HC Deb 22 February 1966 vol 725 cc226-7
42. Sir C. Osborne

asked the Chancellor of the Exchequer what is the internal purchasing power of the £ sterling to the most recent convenient date as compared with October, 1964.

Mr. MacDermot

On the basis of the index of retail prices, the purchasing power of the £, taken as 20s. in October, 1964, was about 18s. 11d. in January, 1966.

Sir C. Osborne

Did I hear the Financial Secretary aright—18s.?

Mr. MacDermot

I said 18s. 11d.

Sir C. Osborne

This is the greatest inflation since 1951. Can the Financial Secretary say what is the cause of this extraordinary and disastrous inflation?

Mr. MacDermot

Yes, Sir. Quite simply, most of the increase was in the early months, as a result of the measures we had to take in order to deal with the deficit which was left to us. Hon. Members can take comfort from the fact that the rise in the index in the last 10 months has been 1.7 per cent.