I PRIME MINISTER John Nott did discuss the gist of

---

c

PRIME MINISTER

John Nott d i d now

that

discuss

the

gist

7 May

of h i s m i n u t e o f

I h a v e s e e n h i s m i n u t e I would

like

t o r e s t a t e my

f o r immediate a b o l i t i o n - John's o p t i o n

( i ) - but

the

hoc

idea

of

our

reserving

p o w e r s f o r ad

i n d i v i d u a l p r i c e s or f o r i n d i v i d u a l p r i c e retrospectively. but

among t h e

There are

most i m p o r t a n t

Government i n t h e

among f i r m s

Commission i n t e r f e r e n c e . i n v e s t i g a t i o n would n o t and

to business

I

that

pricing decisions

creates uncertainty

c r e a t e new

are

The

i t involves

of

possibility

outright and

an

c a r e f u l not

most p e o p l e a l r e a d y impact

I do,

adverse to

understand

u n i o n s e n t i m e n t we

that

increases. can

I f we

draw a t t e n t i o n

want t o

the

autumn

impact

of

pay



the



profit

to

c o n t r o l many p r i c e s u n d e r t h e

the

found to

exist,

fact

t h a t we

F a i r Trading the

a Monopolies Commission

o r d e r more e x t e n s i v e

had

o f f e r a sop

can

to

boost

necessary.

the P r i c e Commission has

interest

empower u s

any

a b o l i t i o n of the

a monopoly s i t u a t i o n w h i c h o p e r a t e s a g a i n s t

can

fact

Commission might

on

Provided

be

in

out

exaggerate the

the

of

t o be

the

impact

that i t



d i d n o t h i n g t o m o d e r a t e u n i o n wage demands

on p r i c e

p o s s e s s powers to

cancel

a b o l i t i o n of

P r i c e C o m m i s s i o n on u n i o n s e n t i m e n t ;

trade

would

by

Price

would

r i s k that

winter

of

but

s h o u l d be

effective

possibility

and

remove t h a t u n c e r t a i n t y

round.

last

interference

Boards

repercussions

we

Commission

hoc

have p o l i t i c a l But

reversed

o f ad

unkown u n c e r t a i n t i e s , and

the

t o be

individual firms

about the

resist

review

to the P r i c e

c o n f i d e n c e which John b e l i e v e s , as

appreciate

safeguards

Boards to

but

preference

I would

increases

many o b j e c t i o n s

w i t h me

price reductions

and no

to



already

Act.

public







investigation

than

are

/possible

...





2

possible

following

a Price

when a n n o u n c i n g t h e r e f e r to

our

Commission i n v e s t i g a t i o n .

abolition

ability,

should

of t h e i t be

Commission machinery f o r p r i c e can

instruct

the

No

short

doubt i t w i l l

time

be

investigations.

n e c e s s a r y to

to a b o l i s h

the

Price

enactment of

the

legislation,

the

Commission's a c t i v i t i e s

am



also



Monopolies



( I understand that their

to r e p o r t

period

c o n s i d e r what i n t e r i m

intention

I

the

should

that,

investigation within

a

we



scale).

made f o r

the

limit

o f m o n o p o l i s t s and

s h o u l d be

and

C o m m i s s i o n , we

needed, to use

Monopolies Commission to

only to p r i c i n g p r a c t i c e s relatively

Price

I suggest

between the Commission,

during that

copying t h i s minute to

Cabinet

announcement of i f that

i n order to

curtail

c o l l e a g u e s and

ID



i s the

the decision, the

time.

K

Department of Industry Ashdown House

arrangements

S i r J o h n Hunt.

J May

1979