§ Q4. Sir C. Osborneasked the Prime Minister, in view of the fact that November's rise of 1½ per cent. in industrial production was still below the pre-squeeze level of July, 1966, when he expects his target of 4 per cent. annual increase to be achieved.
§ The Prime MinisterI would refer the hon. Member to the Answer given by my right hon. Friend the Chancellor of the Exchequer to a Question by the hon. Member for Worthing (Mr. Higgins) on 18th January.—[Vol. 756, c. 654.]
§ Sir C. OsborneWhy have the sacrifices which the right hon. Gentleman imposed in the freeze and squeeze policy of July, 1966, failed to produce the industrial results which he promised?
§ The Prime MinisterThe hon. Gentleman will be aware that there was a considerable increase in productivity in the year following those measures. I am sure that he will also know, with his very close contact with industry, of the much sharper rise in industrial production which is going on at present.
§ Mr. DickensCan my right hon. Friend say whether or not the Government accept the figure of 6 per cent. as the rate of economic growth for this country set out in the T.U.C. Economic Review between mid-1968 and mid-1969? If not, what is the Government's figure for this period?
§ The Prime MinisterWe have made it clear to the T.U.C. in our discussions with them that it would be perfectly feasible in present conditions to get an increase of 6 per cent. or even more, but on the basis of a consumer boom and with the danger of a high degree of inflation. That is why my right hon. Friend quoted a figure of 4 per cent. in 1968 and, he said, perhaps 1969 as well.
§ Mr. MaudlingAs we shall have to export about 17 per cent. more in sterling terms to earn the same foreign exchange, how much of this 4 per cent. will be left for private consumption or investment?
§ The Prime MinisterI have nothing to add to previous answers on that question by my right hon. Friend. The right hon. Gentleman is absolutely right. We need a very big increase in exports and import-saving, and this will take a high proportion of the 4 per cent. Of course, everything depends, both as regards the answer to the right hon. Gentleman's question and that to my hon. Friend, on whether we get a more than average increase in productivity this year, which would enable higher personal consumption and, of course, a higher rate of total production.