HC Deb 24 January 1985 vol 71 cc1121-2
10. Mr. Bellingham

asked the Chancellor of the Exchequer if he is satisfied with the present level of growth in the economy.

Mr. Law son

Gross domestic product rose by about 1½ per cent. in the year to the third quarter of 1984.

Mr. Bellingham

Is my right hon. Friend aware that, because of this year's excellent growth rate, there has been a record net increase in the number of new firms? Does he agree that, if it were not for the highly damaging and totally unjustified miners' strike, there would be even better growth and less unemployment?

Mr. Lawson

My hon. Friend is correct. The coal strike temporarily dragged down our rate of growth during 1984. Had it not been for the strike, the growth rate in the year to the third quarter of 1984 would have been not 1½ per cent., but about 3 per cent.—equal to the highest increase in Europe. The coal strike is damaging jobs, investment and the economy. Fortunately, it looks as though it will not be too long before this damaging strike is over.

Mr. Fatchett

Will the Chancellor explain to the country why, if he has such faith in his own economic policies, his public expenditure White paper does not predict a decrease in the unemployment level, but predicts that during the next few years unemployment will remain over the 3 million figure?

Mr. Lawson

The unemployment figures in the White Paper are not a prediction. The figures cited in White papers produced by previous Governments were also not predictions. The figures are a conventional assumption for the purpose of calculating benefits and other elements.

Mr. Holt

Does my right hon. Friend accept that, although he may be satisfied with the present level of growth in the economy as a whole, that faith is not sustained on a national basis? What is my right hon. Friend doing for the north of England, compared with the south of England, to ensure that there is a greater stimulation of growth in the area?

Mr. Lawson

I would, of course, be happy to see a higher rate of growth. I hope that that will be possible. I believe that it certainly will be possible as soon as the coal strike is over. It is especially important that we sustain the rate of growth, as we have done for more than four years. I shall continue to do that. I am conscious of the feeling in some parts of the north that people there have been left out, but I am convinced that the policies that are right for the United Kingdom as a whole are right for the north of England.

Mr. Lofthouse

When the Chancellor was in America explaining the growth of the economy, was he able to explain to the Americans that the miners' strike costs him between £90 million and £100 million a week, and did he say why he thought that was a worthwhile economic exercise?

Mr. Lawson

The Americans to whom I have spoken, and many other people overseas, are astonished that any trade union anywhere in the free world would maintain the proposition that uneconomic pits should be kept open, however large their losses.

Mr. Soames

Does my right hon. Friend agree that no economic indicator is a replacement for a pro-business culture? Does he agree that we really need a much more vigorous and enterprising economy?

Mr. Lawson

That is correct. That is the secret of success. It is what the Americans have found, and that is the direction in which we in this country are going.

Mr. Ron Brown

The Chancellor has said much about uneconomic pits. How can he justify an uneconomic Government? Is it simply a matter of class rule, is it simply the bankers' ethic, or is it something special that he can explain to us? We listen to the right hon. Gentleman's diatribes week in and week out.

Mr. Lawson

I suspect that the hon. Gentleman is referring to Johnson Matthey Bankers. My hon. Friend the Economic Secretary has already answered a question on that matter. It is certainly not the policy of the Bank of England to bail out any bank irrespective of the circumstances.