asked the Chancellor of the Exchequer what level of increase or decrease in money wages would be required over a five year period to restore the United Kingdom's international competitiveness to its level of May 1979, assuming no change in the relative level of the exchange rate.

asked the Chancellor of the Exchequer what effect Her Majesty's Government's economic policy has had on the competitiveness of British manufactures since May 1979.

I should like to apologise on behalf of my right hon. and learned Friend the Chancellor of the Exchequer for his absence today. He is abroad attending one of a regular series of informal meetings of Finance Ministers of five countries.

Am I right in thinking that there are two ways to increase competitiveness, the first being to reduce the exchange rate and the other to reduce unit labour costs? As the Chancellor and the Government have said that they reject the idea that has been advanced by my right hon. and hon. Friends of a substantial devaluation, does the right hon. and learned Gentleman agree that the Government are unwilling to tell us how many pounds a week that would cost simply because they dare not tell the British electorate that they intend, should they get a chance in the next five years, to make people internationally competitive by taking large sums of money out of their weekly wage packets?

That is wholly incorrect. The hon. Gentleman has completely ignored productivity, which is another major component in competitiveness. He has also ignored the fact that the test of competitiveness is comparative and that what matters is not merely how much British unit labour costs increase but what happens in other countries.

Is it not astonishing that a Government who continually prate about the need for increased competitiveness have presided over the greatest loss of competitiveness in living memory? Has the right hon. and learned Gentleman seen the report of the National Institute of Economic and Social Research and the London Business School, which apportions blame for the loss of that competitiveness as being up to 70 per cent. due to Government policy and the exchange rate and nil per cent. to the increase in real wages, as real wages have been decreasing?

I do not accept that. I should be more impressed by what the hon. Gentleman said were it not for the fact that between the fourth quarter of 1976 and when the Government came to power competitiveness worsened by 28 per cent., and that from then until today it has fallen by 18 per cent.

Would increased competitiveness as a result of the devaluation of sterling enable British manufacturers to export more competitively if they were unable to control wage costs?

I do not believe that that is what would happen. Experience of past devaluations has shown that inflationary pressures that are caused by increased costs of imports quickly become apparent and that there is a rapid loss of any short-term benefit that may have been secured.

Will the Chief Secretary, who is prone to cite the examples of other countries when trying to excuse British unemployment, study the findings of the European management forum, which were published earlier this week and which add up to the conclusion that during the past 12 months Britain has slipped back significantly in the OECD league of competitiveness?

I shall look forward to studying the document to which the hon. Gentleman refers.

Will my right hon. and learned Friend welcome the mention from the Opposition of the level of real wages? Will he emphasise that it is impossible to increase real wages by 5, 8 or 10 per cent. a year, and that the sooner we all settle for far smaller and more realistic pay settlements, the better it will be for all of us?

It is true that the Opposition seem to be on a learning curve with regard to these matters. They seem to accept in their latest policy document that restraint in pay is necessary. The only difference between us is that they seem to take that for granted and seem, in the same document, to advance policies that are least calculated to achieve it.

First, we hope that the Chancellor of the Exchequer, who informed us that he would not be present today, will have a fruitful discussion with his colleagues.

I do not accept the right hon. Gentleman's facts or his figures. The loss of competitiveness since the second quarter of 1979 is about 18 per cent., but it is significant that, after a sharp fall, cost competitiveness has improved by about 20 per cent. since the beginning of 1981.

asked the Chancellor of the Exchequer if he will give the current rate of inflation and compare it with the level in May 1979 and with the highest level reached since then.

The retail prices index for October, which is the most recent figure available, showed an increase of 6·8 per cent. over the previous 12 months. The corresponding figure for May 1979 was 10·3 per cent. and the highest figure reached since then was 21·9 per cent. in May 1980.

In view of the Government's repeated claims about the benefit derived from reduced inflation, how much of that benefit, if any, will go to old-age pensioners and the millions of people on price index linked social security payments?

All who are on small incomes have a special interest in the defeat of inflation. The Government's increasing success in this will help them as much as others in the community.

Has the Treasury estimated what would be the effect on the current rate of inflation of implementing the Opposition's policies, including devaluation by 30 per cent.?

Any such consideration would be highly theoretical. Certainly, far from being a programme for economic recovery, the Opposition's policies are contrived and constructed on an unsound base and are potentially disastrous.

Does the Minister find it acceptable that, on average, every 1 per cent. reduction in the retail prices index is bought at the price of more than half a million more people in the dole queue?

That is a grossly misleading non-statistic. Such comparisons cannot be made. Those who understand these matters are all agreed that

"beating inflation is essential if we are to maintain and increase employment."—[Official Report, 28 February 1978; Vol. 945, c. 223.]

asked the Chancellor of the Exchequer when he expects his economic policies to result in increased industrial activity.

Manufacturing output has declined slightly this year, but the Industry Act forecast projected an increase of 1 per cent. in 1983. The prospects for activity will be enhanced the more successful we are in improving competitiveness.

How does the Minister expect that reply to be credible when production has fallen by 15 per cent. in the past four years? What action are the Government taking that is likely to create an upturn?

My reply is credible because it is true. We must continue to improve competitiveness so that we can sell more of our goods and services both at home and abroad. In that way, we shall improve output and job prospects.

When the Government consider ways in which to stimulate economic activity, will they weigh carefully the respective benefits of a reduction in personal taxation, which may lead to no more than the purchase of imported goods, and of more direct stimulation such areas of activity as the construction industry?

I am sure that my right hon. and learned Friend the Chancellor will bear those very sensible considerations in mind in preparing his next Budget.

As the forecast that the Minister quoted was published before the recent fall in sterling and the Chief Secretary has just claimed that there has been an improvement in competitiveness as a result, will the recent fall in sterling improve the prospects for manufacturing output next year?

Having considered all the factors, we would not wish to resile from the forecasts in the autumn statement. As I believe the hon. Gentleman fully understands, all these matters will be taken into account when the next Treasury forecast is made at about the time of the next Budget.

asked the Chancellor of the Exchequer when he next expects to meet the Confederation of British Industry.

asked the Chancellor of the Exchequer when he next excepts to meet representatives of the Confederation of British Industry to discuss the level of demand in the British economy.

The Chancellor and I will be meeting representatives of the Confederation of British Industry on 14 December, when we shall be able to have a wide-ranging discussion.

When the Chancellor meets the CBI, will he discuss why, although British industry has done everything that the Chancellor asked of it in making itself slimmer and fitter and has sought in every possible way to reduce its costs and to introduce more flexible working practices, it is now 30 per cent. less competitive than when the Government came to power?

If anybody from the CBI makes that point, my right hon. and learned Friend the Chancellor and I will wish to correct the figures and to point out that competitiveness has improved by 20 per cent. since the beginning of 1981, while the net fall since the Government came to office has been 18 per cent. In this context I welcome the opportunity to correct the wrong assumption of the hon. Member for Motherwell and Wishaw (Dr. Bray) that the gain in competitiveness was caused by the fall in the exchange rate, which is true only to a small extent.

When the Chancellor meets the leaders of he CBI, will he remind them that they supported the policies on which the Government were elected and that they welcomed the Chancellor's first Budget and the lifting of exchange controls? Will he therefore exhort them to take responsibility, with him and the Prime Minister, for the fact that for the first time in history this country has become a net importer of manufactured goods?

The hon. Gentleman is quite right. The CBI supported those policies and still does. Indeed, in its reaction to the autumn statement the CBI rightly pointed out that, as a result of my right hon. and learned Friend's announcements, business costs will have been reduced by nearly £900 million by April 1984.

When the Minister meets the CBI, will he ask to see the latest survey by the North-West region CBI, which shows that only 8 per cent. of industry in the North-West expects any improvement in circumstances next year? Will he consider the request from the CBI, the chambers of commerce and local authorities of all political persuasions for investment by the Government in the North-West, without which they believe there is no prospect of industrial recovery for the region?

I appreciate the difficult conditions in the North-West and, indeed, in the North-East. At the same time, however, I believe that the right course is for the Government, through the various policies and departmental spending programmes, to reflect a proper order of priorities for the country as a whole, which will obviously include giving proper attention to the needs of the North-West.

Will my right hon. and learned Friend remind the CBI of the importance of lower interest rates, as 1 per cent. off interest rates is worth £300 million to industry? Does he agree with the CBI that increased public spending and borrowing tends to put up those interest rates?

I agree with all those propositions, and I am sure that the CBI will as well.

Is it not now clear that the Chancellor's decision to abolish exchange control is forcing the Government to keep up interest rates, thereby holding back recovery, particularly in the building industry?

I do not accept that. If the policy suggested by the right hon. Member for Stepney and Poplar (Mr. Shore) and his hon. Friends for reimposing exchange control were introduced, the value of the pound would rise, at least temporarily, which is contrary to another of the Labour Party's major policy objectives, however mistaken that may be.

Is the Minister aware that the latest CBI survey expects even weaker export growth and increased import penetration? Does he still believe his comment that the evidence of recovery is all around us?

The latest CBI survey reflects the fact, which we have all pointed out and about which there is no mystery, that economic conditions and prospects have been disappointing in the past year. There is no question about that—[HON. MEMBERS: "Oh!"] I am astonished that Labour Members should have listened so carelessly the last time I answered questions that what I say on this occasion has caused surprise. Our estimate of what will happen is set out in the autumn statement published last month, which shows the prospect and expectation of a modest increase of output over the coming year. That remains our expectation.

asked the Chancellor of the Exchequer if he will take action to adjust the value of the £ sterling so as to increase competitiveness.

asked the Chancellor of the Exchequer what is the present valuation of the £ sterling against the United States dollar; and what was its valuation on 3 May 1979.

The value of the pound against the United States dollar this morning was $1·6130. On 3 May 1979 its value was $2·0759. The sterling effective index stood at 85·8 this morning against 86·3 in May 1979. The experience over many years is that the United Kingdom cannot solve its basic problems of competitiveness by depreciation. This must depend on increased productivity, more realistic wage settlements and improving the quality of the goods and services that we produce.

Is the devaluation of a currency that is over valued a competitive devaluation?

I am not sure that there is much point in arguing about the precise definition of devaluation. If we look back at our experience over many years we find that, for instance, when the Labour Party devalued the currency in 1967, within five years any competitive advantage had disappeared. Between 1973 and 1976 there was a 25 per cent. reduction in the international value of sterling, but no gain for competitiveness.

Does the Minister recall the halcyon days when his right hon. Friend the Prime Minister used foolishly to boast that the high value of the pound against the dollar was a measure of the confidence that people abroad had in her Government? Now that there has been a 19 per cent. slippage in that value do we take it that the standing of the right hon. Lady's Government in the United States is as low as it is here?

The standing of my right hon. Friend's Government in the United States is extremely high, as the hon. Gentleman would know if he ever went near that country. A variety of different influences applies to all internationally traded currencies. With regard to how the pound stands, inevitably expectations about oil prices. for example, are liable to lead to influences on our exchange rate. It is vital that we show, as we do, our commitment to the elimination of inflation, which has been the great bugbear of our economy, is unwavering and will be continuously and effectively pursued.

Does my hon. Friend agree that the hon. Member for Workington (Mr. Campbell-Savours) is asking the Chancellor to adjust the exchange rate? Does he further agree that if there were a fear of a Labour Government, the Labour Chancellor would not have to be asked to adjust the devaluation rate, as the pound would plummet?

I am sure that my hon. Friend is right. Fortunately, that possibility is widely deemed to be so remote that the markets are prepared to discount it.

Is it still the policy of the Government, as the Chancellor informed us in his statement a fortnight ago, to leave the exchange rate of the pound to the market? If that is the Government's policy, can the Minister explain why a week or so ago the Bank of England intervened in the markets to push up the base rate to the banks to 10 per cent? Are we to understand from that behaviour that whenever there are significant movements on the foreign exchanges the Government intend to respond by further increases in the bank base rate?

I am afraid that the right hon. Gentleman has not clearly understood what has been happening in the markets. My right hon. and learned Friend the Chancellor has frequently made it clear that we do not have, have never had and would never have an exchange rate target. The performance of the exchange rate is one of the indicators to which we have regard in assessing the relative tightness or laxity of monetary policy.

In order to assist in a more realistic world-wide value of sterling, will the Treasury ask the public authorities to consider making the earliest possible repayment of their foreign debts, which total more than £11 billion?

As the hon. Gentleman knows, since the Government took office we have repaid a great deal of foreign debt on public account, but we have done so wherever it has been profitable so to do. That should be the bench mark by which we operate, not some idea of aiming at a particular figure. The point is that the decision to pay off existing debt or even to incur new debt depends on the profitability of the operation. That is the basis on which we have operated and shall continue to operate.

asked the Chancellor of the Exchequer what is his latest estimate of the United Kingdom's net contribution to the European Economic Community in 1983; and if he will make a statement.

It is impossible to estimate our gross, let alone our net, contribution for 1983 at this stage.

Everyone has welcomed the temporary rebates that have been achieved over the past two years, but is it not intolerable that after 10 years we still have not had a permanent change in the unfair rules and that during that time Britain has had to pay over £1 million a day net every day? What options are open to the Government if there is a continued refusal by the EEC to change the rules, which are grossly unfair to the United Kingdom?

I agree with my hon. Friend that an equitable, long-term solution is highly desirable, and that is what we have been pressing for ever since my right hon. and learned Friend the Chancellor made a speech at The Hague setting out a possible way to achieve that. However, I think that my hon. Friend will not disagree when I say that we have to negotiate for the next arrangement as hard as we can.

Is it not true that the Government know with accuracy how much membership of the EEC costs but are frightened to tell the British people, because the people wish to come out of the Common Market? If the Government do not know, is it not disgraceful? What kind of Exchequer have we if it does not know these costs? Is not the reality that the British people want to come out of the Community as it is too expensive, is backward and does everything that it should not do?

The reality is that the hon. Gentleman has not done his homework. He should know that the 1983 budget has not yet been adopted by the European Parliament and, furthermore, that no agreement has so far been negotiated for the refund of British contributions.

asked the Chancellor of the Exchequer if he is satisfied with the present levels of capital investment in the public sector of the United Kingdom economy; and if he will make a statement.

Public sector capital investment was planned to be £13·8 billion in 1982–83. The Prime Minister has expressed her disappointment that local authorities' and nationalised industries' expenditure is likely to fall well short of these plans. Since these bodies decide their own capital programmes, we cannot ensure that they make full use of the planned provision.

Does my hon. Friend agree that a programme of enhanced, but selective, capital investment, particularly for the building and construction industry, would help reverse the unemployment trend and stimulate the economy? Does he further agree that such a programme would not run contrary to the Government's counter-inflation programme but would help the PSBR and stimulate the private sector, as 90 per cent. of such contracts go straight to the private sector?

My hon. Friend should address those remarks, with which I have much sympathy, to the local authorities and the nationalised industries, because they could spend a great deal more during the current financial year without even reaching the ceilings imposed by the Government. It would help if they did so.

The problem with the local authorities' and nationalised industries' spending that so-called capital allocation is that the Secretary of State for the Environment and other Ministers insist that those bodies spend that money only when there are no revenue implications. Yesterday another Minister came to the House and told us that nearly £50 million was to be spent on the Falklands. That will have serious revenue implications for those 1,500 people. Why cannot the rest of Great Britain be treated in the same way? The money would then be spent and the unemployment figures would go down.

The hon. Gentleman is wrong on two counts. First, the revenue implications of increased capital investment by local authorities are taken into account—

No, they are not.

—in setting their targets. Secondly, local authorities have received about £1½ billion during the current financial year from the sale of council houses. That money is available without any servicing costs at all.

Can my hon. Friend understand the surprise of Humberside ratepayers where the Labour council, having spent money like water, increased the rates by 60 per cent. and spent all its capital allocation and receipts, is now being asked by the Government to put forward applications for further allocations? Can he understand why the ratepayers feel that it is a prize for a profligate spender?

I cannot answer for any local authority which has overspent its revenue account and robbed its capital account to do so. I cannot comment on Humberside.

Is it not pure effrontery to lecture local authorities on failing to invest, after three years during which they and nationalised industries have seen their cash limits screwed down? Is the Minister aware that the combined figure for central and local government investment is half the 1979 level? Those cuts have crippled industries such as construction, which depend on public sector investment. Would the hon. Gentleman care to comment on the speech last week by Mr. Chetwood, Wimpey's chief executive, when he predicted that it would take the construction industry the next 10 years to recover from the past three years of Conservative Government?

The hon. Gentleman must particularise. There are two ways in which capital expenditure takes place. First, there are those grants made by the Government to local authorities and nationalised industries. Secondly, there is what those bodies spend. If the hon. Gentleman looks at the figures of what they spend, he will find that his figure is not correct. It is perfectly correct for the Government to draw attention to the shortfall in capital spending by those bodies, since the criticism of my hon. Friend the Member for Bridlington (Mr. Townend), which has great validity, is that they have not spent what they could.

asked the Chancellor of the Exchequer how far a married man with two children on average and less than average income has benefited from changes in the levels of income tax and national insurance contributions under the present Administration.

The burden of income tax for those on average earnings has reduced since the Government took office. National insurance contributions are higher, because they have had to finance increased benefits. After taking account of increases in child benefit, most married families at all income levels with two children are now better off in real terms than in 1978–79.

Is it a fact that in written parliamentary answers information has been given that shows that the vast majority of people are now paying considerably more in taxes and national insurance contributions than when the Government took office? Only those people earning five times the national average and above have benefited. As the Government were elected on a promise of tax cuts, is it not obvious that they were elected on a plain lie?

The hon. Gentleman's question asked how people had benefited. I shall therefore give him answers relating to real after-tax incomes, which. whether people are on half average earnings, average earnings or twice average earnings, have increased between 1 and 5 per cent. in all cases. That assumes that they have had the average rise in earnings.

While the figures that my hon. Friend has given the House represent a step in the right direction, does he agree that a great deal more progress is needed to raise the tax thresholds of those on low incomes?

I have every sympathy with my hon. Friend's point of view. I hope that the House will cooperate to help the Government to reduce the level of public spending so that that desirable objective can be brought to fruition.

Is the Minister aware that he is wilfully misleading the House in the figures that he has just given, having failed to answer the original question? Is he aware that in an answer that he gave me some months ago the figures showed that the burden of income tax and national insurance contributions had risen by £7 in real terms above the level obtaining under the Labour Government in 1978–79? Does he want the figures? I have them here. Why is the Minister seeking to mislead the House We all know that the burden of taxation upon those with average incomes and below has risen and risen again under the Government. How does that square with the pledges given by every Minister at the general election to reduce taxation for all levels of income?

The hon. Gentleman knows full well that I do not mislead the House, wilfully or otherwise. He does not distinguish between the question I was asked by his hon. Friend the Member for Walsall, North (Mr. Winnick) and those that he has asked me previously. The question asked how much certain people have benefited from changes in the level of income tax. The percentage of income tax that they pay is quite different. The hon. Gentleman never takes into account the fact that people have had a few wage increases since we came to power.

Will my hon. Friend face reality and recognise that the tax burden has increased and that it is vital that the Government take that message on board in order to restore incentives to work? Is he aware that the most important thing the Government should do in the forthcoming Budget is to raise tax thresholds above the supplementary benefit and family income supplement levels?

I always face reality. I agree with my hon. Friend that the tax burden has increased. I hope that he agrees with me that the standard of living for all classes has slightly increased. I agree with him that it would be most desirable to lighten the burden of taxation in any way that we can.

asked the Chancellor of the Exchequer which long-term indicators suggest that the economy is improving.

Evidence of an improvement in the underlying potential of the economy may be seen in the reduction in inflation, greater realism in wage bargaining and lower interest rates than a year ago. Further evidence is provided by continuing high levels of productivity growth.

Does the Chief Secretary recall the forecast made a year ago by the Prime Minister, the Chancellor of the Exchequer and himself about the upturn in the economy? Will the right hon. and learned Gentleman now come clean and admit that this was so much moonshine? Will he say what is the difference between those indicators and the ones that he has now presented to the House? Does he not agree that the time has arrived for a fundamental change in policies and that, despite what has been stated from the Government Dispatch Box today, two essential ingredients in a new policy must be a big increase in public expenditure and a complete re-examination of the value of the pound?

I do not agree with either of the hon. Gentleman's conclusions. I believe that an increase in public spending would inevitably have damaging rather than beneficial consequences. I am proud of the fact that this Government have succeeded, for the first time since 1977, in controlling public expenditure by not increasing it during the course of the review. Next year, it will be going down in real terms. I disagree entirely with the policy of devaluation tendered by the hon. Gentleman. The consequence would be to give another twist to the inflationary spiral and damage the improvement to the underlying potential of the economy.

As a profitable motor industry is essential to long-term economic improvement, will my right hon. and learned Friend consider the removal of the unfair 10 per cent. special car tax in the next Budget, which would further help the industry? Is he aware that any loss of revenue will be more than met and made up by increased sales and increased VAT receipts?

Assistance has been given to the motor industry by the removal of hire purchase controls. This has been beneficial. Representations for the further change suggested by my hon. Friend have been made by others. They will be considered carefully.

The House has heard a succession of the most contorted, if not "riddle", figures during today's exchanges. Will the Chief Secretary, in addressing himself to forecasts or indicators concerning the future of the economy, reflect upon his statement a few minutes ago that there had been an improvement in competitiveness of about 20 per cent. since, I think, February 1981? Does he not agree that the improvement that has taken place—it has to be set against the background of an earlier deterioration of about 50 per cent.—has been entirely associated with a downward movement of the exchange rate from the absurd height that it had reached?

No. I do not accept that. The vast majority of the percentage increase in competitiveness occurred before there had been any change in the exchange rate. I welcome the opportunity to point out that the right hon. Member for Stepney and Poplar (Mr. Shore) frequently talks about competitiveness but does not tell the House, as I did earlier this afternoon, that, in the period between the fourth quarter of 1976, when his Government were in power and the time when we came to power there was a fall in competitiveness of 28 per cent. compared with a fall of 18 per cent. since then.

asked the Chancellor of the Exchequer if he will take steps to exempt charities from value added tax in respect of those services which are provided through them by local authorities.

The services provided by charities to local authorities are already generally exempt or outside the scope of the tax.

How can the Minister justify the fact that the Royal National Institute for the Deaf pays £20,000 VAT on residential accommodation for the deaf and for the psychiatrically disturbed? How does he reconcile what has been put to him by the Spastics Society with statements by his right hon. Friend the Secretary of State for Social Services to the effect that he wants greater co-operation between the voluntary bodies and the social services? If his right hon. and learned Friend the Chancellor of the Exchequer intends to take action in the Budget, will he make any proposals retrospective, so that all charities that have been clobbered for VAT on residential accommodation get their money back?

I assure the hon. Gentleman and the House that my right hon. and learned Friend and all Ministers are deeply indebted to the charities for the services that they provide, especially the sort of services to which the hon. Gentleman has referred. It is a fact that charities have always paid indirect tax. They paid purchase tax in the old days. They also paid petrol tax. We have looked at the matter carefully and continue to examine it. It is extremely difficult to find any satisfactory way of giving exemption from a particular form of indirect taxation. It is something that successive Governments have always found it impossible to offer.

asked the Prime Minister if she will list her official engagements for 9 December.

This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in the House I shall be having further meetings later today, including one with Lord Shackleton on his Falklands report.

Will my right hon. Friend join in the call to all those who are preparing to celebrate a Christian festival to urge those who have any knowledge or information about terrorists to put their loyalty to their faith above other loyalties and to help the security forces purge us of this evil?

I agree with my hon. Friend, although he and I would also say that we do not need Christmas to remind us that terrorism is one of the evils of our age, that it may happen at any time and any day, and that we owe it to everyone to fight terrorism unremittingly every day. We shall continue to do so.

I join the right hon. Lady in saying that the whole House and, I believe, the overwhelming majority of the people of this country, are determined to stamp out the terrorism that constitutes such a great threat to our country. I wish to refer specifically to the exclusion orders that the Home Secretary has imposed. I regret deeply that it appears not to have been possible to deal with the matter in the way that my right hon. Friend the Member for Mansfield (Mr. Concannon) recommended to the House on Tuesday. I had thought that the whole House recognised the wisdom of the approach that he suggested at that time.

No. I do not agree with what I think the right hon. Gentleman is saying. Parliament gave the Home Secretary very clear powers under the Prevention of Terrorism (Temporary Provisions) Act 1976. Those powers enable the Home Secretary to exclude certain people from Great Britain and for the Secretary of State to exclude certain people from Northern Ireland. The powers have been used many times. Exclusion orders made by Home Secretaries under that Act and the previous Act amount to 289. Of those, 37 involved the exclusion from the United Kingdom of Irish citizens. The remainder involved exclusions from Great Britain. Since 1976, 24 exclusion orders have been made by the Secretary of State for Northern Ireland, of which seven involved exclusions from Northern Ireland of citizens of the United Kingdom. The remainder were excluded from the United Kingdom. The powers that the Act gives are clear, and it is under that Act that my right hon. Friend has rightly operated. The powers are:

"If the Secretary of State is satisfied that any person … is or has been concerned whether in Great Britain or elsewhere in the commission, preparation or instigation of acts of terrorism … the Secretary of State may make an order against that person prohibiting him from being in, or entering, Great Britain."

I do not question the nature of the Act, because we know its nature. Indeed, I specifically said that I believed that in the circumstances, after the events of Tuesday, it was natural that the Home Secretary should act in this way. However, it leaves considerable anomalies. I am sure that the right hon. Lady will understand this. If she reads the reports and comments that have come from Northern Ireland on the matter—not only from the mainland—I believe that she will understand that we still need to look at the legislation and see how it is applied, and see whether we shall have the same laws applying to the whole of the United Kingdom.

I do not understand what anomalies the right hon. Gentleman is referring to under this Act. The Act is perfectly clear. What anomalies is the right hon. Gentleman referring to?

The anomaly is—[Interruption.] The right hon. Lady asked me a question. The anomaly is—

On a point of order, Mr. Speaker. Is it in order for the Leader of the Opposition to usurp question time to make a series of statements, however incomprehensible they may be?

Order. That point of order was legitimate earlier, but the Leader of the Opposition was asked a question, and I thought that he should give the answer before we moved on.

The anomaly is that under this legislation some people are free to walk about in Belfast but not in London. Surely that is an anomaly. [Interruption.] I ask the right hon. Lady to say that the House of Commons should debate the matter afresh, in view of the circumstances that have arisen.

That is not an anomaly. It is inherent in the Act, which the right hon. Gentleman's Government passed.

Does my right hon. Friend agree that in the face of the clear and grave warning by the Metropolitan Police of the consequences of a visit to London by the representatives of Sinn Fein, my right hon. Friend the Home Secretary had no safe choice other than to ban the visit and to put an end to a deliberate attempt by the leader of the Greater London Council to raise a whirlwind of trouble for London?

I am grateful to my hon. and learned Friend. My right hon. Friend the Home Secretary acted under the clear provisions of this Act, which give the power of exclusion from Great Britain. It also gives powers of exclusion from Northern Ireland, and sometimes those orders could operate so that the person is returned to Britain. It is not an anomaly. It is a clearly thought-out Act, and it has been operated correctly over the years. It was operated correctly and responsibly in this case.

rose—

Here is the author.

As the sponsor of the Prevention of Terrorism (Temporary Provisions) Act 1974—

It was a temporary Act.

—renewed in 1977, with the full support of the Cabinet, including the right hon. Member for Ebbw Vale (Mr. Foot), may I say that in my view the Home Secretary was clearly justified in making such an order under the Act, and that on balance he was right so to do? However, may we know whether he was primarily concerned with the prevention of terrorist acts in this country or the preservation of public order, if these two representatives of terrorism were to visit London at this time?

My right hon. Friend was concerned to act under the powers of the Act which I read out, which is related to acts of terrorism.

asked the Prime Minister if she will list her official engagements for Thursday 9 December.

I refer the hon. Gentleman to the reply that I gave some moments ago.

Is the Prime Minister aware of yesterday's publication in "Social Trends", showing that youth unemployment in this country has reached the staggering figure of 25 per cent? Does she recall that during the Falklands exercise she promised to pursue her views at all costs? Will she apply the same principles, dedication and resources to removing this blight from our society?

As the hon. Gentleman will be aware, there is a big new scheme for youth training, beginning in September of next year. We also have a number of centres up and down the country. Within a year's time there will be 150 such centres for training young people in computer skills and in the skills of information technology. In that sphere there is a growth rate of 8 per cent. a year. There are jobs to be had, and we must make certain that those jobs are found in this country and not overseas.

Will my right hon. Friend take time today to read The Observer of 21 November 1976, where she will see a report of a Labour Party committee that considered unemployment—whose membership included the right hon. Member for Leeds, East (Mr. Healey) and the right hon. Member for Crosby (Mrs. Williams)—which predicted that unemployment would rise by 100 per cent. to 2·5 million by early 1980? Does my right hon. Friend agree that it is politically immoral for the Opposition parties to pretend to make political capital out of a situation which they knew would happen and which their policies helped to create?

I am grateful to my hon. Friend. Unemployment has risen under both Governments. Under both Governments, because of demographic factors, we have had a large number of school leavers over a period of six years. Between 1978 and 1985 there were an extra 1½ million people of working age in this country. So, without a world recession, we should have had to provide many more jobs to keep those people occupied. That is an extra factor, in addition to world recession. Perhaps it is that known factor that gave rise to some of the predictions that my hon. Friend so aptly mentioned.

Will the right hon. Lady find time today to visit Smithfield market? Is she aware that the most profitable industry in Britain today is agriculture, with profits increased by 20 per cent.? Is that not due to compulsory planning agreements, such as those of the Egg Marketing Board and the Potato Marketing Board? Why does she not attach the same principles to controlling imports of steel as she attaches to imports of food to support the Tory farmers, and thus make the rest of industry just as profitable?

I regret that I cannot go to Smithfield, particularly as some of my family are involved in farming. Every country has its own measures for agriculture. We operate under the common agriculture policy for agriculture. We operate under a Community system for steel, under which there are considerable restrictions on steel imports to the Common Market. The same is true of agriculture.

asked the Prime Minister if she will list her official engagements for Thursday 9 December.

I refer my hon. Friend to the reply that I gave some moments ago.

Has my right hon. Friend had time to read the transcript of the Labour Party's last and most misleading party political broadcast on nuclear weapons? Is she aware that the Labour Party is now committed to reducing Britain's defence expenditure in line with that of our European NATO allies, which would mean severe cutbacks in Britain's conventional forces? Does my right hon. Friend appreciate that such cutbacks could lead to NATO commanders resorting to tactical nuclear weapons at an earlier stage?

I am aware of the Opposition's defence policy, which is just not a credible policy. It seems that the answer to the nuclear threat is not unilateralism, which Mr. Andropov called naive, but an intense effort to secure multilateral disarmament.

When?

Regularly, and now in Geneva, if people will come to the negotiating table. If Opposition Members would direct some of their efforts towards influencing the Soviet Union to negotiate, it would be better. I am aware of what my hon. Friend said. It is the Labour Party's policy to reduce the proportion of our gross national product that is spent on defence from the present 5 per cent. down to the European average, which is about 3·5 per cent. That would mean a drop in defence expenditure of £4½ billion, the equivalent of abolishing the Royal Navy.

On a point of order, Mr. Speaker. May I seek your guidance, about the trend in Prime Minister's Question Time? At least two questions today were about the policies of the Labour Party. However, a number of hon. Members have been waiting to ask questions on subjects that are the direct responsibility of the Prime Minister, including foreign affairs. We wanted to ask her about her attitude to, and what action she would take over the disgraceful invasion of Lesotho by the South African military—

Order. The hon. Gentleman must not, under the guise of a point of order, go on to raise the point that is concerning him.

Further to that point of order, Mr. Speaker. I was not seeking to raise a question under the guise of a point of order, but I wanted to seek your guidance. Are we now to understand that if we go to the Table Office and table questions to the Prime Minister about the policies of the Tory Party or Tory local authorities and councils, those questions will be accepted?

Such questions have been asked ever since I have been Speaker, under the present Administration as well as the last Administration. People answer for their own policies.

On a point of order, Mr. Speaker. Will you tell us whether you are setting an interesting precedent by calling Prime Minister's Question 81 before Question 2?

No, but we have had some other precedents today. I have not yet looked at Question No. 81. I hope that all of us will bear in mind that Question Time—I have now seen question No. 81, tabled by the hon. Member for Coatbridge and Airdrie (Mr. Clarke). I am much obliged to the hon. Member for Workington (Mr. Campbell-Savours).