HL Deb 24 November 1997 vol 583 cc759-71

3.40 p.m.

The Lord Privy Seal (Lord Richard)

My Lords, with the leave of the House, I should now like to repeat a Statement made in another place by my right honourable friend the Prime Minister on the special European Council on employment in Luxembourg on 21st November which was attended by my right honourable friends the Prime Minister and the Foreign Secretary. The Council's conclusions have been placed in the Library. The Statement is as follows:

"Unemployment in Europe represents not only personal tragedy on a huge scale but also a tremendous waste of economic talent and potential. At the Amsterdam European Council in June jobs were given the top priority they should always have had. We agreed then a new treaty framework for action on employment, the Employment Chapter. The aim was a co-ordinated strategy to promote a skilled, trained and adaptable workforce and flexible labour markets responsive to economic change. At Luxembourg, the first time the European Council has met just to discuss jobs, we decided how to put this Amsterdam aim into effect.

"Let me make it clear at the outset that we are not creating new EU competences or new EU spending programmes, although we have agreed some useful redeployment of existing resources. What we can agree at European level is the broad lines of a practical approach to job creation. We can commit ourselves to finding and following best practice wherever appropriate. What we therefore sought and agreed was a set of common practical objectives to be enshrined in non-binding guidelines for national employment policies.

At the heart of Europe's new approach is the need to create the right macroeconomic framework and to move more rapidly on the structural reform of labour markets. Removing barriers to the completion of the single market remains crucial, but the role of small firms in creating jobs is now recognised as central, as is the need to create a simpler regulatory and administrative environment for business. These are all ideas which we have promoted and to which we can subscribe wholeheartedly. There were three points at the heart of our discussions: first, an adaptable and skilled workforce responsive to economic change. The emphasis must be on education, skills, technology and an active employment service. We need flexibility, not in the sense of hire and fire management but in the sense of businesses and employees being able to respond to new and changing economic conditions. Secondly, there is entrepreneurship, especially small business. This is where many of the new jobs we need must come from, and we must nurture this sector. Thirdly, we must tackle structural unemployment. This cannot be lowered simply by demand management. We want neither laissez-faire nor old-style state intervention but targeted measures specifically directed at the long-term and young unemployed. "Under adaptability, the Council endorsed the idea of modernising work organisation, including flexible working arrangements to help companies be both productive and competitive. In an important step forward, it also agreed to examine any new regulations to make sure they reduce barriers to employment and help labour markets adapt to structural economic changes. This was a particular British initiative.

"Under entrepreneurship, the focus was the vital role of small and medium-sized enterprises. It was agreed that member states should make starting and running businesses easier by reducing the overhead costs and administrative burdens, in particular of taking on extra staff. More widely, it was agreed that taxation and benefit systems should be made more employment friendly, for example by reducing the tax burden on both labour and other non-wage labour costs where they are at levels which hinder job creation. Some countries are keen to consider the reduction of VAT on labour-intensive services not exposed to cross-border competition.

"To tackle structural unemployment, the Council agreed an approach based on employability. There should be specific commitments to improve the ability of individuals to get and retain jobs, with special emphasis on youth and long-term unemployment. In particular, all member states undertook to offer a fresh start in terms of training or similar measures to all young people unemployed for six months and all adults unemployed for 12 months. A specific target of 20 per cent. was set for the number of unemployed benefiting from active measures to improve their employability. There was also extra emphasis on ensuring that young people do not leave the school system too early and inadequately equipped for the jobs market.

"The Council also emphasised the importance of equal opportunities. In particular, there should be commitments aimed at tackling gender inequality, making it easier for parents to reconcile work and family life and addressing the problems of the disabled in the workplace.

"The actual guidelines setting out these practical objectives and commitments in more detail will be adopted by the end of the year. It will then be for member states to prepare national action plans on how they intend converting these into action. These plans will be subject to scrutiny by other partners. Each member state will be able to apply them in accordance with national circumstances but will be expected to address all the objectives in one way or another. We will review progress first at the Cardiff European Council in June.

"The Luxembourg Council also welcomed extra mobilisation of the resources of the European Investment Bank to improve economic performance. One billion ecu from the bank's reserves will be used over three years to finance new initiatives to help high tech SMEs. Of this, 125 million ecu has already been earmarked for a new European technology facility. The EIB is also starting to lend in the health, education and environment sectors and is stepping up its support for trans-European network projects. In addition, the European Council agreed in principle to redeploy 450 million ecu from the existing EC budget over three years to help job creation, again particularly supporting innovative and job-creating small and medium-sized enterprises. These financial measures will be helpful, but they of course play only a supporting role: reform of labour and product markets is the real key to improving Europe's employment performance.

"The Jobs Summit marks Europe's commitment to a new approach to create jobs and security for the future, not the old-fashioned free-for-all resulting in widespread social exclusion, nor loading more costs and regulations onto business, but a third way: investing in people, in their skills, in small businesses, and setting a stable, long-term framework for business and industry to plan for the future and create jobs. Education and training are the keys. The so-called European social model is being refocussed, based on a modern approach of reform, flexibility and investment in people. We aim to involve both sides of industry fully in this approach.

"We will use the UK Presidency next year to ensure that this is carried through in order to make a real difference to employment, employability and social inclusion. Luxembourg agreed an approach for the long term. Effective follow-up is vital.

"At Amsterdam we showed how a united British Government with a clear direction in Europe could make Britain's voice heard. At Luxembourg we showed how a constructive British approach could result in a new direction on tackling unemployment, an approach based on competitiveness, employability and labour market reform, combining job creation with a fair and cohesive society.

"We recognised at a European level the terrible personal damage which occurs each time an individual who is willing and anxious to work is still unable to find a job through no fault of his own. That is why this Labour Government are working for a Europe that is working for jobs. This approach is right for Britain, right for Europe and right for the people of Europe."

y Lords, that concludes the Statement.

Viscount Cranborne

My Lords, the whole House will be grateful to the Leader of the House for repeating the Statement. I apologise that I appear to have given him my cold which must have made the job more onerous than usual. I hope that he will rapidly recover.

We welcome the fact that the European leaders discussed unemployment in Luxembourg. As has been pointed out on all sides of this House over many years, it is the greatest problem facing western Europe and, as the Statement says, Europe's young people in particular. Of course we welcome many of the aspirations expressed in the final communiqué, particularly measures such as the plan to do more to help the disabled and the aspiration to reduce the tax burden on wage and non-wage costs.

However, there are a number of matters to which I wish to draw attention. First, it is a pity that this huge practical problem was not addressed by our partners in Europe a little earlier. After all, your Lordships will remember that the previous Prime Minister, Mr. Major, was constantly pressing on our European colleagues the need to turn away from costly interventionist strategies and so help business and employment to grow. He received precious little support from the Labour Party at the time.

Secondly, when joblessness is addressed at a summit, it produces, perhaps typically for any summit of this kind, what appears to be a miasma of rhetoric rather than real, firm conclusions. Judging from the press reports we have read on the results of the summit and in view of references to "rows and confusion", one must ask oneself whether the heads of government are not to be congratulated on being able to agree a joint communique at all. Therefore, is this merely a papering over of the cracks or is there real substance behind it? Shall we really be able to look forward to action of the kind we have been advocating, which certainly the Prime Minister seems to have taken to heart, at least in part?

In that context, it was instructive that the French and British Prime Ministers occasionally, in their comments, appeared to have been at entirely different conferences. M. Jospin hailed it as a triumph for what he called a social Europe in which there would be more stated interventionism to create jobs. That is rather different from the rhetoric we heard from the Leader of the House this afternoon. Do the British Government retain a veto on social and employment affairs to prevent the kind of ideas which M. Jospin appears to be proposing? If the answer is anything but an unqualified "yes", the prospects for jobs in this country can only be damaged.

Is it not also the case that we should agree with the German Chancellor on one matter; his remark that, a patented recipe does not exist for everyone"? I was glad to have the comfort of those words given the news we heard this morning; namely, that the independent council of economic advisers in Germany—the so-called five wise men—has warned that German unemployment may well pass 5 million this winter. I am sure that the Leader of the House will remember that the previous government scrupulously resisted the European model of more regulation and European Union interference in employment policy. We were criticised for that from the Benches opposite but the results entirely vindicate our stand. After all, our unemployment levels are lower than those of all our major European partners. Youth unemployment is falling at a rate that the Government's loftily named welfare to work programme never envisaged, long before government measures have come into effect. Small businesses are being formed and are expanding at a rate which would be the envy of most of our competitors. In fact, they are the envy of most of our competitors if newspaper reports are correct about the number of French businesses and individuals coming to settle in this country. One might think that even the Prime Minister, who so enthusiastically attacked each and every one of our measures in government, might have had the spirit to defend that British model without equivocation, instead of talking in—what has become a rather hackneyed phrase in my party—the third way.

What is that third way? It sounds like a stale rhetorical device, a path between laissez-faire economics and old-style intervention and protectionism. It smacks of the worst excesses of the mixed economy of the 1970s, cloaking policies which are pernicious in their effects with anodyne declarations against sin and in favour of motherhood.

It is true that the Prime Minister makes a nod in the direction of flexibility and deregulation, and we must welcome that. But the reality of the past five years is that experience has shown that the British route of deregulation is the best way to job creation and that the European route of regulation is a job destroyer. Therefore, I can see why the Prime Minister talks of businesses being able to respond to new conditions. I can see that very clearly. But then why does he shackle them with the social chapter that need never have been signed in the first place?

I can see why the Prime Minister talks of nurturing the small business sector. We are all in favour of that. But if so, why is he planning to hit many in that sector with a minimum wage and the working time directive? Equally, I can see why he talks of tackling structural unemployment. In that case, having inherited an economy which was the best job creator in Europe, why is he planning to tie Britain into a Europe-wide employment model?

Once more, I fear that there is a huge disparity between government words and deeds on the ground. For all we have heard today, is not the reality that all the actions the Government have taken since May will make it more difficult for people to find jobs and keep them and for small businesses to expand? We have shown already that competition and free markets in a strong legislative framework are what create jobs, not a spurious middle way which looks to corporatist and centralised solutions.

Lord Ezra

My Lords, from these Benches we also welcome the Statement. We consider that the concentration by the recent meeting of the European Council in Luxembourg on unemployment was a big step forward and to the extent that that was due to the initiatives of the British Government, we congratulate them.

Of course this will be an extremely difficult area, given the different approaches in the different countries. But the fact that they were prepared to come together and devote a whole Council meeting to the subject is highly laudable. It is important also that there will be a firm follow-up; that guidelines are to be agreed by the end of this year; and that individual government action plans must be prepared in time for the Cardiff Council meeting in June. Will there be adequate opportunity, when the British national action plan is prepared, for that to be debated fully in this House before the Cardiff meeting takes place? It is important that the Government should be aware of parliamentary opinion on the subject?

I turn to the detail of the Statement. Flexibility is obviously an extremely important issue. There is the UK flexible model as opposed to the continental social model, and it is contended in the document that somehow we have started to achieve a marriage between the two. How serious are the intentions of other countries in making themselves responsive to market changes? The British press at any rate was somewhat critical. One does not necessarily need to go by what the press says but it was felt generally that there was not very much progress in that direction. What about social charges? Was that subject tackled? Was there any response from the other countries that that is something which they regard as having to be urgently attended to?

On the role of the SMEs, it is satisfactory that more attention will be paid to small and medium sized firms and that certain measures backed up with financial support will be adopted. However, bearing in mind the enormous number of such firms throughout the European Union, the sums which are talked about are fairly small. Will it be open to individual member countries, if they so wish, to add to those resources in their own action plans?

On structural unemployment, again the measures which are contemplated are highly desirable but all would require additional resources. As I understand it, those resources will be made available by reallocating existing Community resources. Will that be sufficient for this important purpose? Taken all together, this is an important step forward. We very much welcome it. We look forward to the publication of the guidelines and in particular to the UK action plan.

Lord Richard

My Lords, I am grateful for much of the response. I thought the noble Lord, Lord Ezra, gave a pretty unqualified welcome to what was achieved. The noble Viscount, Lord Cranborne, did not give an unqualified welcome. I have some sympathy for him. He was not quite sure whether to say, "Yes, it is absolutely splendid and it is all due to us" or "They have not really achieved anything". I say respectfully to the noble Viscount that it is difficult to run the two together. Of course, we are not pretending that this is anything greater than it is. However, it is the first European summit that has been devoted to employment. It is the first time that member states have committed themselves to something substantial and positive and have committed themselves to action as opposed to rhetoric. Further, it is the first time in my experience—I had some limited experience in dealing with these matters when I was in the Commission—that there has been some cash on the table, modest though it is.

The noble Lord, Lord Ezra, asked whether 450 million ecu would be sufficient. I do not know. Of course, it is not sufficient to create jobs throughout the whole of the Community but it is enough to start. It is also an important step that the European Investment Bank is making no fewer than 1 billion ecu available over three years. Whether that will be sufficient I cannot say. What is important is that not only have a framework and guidelines been agreed but, as the noble Lord, Lord Ezra, pointed out, there is a mechanism for following that up. I know as well as anyone in this House that all too often European Councils have emerged with forms of words which on the face of it look reasonable but little has happened afterwards. That is true not only of the European Council but of Councils of Ministers too. The test will be whether member states take this measure seriously. All I can say to the House is that on the evidence of this European Council they are taking it seriously. They all agreed to it after a period of bargaining and there is a follow-up procedure. Action plans must be drawn up. These will be public in the sense that each member state's action plan will be available to the others and they will be discussed at the European Council next June.

The proof of this particular pudding will be how many people in employment will be capable of eating it. However, some time will have to pass before that is evident. I hope that I do not claim too much for the measure. The noble Viscount asked me a large number of questions about policy in Germany and in France and whether the French Prime Minister was accurate in his description of the Council, or whether the British Prime Minister or Chancellor Kohl, were accurate in their descriptions. He will know that countries tend to meet at European level and then issue their own press statements. I am not responsible for what M. Jospin says, nor Chancellor Kohl nor Sig. Prodi, nor, I am happy to say, for what any of them say. It seems to me that what is important is what they agreed to. It is that which we have and it is that which will be helpful in the long run.

4.5 p.m.

Lord Campbell of Alloway

My Lords, what is the attitude of Ministers to the minimum wage? What is the attitude of the Government now to the minimum wage? There is nothing said about it in the Statement. Apparently nothing was agreed to and yet this is an important issue which we discussed in the House long before the election. We always said that it would make for unemployment and that it was not useful for small businesses. The Labour Party always took an opposite view. Can the noble Lord explain where we have got to now?

Lord Richard

My Lords, the Labour Party fought an election in favour of a minimum wage. It was elected as a government in favour of a minimum wage. It is still in favour of a minimum wage and has started the procedure for implementing a minimum wage. The Minimum Wage Commission is set up and it will consider the appropriate level of that minimum wage.

I wish to deal with a point which is perhaps implicit in the question of the noble Lord, Lord Campbell of Alloway. Of course the European Council did not consider issues such as a minimum wage for workers in the United Kingdom; that is not part of its remit. It considered the extent to which action in common, based upon a commonality of guidelines—if I can put it that way—could be taken and how far individual countries could go along that particular road and make a dent in the unemployment figures. That is what this measure is about. One should neither elevate it to a position above its importance nor—I say this with great respect to the other side—should one downgrade it to a position that it clearly does not deserve. It comprises a number of useful steps in the right direction in which I think Europe and this country should go.

Lord Bruce of Donington

My Lords, in the nearly quarter century that I have had the honour of being a Member of your Lordships' House I have never heard the report of an international gathering, particularly that relating to the European Community, that contains so much waffle and so little substance. It seems to me to have been assumed by all those concerned at the conference that unemployment essentially was the fault of the people who were unemployed and that somehow the onus was strictly upon them to reach that standard of qualification which would ultimately—there is no date fixed—lead to their being absorbed into industry and into various services. I see that I have the agreement of the noble Viscount, Lord Cranborne, as he nodded. However, I point out to him that he himself assumes that the figure of unemployment in the United Kingdom bears no relationship to the figures that have been published which relate, in the main, to claimant unemployment, whereas the quarterly survey that is carried out reveals authentically that unemployment in the United Kingdom amounts to 2,800,000, and in all probability is somewhere nearer 4 million. What is offered by the Community at large in the conference that has taken place apart from a lot of pious platitudes that reveal no resolve whatever to solve the problems of unemployment but merely paper it over and make its existence politically palatable to the citizens of Europe? Surely we require a little better than that.

Will it not immediately be agreed by Her Majesty's Government that no matter what they say at these conferences—which come out with such platitudes —the economic development of the Community is following precisely the rules of Maastricht which lay down precisely the economic and financial policies to be followed, and which have been followed, resulting in an increase from 15 million to 18 million in total unemployment in Europe? Let it not be assumed for one moment that unemployment, even at the existing claimed figure of 1,300,000, which is scandalous, can be maintained concurrently with the statement that we as a country, or Europe as a continent, is following sound economic policies. Sound to whom, my Lords? Sound to the City of London? Sound to the financial interests and the capital interests in Europe at large, and in this country in particular, but which inflict unnecessary unemployment and suffering upon not only the members of the United Kingdom but also the workers in Europe as a whole?

Lord Richard

My Lords, my noble friend says that he has attended this House for 25 years and has never heard a report from an international gathering with so much waffle and so little substance. I have not sat in this House for 25 years. However, during the seven or eight years that I have attended here, I have heard many interventions from my noble friend—and they are many, far more than reports put forward from international conferences. I do not think that even from my noble friend I have heard an intervention which, frankly, was such a travesty of the real situation.

My noble friend began by denying the value of training, as though somehow or other those Governments which took part in this conference were blaming the unemployed because they were not properly trained. No, we are not blaming the unemployed but we are blaming the system which has left them untrained. We are setting up a set of structures which will train them. For many years I have had a basic belief that if you train someone to do a job, on the whole he has a better chance of finding work than if he is untrained. I am bound to say that I was flabbergasted to hear my noble friend advance his argument today.

My noble friend said that nothing was agreed. For the first time in my experience there is money on the table. Cash is available to small and medium-sized enterprises in order for them to try to take on more labour. There is an agreement at European level that all the nations of the Community will advance in the same direction as regards unemployment. Not only that, there is a set of agreed guidelines; an action plan for each country is to be agreed; action plans for each country are to be followed up.

I would have expected that the attack by my noble friend Lord Bruce of Donington would have been that the conference infringed his sacred principles of subsidiarity and national competence rather than that the European Council had not gone far enough.

Baroness Williams of Crosby

My Lords, I add my congratulations to those given to the noble Lord, the Lord Privy Seal. It is refreshing to see co-operation between member states of the European Union after such a long period in which such co-operation was virtually impossible. That co-operation appears to have commended itself in a substantial way to the electors of Winchester—somewhat more than have the nationalist attitudes of the noble Viscount, Lord Cranborne. Perhaps I may also say how refreshing it is to see the attempt to reduce non-wage costs and to introduce family friendly policies.

In asking the noble Lord these questions, I should declare an interest as the chairman of the job creation competition programme in the European Union. First, does the noble Lord recognise that skill shortages are re-emerging already in countries like the United Kingdom and the Netherlands, where unemployment is falling albeit not so fast as the official figures in both countries suggest? Secondly, at the Job Summit was there discussion of further measures which might be taken to encourage skilled training in the small and medium-sized enterprises to which the noble Lord, the Lord Privy Seal, referred? Finally, with regard to the co-operation principles underlying employment programmes put forward by member states, will the noble Lord confirm that the purpose of the third way was to reduce unemployment without the massive increase in poverty and inequities which unquestionably defaced the record of the previous government?

Lord Richard

My Lords, I thank the noble Baroness for her introductory remarks.

Perhaps I may say a word about skills shortages. Many years ago when I was in Brussels—we were at the height of a major depression—it struck me that the ultimate irony and expression of incompetence on the part of member states would be to emerge from that recession needing skilled labour which was not there. It could only mean that our training policies had failed. Whether there was any specific discussion in relation to training in the SMEs I do not know. I shall inquire. If there is anything I can usefully add, I shall of course tell the noble Baroness.

The noble Baroness is right when she describes the third way principle. It is an attempt—I think that it is worth an attempt—to see to what extent one can have all the nations of Europe co-operating in a certain direction without committing themselves over much on one side or the other to a plain and perhaps over-precise statement of economic ideology.

Lord Beloff

My Lords, on reflection, does the noble Lord, the Leader of the House, agree that what has come out of this summit is an agreement that different member states should pursue the reduction of unemployment, which is their common goal, by their own measures; and that there is no need to worry about subsidiarity because it is there? On hearing the statements by the Prime Minister of France to go no further, is it not likely that when the action plans are circulated the French and, let us say, the United Kingdom action plans, will be substantially different? In the light of that, if the noble Lord agrees with me, will there not be something to be said for not having summits? Summit meetings remove from our affairs the Prime Minister who has many serious issues to confront. He cannot benefit from this constant jumping onto aircraft which seems to be a characteristic of modern statesmanship. Would it not be good to have a moratorium on summits for a year or two to see whether in the meantime we and other countries can reach the goal of reducing unemployment—a goal that we all cherish?

Lord Richard

My Lords, as regards the last part of the noble Lord's question, before 1st May of this year I was in favour of almost continual summits, preferably at long distances from the United Kingdom. My attitude on the absence of Prime Ministers from the United Kingdom may have modified slightly since then. However, of course these are important issues. They are important discussions on important subjects.

The noble Lord, Lord Beloff, says that if the countries act according to their own national plan, why bother with a summit? I was trying to think of a phrase which summed up my perception of the issue as opposed to his. The summit seeks to achieve guided co-operation, if I may use a phrase which will appeal to the noble Lord. These proposals are not compulsory. There is an agreement to co-operate for sensible, common aims. There are broad agreements on the guidelines which govern that co-operation. The proposal does not seek to go further than that at this stage. Whether or not one is in favour of being in the European Union, I cannot for the life of me see what is wrong with that.

Lord Monkswell

My Lords, I thank my noble friend for repeating the Statement. I wonder whether he agrees with me that the reduction in barriers to women entering the job market is not merely teaching them about apple pie and motherhood, as the Leader of the Opposition seems to think. Am I correct in thinking that while our Prime Minister has contributed ideas which, with the new Labour Government, are fresh to European thinking, Britain has also been receptive to ideas developed on the Continent of Europe? Will he confirm in particular that our emphasis on reducing barriers to women and disabled people entering the job market received a warm welcome among our European partners, and that their emphasis on injecting demand into the economy was welcomed by the Prime Minister, as evidenced in investment by the European Investment Bank?

The general emphasis on training as a prerequisite to ensuring that the skills shortages referred to do not become significantly apparent is welcome right across the board. I am sure that there is agreement right across Europe on that important measure.

Lord Richard

My Lords, I am in the happy, almost totally unprecedented position of being able to agree with every word that my noble friend has said. It does not happen all that often; but on this occasion, I do. He is quite right. In this area, as in many others, we have ideas, some of which our European partners believe are helpful; they have ideas which, eventually, the British Government believe are helpful.

One is in a slightly reminiscing mood this afternoon. I am not quite sure why. One of the pleasures I receive from examining recent events in Europe is seeing that that terribly modest little proposal of mine, which was rubbished by the previous government for many years—namely, the parental leave directive—is now to be implemented. That is quite a good example of the way in which the Government now approach these matters. My noble friend is quite right.

Baroness Carnegy of Lour

My Lords, an interesting point made by the noble Lord was that some countries have it in mind to reduce VAT in some areas. Will he comment further on that? Will he say which countries have it in mind, and in which areas; and was the United Kingdom among them?

Lord Richard

My Lords, the answer to the final part of the question is no. What I believe happened is that some countries felt that in certain local areas there were small-scale enterprises which would benefit from a reduction in VAT in that specific sector and in that particular country. It had nothing to do with an overall European approach, but was limited to small areas. There was a certain amount of discussion about the matter. It was felt that the approach might be worth exploring, and if one country wanted to include it in its action plan, clearly it would have to be considered in the future. There is no commitment whatsoever on the part of the United Kingdom Government.

Lord Peston

My Lords, if we are wandering down memory lane, perhaps I may say, first, how right the Government are in emphasising the importance of investment in human capital: in educating and improving the training of the labour force. Some of us have been saying that for 30 years or more. There is nothing new about it. Is my noble friend aware that that makes the labour force more employable; it does not make the labour force more employed? Unless I misheard the Statement, it seemed to say that these days no one believes in demand management. I ask my noble friend to bear in mind that if, next year, we follow the lead of the Bank of England, which has already decided that demand is rising too rapidly—and it appears as if the Treasury believes that as well—most of us believe that, if we were then to cut back on demand for other reasons, unemployment would rise, despite everybody's good intentions with respect to the labour force. When my noble friend next meets his right honourable friend the Chancellor of the Exchequer, I hope that he will point out that demand still has a central role to play in determining how many people are employed.

Lord Richard

My Lords, I cannot imagine that my right honourable friend the Chancellor of the Exchequer would disagree with somebody so economically literate as my noble friend.