§ Last October I announced an increase in our plans for public expenditure in 1978–79 of £1,000 million at 1977 survey prices, including £400 million on construction and over £300 million on raising the rate of child benefit to £2.30 from this month. These increases were included in the Government's expenditure plans as set out in the public expenditure White Paper last January. The White Paper also made provision for the statutory uprating of the main social security benefits in line with earnings or prices as appropriate.
1196§ We have therefore decided to increase in November the rate of pension by £3.20 to £31.20 for a married couple, and by £2 to £19.50 for a single person. This is likely to represent an increase of over 4 per cent. in real terms. The real value of the pension will thus have risen by over 20 per cent. since this Government came to office when the married pension was £12.50 and the single £7.75. My right hon. Friend the Secretary of State for Social Services will shortly be announcing the full details of the uprating, including the increases in short-term benefits. Altogether, these improvements will be worth around £500 million in 1978–79 and £1,300 million in a full year. The revised national insurance contribution rates for 1978–79 now in payment were announced by my right hon. Friend the Minister for Social Security last December.
§ The Government's plans provided a contingency reserve of £750 million at 1977 survey prices to cover additional public expenditure measures in 1978–79. We have decided to allocate now a substantial part of the contingency reserve to such measures.
§ The first call on this sum is for the employment measures which my right hon. Friend the Secretary of Stale for Employment announced last month. The extra cost of these additional measures to United Kingdom employment programmes in 1978–79 is estimated at about £156 million and in 1979–80 at about £144 million. As I said earlier, these additional measures, combined with the others previously announced, will protect or provide about 400,000 jobs or training places by March 1979.
§ The Government are also making available further sums in 1978–79 to expand other programmes which are of particular social and economic importance at this time. Within the social services we are giving on this occasion the highest priority to health and education. There will be an allocation of £50 million in 1978–79 for the Health Service in the United Kingdom for specific improvements in services for patients. These will vary from place to place but there will be, for example, extra resources for the full opening of newly completed hospitals, facilities to cut waiting lists, more staff to help care for the elderly 1197 and handicapped, and over 400 extra kidney machines, Education will receive £40 million to cover a higher rate of capital expenditure by local education authorities on schools and colleges and there will be additional funds for retraining teachers in subjects like mathematics, science and crafts where there is a shortage.
§ There will also be £20 million for environmental services, including building small factories in rural areas by the Development Commission, and for preserving the coastline. There will be provision for higher expenditure on law and order—such as police and prisons and the probation services; special assistance for certain areas affected by early steel closures; and a small extra sum for sea defences in addition to the help announced for farmers affected by storm and flood damage earlier this year. Finally, funds will be made available to promote insulation of private houses and to launch a further scheme to promote energy saving in industry and commerce. I think that this will make a helpful contribution to the energy objectives of the concerted international programme I have mentioned.
§ These decisions will provide useful additions to a wide range of public expenditure programmes and will also bring some further help to the construction industry. Further details will be announced by the Ministers responsible in each case.
§ The other increases in expenditure are designed to help the family budget. The Government have decided that the autumn increase in the charge for school meals will not take place. We have also decided to take advantage of the Common Market subsidy for school milk by enabling local education authorities to provide free milk for 7-to-11-year-olds. The net cost of these two measures is about £68 million in 1978–79.
§ Finally, we are raising child benefit again. As I announced last summer, child benefit was raised this month to £2.30 a week for all children, and the premium for the first child of one-parent families doubled to £1. The Government have now decided that the child benefit rate will be increased in April 1979 to £4 for all children. Meanwhile, as a first instalment of this increase, the Government 1198 have decided to increase child benefit by 70p to £3 for all children this November. In addition, the premium for children of one-parent families will be doubled from £1 to £2 in November.
§ The cost of these increases in 1978–79 will be around £165 million. They will give a further major boost to child support for working families. Those dependent on social security benefits will, of course, gain from the general social security uprating which I have just announced.
§ In deciding on these measures of additional expenditure this year, the Government have regarded it as an essential principle that their cost should be met within the public expenditure plans published in January. Accordingly, the cost will be met from the contingency reserve for this year.
§ It has been argued from many quarters, including by many of my right hon. and hon. Friends, that the Government should take major expenditure decisions on measures affecting people's incomes, such as child benefit, at the same time as their main decisions on taxation. The two can then be seen in relation to each other. I believe it is right that the Government should have taken now their principal remaining decisions affecting 1978–79. Just under £200 million at 1977 survey prices remains available in the contingency reserve. Any contingencies requiring additional expenditure in the remainder of the year will be met within this figure.
§ The Government will consider the programmes for 1979–80 and subsequent years in the public expenditure survey. It remains the Government's firm intention to contain the growth of expenditure planned for those years within the growth which we can expect in the economy as a whole.