§ So many other facts tell the same story. Consumer spending rose last year, in percentage terms, by seven times as much as manufacturing output. We actually manufactured 4 per cent. less goods in 1978 than in 1973. But the volume of manufactured imports went up by 13½per cent. Though demand was rising strongly, and unemployment remained high, the economy was almost unable to increase supply. The current account of the balance of payments was barely in surplus last year, despite a massive contribution of £3½ billion from North Sea oil and gas. And well before the last Administration left office inflation was back on a rising trend. Although many price increases had been held back behind the general election dam, the rate of inflation in the six months to April—excluding seasonal foods—was running at no less than 12.3 per cent. at an annual rate.
§ On that form and on the policies which brought it about, there is little reason to expect any improvement in the future. 237 Productivity is rising less than half as fast as in the early 1970s. There is no sign of any change for the better there. Last year's growth in demand could never have been sustained, because, as the trade figures make clear, it was largely met from imports. That was the main reason why the recent fall in unemployment was, in any event, likely to be reversed.
§ It would be easy to conclude that these difficulties are all the fault of the last Administration. Certainly the Labour Party bears a heavy responsibility. Labour Governments have, after all, been in office for 11 of the last 15 years. Even so, I want to consider our problems in an even longer perspective.
§ Only a quarter of a century ago—within the memory of almost every Member of this House—the people of the United Kingdom enjoyed higher living standards than the citizens of any of the larger countries of Europe. Amongst the free nations of the world, Britain was then second only to the United States in economic strength.
§ It is not so today. For example, France and Germany's combined share of world trade in manufactured goods, which in 1954 was almost the same as Britain's alone, is now more than three times as large as ours. The French people now produce half as much again as we do. The Germans produce more than twice as much, and they are moving further ahead all the time.
§ There has, of course, been plenty to say in mitigation of all this. At least until recently, we have been able to claim a good record in most of those things that can be summed up in the phrase "the quality of life". But in the last few years the hard facts of our relative decline have become increasingly plain, and the threat of absolute decline has gradually become very real. That is not a prospect that I am prepared to accept. Nor, I believe, are the British people. They realise that we cannot for ever go on avoiding difficult choices in the fatal, and increasingly futile, quest for easy solutions.