Unemployment

Part of Orders of the Day — Supply – in the House of Commons at 9:30 pm on 27 July 1982.

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Photo of Mr Norman Tebbit Mr Norman Tebbit , Waltham Forest Chingford 9:30, 27 July 1982

The right hon. Gentleman will surely be even keener now to see lower inflation and greater financial stability, and even more keen to give the two cheers.

I agree with my right hon. Friend the Member for Taunton. It is right to emphasise our progress on inflation, unit costs, competitiveness, the strong balance of payments and the confidence in sterling abroad. None of those improvements was mentioned by the right hon. Gentleman.

Of course we all want lower interest rates. My right hon. Friend was absolutely right to say that there is no magic wand or formula and that we need to change the balance between current and capital expenditure. That means we need to hold back labour costs. As my right hon. Friend suggested, it would be instructive to get some of his friends from the City, with the skills that City bankers have, to take a sober assessment of some of the plans as they come forward.

The right hon. Member for Houghton-le-Spring (Mr. Urwin) was, as always, sober and concerned. We share his concern about the "Atlantic Conveyor" contract. However, it is important to recollect that even after a substantial subsidy of 30 per cent. on British Shipbuilders' price there is still a wide gap between its price and that of the foreign yards. Three parties are involved—Cunard, the Government and British Shipbuilders. All have a role in bridging that gap but they are all limited in what they can do. The Government will certainly do their part.

The hon. Member for Tottenham (Mr. Atkinson) was typical of his colleagues in showing a contempt for small businesses. No doubt he would have despised Morris when he started his engineering business. No doubt he would have had nothing but contempt for Marks and Spencer when they had a market stall, even if his class consciousness causes him to touch his cap to Lord Sieff now that he is a big employer.

My hon. Friend the Member for Kidderminster (Mr. Bulmer) had the realism of an employer in supporting the Government, as did my hon. Friends the Members for Aberdeenshire, West (Sir R. Fairgrieve) and for Edinburgh, South (Mr. Ancram).

Of all the speeches from the Opposition Benches below the Gangway, the one that stood out was that of the hon. Member for Edinburgh, Leith (Mr. Brown). He had some difficulty in seeing the truth in the unemployment statistics. However, I believe he had some difficulty in seeing Russian tanks in Afghanistan, so I recommend an optician for him.

For the reasons I have given, all our energies must be turned to how we can deal with the problem of unemployment. The first steps in the process of combating unemployment must be to restore profitability to industry, restore the stability of money, control inflation, reduce the cost of investment by lowering interest rates and improve the yield of wealth from our investments.

Tax policies are, of course, important. A percentage point off the national insurance surcharge is important, but a 1 per cent. lower wage settlement is even more important. To reach competitive manning levels is of the greatest importance of all.

The key factor has been neglected today. Unemployment is a problem of poor countries, not of rich countries. Our problem is that we have not been sufficiently good at producing wealth, but we have made good progress in laying the foundation for that wealth production. We shall not put another inflationary time bomb in those foundations to blow them up. For that reason I commend the amendment to the House and ask it to reject the motion.