§ Mr. Roy Hughes
asked the Chancellor of the Exchequer if he will estimate (a) the number of jobs created, after one, two and three years, by £1,000 million of additional public expenditure per annum on infrastructure projects, financed by borrowing and (b) the annual savings to the Exchequer of the corresponding reductions in unemployment.
§ Mr. Peter Rees
The net effect of any increase in public expenditure on employment and unemployment is extremely uncertain. The direct creation of jobs by additional public expenditure would be likely to be offset by a loss of jobs in the private sector as a result of higher inflation and the higher interest rates which increased borrowing would entail. Precise estimates would be subject to a large margin of error and would depend on the policy assumptions underlying them.