An anti-Benn initiative

David Crouch, MP

Within the Labour Party, Mr Wedgwood Benn is hard at work on his plans for the socialisation of British industry_ His proposed National Enterprise Board will be responsible for determining the direction in which British industrial resources should go. He has definite plans for the nationalisation of shipbuilding, aircraft manufacture and the ports. He is also considering nationalising large sectors of pharmaceuticals, construction, road haulage, banking, insurance, building societies, machine tools and multi-national companies.

With the National Enterprise Board he proposes to go much further than this, requiring nearly 200 major British companies to come under the wing of the government and requiring them to discuss all their plans, investment, expansion and location with the next Labour government. There has never been a proposal so dramatic as this to interfere with free enterprise. The Labour Party is set on course to producing a socialist state. They talked about it in the past, but they never got round to it_ Now there can be no doubt about it. And it could start happening next year if Labour wins the next general election, which is almost certain to take place this autumn. What can British industry do in the face of this threat? If it looks at the Tory Party these days it is not likely to be filled with much enthusiasm or inspiration. The last Conservative government were not averse to government control or intervention in large measure. They were prepared to intervene when industry got into trouble: in shipbuilding and in the case of Rolls-Royce. They were prepared to sustain expensive projects in aerospace and in corn: puters. They stepped in when there was any threat of one particular company dominating one sector of industry and exploiting its market power. They intervened when industrial activity was thought to be too small. The Conservative Industry Act was used to help new companies grow and to develop new products, as well as to move to the regions. The Conservative Government never hesitated to lean' on the nationalised industries and to breathe down the necks of the board chairmen over investment programmes and prices — not always with the best results.

It does seem as though Conservative ministers liked planning and control almost as much as their Labour counterparts. It is not a like that is shared by industry. Many businessmen feel that the Conservative government did not support the most important industrial developments. There is a school of thought that feels that it is a waste of money to try to sustain old industry and old products; that if government money and invention is to be worthwhile it must be directed towards innovation, thus to enable Britain to continue to lead as an industrial power. There is a case for Concorde and for comptiters, for electronics and nuclear power, but the case for government intervention has less meaning in motor cars and textiles and shipbuilding.

The whole question of government intervention needs to be examined afresh. Governments, Labour and Conservative, in the past have always seen intervention as necessary to sustain an industry, to allow it to compete and, above all, to produce jobs. Having given support it has been natural to expect the Government to have a say in the control of the enterprise. This is the road to socialism and the gradual elimination of free enterprise. notwithstanding anything Mr Benn may say. We have to find another way and so far we have not done so. We always pride ourselves on the efficiency of the London capital market, but we must begin to question whether there is a sufficiently close understanding between the finance houses and the industrial entrepreneurs — the men of vision in industry.

Today industry requires long-term investment on a very :large scale to enable it to develop new ideas. However, it is understanda ble that the City might be more attracted by less speculative and less difficult decisions and prefer to back existing products and the exten sion of existing factories. We know that the City was too readily attracted to the office development and property boom. It would have been much better if its money had been directed to innovatory industries requiring enormous injections of capital. This is the sort of problem which Mr Benn's National Enterprise Board is designed to take care of. It might well find support from some industrial leaders who are looking for money.

What therefore has the Conservative Party to offer in its place? Another Board by another name? That cannot be the proper answer if we believe in the free enterprise system. No; what we have to do is to encourage the development of the mechanisms of the free market outside government control and to improve the links between industry and the finance market. It is quite wrong to assume that the private enter prise system is incapable of meeting the requirements of modern industry, and enabling it to move in the right direction of long-term investment in the development and expansion of new innovations. If the Conservative Party continues to adopt the attitude that politicians and bureaucrats know best then we cannot expect the executives of manufacturing in dustries, and in the financial world, to flourish and produce the answers themselves. Such an approach can only have the effect of suppressing initiative and producing acceptance of the inevitablity of state control and management.

Of course, it is no use expecting industry and finance to come together and produce successful results unless there are real advantages offered in return. Industry must be given much greater incentives towards making money and Conservatives must have no hesitation in declaring that profit-making is absolutely vital to our economic success. This may well cause an outcry from all those who distrust the free enterprise system. But there is no need to make apologies for such a policy. Profits are required for investment. Today modern industry has to plan investment on a scale to match interna tional demand and competition. The Conservative Party must demonstrate its faith in the free enterprise system by speaking out in favour of high profits for the high investment that is needed.

By making a determined move in a new direction away from state intervention in industrial activity a much greater responsibility will fall on the private individual and the private sector of business. An opportunity to make higher profits must be matched by a new determination from in from employers, to shoulder new and bigger responsibilities towards society. They too must be prepared to deliver a "social contract" both to their employees and to the public. To their employees they must offer the prospect of higher wages and disperse for ever the distrust which has been generated for too long, that the aim of employers is to resist all demands for higher pay and only to give way under trade union pressure. A new attitude from employers to employees is required. An attitude which involves them more in the objectives of the business enterprise. The target of high profits must not be achieved as a result of low wages, but must be seen to be linked with higher pay, better conditions, close co-operation and consultation, and a large degree of involvement with the overall management decisions.

'Worker participation' is a phrase much talked about these days and political parties vie with each other to claim that they believe in it. It is a pity that it should need political intervention to produce this necessary development in the relationship between management and men, but it will nevertheless require a new Companies Act to define these new responsibilities of an employer. But an Act of Parliament alone will not produce the answer and the initiative must come from the employers. They must make a positive move towards assuming a new place in our industrial society: a place of leadership and power equal to that of the trade unions. If this can be achieved, and can be seen to he real, then we might really create a new pattern in our society where men and women find that they can look to their employers, not only as the providers of jobs and the creators of wealth, but as joint partners in an interesting enterprise.

We must seek to decentralise the present power structures, so that individuals feel that they are working with smaller units and of a more manageable size. The tragedy of the .present disharmony in our industrial society is that since the war we have systematically been enlarging the units within which people work and are controlled, whether in industrial structures of union responsibility. This has resulted in attitudes of remote strength on • each side which have frequently caused the adoption of antagonistic positions towards each other with effects which have turned local difficulties into regional and national stoppages.

The trouble with British employers is that they have not organised themselves as well as the trade unions in the last twenty-five years. The unions are looked upon, with every justification, as' the guardians of their members. Today they are very effective in this task. The employers on the otherhand are not seen in the .sarne itight at all. They may be the providers of the jobs, but too often they seem to earn few thanks for this contribution they make to society. They have not assumed a big enough voice in the country and very, few industrial leaders look as important as the big men of the trade unions.

In earlier days, when private enterprise was flourishing in Britain the industrial leaders were seen to be much bigger figures, even if, they had an old-fashioned approach of tough paternalism towards their employees. Those were the days when there was less equality, less democracy and less opportunity for the worker. Surely, now that we recognise the needs for full democratisation in industry the employers must take the initiative in changing the role they have to play. The worker no longer looks on them with deference in the fear that he may lose his job. He has his union to protect him. He has a new-found confidence. The employer and manager must, in turn, show a new understanding of those who work for them, which must go beyond meeting wage demands made under union pressure. It should anticipate union action and involve talking about the job and the company, as well as rates of pay.

I believe there is a new road for us to follow, rather than the one which we seem to have got stuck on since the war and which is leading to a socialist state under any government. The new road is in the opposite direction. It points towards a society where people are not only more equal, but also more free. A society Where the government does not attempt to control or direct people or business to anything like the extent to which we have become accustomed to as normal. It is a society where people can see recognisable goals for themselves and their families. A society where people can identify their bosses but where there is a new relationship between the bosses and the workers — and understanding that they are partners in a joint enterprise. A society where a successful enterprise means high wages, high profits, high investments, expansion and growth, and higher opportunities for everyone concerned. For too long we have thought of such a society as only being obtainable from a government, Labour or Conservative, prepared to intervene on a wide scale. By attempting to control so much of people's lives and the management of the economy in such detail we have robbed the people of initiative, energy, enterprise and enjoyment. It is only natural that they should have become lethargic, depressed, unwilling to work and all too ready to urn to the powerful pressure groups, such as trade unions, to get for them what they could have achieved for themselves with so much t njoyment The initial leadership for such a change must come from the Conservative Party. To go down the road towards free enterprise would be a return to one of the basic principles of Conser

vatism. The government would have a major part to play, as ever, in safeguarding the liberty of the individual, his human rights and in controlling the excesses of individual enterprise which touched on these rights, whether they came from employers or the unions. But by standing back and allowing the employers to rise in strength and stature again as the providers of wealth and jobs, and making a major social contribution as well, we should have helped to create that balance of power in our society which is so vital for our continuance as a free nation. We must move in: this direction, and in doing so we shall both be preventing the revolutionary slide into socialism which is already taking place, and removing the causes which tempt men into anarchy.

The Conservatives have a duty to start fighting now, which there is still time and show that there is another answer to living in our modern industrial world. It will require a new initiative, determination and inspired leadership. Free enterprise, our democratic system and the future of the Conservative Party are all at stake.

David Crouch is Conservative MP for Canterbury and a member of the Select Committee on Nationalised Industries.