§ Mr. Austin MitchellTo ask the Chancellor of the Exchequer what is the effect of the increase of interest rates this year on the rate of profitability of manufacturing industry in the United Kingdom.
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§ Mr. NelsonNo estimates of the effect of interest rates changes on the rate of profitability of UK manufacturing industry are available. Treasury forecast of profitability of UK industrial and commercial companies, as measured by the real rate of return of capital, are given in chapter 3 of the Treasury's "Financial Statement and Budget Report", 1995–96. The forecast shows a healthy rise in the real rate of return on capital in 1994, followed by some further increase in 1995.
§ Mr. Austin MitchellTo ask the Chancellor of the Exchequer what effect the increase in interest rates on 7 December has had on real interest rates; and if he will publish a table showing the real interest in each year since 1994.
§ Mr. NelsonReal interest rates can be calculated in several ways, using either short or longer term nominal interest rates, and either past or expected future rates of inflation.
Data on interest rates and inflation are published in the CSO publications "Financial Statistics", table 7.10, and "Economic Trends", table 3.1. Data on expected future inflation rates are published in the Treasury's monthly review of independent forecasters, and the Bank of England's inflation report.