Economy

HC Deb 28 October 1982 vol 29 cc518-9W

4. Mr. Bidwell

asked the Chancellor of the Exchequer what are the main factors likely to influence the recovery of the economy.

Sir Geoffrey Howe

In the immediate future the economy is bound to be affected by the hesitation in world economic growth. But our continued success in combating inflation and lower interest rates are providing a firm basis for domestic recovery. At a time when other countries are managing to hold down the increases in their costs it is even more important that we make further progress in moderating the level of pay settlements and improving our competitiveness.

5. Mr. Geoffrey Robinson

asked the Chancellor of the Exchequer when he will be publishing the forecast for the economy as required under the Industry Act.

Mr. Wakeham

The Industry Act forecast will be included in the autumn statement which we intend to publish as soon as possible.

8. Mr. Campbell-Savours

asked the Chancellor of the Exchequer what measures he now proposes to stimulate the economy.

Mr. Brittan

The essential task is now to continue with the balanced and responsible approach the Government is already pursuing towards monetary and fiscal policy and help create the conditions for sustainable growth.

15. Mr. Knox

asked the Chancellor of the Exchequer whether there have been any further signs that the economy is recovering from the recession.

16. Mr. Dubs

asked the Chancellor of the Exchequer what recent evidence available to him supports his view that the economy is recovering.

Mr. Brittan

Although world markets are less buoyant than was previously expected, activity remains higher than in the first half of last year. Profits of industrial companies continue to recover and manufacturing productivity is still rising strongly. Interest rates are now down 6½points since the autumn and I confidently expect that inflation will fall to 5 per cent. next year. Prospects for a renewed modest recovery next year are good.

18. Mr. Lofthouse

asked the Chancellor of the Exchequer whether he is satisfied with the present state of the economy.

24. Mr. Newens

asked the Chancellor of the Exchequer if he is satisfied with the progress made towards recovery from the recession in the British economy to date; and if he will make a statement.

Mr. Brittan

I am confident that the policies being pursued are the best ones for achieving a sustainable improvement in the economy's performance.

22. Mr. Cryer

asked the Chancellor of the Exchequer when he expects his policies to effect an improvement in the economy; and if he will make a statement.

29. Mr. Winnick

asked the Chancellor of the Exchequer when he now expects to see a substantial improvement in the economy.

38. Mr. Craigen

asked the Chancellor of the Exchequer what are the prospects for the recovery of the economy.

Sir Geoffrey Howe

Despite a difficult world situation, the rapidly falling rate of inflation and lower interest rates at home are providing good foundations for recovery. However, as other countries succeed in holding down their costs and prices, it becomes even more important that we make further progress in moderating the level of pay settlements and improving our competitive position. An Industry Act forecast will be published as usual later in the autumn.

30. Miss Joan Lestor

asked the Chancellor of the Exchequer what has been the change in relative competitiveness of the British economy since May 1979.

Sir Geoffrey Howe

The IMF's indices of relative unit labour costs show that between the second quarter of 1979 and the first quarter of 1981 our manufacturing cost competitiveness worsened by about 40 per cent. Subsequently, greater wage moderation, improved productivity and the fall in the value of sterling last year has produced an improvement of between 10 and 15 per cent.

35. Mr. Gwilym Roberts

asked the Chancellor of the Exchequer if he will list in theOfficial Reportthe principal criteria by which he measures the state of the economy and the latest available figures relevant to these criteria.

Mr. Wakeham

The development of major aspects of the economy are monitored by reference to the movements of a large number of economic indicators. Further guidance can be found in several documents including the economic assessment published in each month's issue of the Treasury's economic progress report.