§ 6. Mr. Alan Howarthasked the Chancellor of the Exchequer what is his latest projection for public expenditure as a proportion of gross domestic product in 1986–87.
§ Mr. MacGregorThe latest estimate of general Government expenditure as a percentage of gross domestic product for 1986–87 is 42½ per cent.
§ Mr. HowarthDoes my right hon. Friend agree that we are by no means achieving full value for our existing public expenditure on health and education? Although it is far from certain that a more relaxed approach to public expenditure would produce better public services, we know all too well from experience that it would lead to higher taxes, higher interest rates and higher unemployment. Will my right hon. Friend underline that truth to the alliance parties, which want to spend an extra £10 billion, and to the Liberal party in Warwickshire, which proposed a rate increase of 23.3 per cent. and more? I am happy to say that those Liberals failed to impress the electorate.
§ Mr. MacGregorMy hon. Friend was correct in the first part of his question. That is why, in addition to establishing priorities in public expenditure, we are concentrating so much on getting value for money in all the programmes. I am sure my hon. Friend will be pleased to know that, as a result of efforts in obtaining value for money in the Health Service, about £150 million a year extra has been devoted to real front-line care. We must continue with such an approach. My hon. Friend was entirely right in the second part of his question. As we saw under the last Labour Government, those were precisely the consequences, and they would be repeated under the proposals put forward by the Liberals and the SDP.
§ Mr. MaddenHow much is it costing the Government to sustain record unemployment?
§ Mr. MacGregorThe figures for unemployment benefit are in the public expenditure White Paper. If there is ever-increasing public expenditure, it has to be paid for in other ways, which loses real, permanent jobs elsewhere.