§ 9. Mr. Andrew F. Bennettasked the Chancellor of the Exchequer what is his most recent estimate of the cost in terms of benefits paid out and income lost as a result of each of extra 10,000 unemployed.
§ Mr. Peter ReesAdditional benefits would depend on the family cicumstances of those becoming unemployed, but an extra 10,000 unemployed in 1983–84 would, on average, increase expenditure on benefits and administration by about £18.5 million.
§ Mr. BennettDoes the Chief Secretary agree that, now that the election is over, there is no need for the Government to disguise the full cost of unemployment? Would it not be a good idea to come clean and remind the country that it now costs between £5,000 and £6,000 to keep someone out of work for the first 12 months and that there are about 60,000 teachers and many thousands of qualified doctors and nurses who would be only too pleased to be put to work rather than be paid unemployment benefit?
§ Mr. ReesThe hon. Gentleman's command of figures is a little imperfect. Even the House of Lords Select Committee arrived at only £5,000, with many qualifications. The hon. Gentleman seems to overlook the £2 billion that the Government have spent on programmes to create real rather than phoney jobs. [HON. MEMBERS: "Where?"]
§ Mr. FlanneryTell the truth, for once.
§ Mr. MarlowDo not those figures show strongly how important it is for the Government to stick to their existing policies so that unemployment can be reduced as soon as possible?
§ Mr. ReesMy hon. Friend is right. The countries that are showing the strongest signs of economic resurgence are those that have conquered or nearly conquered inflation. I have in mind West Germany and Japan.
§ Dr. BrayWill the Chief Secretary publish the basis of his estimate and explain why, at about £2,000 per head, the cost of keeping someone unemployed for a year is so much less than the estimate of the House of Lords Select Committee?
§ Mr. ReesI shall write to the hon. Gentleman giving him the detailed figures if he thinks that that will assist.
§ Mr. Robin CookWill the Chief Secretary admit that the reason why his figure is so low is that it is only the cost of the benefits? Does he not realise that the cost of unemployment and lost output is greater than the cost of benefits, as was recognised by the House of Lords Select Committee, the IFS and the Treasury until February 1981, when it stopped publishing figures because they were too embarrassing? Does he agree that, if the Government want to cut the appalling waste of unemployment, the logical, effective and humane way in which to do it is not to fiddle down the level of benefit but to reduce the millions who are condemned to unemployment?
§ Mr. ReesOur policies are designed to do precisely that. The sound policies that are being pursued by the Government are much more likely to create real jobs than the inflationary ones that were recommended by the Labour party during and before the election campaign.