defeat for him on the morrow of his highly publicised victory. Then there were the postmen. Ah, triumph was sweet; the bully had conquered the weak. And nothing would ever be the same again. You would see them all, miners, railway workers, engineers, dockers, bow the knee at his command.
Two years ago at his Blackpool victory conference he claimed ‘We were returned to office to change the course of history of this nation. Nothing less… It will not happen overnight. It may be there will be no day that you can mark on the calendar and say “That was Freedom Day.”’ So until he names the day let us now measure the industrial consequences of Mr. Edward Heath. In five years eight months of the Labour Government 24,045,000 man days were lost through industrial disputes. Too many we all agree. And we and the T.U. C. were working out means to reduce that toll. But in two years and two months of Mr. Heath, up to the end of August, against our 24,045,000 his Government has cost the country 42,665,000 man days lost through industrial stoppages. And in the eight months of this year alone he has lost 19,000,000 days, almost as many as the Labour Government’s toll over close on six years. (Applause)
And this year he has thrown a new spanner into the mechanism of industrial relations - N.I.R.C. Even a Morecambe and Wise send-up of the British legal system could never have produced a script in which the Secretary of State for Employment could solemnly submit to the Court, to N.I.R.C., that he had reason to think that the railwaymen of Britain did not agree with Sid Greene, Ray Buckton and Percy Goldrick, without having to produce evidence, either to the Court or to Parliament. And when the railwaymen of Britain gave their answer, 6 to 1, we had his considered judgement on the Industrial Relations Act, N.I.R.C., and he said - yes, yes, he actually, said this – ‘All my recent evidence is that the legislation is succeeding beyond expectation in its first aim: to concentrate industry’s mind on improving industrial relations.’
Had the Employment Secretary been Master of the Titanic - his last radio message would no doubt have been to the effect that he had succeeded in his main purpose of drawing attention to the study of Atlantic Meteorology and the problems of marine engineering. (Applause)
But other references to the Court have thrown up a different kind of ignorance. What could that Court know of the anxieties of dockland in the face of the harsh and brutal technological change which has hit this industry as deeply as any other industry in Britain. Experienced trade union leaders here know about them. Many delegates in this hall know about them. Those of us who represent dockland seats in Parliament know about them. All of us know how formidable were the problems with which Jack Jones and Lord Aldington were faced. In the very week when the Jones-Aldington Report provided, a statesmanlike basis for peace in the docks - that Report was rejected by the Dockers’ Delegate Conference, and it was rejected because of their anger at the gaoling of their fellow-dockers. There would have been, in my view, no dockers’ strike but for the provocative and irrelevant intervention of the Industrial Relations Act and the National Industrial Relations Court. (Applause)
But that is not all. On both the occasions when they were saved by the Official Solicitor the Government had a clear duty to act, and they were powerless to do so. A Government should never manoeuvre itself into the position that when it needs to act, and the interests of the country demand that it should act, that it is impotent, immobile, deprived of the power to act. That is the mark not of a Government, it is the mark of abdication, of impotence. When Britain elects its Government it does not intend that that Government, facing acute national emergency, especially if that is caused by its own doctrinaire actions, that that Government should be dependent on a mysterious legal functionary. Any more than it should have been the case, and it was the case, that the whole future of Rolls Royce and 50,000 workers depended not on a decision of the British Government at the end of the day but the maverick vote of a senator in Washington, who fortunately voted the right way.
N.I.R.C., industrial confrontations are the essence of the Conservatism of the seventies - of this Government, and above all of the Prime Minister. Ignorance - of industry and of people - a monastic unconcern, a monumental preoccupation only with Europe.
But that is not all. The new style of Government he promised us here at Blackpool two years ago is its fatal facility for dividing this nation. Mr. Heath presides over a sick Government, which if it lasts much longer will start infecting the nation with its sickness. (Applause) It is the fault not of Britain, but of those who currently control Britain’s destiny, that that is the image which is presented abroad.
On the day he became Prime Minister, he pledged himself to create a united nation. A united nation. In education? Mrs. Margaret Thatcher’s addiction to the veto in the face of opposition even from some Conservative authorities, has stopped the progress to equality of educational opportunity which just over two years ago appeared to be assured and accepted. In Mr. Heath’s 1970 election manifesto he gave this pledge on behalf of a future Conservative Government.
These were his words in the manifesto:
‘On many issues, particularly in education and housing’ – yes – ‘Particularly in education and housing, they (the Labour Government) have deliberately overridden the views of elected councillors. We think it wrong that the balance of power between central and local Government should have been distorted, and we will redress the balance and increase the independence of local authorities.’ (Laughter)
That is what he said.
But a Tory minority can sabotage the wishes of a whole community in the matter of equality of opportunity with ministerial blessing today. A few days ago there was a report that 64 per cent of the nation’s children are still subject to some form of 11 plus selection. That would not have been the case today if Ted Short’s comprehensive education Bill, going through Parliament in 1970, had been carried through. But freedom for local authorities? When Labour councillors were threatened with all the pains and penalties La Belle Dame Sans Merci could devise for them over school milk, including loss of civic rights if they presumed to discharge their responsibilities to the children of their areas by providing school milk to seven-year-olds?
A united nation in old age. Dick Crossman’s Superannuation Bill would have achieved this. Sir Keith Joseph’s Bill is deliberately designed to perpetuate two nations in old age - favoured ones in private pension scheme; and seven millions outside private pension schemes condemned to permanent poverty.
Labour in Parliament, the T.U.C., the National Council of Labour have fought without remission for justice for the pensioner. 75p - 15s. - is all he can offer, at a time of accelerating price increases in a society characterised by class-based tax remissions, and the emancipation of the land and property profiteer. All he can offer - 75p - in a society where to him that hath shall be given, a society where the favoured are not the creators of the nation’s wealth, or the past creators of the nation’s wealth, but the possessors of the nation’s wealth.
And now, his latest destructive blow against the ‘one nation’ philosophy, the pinnacle of his achievement. This week, even as we met in Blackpool, the Housing Finance Act came into force. Whom the gods wish to destroy, they first make mad - by persuading them to invite the trade unions to enter into discussions about inflation, and then to slap the unions and their members in the face with a calculated increase in the rents of millions of families. (Applause)
It is not only council house and new town rents. Labour, within months of taking office in 1964, repealed the previous Tory Rent Act and restored control of private rents. Mr. Heath’s Act will mean that private tenants, no less than council tenants, will now have to pay more. When Mr. Heath says ‘Fair rents’ he means higher rents. And to encourage the alternative of home ownership they have succeeded in raising the cost of an average house by a rate of 45 per cent since they came into office. Though if you live in the Eastern region it has risen by 58 per cent - this is existing houses - where there is no element of increased cost of building. In the Southern region it has risen by 67 per cent and in the South-East by 71 per cent. In the first half of this year the average price of a new house was rising at an annual rate of 34 per cent, and of an existing house by 36 per cent.
Now these cases, the Housing. Finance Bill and the Scottish Housing Finance Bill, like the Industrial Relations Bill and the European Communities Bill, were railroaded through Parliament by gagging debate.
That is not, of course, all they have in common. Just as the Industrial Relations Act
was drafted so as to close the door to industrial democracy, and the European Communities Bill was drafted so as to deny the exercise of Parliamentary democracy, so the Housing Finance Acts are proofed against any possible exercise of local democracy. I quoted Mr. Heath’s manifesto pledge to the local authorities. That is not all he said. In the election campaign he had this to say as well. I quote him. These are his words out of his mouth:
The most urgent reform of local government is, to get the Government spanner out of the works. Under Labour there can never be real reform of local government for they will always seek to use their powers to bend the local authorities to their will. It will be for a Conservative Government to restore to the local elector and the local councillor the freedom of action he needs to make life better for himself and his fellow citizens and to control his own destiny and that of his community.
All this he said. This is what he won votes on.
How was that promised freedom given reality? By watertight statutory provisions, by the denial of local responsibility, by the threats of surcharges, by the deprivation of civic rights, and rights as a citizen, and if all that fails the imposition on an elected authority of Mr. Heath’s housing commissars, who have taxing powers as well. The Tories have wrecked; on all these things the Tories have wrecked. We will rebuild. The Labour Party on its return to power will take urgent action.
Industrial relations; we have said we will sweep away the Industrial Relations Act. (Applause) The Joint Committee of the Labour Party and the T.U.C. have agreed on the procedures on the timing and the precise provisions which will be required, and to do this we shall have an unequivocal mandate. With the Act, N.I.R.C. and all its costly infrastructure will be consigned to oblivion and that talented judge redeployed to more productive work. (Applause)
Education; we shall by law remove the tyranny and indignity of the 11-plus (Applause) and, as Ted Short made clear a few days ago in his speech about privilege, our priority will be to ensure a fair start in life for those children who have been held back in their earliest formative years by family circumstances, by bad housing and by family poverty.
On housing, I repeat what was said yesterday; we shall repeal the Housing Finance Act and the Scottish Housing Finance Act. We shall introduce new and comprehensive housing legislation and Labour’s Programme for Britain sets out the line on which we are of working, added to by the discussions yesterday. The improvement grant racket will be of dealt with, so will property speculation and the scandal of empty premises. Under the Tories, Centre Point would be likely to be scheduled as an ancient monument before it is either occupied at reasonable rents or paying penal rates for non-use. Above all, we shall have a social policy for the land, and to this I will come later. (Applause)
There can be no road to national agreement, national unity, on a policy adequate for dealing with inflation and unemployment except on a basis of social justice. Mr. Heath, after two years’ presidency of the inflationary society, is now groping his way forward in the darkness with nought to guide him but the flickering light of his P.R. advisers, because he refuses to create the conditions in which a national effort to fight inflation can be forthcoming. He asks for sacrifices but he must know that the first sacrifices must be those of a blinkered and selfish Conservative ideology which stands in the way of a national approach by the whole community.
Today I challenge Mr. Heath because I am going to set out the conditions - the conditions which must be guaranteed by any government of any party with the real will to unite the nation in an attack on inflation and unemployment.
Mr. Heath asks, nay, demands, a tight curb on increases in wages and salaries and offers in return to seek a limit on rising prices in the shops, on all the burdens which fall on an average family. But Mr. Heath knows that he cannot guarantee to hold prices to an increase of just 5 per cent over the next year. He cannot hold them to 5 per cent. He knows that food prices are rising at a rapid rate. His policies have been designed to this end and those policies at least are working. He knows - even Mr. Prior must have told him - what is in store for the prices of meat, for bread, for bacon, for coffee and other foods. He knows how his June devaluation is increasing the price of food and raw materials. The C.B.I. know that they cannot provide any binding undertaking which will set the price in the supermarkets. The CBI can use their influence over the price of a wide range of manufactured goods and components. But even a successful policy holding down the manufactured goods wholesale price index - even total success in keeping down the price of ball bearings and biros will not of itself hold prices down in the High Street, and to pretend otherwise is to offer the British people a false prospectus. Mr. Heath sets his limit for wage increases when he knows he cannot deliver on prices in the High Street, and he cannot deliver because his free market policies, his food levies - and above all his European Policies - and his V.A.T. - have already set the price pattern for the months, perhaps even for the years, ahead.
Of course, it is popular to proclaim a policy aimed at restraining prices. It will be when he once again has to confess failure that reality will set in.
There is no doubt that if Canute had produced a grandiose plan for a sea wall implanted in shifting sands his courtiers would have dutifully cheered. No doubt his people would have cheered - cheered, that is, until the sea seeped in, and through, and round, and the whole edifice crashed in ruins.
Mr. Heath’s new sea wall against the tide of inflation is already hailed as a triumph of civil engineering - until it is built. (Laughter) Until a spring tide of rising prices, rents, rates, created by Mr. Heath’s own policies, swollen by his tidal bore from Europe, comes, silent, flooding in the main.
Mr. Heath knows he cannot deliver on prices. But I think he knows also the conditions of any comprehensive policy. I told him actually what they were. In the Parliamentary debate on devaluation last June, and in the debate on industrial relations in early July, I told him the minimum conditions of success in the meetings he had set in hand with the T.U.C. and the C.B.I. – ‘The T.U.C. proposals for a threshold, price-related wage arrangement; Government exercised control of strategic prices, and of the remuneration of top people, as well as of rents and dividends, the restoration of the Consumer Council, the repeal of food levies, the dropping of the Housing Finance Acts; the control of land prices and property speculation, the repeal or the sterilising of the Industrial Relations Act, and a moratorium on the value added tax.’
I told him all that - (Laughter) - and I told him that in the House in two debates in a week and the whole Parliamentary Labour Party - yes, the whole Parliamentary Labour Party - voted for it.
When Mr. Heath now seeks to involve public opinion in favour of his £2 a week policy, he has a duty to say exactly what this will mean as a result of his Government’s policies. He has a duty to say what a £2 pay rise would mean for workers caught in the poverty trap.
The Financial Times last Thursday quoted U.S.D.A.W.’s calculations about lower paid workers - a married man, earning £18, with one child and living in a council house, with rent and rates responsibilities of £5.90 a week, would actually be 39p worse off with a £2 pay rise. If he was earning £23 he would only gain 11p from the £25 he would then be getting, while if he had two children and was on £19 and that was raised to £21 he would be 20p worse off.
For any Government, in any democracy, the first condition of success is a. sufficient degree of trust between the Government and those to whom the appeal is made. (Applause) Mr. Heath, for his part, has forfeited any claim to such trust.
So what are the conditions for a viable policy to fight inflation? I will list them, those which I feel are the right answer in this or a similar crisis situation. There must be effective safeguards to ensure that shop prices and all other prices and charges affecting the cost of living are held to the required amount. Local authority and new town rents must be kept within the permitted price limit. When Mr. Heath in Parliament was lauding the C.B.I. 5 per cent restraint policy, I asked him if he would guarantee to keep council rents within the 5 per cent limit over the next year. He refused to give any promise, but when we pressed him he gave us his calculations. He said, ‘No, they are going to go up by 7 per cent,’ but that was an average for local authority tenants and private tenants who come rather later into the picture; on our calculations the likely figure is somewhere between 13 and 14 per cent net. So Mr. Heath must act to stop the operations of the Housing Finance Acts if he wants to make this appeal. (Applause)
The same limit must apply to rents charged by private landlords for the duration. Rates, over the nation as a whole, must also be held within the prescribed limit, and for this purpose make full use of the powers granted – Labour’s domestic rate subsidy legislation.
Next, speculation in land and property deals. For the duration of any incomes proposals, all capital gains from land and property over the permitted level must be subject to an excess profits levy; though the owner-occupier’s residence would be exempt from these arrangements. (Applause)
Incomes and price restraint must be accompanied by dividend restraint. To prevent the retention of undistributed dividends for future distributions an appropriate proportion of retained profits should be put into the National Workers’ Capital Fund proposed in ‘Labour’s Programme for Britain.’ (Applause)
There must be no discrimination against the public sector in wages and salaries. (Prolonged applause) Public sector price increases, including fares, must be held down to the limit set, and for this purpose, as we have repeatedly demanded, appropriate adjustments must be made in the financial relations between Government and public industry. Action must be taken on V.A.T.; action must be taken to increase pensions substantially above their present intentions. (Applause)
These are some of the necessary conditions of a crisis anti-inflationary programme such as Mr. Heath has been driven into talking about, but we have to look to a broader and more lasting solution.
Mr. Heath makes an appeal for rigorous restrictions in wages, yet next week in this hall he will be boasting about the tax cuts he has made over the last two years. He says now, ‘Not more than £2 a week for anybody,’ ‘Not more than £2 a week increase,’ and that is subject to deductions, if an hour is taken off the working week. For a worker on the near average pay of say £1,500 a year, £2 a week more. But an executive or professional man on £15,000 a year has already received through the budget a reduction of £1,500 a year by a cut in his taxes, and that means he receives now an increase in take-home pay of £30 per week, without a penny increase in his earnings. If he borrows from his bank for, say, the stock exchange or land speculation, the interest on his borrowing is now once again charged against income, reducing his tax liability.
Executives in industry can get a large supplementary bonus in stock options; family income now once again can be divided by excluding the children of wealthy families from the family tax computation, so that the total tax paid by the family is reduced. A man living on unearned income with £20,000 a year will gain £1,652 in increased spending money, and that is over £30 a week.
Now, there can be no lasting understanding, and I am looking now to the broader problems of the future, not Mr. Heath’s crisis, there can be no lasting understanding between Government and labour unless and until such policies are halted and reversed. Mr. Heath’s statement has given ‘Labour’s Programme for Britain’ a new impetus, and has still greater relevance, because in its economic, as in its social policies, it provides the means to the socially just community which alone can provide the power base for a policy against inflation and against unemployment, and against the social evils of modern urban society. If I pick out just one which is relevant to this kind of society, in which we can have an all-community understanding, it must be the subject of land. This lasting solution must cover the problem of land. We pay respect to Lord Silkin’s valiant, if complex efforts in 1947. If the Conservative Government had not rejected it when they came back into office in 1951, we should not have seen the land and the property boom of the ’50s and ’60s on which we, in part, fought the election of 1964. I believe the Land Commission, our Land Commission, was the most comprehensive attack on the problems so far attempted; it was beginning to work, and prices were falling in the later months of our government, but this was too late, and the reason was the inadequate zoning of land for development which the Commission could take into public ownership.
Well, we have all thought again, and it is no secret. There are never leaks from the Executive, as you know, but at least it does not seem to be a secret that I proposed to the National Executive last May that there was no solution to this problem without taking into public ownership all the land required in this century for urban development, (Applause.) and at existing use values. Conference went on record yesterday in support of this.
In my view, and this we must all consider when we come to work out the details, land required for urban development alone may not be enough. Delegates for rural constituencies here will confirm the existence of a racket in agricultural land. There are different explanations: a hedge against inflation; a stake in the country; the advantage of favourable estate duties on agricultural property; or a desire that the higher farm prices which the Common Market will bring must accrue in higher rents to those who make money by owning farm land rather than those who earn money by working farm land.
Whatever the reasons, land which is unlikely ever to get planning permission is now escalating in value. I recently read a responsible Conservative newspaper which said that any young man with farming experience who wanted to buy his own farm and set up on his own account should either have recently inherited a large fortune from a deceased relative or should win the pools. (Laughter)
There is another factor. When the Government panicked on rising unemployment they pumped money into the economy. Their much vaunted tax concessions owe nothing to the economies in public expenditure they said would be so easy. Public expenditure had risen at a record rate. Tax handouts and no less bank lending increasing in recent months at an annual rate of 30 per cent went not into a jobs boom: it went partly, of course into an imports boom, but an inordinately high proportion of the new money went into land and property.
It is elementary economics that while money going into capital can increase to supply fixtures and equipment, while money going into jobs can increase the demand for labour, money pumped into the purchase of the scarce commodity of land cannot create more land, it can only increase its price.
In human terms, it means a heavy burden on those who are trying to buy a house. There is not a delegate here who does not know someone - son, daughter, neighbour - who has not been gazumped out of the house for which they have painfully saved by what is ultimately the effects of land price inflation.
And in social terms, too, we have the other side of the Tory medal. I quote that impartial social observer and anthropologist, M. William Hickey of the Daily Express (Laughter) on Saturday, May 6, under the headline ‘What a Swell Party Year This Is.’ He went on: ‘As shares soar and land prices boom, the rich in Britain suddenly realise they can actually afford to enjoy themselves for the first time in years.’ (Laughter) Look what we did. ‘I can,’ he says, ‘safely forecast the most sparkling profusion of parties and entertainments for many a season.’ He proceeds to list some of the more spectacular, but I am not going to give them publicity. Such is the kingdom of Heath. (Laughter and applause.) And in that kingdom, you know, there are going to be some glamorous coming out parties on £2 a week! (Laughter and applause)
Mr. Heath, of course, smoothly blamed every price increase on unions and wages. I challenged him, without any reply so far - we may hear it next week - to explain how the doubling in a year, or not much more than a year, of the price of a house built in the 1890s is due to wages. I want him to explain this. I want him to take the case of the house in Hammersmith that we heard about recently from the leader of the council, which exchanged hands 12 times in a year, or more. Twelve times it had been empty - All the time it had been empty, but each time going up in price. I do not see - perhaps he can tell me - how this could be due to wages, because I think a posthumous increase in the wages of a long-dead London building craftsman is difficult to sustain. (Laughter)
As for the increase in farm land prices, even he can hardly blame that on the farm workers’ wages of £16.20 per week. (Applause)
But the escalation of land prices is a cancer of our Tory society. Our policy is simple. Values created not by private merit but by the development of the community belong not in part but in whole to the community which created them, and so it must be, and that will be our policy. And, as we learned, equally we must assert the rights of the community equally to the minerals under our soil. It is a reflection on all of us that we know so little about the wealth on which we are sitting. We cannot leave this to private enterprise. Environmental considerations alone require that the State, and only the State, should decide the balance as between the mineral development and the safeguarding of our natural heritage. (Applause)
I have gone on longer than I meant. I want to finish with this.
Mr. Heath’s crisis cannot be solved within the rigidities of his policy and his prejudices. The nation has known for a year, and he has at last been compelled to concede, that there is a crisis. What he refuses to recognise is that this is a continuing crisis now for Britain. Whatever short-term experiments may be tried it is a continuing crisis which requires a fundamental and lasting understanding between Government and the creators of the nation’s wealth. This is a crisis that any government now in Britain will have to face. Mr. Heath cannot, and will not, take the broader economic and social measures to resolve this crisis. He has had his opportunity. Two years ago it was here in Blackpool that he told the country how he intended to use it, and now his failure is apparent even to him.
But what we here must realise is that the events of last week have created a new challenge to this Movement. It is a challenge that I believe this Conference is preparing to meet, because what happened last week means now that the Labour Movement, and only the Labour Movement, can deal with this situation. (Applause) Mr. Heath knows that. His snarling at the trade union movement now gives place to more dulcet wooing tones, because he is looking to the unions to find a way out for him. Whatever his intention I can say this, I hope. Mr. Heath has now given a new impetus in the talks between Labour’s leadership and the leadership of the Trades Union Congress. It will be the desire of this Conference this week to make clear its hope and determination that that accord will be real and effective. Whatever short-term amelioration of this crisis may be possible, whatever poultices may be applied or who applies, them, the continuing crisis now is not going to be relieved except - it is not going to be resolved, above all, except - by a general election. (Applause) This may not be what Mr. Heath is seeking. He hopes, I think, to seek to avoid it. But among his advisers are those who would want him to negotiate with the unions by preparing to blame them for any breakdown; to follow in fact the posture of the Japanese war lords who, while negotiating for peace, were planning Pearl Harbour.
We here are united in the belief that the British people should now have the right to decide in a general election. We said that in our resolution last year, the resolution on the Common Market, calling on him to submit the Market and all its other policies to the arbitrament of the British people.
So, a general election on Europe, yes - we have all called for that - but, still more, on the measures needed to restore the strength of Britain to play our full part in the world whatever happens in Europe. When the election comes is not for us, here to decide. But the very nature of the crisis Mr. Heath has inflicted upon Britain throws upon this Conference a responsibility some of us might not have foreseen even a week ago.
The responsibility which this Movement now has to assume is not going to be an easy one. The task we are going to have to face, perhaps very soon, perhaps later, is growing week by week. We have now to speed our preparations for a crisis whose nature and depth Mr. Heath has concealed from the nation and which we shall have to resolve.
I believe that delegates came to this conference with a deeper sense of underlying unity than we have known for many years. (Cries of ‘Hear, Hear’ and applause) And there will be no-one now who will seek to imperil that unity in the face of the challenge, of the opportunity above all, presented to us and the challenge facing this nation.
I believe that when we go from here we shall go with that unity strengthened, but not only that, we shall go with the backing of the whole Labour Movement and that backing will sustain us in all we have to do (Standing ovation.)