§ 6. Mr. Bruceasked the Chancellor of the Exchequer what representations he has recently received concerning increasing the public sector borrowing requirement.
§ Mr. MacGregorMy right hon. Friend the Chancellor of the Exchequer has received a number of representations concerning the public sector borrowing requirement and related matters.
§ Mr. BruceWill the Minister acknowledge that last year the Chancellor of the Exchequer described his Budget as a Budget for jobs, but that unemployment has increased? Will he now acknowledge that a modest increase in the public sector borrowing requirement will be necessary to secure the finance to tackle the problem of unemployment? Will he now undertake to change his strategy, which would be destroyed by a modest increase in the PSBR?
§ Mr. MacGregorI have already said that a number of measures which were announced last year have come into effect this year, although we have not yet seen their impact on jobs. I must make it clear that, as a result of the strategy that my right hon. Friend has been pursuing, the manufacturing industry and the economy are growing at a faster rate than before and inflation is at a lower level than for a long time. We are becoming more competitive, and that is the best guarantee for jobs in the future.
§ Mr. WattsCan my right hon. Friend estimate what would be the effect on inflation and interest rates of a £24 billion increase in public expenditure implicit in the Labour party's programme and not to be funded through taxation?
§ Mr. MacGregorClearly it would be very severe. I stick to the figure in the region of £24 billion. Yesterday I wrote to the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) and admitted that one of the figures that I gave earlier should be down, but said that another should be up. I note that the right hon. Gentleman has not given an alternative figure. If the sum of £24 billion is to be lower—I certainly hope it would be—I should be interested to know which of his colleagues' spending commitments he would intend to knock out. The right hon. Gentleman would have to do that, because my hon. Friend is absolutely right.
§ Mr. Terry DavisIn view of the Government's track record from the so-called Budget for jobs last year back to the so-called Budget for enterprise in 1979 and the fact that the numbers of people working in Britain—the employed and the self-employed—have gone down by more than a million, what assurance can the Minister give the British people that this year's Budget will be any more successful than his right hon. Friend's previous Budgets?
§ Mr. MacGregorThe work force has grown considerably in recent years. Since 1983 there has been an increase in the numbers of people employed. One of the key factors is that we have had a consistently higher rate of manufacturing growth over a number of years.
§ Mr. MacGregorThe hon. Gentleman knows that the same is happening in other countries with technology, tax, and so on. Nevertheless, it is absolutely clear that we are on a better course with regard to inflation and growth than for a long time.