HC Deb 13 May 1982 vol 23 cc933-4
4. Mr. Chapman

asked the Chancellor of the Exchequer by how much total public expenditure has risen in cash terms in the last three years; and how much the retail price index has risen during the same period.

Mr. Brittan

In cash terms the estimated outturn for the planning total for 1981–82, as published in the FSBR, is £105.2 billion. This represents an increase of 59.6 per cent. on the corresponding figure for 1978–79. Later indications suggest that the outturn for 1981–82 may be a little lower. During the same period the retail price index has risen by 50.2 per cent.

Mr. Chapman

Will my right hon. and learned Friend confirm in plain language that public expenditure has risen in real terms under this Government? To take a more detailed example to counter the mythology perpetrated by the Opposition, will he confirm that in health and personal social services real expenditure has increased by no less than 6 per cent.?

Mr. Brittan

There is endless controversy about what "real terms" means, but in the broadest sense of the term my hon. Friend is right. He is certainly absolutely right about the position with regard to health expenditure.

Mr. Jay

As the Chancellor has said that Government expenditure on the Falklands task force will in no way upset the Government's economic policy, would a similar increase in spending on, say, housing have upset the Government's policy?

Mr. Brittan

The answer is that it depends how much.

Mr. Dorrell

Although total public expenditure has risen in real terms under the Government, does the Minister agree that capital expenditure has declined in real terms? In view of the more encouraging trends in public sector borrowing and the substantial amount of slack that still exists in the economy, is it not reasonable now to undertake a marginal increase in capital expenditure to try to drip-feed the economy rather faster out of recession?

Mr. Brittan

Drip-feeding the economy rather faster is the way in which I believe that we shall emerge from recession. I share my hon. Friend's concern about capital expenditure. He will, of course, agree with me that the priority that we give to the social services and the amount that we spend on public sector pay are constraints that limit the extent of capital expenditure that we should otherwise wish.

Mr. Skinner

Although it may be argued that total public expenditure has increased during the past three years, is it not important to ask whether expenditure has been spent? On the matter of pay, which the Chief Secretary mentioned in his last answer, is it not worth noting that the Government's priorities in spending public money on pay relate more to lining the pockets of top civil servants and the judges than to helping people such as nurses and other Health Service workers, who are subject to a 6.4 per cent limit? That is the important factor, not the figure of total public expenditure. Who is benefiting?

Mr. Brittan

The answer is that the people of this country, on whose behalf the hon. Gentleman generates such synthetic anger, would be a great deal better off if he and his friends had not encouraged the massive increases that were awarded by Professor Clegg. Without those, we should have been on the road to recovery earlier.