HEATH WANTS CEILING OF £2 WAGE RISES

Press, Volume CXII, Issue 33033, 28 September 1972, Page 17

HEATH WANTS CEILING OF £2 WAGE RISES

(N.Z.P.A.-Reuter —Copyright) LONDON, September 27.

Ambitious new Government proposals for voluntary restraints to curb Britain’s inflationary spiral of rising wages and prices today appeared likely to run into opposition from militant trade unionists pressing for large pay increases.

The Government plans, outlined yesterday by the Prime Minister (Mr Edward Heath), suggest a ceiling of £2 (SNZ4.3O) a week on pay rises and a 5 per cent limit on price increases over the next 12 months. The average weekly wage in Britain is about £25 sterling (SNZS3).

Mr Heath, who put forward the proposals at tripartite

talks with industrial and trades union leaders, said that the Government, for its part, would set a growth target of 5 per cent tr cover the next two years. The suggestions come at a time of intense pressure from many quarters for compulsory legislation to control inflation. Food prices alone have risen by more than 17 per cent in less than two years since the Conservative Party Government came to power. Leaders of the Confederation of British Industry (C. 8.1. representing man-

agement in the private sector, and of the Trades Union Congress (T.U.C.), representing some 10 million workers, will give their considered reaction to the proposals at the next round of tripartite talks on October 16.

Their initial response has been cautious. The T.U.C. general secretary (Mr Vic Feather) said that at first glance the proposals “seem to indicate a good deal of fair play for a great number of people.” A C. 8.1. spokesman expressed some satisfaction but said that certain companies would be in extreme difficulties if they complied with the ceiling on price increases. Industrial commentators were quick to point out the difficulties in getting co-op-eration on wage restraint from militant rank and file unionists.

Pay claims ranging up to 40 per cent for workers in both the public and private sectors of industry are already in the pipeline.

Coal miners, who early this year crippled the country with a 10-week stoppage before receiving an average 21 per cent pay increase, are demanding rises in basic weekly rates of between £4.50 and £7 ($NZ9.65 and $l5). Electricity supply workers and dustmen — who have also struck for more pay since the Government came to power —; are demanding substantial rises too.

The first reaction to Mr Heath’s proposals from individual trade unions was critical.

Mr Clive Jenkins, general secretary of the 222,000strong Association of Scientific, Technical and Managerial Staffs, said: “A limit on salary and wage increase is absolutely unrealistic. The cost of living will rocket if we join the Common Market.” Mr Heath’s announcement that the £2-a-week limit on pay increases would apply immediately to new claims from Government workers was described as “bloody monstrous” by Mr William Kendall, secretary-general of the 188,000-strong Civil and Public Services’ Union.

Commentators also pointed out that earlier this month the T.U.C. came out strongly against wage restraints, except as part of an economic strategy covering rent control, profits, dividends, and prices.

However Mr Heath last night stressed that the flatrate wage increases would benefit the lower paid and observers thought that this might sway some unionists to a more favourable attitude.

“The Times” newspaper said that the Prime Minister’s proposals were vital to the future of his Government and to the future of the British economy.

It thought that if the trade unions accepted the proposals the prospect for the economy would be altogether changed for the better. The “Guardian” said that “to accept the present plan for at least one year is better than to drift onwards without restraint.” But the Communist “Morning Star,” described the proposed pay increase limit as "outrageous.”