Public Expenditure (White Paper)

Part of the debate – in the House of Commons at 12:00 am on 21st January 1970.

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Photo of Sir Austen Albu Sir Austen Albu , Edmonton 12:00 am, 21st January 1970

This is an extremely important matter. It has been referred to by hon. Members opposite, including the right hon. Member for Thirsk and Malton.

Of course, we all want higher growth, but so far we do not know how to get it. There is absolutely no proof that a change in the level of taxation will raise or lower the rate of economic growth. We are not getting at present, nor have we got for many years, that increase in productivity which, now that our working population is static, will alone give us an increase in national output.

This may be disappointing, but we have to bear in mind that the present level of increase in productivity, taking one year with another, is actually historically as good as we have ever had. There are structural defects in the British economy or the way we go about our affairs which are not new. They have been going on since the days of Joseph Chamberlain or even the Great Exhibition of 1851. It is no good arguing that we should have a 4, 5, or 6 per cent. growth; we could have it for one or two years as we have had it in the past and then get into a balance of payments crisis and have to stop it again. It is not a question, as some hon. Members appear to think, of just increasing demand. The capacity for increased growth is not there.