HC Deb 16 February 1971 vol 811 cc1591-2
14. Mr. Sheldon

asked the Chancellor of the Exchequer what estimate he has made of the balance of payments out-turn for the first quarter of 1971.

48. Mr. Dykes

asked the Chancellor of the Exchequer what was the balance of payments out-turn for the United Kingdom for 1970 and the estimated out-turn for the financial year 1970–71.

Mr. Barber

I expect a current surplus of about £600 million for 1970, and perhaps more. Detailed estimates of the balance of payments for last year and for the first quarter of 1971 will be published in March and June respectively.

Mr. Sheldon

Since the balance of payments surplus is running at a level very much higher than expected by the Government, why is the right hon. Gentleman operating so restrictive an economic policy? In particular, why is he permitting records levels of unemployment and bankruptcies, the lowest level of industrial investment and a high level of inflation, all at the same time? Are these achievements of which he can be proud?

Mr. Barber

The first necessity if we are to get these things right is to curb the present level of inflation. I am sure that the House agrees on that. The steps we are taking are designed to achieve that objective.

Mr. Dykes

Would not my right hon. Friend agree that the curbing of the existing rate of inflation could go hand in hand with a faster deliberate policy of increasing real resources, bearing in mind that the balance of payments would help towards that end?

Mr. Barber

The first necessity if we are to get an adequate rate of growth—which has been the aim of all Governments over the years but they have not been successful in achieving it—is to curb the present rate of cost inflation.

Mr. James Hamilton

Bearing in mind the balance of payments surplus, will the right hon. Gentleman take cognisance of the point of view of the T.U.C. that we should have an expansionist policy? Is he aware that the next figures for Scotland will show 125,000 people unemployed? Is he not prepared to do something about it before it is too late?

Mr. Barber

One of the reasons for the present high level of unemployment is without doubt the present high level of wage demands and wage settlements. There is no doubt about that. Sometimes I think that those trade union leaders who put in claims for excessive increases do not appreciate that by doing so they are causing unemployment among their own members.

Mr. Kenneth Baker

In view of the encouraging figures my right hon. Friend has given, what progress does he expect to make this year in the repayment of overseas debt, the legacy which the last Government left us, of over £1,500 million?

Mr. Barber

One of the reasons why we have to have a high level of surplus on our current account is this very heavy load of short and medium term debt to repay—a debt left to us by our predecessors.

Mr. Roy Jenkins

Will the right hon. Gentleman tell us what, if any, is the amount of short-term debt outstanding?

Mr. Barber

I can tell the right hon. Gentleman that, since the third quarter, published repayments for short and medium-term debt have totalled £156 million.

Mr. Jenkins

Is there any short-term debt outstanding?

Mr. Barber

The right hon. Gentleman knows perfectly well that these figures will be published at the normal time. [Interruption.] He also knows perfectly well that we are following the practice followed by the last Government.