Recession and Unemployment

Part of Opposition Day – in the House of Commons at 6:10 pm on 19th February 1992.

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Photo of Mr Steven Norris Mr Steven Norris , Epping Forest 6:10 pm, 19th February 1992

In the next few minutes I intend to follow the line that the hon. Gentleman has just taken. I shall offer my contribution as a small business man—one who has been in business for himself on and off for the past 20 years. Others will no doubt wish to contribute to the debate from their own perspectives.

I am happy to acknowledge that the Government, in the wake of the 1987 stock market correction— it was called a crash at the time, but we all know that it was a correction—pulled the levers of demand too hard. I supported the Government, as did my right hon. and hon. Friends, because we desperately wanted to avoid a crisis of confidence—a recession, sadly—and in doing so it is clear that we over-ignited the flames of demand. The consequences of that were very sad.

I merely make two observations. The most salient one, which should oft be repeated, is that Opposition Members urged us at that time to take even more fierce action to ensure that demand was maintained. Now that the House is quieter, I can say that it is also clear beyond peradventure that conditions in world markets have now exacerbated a situation which faced this country just at the point when we would otherwise have been beginning to come out of recession. The evidence of what is happening in the United States has already been felt by the British car market, for instance. Evidence of what is going on in Germany was cited by my right hon. Friend the Secretary of State.

I therefore have no qualms about accepting the full share of moral responsibility for the present position of the British economy. I see no point is pulling over entrails to determine the proportions of such responsibility, particularly in view of the evident collusion and strong endorsement of the Opposition.

Furthermore, I deeply resent the implication in the remarks of the hon. Member for Kingston upon Hull, West (Mr. Randall) that only the Opposition care about the unemployment consequences of the recession. I know of no Conservative Member who believes that one unemployed person is a desirable feature of any economy. One unemployed person is one too many, one failed business is one too many, and we have seen too many of both those individual tragedies. Business failures are tragedies in themselves. They are as regretted as sad news, and as desperately disappointing to my hon. Friends as they are to Opposition Members. They are the sad and inevitable price that is paid for the brave action that the Government took when they recognised that the levers of demand had been pulled too hard and the economy was overheating.

Although the Government took brave, draconian action which hurt, it has had, beyond any doubt, the desired effect in re-establishing the essentials for recovery and growth in the 1990s, such as low inflation and the best record of employment losses through strikes for the past five decades.