Economic Situation

Part of the debate – in the House of Commons at 12:00 am on 11th July 1960.

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Photo of Mr Geoffrey Hirst Mr Geoffrey Hirst , Shipley 12:00 am, 11th July 1960

The hon. Member for Greenwich (Mr. Marsh) certainly lost no chances of making the most of the many opportunities which he provided in his speech for enjoying himself, and which I think we enjoyed with him as well, but I do not know what he was doing in 1947, 1949 and 1951. He seems not to have caught up with the background which he must have known existed at that time, because none of the difficulties which we have had—and we have had our difficulties—have been anywhere near the size, the nature or the devastating effect on the economy which the devaluation crisis and the balance of payments crisis brought upon this country.

Although I cannot accept the hon. Gentleman's figures, there is just one thing upon which I agree with him, and that is the very important problem of exports. I feel that he would carry everybody in the Committee with him about that, although, as I say, I cannot agree with the hon. Gentleman's figures. The importance of the problem of exports is obviously tremendous, and I hope that everyone, irrespective of party—because I feel that this is a vital matter to our economy—will play his part in bringing to the notice of everyone the need to make this country thoroughly export-minded. There is no doubt that that is the overall need.

In the past, people have gone out and have conducted their export trade but not, I think, in the way in which we were brought up to be sea-minded, with the traditions of the Navy behind us. Now we have got to think differently, and our greatest need is to be export-minded. There is a mass of opportunities for the smaller firms who have not trodden this path seriously. This is a matter in which every Member, irrespective of politics, can play some part because it means so much in terms not only of spreading our economy but of the happiness and progress of us all.

Time marches on, and I am only too well aware of the little time available in this debate. I hope, therefore, that if I omit three-quarters of my speech and stick to one aspect I shall not be too unpopular. I wish to deal with an aspect, to speak on which I claim a little precedence. I am a little sorry that the right hon. Member for Huyton (Mr. H. Wilson) used an occasion when I put a Question to the Prime Minister to make a veiled attack on him. It was, I thought, a great shame. I think that we have had no better peace-time Prime Minister in the memory of any of us. He has done a magnificent job and it is rather a pity that the right hon. Gentleman should use such an occasion to attack him. I admire the Prime Minister tremendously. It was because of that admiration that I wanted to see whether I could associate him a little more clearly with an object and aim which I have pursued in the House almost relentlessly for many years.

I will spare the Committee the various extracts which I had proposed to read. The idea to which the Economist gives a good deal of space under "Divide to Rule" this week is something about which I was talking quite a lot in April, 1954. I have consistently been in favour of some system of that kind. When we come to the question of Government expenditure, it throws back upon us the phrase "The back benchers are responsible". In the broad sense, since we are all together in the House of Commons, of course we are responsible.

The Prime Minister at least gave me a Written Answer—not the one which I had intended to quote, which I had hoped would be an Oral Answer, but at least it was intelligible—in which he said: Responsibility in this matter rests where it should—on the Government as a whole, on my right hon. Friend the Chancellor of the Exchequer as custodian of the national finances, and on each of the Ministers in charge of the Department"—[OFFICIAL REPORT, 30th June, 1960; Vol. 625, c. 142.] I do not quarrel with that. I maintain that that is exactly where responsibility does rest. It rests with the Government, and in particular with the Cabinet who are, in this context, with the Government, like a board of directors of a company. There is only one subtle difference. We do not have so much control over them as, for example, have the shareholders of a company.

It is also said that, having willed the end, the nation wills the means. It must be borne in mind that the nation does not will the means if, in fact, it is going to cause unnecessary difficulties or serious cutbacks in investment or reductions in taxation not being made, or whatever it may be. Clearly, it does not will the means in that context. There. I think, my right hon. Friend the Member for Thirsk and Malton (Mr. Turton) was on a point of which I highly approve. There must be some forward assurance of where Government expenditure is going to lead.

One can talk about instances galore, but I can call to mind one instance which is particularly interesting. That is the London-Yorkshire Motorway. In 1955 it was going to cost£12½million. It was adjusted in 1957 to£15¼ million, and later in the year to£17½million. In 1959 the cost was estimated at£19 million, and in 1960 the first section cost£22 million. That is not what I call a clever little story. But when we come to the second section, the part which runs up to Doncaster, I am informed that at a rough estimate it will cost£36½million for a distance only a little longer than the first section. It goes through more difficult country.

As these battles have been fought so much in the House already, one knows only too well about the route which was offered to the former Minister of Transport two or three years ago. I wonder whether that came up at Cabinet level. I wonder whether its possible cost was foreseen or whether any form of budgetary control was envisaged. All too often the cake is baked before the Treasury can check the ingredients, and that is one of the growing troubles in connection with expenditure. One only has to read the Reports of the Public Accounts Committee and of the Auditor General to see the difference between estimates and performances of which I have given an instance.

In the campaign which I have waged over the years, I have had a double purpose: first, a vast improvement in the control of Departmental expenditure and some machinery to ensure better control of nationalised industry expenditure; and secondly, the control of the level of expenditure at early policy stages and budgetary control thereafter. I am not in inner circles, but it does not appear to have been done, as I know it is done in the businesses of which I have personal experience.

My hon. Friend the Member for Wolverhampton, South West (Mr. Powell) in The Banker in 1958 said: The Gladstonian garrison may still be at their posts, but to repel the foes of the twentieth century they have only the weapons of the nineteenth. That is true. The Economist on 9th July, referring to myself and to my Question to the Prime Minister, said: Mr. Hirst was right—there is no senior Minister with sufficient time to fulfil the Victorian Chancellor's traditional job of seeing that the department give the best possible value for the taxpayers' money. I feel that there is room for reform and that it should take this form. There should be a Minister for Economic Affairs. He might well be the Chancellor. The name does not matter so long as the functions are performed. This Minister for Economic Affairs should watch over the economy and study the likely trends and circumstances which arise from Government policies and plans, such as the school-building programme. I wonder how many people know what that will cost in the next ten years? Can we contain it at the past level or not?(/quote> Next there should be a Minister of Finance who is in charge of the machinery of the Budget itself—the financial aspects and the carrying out of the ordinary day-to-day job of the Treasury. Something of that kind is required. Both are important, of course, but the Minister for Economic Affairs. or whatever he is called, must be the leading light and in the confidence of the Prime Minister. The Prime Minister would have to be willing to associate himself and to give a lead.

That is the simple issue which I have been advancing for so long and it would help a little towards obviating this "blow hot, blow cold" tendency which is damaging to our investment pattern, and will damage both the private and the public sectors if it is allowed to continue for too long. One gets evidence of this, for example in cases where customers cannot carry the expense or obtain loans with which to finance deals, and fall back on the firms from whom they are ordering, whose resources for investment are thus reduced.

That may be what is required at the moment, but it cannot be to the good of the country, taking the long view. If we are to lift our economy we have got to find greater investment opportunities and propagate export mindedness among our people. We cannot afford to potter about parochially with our own affairs and ignore what is happening elsewhere. I shall not develop other aspects of the matter which I had in mind. I content myself with that one plea, which I have made on more than one occasion each year since 1953.

I end on a personal note. As my right hon. Friend the Chancellor knows, as the Committee knows and, indeed, as the world knows, I have not, I am sorry to say, seen eye to eye with my right hon. Friend in his Budget and Finance Bill this year. Far from it. I have never been one to say things behind a person's back that I felt ought to be said to his face. I have never been one to hide my views at any time, even if it required a large amount of courage sometimes to give them. I have been highly critical, and I remain highly critical, of that Measure, but I wish to say that I have appreciated enormously the integrity, courtesy and personality in the House of the Chancellor of the Exchequer.

I have appreciated enormously the job which my right hon. Friend has done for this country over the years. I value it very greatly indeed. It means far more to me than my little past quarrels, if I may call them that. I cannot possibly eat the words in which I expressed my own economic thinking and I cannot possibly withdraw my attack on the Budget and the Finance Bill, but those are very small things in a period of years and certainly small measured against my personal regard for my right hon. Friend.