Economic Activity (Hansard, 13 May 1985)

§ 1. Mr. Knox
asked the Chancellor of the Exchequer what recent representations he has received regarding further signs of an increase in economic activity.

§ The Chancellor of the Exchequer (Mr. Nigel Lawson)
The latest CBI quarterly survey of manufacturing industry recorded an upsurge in business optimism, the fastest ever rise in export orders and the expectation of continued and accelerating growth in output.

§ Mr. Knox
For some years now Treasury Ministers have been making very optimistic noises about an economic recovery, yet unemployment continues to rise. When does my right hon. Friend expect that his economic policies will be so successful that unemployment will start to fall?

§ Mr. Lawson
If my hon. Friend had listened carefully to the answer that I gave to his original question he would have heard that those expectations were not mine but those of the membership of the CBI, as recorded in the CBI's industrial trends survey. But my hon. Friend is quite right, in that we are all greatly concerned about the fact that unemployment is high and still rising. Equally, I am sure he will acknowledge that a remarkable recovery and upswing is now going on in the United Kingdom's economy, which has already led, over the past two years, to more new jobs being created in this country than in the rest of Europe put together. I do not know when that will lead to a reduction in unemployment, but obviously the sooner the better for both my hon. Friend and the Government.

§ Mr. Wrigglesworth
Will the Chancellor of the Exchequer bear in mind that even if he succeeds in deluding himself about the figures, he is not deluding anyone else? Will he consider not only the selective figures that he chooses but the Government's own figures from the central statistical office, which show that the socalled economic recovery will falter next year even from its present level? What does the right hon. Gentleman intend to do about it? When will he learn the lessons, arid when will he change course?

§ Mr. Lawson
As is customary, the hon. Gentleman is talking complete rubbish. I can remember being told in 1982 that the recovery would peter out in 1983. Then, when it continued strongly in 1983, we were told that it would peter out in 1984. But when it continued in 1984, we were told that it would peter out in 1985. Recovery is continuing strongly this year, but of course the hon. Gentleman says that it will peter out in 1986. He should learn from experience and recognise that so far the Government's forecasts have been proved right.

§ Mr. Latham
Has my right hon. Friend noticed that, particularly in Leicestershire, significant shortages are emerging of skilled and semi-skilled workers in manufacturing industry, as has been reported in the local newspaper? Are the Government giving that some attention, in order to see what can be done to alleviate the situation?

§ Mr. Lawson
My hon. Friend is quite right. Incidentally, I commend the Leicester Mercury on its "jobs going begging" feature to which my hon. Friend has alluded. We are increasing expenditure on training substantially at both ends of the training spectrum. With the assistance of industry, we hope to expand the youth training scheme to a two-year scheme with a genuine training content that leads ultimately to a recognised qualification. At the same time, we are switching resources within higher and further education in order to produce more of the highly skilled technologists that industry badly needs.

§ Mr. Hattersley
The Chancellor of the Exchequer has told the House that he does not know when unemployment is likely to fall, but we all know that a forecast is made internally for the Treasury that must include such figures. Why does he not tell us the Government's estimate, even though we know that he dare not admit that there will be no significant fall in the foreseeable future?

§ Mr. Lawson
I do not admit any such thing. We do not know precisely what the unemployment trend will be. Indeed, this Government, previous Conservative Governments and the Government in which the right hon. Gentleman served, have never forecast unemployment figures.