HC Deb 12 July 1966 vol 731 cc1191-3
6. Mr. Biffen

asked the Chancellor of the Exchequer what is his current estimate of the date when he expects the United Kingdom balance of payments to move out of deficit.

42. Mr. Stratton Mills

asked the Chancellor of the Exchequer if he will make a statement on when he estimates the United Kingdom balance of payments is likely to move into surplus.

Mr. Callaghan

Temporary factors will result in a period of fluctuation during the next few months, but the aim is to move into surplus during next year.

Mr. Biffen

In arriving at that answer, did the right hon. Gentleman consider and reject what many of us regard as good advice—that the economy requires further deflation of consumer demand?

Mr. Callaghan

I always accept good advice.

Mr. Mills

As the right hon. Gentleman was wrong in his three previous estimates, will he now estimate the likely deficit for 1966? As all the signs show that the country is approaching an economic blizzard, does he intend to act or refrain from action—as he has done in the last eighteen months?

Mr. Callaghan

It was not possible to foresee at the last Budget the effect of the seamen's strike, which has, in fact, had a serious effect on the economy. That, combined with the unfavourable movement of commodity prices, including the astronomical rise in the price of copper, was not completely foreseen. This has had the effect of putting the balance back.

Mr. Iain Macleod

Will the Chancellor recognise that what he has said departs very much from all his previous forecasts even taking into account fully the seamen's strike? Can he define a little more closely what he means by the term "moving into surplus next year"? Does he mean at the beginning of the year or at the end?

Mr. Callaghan

I think that we would move out of the deficit during the course of next year.

Mr. Manuel

Is my right hon. Friend aware that, despite the loaded questions and innuendoes from the Opposition, we on this side will give him full support in any action he may take to move out of the balance of payments deficit at the earliest possible moment?

Mr. Callaghan

I am obliged to my hon. Friend. I think that that is the view of the country as a whole.

Sir A. V. Harvey

Is the Chancellor aware that the country will also give full support if the Government give the lead?

Is he aware that his statement yesterday that all will be well when the S.E.T. comes into operation impressed neither foreigners nor the country? Will he do something immediate?