HC Deb 06 December 1979 vol 975 cc332-3W
Mr. Austin Mitchell

asked the Chancellor of the Exchequer whether he will circulate a table in theOfficial Report showing the central Government borrowing requirement and the public sector borrowing requirement as a percentage of gross domestic product in each year since 1970 and the corresponding figures for 1979–80 and 1980–81; together with the corresponding figures for France, Germany and the United States of America.

Mr. Lawson

As I explained in my answer to the hon. Member for Dundee, West (Mr. Ross) of 7 November—[Vol. 973, c.181]—the public sector borrowing requirement is not generally compiled by other countries and the data are not available from international sources. Some data are available for an aggregate that approximates to the central Government borrowing requirement but not for the run of years in question. The nearest measures available consistently for the four countries are the general Government financial deficit (general Government being central Government plus State and/or local government) and the central Government financial deficit. Figures for these measures and for the countries' gross domestic products (at current prices) for 1970 to 1977 are given inNational Accounts of OECD Countries 1960–77, volume 2.

Figures on a comparable basis for the general Government financial deficit only (as a percentage of GDP) for 1978, with forecasts (except for the United States) for 1979, are given inEOCD Economic Outlook No. 25 (July 1979), page 41.

Forecasts for 1980 and later years are not available on a comparable basis.

£million unadjusted
1978 Percentage of total 1979 First half Percentage of total
PSBR 8,338 4,875
Financed by—
Borrowing from the non-bank private sector:
Notes and coin 1,204 14 401 8
Sales of debt 6,084 73 6,436 132
Direct external finance of the public sector 1,392 17 —743 —15
Borrowing from the banking system—
in sterling 67 1 —911 —19
in foreign currencies —409 —5 —308 —6
Source: Financial Statistics, Table 2–6

Mr. Race

asked the Chancellor of Exchequer what is his estimate of the full employment public sector borrowing requirement in the financial year 1980–81, assuming a return to 1973 levels of employment.

Mr. Biffen

I regret that I am unable to give the hon. Member the information he request. Such a calculation would require numerous assumptions about how the higher level of employment was obtained, would be costly and would displace other work. However, as the forecast published on 22 November stated, an extra 2 per cent on gross domestic product in 1980 would be likely to reduce the public sector borrowing requirement in 1980–81 by at least ½ percent. of gross domestic product.