§ 17. Mr. KnoxTo ask the Chancellor of the Exchequer if he will make a statement on the level of total demand in the economy.
§ Mr. MellorDomestic demand fell by 3 per cent. in real terms in 1991. In my right hon. Friend's Budget forecast, it is projected to rise by 1¼ per cent. in 1992 and by 3¾ per cent. in the year to the first half of 1993.
§ Mr. KnoxDoes my right hon. and learned Friend agree that the tax cuts in the Budget will help to restore consumer demand, which is much in need of a boost?
§ Mr. MellorIndeed, and my hon. Friend will know only too well that since October 1990 the income of the average wage earner has increased by 15 per cent. in real terms as a result of real growth in earnings and the continuing fall in mortgage interest rates. That is the basis for my right hon. Friend the Chancellor's forecast that the economy will pick up in line with his Budget statement.