asked the Chancellor of the Exchequer if he will estimate the annual saving to the Treasury if the building societies lending rate is dropped by 1 per cent. per annum.

A reduction in the building societies mortgage interest rate would reduce the cost of tax relief for mortgage interest by approximately £180 million, but this would be largely offset by the reduced tax yield from interest paid to investors if deposit rates were also lowered.

I am obliged to my hon. Friend for that answer. Does he agree that building societies interest rates are too high? Does he further agree that the arbitrary way in which building societies impose their policy, which is dictated by the number of people who walk through the doors of building society offices, affords little protection to borrowers and is dictated by the building societies cartel?

It is for the building societies to decide how they determine their lending rates, but there are hopeful signs that there may be a reduction. I understand that they will meet on 16 March after the Budget to consider a decision. I am sure that if the societies decide to reduce interest rates, that will be widely welcomed by all those with mortgages.

Does the hon. Gentleman agree that if the lending rate falls by 1 per cent. there will be an immediate effect on the investment rate? Does he agree also that the Government's arrangement with the building societes whereby they pay a composite rate of tax is inequitable for people on low incomes, who pay no tax? If he were to extend this composite system to the banks, would that not compound the inequity? Does he finally agree that if the only alternative to the payment of gross interest that he leaves open is national savings, this is political sharp practice?

The building societies composite rate has been in place for many years, and a large number of tax payers and non-tax payers have deposited money with building societies during that period. If there were a reduction in the lending rates of societies, it is expected that there would be a reduction in deposit rates also, but that is the normal pattern of building societies business.

As my hon. Friend's reply underlines the importance of tax relief to those who are purchasing their properties through building societies, will he urge upon his right hon. Friend the Chancellor of the Exchequer the great importance, in the development of thrift through house purchase, of retaining the present structure of tax relief to borrowers, and hasten very slowly in any movement which might have been implied in the press over the last few days towards its termination?

I am sure that my right hon. Friend heard the comments of my hon. Friend as well as I did.

Does the Minister accept that the changes which the Government have recently announced in the tax treatment of the gilt-edged stock of the building societies are likely to have delayed a decrease in the lending rate to mortgage holders? Why did the Government not come to the House before making that statement—and, indeed, the statement on changes in taxes on banks—and inform the House of what was to be done, or, indeed, leave it to the Budget? Does this not show a degree of high-handedness that is rather like the actions of an elective dictatorship?

No, the hon. Gentleman is mistaken. It is not a budgetary matter to apply a tax that already exists. The question is only whether a tax should or should not be applied, and the legal advice received, which was unequivocal, was that such a tax should have been applied. It is also proper that once such a decision is made it should be implemented without delay.

asked the Chancellor of the Exchequer what was the total revenue derived from North sea oil in 1982–83; and what he expects it to be in the present financial year.

The total tax take from the North sea was £7·8 billion in 1982–83 and is estimated to be £9 billion in 1983–84.

Does the Chief Secretary agree that one of the most damaging accusations that is being made against his Government's policies is that they are squandering the benefits of North sea oil, to the detriment of Britain's industry and jobs? The question can best be summed up in the phrase, "Where has all our money gone?"

If the hon. Gentleman had reflected a little on the facts, he may not have gone into that cul de sac. Oil revenues have helped to reduce Government borrowing and so have contributed to a reduction in inflation and interest rates, which is essential for substantial growth in output and jobs.

Does my right hon. and learned Friend agree that one reason why the forecast level of oil revenues is higher than expected, and likely to last at a higher rate for longer, is the sensitive and pragmatic way in which the Government have dealt with oil taxation as compared with their predecessors and especially the way in which they have encouraged the developmment of marginal fields?

I am grateful to my hon. Friend, who has perceptively observed that the Government have struck the right balance in this rather delicate issue.

Contrary to what the hon. Member for Bridlington (Mr. Townend) said, are not the Government caught in a cleft stick? To sustain the present peak of production they are having to grant tax concessions to the oil industry. Does that not make it inevitable that tax revenues will fall sharply from next year onwards?

It is true that oil tax revenues may fall from next year onwards. That is due not to the structure of the tax but to the geological conditions of the oil reserves that have been or are likely to be discovered.

Does my right hon. and learned Friend agree that tax revenues, whether from oil or anything else, once collected cannot be spent twice? Scotland has gained remarkable benefits from having the North sea so close to its shores.

I agree with my hon. Friend. It is right and proper not to double count revenues, as previous Administrations did. I am happy to note the remarkable increase in industrial and related activities, particularly in and around Aberdeen.

Is the hon. and learned Gentleman aware that the total oil tax take since 1979 to date amounts to £29 billion? Why have the Government frittered all that money away on unemployment during that period?

I am surprised if the hon. Lady feels that unemployment benefit should have been cut. If she does her sums more accurately she will find that the oil revenues have used to productive purposes, not exclusively for that purpose.

asked the Chancellor of the Exchequer by approximately what date he expects to know the public sector borrowing outturn for 1983–84.

I expect to publish an estimate of the public sector borrowing requirement outturn for 1983–84 on 17 April.

As the Chancellor treats the PSBR as the centrepiece of his policy, and as in the previous two Budgets there have been mistakes of £2 billion and £1·5 billion in the forecast of the PSBR outturn, why does he not revert to the mid-April Budget date, so that it may be more accurately based?

The hon. Gentleman has a good point. We seek to make the most accurate estimate that we can of the borrowing requirement for the year coming to an end when framing the Budget for the following year. I agree that a case can be made for having the Budget in mid-April rather than in mid-March, as he suggested.

asked the Chancellor of the Exchequer if he is satisfied with the current and projected position of the balance of payments

Yes, Sir.

Does my hon. Friend agree that there is a great variety of opinion with a wide margin of error? For example, for 1985 Phillips and Drew have given a projection of £1·1 billion on the minus side, whereas the London Business School has given a figure of £1·5 billion on the plus side. Where can one find reliability, and who has been turning in the best estimates?

My hon. Friend is right to draw attention to the difficulty of making accurate forecasts of the balance of payments for any year, let alone those in the future. We achieved a healthy surplus of £2 billion on the balance of payments last year, and that, in my view, is satisfactory.

Does the Minister agree that one reason why the Government have been placed in some difficulty once again this year is the appointment of Mr. MacGregor to the mining industry? He took on the miners last autumn and was stupid enough to say that he could stand an overtime ban for 50 years because he was saving the Coal Board money. The fact is that, as a result of an overtime ban of 18 or 19 weeks, not only has the Coal Board not saved money, but it has finished up with a big debt round its neck and is asking for more money from the taxpayer as a result of Mr. MacGregor's foolishness, when—

Order. I am not certain that that has anything to do with the balance of payments.

asked the Chancellor of the Exchequer if he is satisfied with the progress of the economy.

We are currently enjoying a combination of steady growth and low inflation not seen since the 1960s.

Does the Minister agree that any definition of the progress of the economy must include a consideration of the level of unemployment, the level of taxation and the development of manufacturing industry? As the Government have so signally failed on these three issues during the past five years, and as the Tory party made specific election promises on them, why does the Chancellor not bury his pride and embark seriously on fundamentally new policies?

Because my right hon. Friend and I are satisfied that the long-term policies adopted by the Government offer the best prospects for the country. I remind the hon. Gentleman, and the House, that if he adopts at least one of his criteria as the touchstone of success or failure, he will recall that unemployment doubled under the last Labour Administration.

Will my right hon. and learned Friend accept that an important plank in the Government's policy is to contain the public sector and encourage the private sector? Can he, therefore, explain the recent anomaly of the imposition of the composite rate of income tax on private sector banks and Trustee Savings Bank deposit account interest, while exempting deposit account interest in the public sector National Savings Bank? Will he take steps to rectify the anomaly?

I assure my hon. Friend that we attach the greatest importance to encouraging and enlarging the private sector. I cannot comment on rumours that may or may not touch on my right hon. Friend's Budget on Tuesday.

In his latest report to Sunderland borough council, the principal careers officer said that there were 1,700 youngsters registered without jobs and 2,500 on special schemes, yet there were just 40 job vacancies, and only 10 vacancies for youngsters in my constituency. How can the Minister say that the economy is recovering, when we are in that sorry state?

Perhaps I can encourage the hon. Gentleman by reminding him that the number of people in work has recently been increased by 85,000.

Does my right hon. and learned Friend accept that, in addition to the other indicators that we have seen of late, the fact that only today we note that the building society rate may come down by 0·5 or 0·75 per cent. is yet another indication that the economy is reviving?

I am grateful to my hon. Friend for reminding me of that fact. The OECD and the European Community have singled out the United Kingdom of all the countries in the Community as the country whose economy is most likely to grow in the current year.

How can the Chief Secretary be satisfied with the progress of the economy when the underlying level of unemployment shows an increase of more than 50,000 in two months?

One is never complacent about the underlying position of the economy. As an earnest of our concern, we are spending between £2 billion and £3 billion on training and job creation measures.

asked the Chancellor of the Exchequer what is the present rate of inflation.

In the 12 months to January 1984, the retail price index increased by 5·1 per cent.

I thank my right hon. Friend for that news, which will delight everybody. Does he agree that, in addition to all the other advantages, reducing inflation will help unemployment more in the long run than almost any other measure that the Government could take?

My hon. Friend is right, and the 364 economists were wrong in 1981 because they failed to realise that bringing down inflation, as we have succeeded in doing, would itself be a major contributory factor to the recovery that is now taking place.

In view of the rosy picture which the Chancellor and his colleagues on the Government Front Bench are trying to paint of the economy and inflation, may I ask him to explain the collapse of the Tory vote at the Chesterfield by-election?

I am disappointed—[HON. MEMBERS: "Hear, hear."]—that Labour Members should seek every opportunity to decry a state of affairs in which inflation is low and coming down, output is at its highest level ever and still rising, living standards are at their highest level ever and rising and interest rates are low and trending down.

The right hon. Gentleman will have to do better than that next week.

asked the Chancellor of the Exchequer what role the exchange rate plays in his monetary policy.

The exchange rate is one of many factors taken into account in interpreting monetary conditions.

If the Chancellor's money supply objectives, interest rate policy and exchange rate targets should prove to be inconsistent, which will take priority? Will he opt for an overvalued exchange rate, still pricing British workers out of jobs, high interest rates at damagingly high levels, or increased deflationary contraction? Which will it be?

There is a fundamental flaw in the hon. Gentleman's supplementary question, because there is no target for the exchange rate.

Will my hon. Friend confirm that it should be Treasury policy to ensure a declining trend in interest rates?

It is our policy that there should be a declining trend in interest rates, and I am glad to note that the effectiveness of our fiscal and financial policies in recent years have brought that about. I hope that it will continue.

asked the Chancellor of the Exchequer what has been the impact of the recovery upon employment.

Latest estimates show a rise of 85,000, between March and September of last year, in the number of people in work.

I welcome that news as a modest step in the right direction. Does my right hon. and learned Friend agree that one of the great hopes for the economy in the coming period of recovery is the recovery and expansion of the service sector and of the new manufacturing industries in, for example, electronics?

My hon. Friend refers to two growth areas. I remind the House that there was an increase of about 200,000 in the number of people in service industries in the first three quarters of 1983.

In view of the right hon. and learned Gentleman's remarks about recovery, is he aware that in Scotland unemployment has been increasing for a considerable time? Is he further aware that in my constituency one of the larger companies has gone into liquidation, that two other companies, in only four months, have also gone into liquidation, that one firm is on the brink of packing up and that, on that basis, 22·4 per cent. of the insurable population in Lanarkshire are unemployed? Is that recovery?

I am sorry to hear of the individual cases in his constituency to which the hon. Gentleman draws attention. [Interruption.] Perhaps he will lift his eyes a little and look at the increased activity in the Grampian region.

Will my right hon. and learned Friend confess to the House that, despite the views of some of the pundits in the Treasury, manufacturing industry is still the real wealth creator in this country? Will he further confess to the House that the majority of the service industries, such as insurance, banking, and shipping, are in existence only because they are serving manufacturing industry? Will he make this confession to the House and therefore give emphasis to manufacturing industry in the Budget and in Government policy?

Much as I should like to succumb to the charms of my hon. Friend, I am not certain whether I shall choose him as my father confessor in this matter. The service industries are very important. They may well complement the activities of manufacturers, but they also stand and justify themselves in their own right.

Has not the recovery to which the right hon. and learned Gentleman referred been fuelled largely by a growth in consumer expenditure and by a lowering of the savings ratio? Will he therefore tell the House when he expects the recovery in the manufacturing sector, to which the hon. Member for Macclesfield (Mr. Winterton) has just referred, to come and how he expects that to be fuelled?

I remind the hon. Gentleman that the gross domestic product increased by 3 per cent. last year and is expected to increase by 3 per cent. this year.

Is my right hon. and learned Friend satisfied that the taxpayer will get good value from the Nissan development? Will he examine the funds to jobs ratio of that project vis-a-vis urban development grant projects, in which I declare an interest? Will he in due course let the House know whether he thinks the Nissan project stands up to this comparison?

The Nissan project is extremely important, but my right hon. Friend the Secretary of State for Trade and Industry should answer my hon. Friend's questions, and I shall make sure that his attention is drawn to them.

Reference has been made to individual cases of unemployment. Is the Minister aware that 3·2 million is well below the actual figure of unemployed, because of the way in which the figures are collected? Is he aware that the true figure shows no indication of coming down and that the outside world sees no sign of the so-called recovery that is talked about eloquently in the House? Is he further aware that in my constituency there is no uncertainty about the situation and that it is an utter disgrace to talk about a recovery that is doing nothing for the unemployed?

I think that the hon. Gentleman is basing his rather fevered observations on anecdotal evidence rather than on hard facts. I remind him, and this is factual, of the increase in the number of people in work of 85,000 between March and September last year.

asked the Chancellor of the Exchequer if he will report progress being made in developing the system of annual performance reviews in his Department.

My right hon. Friend's departments are implementing the proposals reported to the House in last year's White Paper, "Financial Management in Government Deprtments." As promised in that White Paper, we will report progress in July.

Is my hon. Friend content with the drive for efficiency in the rest of the public sector?

I am by no means content. If the rest of the public services were doing as well as we have been doing in the Civil Service, the position would be much improved. In local government, although we have seen some fall in numbers, the trend is going up. Certainly the Greater London council is behaving in a most irresponsible fashion over the recruitment of staff. I want to see the implementation of the Griffiths report on the National Health Service.

When the Minister is considering value for money within his Department, will he examine the results of the Inland Revenue's in-depth investigation into company accounts? Last year it examined 5,300 accounts, as a result of which 4,100 companies had to pay increased tax for that year. Does he agree that an 80 per cent. return in this area of tax avoidance merits more investigation, not less, by the Inland Revenue?

That is precisely what the Government have done. The number of people in the investigation branch of the Inland Revenue has been increased significantly compared with the number available for that work under the Labour Government.

asked the Chancellor of the Exchequer what net contribution the United Kingdom has made to the Common Market from 1 January 1973 until the most recent date for which figures are available; and if he will express this total as a net sum per day.

Net payments in the period 1 January 1973 to 31 December 1983 amounted to £4,777 million. This is equivalent to approximately £1·2 million a day since accession.

Does this not represent an indefensible and damaging drain on our national resources, which should come to an end in the current discussions? Will my hon. Friend assure us that the £42 million, on which the Common Market defaulted on 31 December, and the £450 million rebate due on 31 March will be paid?

In the days and weeks ahead we shall be pursuing with determination the recovery of our refunds. The figures that I cited demonstrate the need for reform of the European Community budget and the value of the refund that the Government have been able to obtain for the United Kingdom. In the period 1 January 1973 to 31 December 1983, the Government's record of refunds stands at Conservatives, £2,500 million, Labour, nil.

As it has cost Britain, which is supposed to be one of the least wealthy countries in the Community, £1·2 million a day, why is it assumed that if Spain and Portugal join the Community they will be net recipients?

The figure of £1·2 million is significant. It is difficult to make any exact assessment of the impact of Spain and Portugal joining the Community, especially as the transitional arrangements have yet to be worked out.

rose—

As an act of charity, Mr. Dennis Skinner.

Will the Economic Secretary confirm that, during the first 10 years that Britain was in the Common Market, the net contribution, after all refunds, was about £4,000 million and that, since the Government came to power, the net contribution to the Common Market has been £2,500 million? That represents 60 per cent. of the total contribution during fewer years.

I am delighted to be able to confirm that the Labour Government in the 1970s — [Interruption.] I am delighted to be able to confirm that the Labour Government in the 1970s—[Interruption.] I am delighted to be able to confirm that the Labour Government in the 1970s benefited from the transitional arrangements so prudently worked out by the previous Conservative Government under my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath).

asked the Chancellor of the Exchequer when he intends to publish his long-term proposals and options for public expenditure.

A Green Paper on public expenditure and taxation in the 1990s will be published on Budget day.

Will the Government set out their priorities for cutting public expenditure in the event of their assumptions for containing public expenditure and an optimistic assessment of growth not being achieved?

A Green Paper is, of course, a discussion document, one of its main purposes being to elicit responses from others outside the Government. One of the responses to which I most look forward is that from my hon. Friend.

Will the Chancellor now end his relentless and unsuccessful attempts to resolve the ever-deepening crisis within the economy and turn his mind to massive public expenditure to provide the jobs needed and to start the recovery of the economy?

There is a great social problem of unemployment in many parts of the country, and no Conservative Member would wish for a moment to minimise it. I hope that Opposition Members will equally acknowledge that the economy is recovering and is in a sounder and healthier position than for many years.

Does my right hon. Friend agree that, despite the strength of the economic recovery, on which I congratulate him and his colleagues, the level of public sector capital formation is still causing worry? Will he include in his paper next week some options showing how public capital investment can be increased?

I understand my hon. Friend's view, which I know is widely shared. I am not sure that it is especially helpful to consider public expenditure on capital account as a whole. Each individual project must be justified on its merits. I am sure that my hon. Friend will look at table 1.13 in the public expenditure White Paper published last month, which showed that during the past four or five years, in aggregate, public sector capital formation years has been roughly stable in real terms.

As the official release of long-term options will give rise to immediate public discussion, and as the long-term survey does not contain market-sensitive information, will the Chancellor be courteous enough to give hon. Members the assistance of advance copies on the morning of Budget day?

That is not possible, for reasons that will become clear to the hon. Gentleman when he sees the document.

Is it still the Government's policy that the availability of finance will determine the level of expenditure, and not the other way about, and will the Green Paper include both sides of the economic equation?

Yes, Sir.

Will the Chancellor bear in mind that private sector industry depends largely on public expenditure, especially on capital account, and in particular that the construction industry depends for about 50 per cent. of its work load on public capital investment? Would it not be wise, if not urgent, to increase capital investment for the benefit of the construction industry, get the houses and other buildings that we require put up and bring back into employment some of the more than 4,000 unemployed construction workers?

It is the policy of this Government to allow as many people as possible to own their own homes—in other words, we attach greater importance to the provision of housing in the private sector than to the provision of housing in the public sector. That is why we have given council tenants unparalleled opportunities to buy the homes in which they live, and I am glad to say that large numbers of them are doing that.

Has my right hon. Friend seen the reports that have started to emerge of skilled labour shortages in manufacturing, and of industries trying to recruit but being unable to find people with the right skills? In making his long-term plans for public expenditure, will my right hon. Friend make certain that there is adequate provision to ensure a proper supply of skilled people to the labour market?

My hon. Friend is on a good point. My right hon. Friend the Secretary of State for Employment and his predecessors have done more for training than any previous Government. My hon. Friend will be interested to know that this was a matter on which we had a worthwhile discussion in the NEDC only yesterday.

If the Government's policy is real economic growth and no real growth in the public sector, what happens if the real growth assumptions in the economy are not met? Does that mean that there will be a fall in public expenditure? Is it true that the Prime Minister has issued instructions to each of the Departments that they should not publish the real effects on individual services provided by the state if those public expenditure cuts were to be introduced, to avoid embarrassment to the Government and yet another banana skin?

There are no such instructions and the hon. Gentleman is piling hypothesis upon hypothesis.

asked the Chancellor of the Exchequer how the most recent figures for the rate of inflation in the United Kingdom compares with the rates of inflation of the United Kingdom's main competitors within the Organisation for Economic Co-operation and Development.

Over the 12 months to January 1984 the United Kingdom retail price index increased by 5·1 per cent., that is to say above the rates of Japan, West Germany and the United States, but below the rates of Canada, France and Italy.

Is my right hon. Friend satisfied that the public understand that a 5 per cent. rate of inflation still means a doubling of prices in 14 years? As this is far too high, will he ensure that the Government continue their policies to reduce the rate of inflation?

I cannot answer for the state of mind of the general public, but I can give my hon. Friend the assurance on Government policies that he requires.

At the meeting of the NEDC and the TUC, was there any discussion of the levels of pay settlements consistent with improved competitiveness?

It has always been the Government's view that wage settlements should be low enough to be consistent with improved job prospects in the industries concerned.

asked the Chancellor of the Exchequer if he is satisfied with the trend of manufacturing investment.

Manufacturing investment is on a rising trend. The latest DTI investment intentions survey suggests that it will increase by 9 per cent. in the coming year.

If that most encouraging trend is to continue, is it not essential that the Treasury ensures that the Department of Trade and Industry has enough funds available to continue its excellent capital grant schemes?

That is, of course, a matter for my right hon. Friend the Secretary of State for Trade and Industry, but as he is an assiduous reader of Hansard I feel sure that he will discover my hon. Friend's remarks very quickly.

Are our 40 largest manufacturing companies still producing one third of their total output overseas? If this is so, does the Chancellor agree that it is not surprising in view of the Government's abandonment of exchange controls on assuming office? Is not the only way to ensure real investment in manufacturing industry for the Government to take control of the large companies?

Perhaps the hon. Gentleman did not hear the reply that I gave some moments ago. The Department of Trade and Industry investment intentions survey suggests that manufacturing investment in this country will increase by 9 per cent. in the coming year. There has also been substantial investment abroad, which is good for British exports. It produces and will continue to produce a flow of invisible earnings to this country, which will be particularly valuable when earnings from oil begin to decline.

asked the Chancellor of the Exchequer what evidence he has indicating that the construction industry is benefiting from the economic recovery.

Figures available so far for 1983 show that construction industry output increased by about 3·5 per cent., with new orders rising by about 13 per cent.

Does my hon. Friend agree that, notwithstanding those encouraging signs, there is concern throughout the construction industry that the European Community might in future levy VAT on non-domestic construction work? Will he confirm that the Government are united in their resolve to resist that at all costs?

My hon. Friend had an interesting Adjournment debate only last week, when I made the Government's position abundantly clear.

Does the Minister agree that one way to benefit the construction industry is to make hundreds of millions of pounds available to local authorities so that they can repair and renovate the many industrialised housing sites that are literally falling down?

I am sure that my right hon. Friend the Secretary of State for the Environment is well aware of that matter, but if local authorities spent less in wasteful current expenditure more money would be available for capital spending.

Does the Minister believe that the Government's rate-capping proposals will help the construction industry, and if so, how?

That matter would be best put to my right hon. Friend the Secretary of State for the Environment.

In view of the Chancellor's encouraging remarks this afternoon—from his point of view—will he give the House an estimated date when the 400,000 unemployed construction workers will be back at work building and renovating houses and ensuring that the 6 million people living in damp properties have decent homes to live in?

As I have said, if local authorities were more careful and increased the efficiency of their current account spending, more funds would be available for such projects. As Government policies are leading to economic recovery in the country as a whole, that will also benefit the construction industry.

asked the Chancellor of the Exchequer if, for fiscal policy purposes, he regards all the nationalised industries as identical.

In general, for fiscal policy purposes, no distinctions are drawn between the nationalised industries.

Does the Treasury recognise the essential difference in the deserving qualification for public funds between manufacturing and extractive industries such as steel and coal, and vehicle manufacture, in which competitive factors apply? Is it aware of the need for public funds to sustain part of the nation's transport infrastructure, where the factors are totally different?

My hon. Friend will recognise that, with regard to the first category of industries, a central theme of Government policy is to return as many of them as possible to the private sector. In relation to the second category referred to by my hon. Friend, a 5 per cent. rate of return is expected on most investments, with the possible exception of British Rail, where the need to continue the safe operation of loss-making lines must be taken into account, because of its public service obligation.

asked the Chancellor of the Exchequer what recent representations he has received concerning the duty on beer.

Representations have been received from a number of organisations, including the Brewers' Society, Licensed Victuallers Associations, the Association of Licensed House Managers as well as from individual companies and members of the public. All these representations are being carefully considered by my right hon. Friend.

Does my hon. Friend agree that in a beer-drinking country sudden increases in the duty on beer are as unwise for the political health of the Chancellor as imbibing large quantities of wine are unwise for his physical health?

I am sure that my right hon. Friend the Chancellor has heard that sage advice, but I know that my hon. Friend would not expect me to anticipate my right hon. Friend's Budget statement.

asked the Prime Minister if she will list her official engagements for Thursday 8 March.

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.

I thank my right hon. Friend for that reply. Does she agree that there is a great future for the coal industry but that the taxpayer cannot for ever continue to pay for old and uneconomic pits through Government spending, which this year will exceed £1 billion? Does she share my hope that the miners' trade unions will eventually understand that the best hope for jobs for their members lies in new and profitable developments in new coalfields and not in support for the dying or the dead?

I agree with my hon. Friend that there is a great future for a productive, profitable and well-paid mining industry. The "Plan for Coal" and its revision consisted of three parts. The first was good investment for the industry. That has been honoured. Since 1979, through the taxpayer, the Government have provided about £2 million per day investment in coal mining. The second part was increased productivity'. Productivity was due to increase by about 4 per cent. per annum. That was 10 years ago and it has risen by only 4·7 per cent. over the whole period. The third part was the closure programme, which is also behind. If we concentrate on putting investment into the good pits and carry out the rest of the programme, there is a good future for the industry.

Is the Prime Minister aware that, on the instruction of a former Secretary of State for Energy, the present Chancellor of the Exchequer, the British Gas Corporation is about to sell off the Wytch farm oilfield at a knockdown price of £180 million when its full economic value is £400 million? Does she agree that that is a scandal when the same Chancellor has instructed the gas and electricity industries to increase their prices by 2 per cent.? Bearing in mind that the Chancellor's instruction is questionable legally, will she put a stop to the sale until the House has had a chance to debate it?

No, Sir. Nor do I accept the hon. Gentleman's figure for the economic value of the field. As for price increases, the electricity price increase to domestic consumers will be 2 per cent. over two years. Under the Labour Government, it was 2 per cent. every six weeks. Gas prices are bound to rise as the cheaper gas from the southern basin of the North sea runs out and has to be replaced by the more expensive gas, at five or six times the price, from the northern part of the North sea.

asked the Prime Minister if she will list her official engagements for Thursday 8 March.

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

Has my right hon. Friend had the chance to read reports of a draft pamphlet entitled "Parliamentary Reform" written by the new right hon. Member for Chesterfield (Mr. Benn), which includes, among other extreme ideas, a proposal to remove the royal prerogative? Does my right hon. Friend agree that that is the real face of the Labour party, or should we invite the Leader of the Opposition—

Order. I do not think that the Prime Minister can answer questions on matters for which she has absolutely no responsibility.

Is the right hon. Lady aware that I and countless others warmly support the views expressed by the Prince of Wales this week, both about the insecurity' of the old and about criminal offences by a small proportion of the young? Is the right hon. Lady further aware that we are appalled by the 30 per cent. increase in crime that has occurred while she has been Prime Minister? Will the right hon. Lady now confront these problems, not just with sufficient and effective policing, but through the provision of jobs, education and the strengthening of family life?

I warmly endorse the Prince of Wales's view that lack of respect for age is a factor in causing the apparent increase of attacks by young thugs on old people. With regard to his comments on unemployment and crime, I must point out to the right hon. Gentleman that a study has been carried out under the auspices of the Social Science Research Council, which concluded:

"There is no significant association between increases in recorded crime and increases in unemployment."

There are colliding counsels from various research bodies on the relationship between crime and economic depression, but I tend to go in the same direction as the Prince of Wales—

Come on, Prince Charming.

I must say that we are hearing new sentiments of all kinds from the Government Benches today.

If the right hon. Gentleman studies the crime figures over the years he will probably come to the same conclusion as the SSRC, which said in the study I have in my hand::

"There is no significant association between increases in recorded crime and increases in unemployment."

Will my right hon. Friend acknowledge that the impending sale of the Scott Lithgow yard to Trafalgar House and Howard Doris is due in part to the efforts and energies of Ministers and is an endorsement of the view that the lower Clyde is a potential world-beater in offshore oil technology? Does she further agree that the deal enhances the prospects of recovery in the Scottish economy?

Yes. I join my hon. Friend in welcoming the deal between Trafalgar House and Howard Doris, which have made a joint bid for Scott Lithgow. I believe that it will augur well for the yard and give it a chance to re-establish its reputation and performance. I hope that it will gain orders for new exploration.

Why has the Prime Minister not referred to the threat to shipping in the Straits of Hormuz and the Gulf itself? As, at Question Time, the Prime Minister refused to exclude the use of the British Navy, will she admit that it would be far better to take this issue to the United Nations and mount a United Nations maritime peace-keeping force as, if that had been done in 1967 with regard to the Straits of Teheran the Arab-Israeli war might have been prevented?

It would be extremely difficult, if not impossible, for the United Nations to mount a maritime peacekeeping force. The contingency arrangements of the United States—we might one day have to add our ships although they are not there yet—are the best way in which to try to keep open the Straits of Hormuz. With regard to a statement about the vessel Charming in the port of Bandar-Khomeini, my hon. Friend the Minster of State, Foreign and Commonwealth Office, will be making a statement after Question Time.

asked the Prime Minister if she will list her official engagements for Thursday 8 March.

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

Has the Prime Minister been made aware of the petition that I handed in to No. 11 Downing street last week on behalf of the National Union of Labour and Socialist Clubs, which was signed by many thousands of working people, protesting at the suggested nonsense that the tax on beer should be increased by 7p a pint to bring it into line with the tax on wine? Will the Prime Minister make it clear to Ministers and the Common Market bureaucrats that this harmonisation nonsense will not apply in this country?

I am not aware of the petition that the hon. Gentleman handed in to No. 11 Downing street. I do not live there, but I am sure that the occupant knows about it.

Has my right hon. Friend had time today to study the press report that members of the National Union of Journalists who are in dispute with the Libyan Jamahiriya news agency in London have had their lives threatened by an official of that agency, to wit a Mr. Omar Faraht? Will she confirm that if those allegations are proved to be correct she will ask the Foreign Secretary to lodge the strongest protests with the Libyan Government?

If what my hon. Friend says is correct, perhaps he will take it up vigorously with my right hon. and learned Friend the Foreign Secretary. Anyone in Britain who is threatened can expect to get the maximum police protection that is as good as we can possibly make it.

Will the forecast increase in prescription charges apply to terminal cancer patients? If so, how on earth can the right hon. Lady justify that?

The order for prescription and other charges increases will be laid before the House today. The exempt groups—children, old people, expectant and nursing mothers, certain of the long-term sick and those on low incomes—are unchanged. Moreover, 72 per cent. of prescriptions are free and another 6 per cent. are purchased by low-cost season tickets. The increases in charges will mean that, as a percentage of the total cost of the National Health Service [Interruption.] Those who would be expected to have the benefit of long-term low-cost season tickets will have them. In other words, the existing arrangements are not changed. Charges are only 3·2 per cent. of the total cost of the National Health Service, compared with 5·4 per cent. 20 years ago.

St. Francis, St. Francis.

Order. The hon. Gentleman must contain himself.

asked the Prime Minister if she will list her official engagements for Thursday 8 March.

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

Does the Prime Minister agree that the Trident missile system will increase from 64 to 900 the number of targets in the Soviet Union that Britain can independently hit? In the light of those figures, how can she justify the continued exclusion of British nuclear weapons from the Geneva disarmament talks?

First, the precise numbers depend on the number of missiles that we decide to put on each submarine, and no decision has been taken about that yet. It will, in any event, increase the present numbers. With regard to the second part of the question, it is an independent nuclear deterrent for use in the last resort. To include it in those talks as part of the United States' strategic missile system would mean that the United States could no longer have parity with the Soviet Union and that their numbers would be determined by the numbers that Britain and France had.