§ 9. Mr. Knoxasked the Chancellor of the Exchequer what is his latest estimate of the rate of growth.
§ Mr. BarberAs I said in my Budget Statement, I believe the economy will continue to grow at an annual rate of around 5 per cent. over the 18 months from the second half of 1972 to the first half of 1974.
§ Mr. KnoxDoes my right hon. Friend not agree that an absolute assurance that we would have a 5 per cent. rate of growth over five years would do a great deal to restore confidence in this country, increase investment on a permanent basis, and enable us to increase living standards to a level comparable to that of our friends in the EEC?
§ Mr. BarberI know that my hon. Friend is a fervent supporter of the Government's policy on growth. It is the case that we are now achieving double the rate of economic expansion of the past decade. There is plenty of evidence to support a 5 per cent. growth rate. Industrial production in the three months to January was 1½ per cent. higher than the previous three months and 6½ per cent. higher than a year earlier. Consumer expenditure rose a further 2¼ per cent. in the fourth quarter, to be about 7 per cent. higher than a year earlier and within that the retail sales index rose by 2¼ per cent. in the three months to January, to be about 8 per cent. higher than a year earlier. Unemployment has fallen in March by over 29,000, and is now 240,000 lower than a year earlier.
§ Mr. Joel BarnettWill the Chancellor tell us that he is not planning a 5 per cent. level of growth for five years, but for 18 months? What are his plans for the rest of the period?
§ Mr. BarberI have said on a number of occasions that the Government are committed to a higher rate of growth—
§ Mr. BarnettNot 5 per cent.
§ Mr. Barber—much higher than the rate of growth achieved by the previous administration. Having heard that the Opposition are now committed to a faster growth rate, I would have thought that they would welcome what we have achieved. I look forward to the hon. Member making that point when he next speaks from the Dispatch Box.
§ Mr. Bruce-GardyneWill my right hon. Friend confirm that it is no more in the power of the Government to guarantee a given rate of growth over five years than it is within their power to guarantee the state of the weather in the month of June?
§ Mr. BarberWhat a Government can do, and what this Government have done, is to create the conditions which will enable the economy to grow faster.
§ Mr. Joel BarnettIndustrial investment?
§ Mr. BarberIt is all very well for the hon. Member to say these things, but it would be a welcome change if, just for once, he and his colleagues would refrain from running down our country.
§ Mr. HealeyThe Chancellor of the Exchequer will be well aware that in my Budget speech I congratulated the Government on achieving, for the time being, a 5 per cent. rate of growth. Will the right hon. Gentleman clear up the confusion between what he has just told us and what the Prime Minister said last autumn? In September the Prime Minister said that he was aiming at a 5 per cent. growth rate for a further two years from that time. The Chancellor appears to have cut that period by nine months. Can he explain the disparity between the two estimates?
§ Mr. BarberThere is no inconsistency between what the Prime Minister said and what I said in my Budget speech.