HC Deb 03 November 1970 vol 805 cc825-6
3. Mr. Marquand

asked the Chancellor of the Exchequer when he expects to complete his review of public expenditure.

6. Mr. John Fraser

asked the Chancellor of the Exchequer whether he has yet completed his review of public expenditure.

The Chief Secretary to the Treasury (Mr. Maurice Macmillan)

I have nothing to add to the statement which my right hon. Friend made on 27th October.—[Vol. 805, c. 37–75.]

Mr. Marquand

Is the Chief Secretary aware that £85 million, about 20 per cent. of the total savings for 1971–72, comes under the heading of "relative price effects and other adjustments", which include, apparently, adjustments in the price effects of social security benefits? Could he please tell us what proportion of the £85 million is due to changes in the relative price effect and what proportion is due to the other adjustments?

Mr. Macmillan

I could not give that figure offhand but I can tell the hon. Gentleman that these are factual changes rather than changes in policy; that is to say, changes which have already happened. No doubt if the hon. Gentleman catches your eye, Mr. Speaker, he could elaborate the point at a later stage this week.

Mr. John Fraser

What study has the right hon. Gentleman made of the effects on the cost of living of people who will not receive substantial tax reliefs as a result of the rises in fares, food prices, prescription charges, school meals and other charges which will go up for ordinary working men and women as a result of the publication and implementation of the White Paper?

Mr. Macmillan

The Chancellor of the Exchequer will no doubt deal with that point tomorrow, should he be fortunate enough to catch your eye, Mr. Speaker. With the extra mitigation, no one among the lower-paid workpeople will be worse off. When the family income supplement is introduced, many will be considerably better off.

Mr. Lane

Will my right hon. Friend confirm that in his projections of future public expenditure he will keep in mind the need for a further increase in retirement pensions before very long?

Mr. Macmillan

These and the other consequential rises in social security benefits are contained in the forward estimate.

Mr. Taverne

How can the Chief Secretary or his right hon. Friend justify claiming as a cut in public expenditure the figure of £125 million which was shortfall?

Mr. Macmillan

The hon. and learned Gentleman has a curious view of this operation. What we are doing is trying to reduce the total impact of public expenditure on the economy. We are therefore making reductions in public expenditure. Some of them are accounted for by cuts; some of them, I am happy to say, came from shortfall.