§ Mr. Austin Mitchellasked the Chancellor of the Exchequer what is the relationship between movements in the public sector borrowing requirement and money supply growth on an annual basis between 1972 and 1979; and if he will make a statement.
§ Mr. LawsonMovements in the PSBR and £M3 between 1972 and 1979 are shown in the following table:
£ millions PSBR Increase in £M3 1972 2050 4927 1973 4191 6702 1974 6437 3255 1975 10480 2331 1976 9128 3565 1977 5995 4130 1978 8331 6772 1979 12569 6615 The relationship between fiscal policy and £M3 is discussed in a Treasury paper, entitled "Background to the Government's Economic Policy", submitted recently to the Treasury and Civil Service Select Committee. A copy has been placed in the House of Commons Library.