§ Q2. Mr. Tebbitasked the Prime Minister if he is satisfied with the cooperation between Ministers in relation to the effect of the Government's review of public expenditure.
§ The Prime MinisterYes.
§ Mr. TebbitSince the Chancellor of the Exchequer has given his estimate of unemployment for the end of 1979 as 3 per cent.—
§ Mr. Russell KerrCome on, Uriah!
§ Mr. Tebbit—will the Prime Minister say whether the Secretary of State for Employment has given his estimate of the peak figure of unemployment and when it is likely to be reached, and will he then tell us what those figures are?
§ The Prime MinisterIf the hon. Gentleman wishes to question my right hon. Friend the Secretary of State for Employment, no doubt he will table the necessary Question.
With regard to the co-ordination of our review of public expenditure, there is agreement, but on the general question of employment my right hon. Friend the Chancellor of the Exchequer has made it clear more than once that in order to get to this figure of 3 per cent. British industry will need to grow at the rate of something like 8½ per cent. a year. That is very substantial, but it is the basis upon which both sides of the NEDC agreed yesterday that we should proceed, and I am glad to see that that is so. This is not an impossibility. It is beyond what the country has done in recent years, but we should not set our sights too low. This is one reason why we took decisions on public expenditure which 2119 are very difficult and trying now. For the first time, there has been created a situation in which we have taken action in advance of the need. I hope that British industry will respond to it.
§ Mr. MacFarquharOn the general question of Government co-ordination, although the Secretary of State for Prices and Consumer Protection has reaffirmed that nationalised industries that make excessive profits can be forced to reduce their prices, the Secretary of State for Industry has indicated that there is no case for the Post Office reducing its prices although it made twice the budgeted profit last year. Does my right hon. Friend agree that there is a case for the Post Office paying attention to the Early-Day Motion, signed by at least 80 Labour Members, calling upon the Post Office to reduce some of its prices to the consumer?
§ The Prime MinisterI have been into this matter. There was an adventitious profit made by the Post Office, and in normal circumstances there would be a case for reducing prices. On the other hand, that would pull against another aspect of Government policy, which is to reduce the public sector borrowing requirement. The Post Office will now be more able to finance its needs, especially for telecommunications, out of these profits. Balancing the two together, it seemed to us as a Government that it was better for the Post Office to keep these profits and to finance itself in this way than to add to our borrowing requirement.
§ Mr. NelsonDoes the Prime Minister consider it realistic of the Chancellor of the Exchequer to talk about another four years of wage restraint when, at the same time, the Government intend to spend more than ever before on such matters as the nationalisation of industry and land? What form does the right hon. Gentleman imagine that the wage restraint will take when the announcement by the Chancellor of the Exchequer amounts to a refinancing of our existing public expenditure rather than a realistic cut?
§ The Prime MinisterPart of the cuts were refinancing from the private sector. I should have thought that the hon. Gentleman would welcome that in his professional capacity. There is no 2120 reason why we should not seek to make this transfer from public borrowing to private savings in this sense.
As for the levels of incomes and wages over the next three or four years, this will be a difficult period for us. But I believe that if we can hold the country on a steady course from now until 1980, there will be great opportunities open to us. I have seen, for example, that trade union leaders have said that they want a return to collective bargaining. But they have also said—and I repeat it because I am in line with them on it—that there can be no wages explosion without setting back all the gains that we have made so painfully in the past 18 months.
§ Mr. LiptonWill my right hon. Friend do his best to ensure that his natural optimism is not always shadowed by the natural and perpetual misery of Opposition Members who decry all that we are trying to do?
§ The Prime MinisterI am not much influenced by Question Time in the House of Commons, I must say. I have now, after four months, come to see the game that the Opposition play.
§ Mrs. ThatcherSometimes the Opposition just try to find out the facts, I am afraid not very successfully. Earlier, the Prime Minister referred to certain economic forecasts. Since one of the most important of them is the maximum number of unemployed—and he must have informed himself about that—will he tell the House what he expects to be the maximum number of unemployed during next year?
§ The Prime MinisterMy right hon. Friend the Chancellor of the Exchequer said that he expected unemployment to begin to come down by the end of the year. I cannot improve on that forecast. In any event, I have come without the figures. The original Question asked me whether I was satisfied with the co-ordination between Ministers—
§ Mr. TebbitOne of them is concerned with unemployment.
§ The Prime MinisterSometimes the hon. Gentleman is not nearly as nice as he sounds. We must monitor progress on this matter quarter by quarter, but my hope and expectation is that the 2121 Chancellor's figure will prove right and that the figure will start to move down towards the end of the year.
§ Mrs. ThatcherBut the Chancellor of the Exchequer did not give any figures. He refused to give figures when cross-examined by both sides of the House. I should have thought that the Prime Minister would automatically have informed himself about one of the main figures, which is the maximum number of unemployed expected during the next year. Is the right hon. Gentleman saying that he has not done so?
§ The Prime MinisterYes, I am saying that. I find that these forecasts often cancel each other out. However, as the right hon. Lady has raised the matter, I shall look into what lain Macleod said when he was Minister of Labour—some hon. Members were not here at the time —about publishing forecasts on unemployment, and perhaps later we can return to the question whether forecasts should be published. If the right hon. Lady is still not satisfied, she or someone else can table Questions to the Chancellor of the Exchequer.
I beg the right hon. Lady not to take too much notice of forecasts. So many of them have been proved wrong during the past six months, including, for example, the forecast from the National Economic Institute which said that our gross domestic product would come down during the first half of this year. There are very many other examples. I suggest that we stick to what is known rather than to what is forecast.