HC Deb 22 February 1968 vol 759 cc627-9
6. Mr. Ridsdale

asked the Secretary of State for Economic Affairs whether he will make a statement on the medium term outlook, in the light of devaluation, as a first stage of the new National Plan.

8. Mr. Marten

asked the Secretary of State for Economic Affairs on what plan- ning assumptions the new planning exercise, being a review of the medium-term economic outlook, is based.

23. Mr. Ridley

asked the Secretary of State for Economic Affairs whether he will make a statement on the effects of devaluation of the £ sterling on the National Plan.

Mr. Shore

There has been useful discussion in the National Economic Development Council on the economic prospects following devaluation, in preparation for the new planning exercise. I should not wish to prejudge the conclusions of this exercise. The central assumptions are that the transfer of resources to exports and import-saving will ease the balance of payments problem and make possible a higher and more sustained rate of growth.

Mr. Ridsdale

Is the Minister aware that we all want him to get the National Plan right now? If he is to get the National Plan right, it would be far better if we knew what were the conclusions on which he based the plan. Why is he being so secretive?

Mr. Shore

I do not accept that criticism, although I am glad to have the hon. Member's support in the new planning exercise on which we are starting. We have to take a view of the economy in this new post-devaluation situation. We have already begun this and have given a preliminary paper, but we hope to develop it further in the next few months.

Mr. Marten

Is the Minister aware that his Answer to my Question is totally unsatisfactory? He has merely repeated what the Prime Minister said. Can he not tell the House the assumptions on which his great planning exercise is based? What about private investment, unemployment, the growth rate and other factors?

Mr. Shore

There are many assumptions which have to be worked out and brought together, but the key assumption which has been announced is that it is the Government's view that it should be possible for G.N.P. to grow at roughly 4 per cent. this year and possibly 4 per cent. in 1969. These are the starting points.

Mr. Ridley

Will the new National Plan be based on the real present value of the £ or on the hypothesis that the £ in one's pocket has not been devalued?

Mr. Shore

I assure the hon. Gentleman that the figures will be consistent.

Mr. Iain Macleod

The Secretary of State has said something about central consultation. Can he tell us what consultation, if any, he intends to have more widely with industry and firms? Will it be based, as last time, on a questionnaire?

Mr. Shore

I should not like to give too firm an answer to that. The right hon. Gentleman probably knows that we are discussing planning not only with the N.E.D.C., but also with the E.D.C.s. It may well be that they have a view about the best way of carrying out consultations with firms and we shall take account of that.

Mr. Ogden

Would my right hon. Friend agree that it is vitally important he should have consultation with individual groups or parts of industry to establish a certain and sure basis for future productivity and planning?

Mr. Shore

I absolutely accept that from my hon. Friend. The question really is which group, as it were, it is most sensible to contact. Is it in certain cases the E.D.C.s or should it be other bodies and organisations?