HC Deb 20 January 1976 vol 903 cc1130-2
Q2. Mr. George Gardiner

asked the Prime Minister if he will elevate the Chief Secretary to the Treasury to Cabinet rank.

The Prime Minister

I refer the hon. Member to the reply that I gave to the hon. Member for Norfolk, South (Mr. MacGregor) on 15th January, Sir.

Mr. Gardiner

In view of today's unemployment figures, will the Prime Minister consider arranging a swap between the Chief Secretary and the Chancellor of the Exchequer and so clear out of his Cabinet those Ministers who are responsible for this deplorable situation? When he considers the unemployment figures that have been published today, will he arrange to be briefed by the Chief Secretary, who has repeatedly stressed that £1 spent on subsidies is £1 less for industrial investment and viable jobs?

The Prime Minister

I confess that I am in some difficulty, because last Thursday the hon. Gentleman, together with six of his hon. Friends, wanted the Chief Secretary sacked. Now he wants him promoted. I believe that the half-way state between the two is just about right.

The hon. Gentleman is totally wrong if he associates that with the unemployment figures, because my right hon. Friend the Chief Secretary, with the full support of the Chancellor and myself, has assiduously been ensuring that in the period of world recovery in 1977 and 1978 it will be very important to restrain public expenditure and so release resources for investment and export in that situation, so that we do not face the quick restraints on expansion that have happened in past years. That is not a case for slashing, ill-considered cuts in expenditure now—cuts for which the Conservative Party has been pressing and which they never specify, but which would lead to a large increase in unemployment.

Mr. Duffy

Has my right hon. Friend the Prime Minister noticed the increased grounds for optimism about the performance of our economy in 1976—to which nearly every economic forecaster now subscribes—and notably about our prospects of achieving a single-figure rate of inflation by the end of the year, or even, as some believe, before the end of the year?

The Prime Minister

Yes. By this time we had hoped to receive some comments from the Opposition about the success of the Government's policy and the acceptance by the whole population of our proposals on inflation, which the Opposition did not dare vote against or for. We had hoped that we would receive some compliments from them about the fact that the balance of payments last year showed a deficit of less than half what it was the previous year, and very much less than it was in the Opposition's last year of office, before the rise in oil prices began to hit Britain.

Mr. Hooson

Is it not time that the Prime Minister abandoned his arid argument of loose falsities and told the House what he intends to do about it? The right hon. Gentleman says that he wants to encourage investment in industry. How does he propose to do it? Does he intend to reduce taxation and to have more Government investment, or does he intend to go along with unemployment until the end of the decade and then blame someone else for it?

The Prime Minister

I am not in the slightest degree interested in placing responsibility on members of the Opposition, but occasionally when I am attacked I defend myself, which I am entitled to do, in my position. The hon. and learned Gentleman usually adopts a position of amiable neutrality on these matters, but it is quite clear that he missed all the economic debates, the statement of the Chancellor of the Exchequer about investment, the steps that he has already taken and—one of the most significant points—the considerable resources that he has placed at the disposal of particular industries for regeneration—a measure approved by the whole House—as well as the creation of the National Enterprise Board.

Mr. Ashley

Will my right hon. Friend ask his right hon. Friend the Chief Secretary to consider the question of industrial perks to upper management, especially as they include such provisions as housing, entertainment, free insurance and interest-free loans? In particular, will he ask the Chief Secretary to look at apparent negligence by the Treasury, which was disclosed in two Parliamentary Answers to me in December? In reply to a Question from me, one Minister said that those perks were taxable, but another Minister said that the total number of people receiving these perks was not known. Is that not an unsatisfactory situation?

The Prime Minister

My hon. Friend will be aware that under successive Governments there has been a tightening up of tax laws in respect of income that is provided in different ways. A great deal of evidence has been adduced to show that this does not go far enough. These matters are continually considered by my right hon. Friend the Chancellor of the Exchequer, but I cannot at this stage anticipate my right hon. Friend's Budget Statement.