§ Lord Lamont of Lerwick
asked Her Majesty's Government:
What is the basis, including the immigration assumption and the method of its calculation, for the Treasury assessment referred to by the Prime Minister in his speech to the Confederation of British Industry on 27 April, that the United Kingdom's economic growth rate would be some 0.5 per cent lower for the next two years if net immigration were to cease. [HL2951]
§ Lord McIntosh of Haringey
The basis of the Prime Minister's statement that "economic growth would be almost ½ per cent lower over the next two years if net migration were to cease" lies in the Treasury's trend growth assessment, as explained in recent Pre-Budget and Budget Reports and the paperTrend Growth: Recent Developments and Prospects, HM Treasury, April 2002, published alongside Budget 2002. Net inward migration contributes to economic growth by adding to the population of working age and hence labour supply. Treasury assumptions about growth in the population of working age are informed by recent data and Government Actuary's Department projections. Latest data for net inward migration show that it contributed 0.4 percentage points to growth in the population of working age betwen 2001 and 2002.