HC Deb 06 February 1978 vol 943 cc421-2W
Mr. Baker

asked the Chancellor of the Exchequer what average annual rates of growth, in demand terms, in total direct public expenditure, total indirect public expenditure and total public expenditure, are implied by the expenditure plans in Command Paper No. 7049.

Mr. Joel Barnett,

pursuant to his reply [Official Report, 27th January 1978; Vol. 942, c. 839], circulated the following further answer:

I hope that the hon. Member will bear in mind the severely limited nature of conventional calculations of growth rates of public expenditure in demand terms. For instance, only the initial impact on demand is measured, excluding consequential and associated effects. This and some other features are noted in the "Handbook on Methodology for Public Expenditure White Papers" published in 1972. Subject to these qualifications, the expenditure plans in Cmnd 7049 imply annual average rates of increase of about½ per cent. for total direct public expenditure, of 3½–4 per cent. for total indirect public expenditure and 1½–2 per cent. for total public expenditure over the period 1976–77 to 1981–82, all estimated in the traditional way.

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