The growing output of North Sea oil will not be sufficient to achieve this. The return to full employment must depend primarily on increasing our industrial investment and our net exports of industrial goods, otherwise we can have no assurance that we shall be able to take up the slack in the economy, even when North Sea oil is in full production, without running once more into the familiar difficulties of supply constraints in industry and deficits on the balance of payments.
Moreover, North Sea oil will not last for ever. It is essential to use the advantages which it offers us during the period when it is available to strengthen our industrial base and our trading performance, so that we can maintain full employment and an acceptable standard of living when the flow of North Sea oil diminishes.
In sum, North Sea oil will not itself create a large number of new jobs, nor will it make possible a rapid return to full employment based on a sudden expansion of domestic demand, whether in the public or the private sector. But it does give us the prospect of a period of years in which we can pursue our industrial strategy, and so expand our manufacturing base, without the constant risk that balance of payments constraints will force us to cut back domestic demand just when the process of industrial expansion could otherwise have become self-sustaining.
In other words, it gives us solid grounds for confidence that, if we hold to our present policies, and apply them steadily and consistently, we shall be able to create the conditions for what I described in December as a decisive break away from the restrictive pattern of present circumstances and post-war disappointments.