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The effect on the RPI of a change in the exchange rate depends on the circumstances in which it occurs. It is not possible to give a single estimate.Imports and Exports
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer, pursuant to his answer of 1 July, Official Report, column 758, what assessment he has made of the factors which account for (a) the change in the level of exports to the rest of the EC of consumer goods including passenger motor cars in the three years to 1991 and the subsequent change to the first quarter of 1994 and (b) the corresponding increases of exports to the rest of the world : how the figures for the three months ended April differ from his forecasts since September 1992 ; and what were the corresponding changes in the volume of imports and in United Kingdom output of the consumer goods industries, and the figures for April.
Mr. Clarke : As discussed in the Treasury's summer economic forecast, export and import levels are affected by a number of factors including world trade, domestic demand and competitiveness. Forecasts are not made separately for trade with other EC countries and with non-EC countries, nor for consumer goods including passenger motor cars.
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer what estimates he has available on the effect of differing degrees of devaluation on the share of imports in the United Kingdom market.
Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
City (Earnings)
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer what effect the increase in bonuses paid in the City in 1994 had on the increase in average earnings ; and what proposals he has to restrict such bonuses.
Mr. Nelson : The large rise in bonuses in the financial sector in the first quarter of 1994 contributed to the rise in whole economy underlying average earnings growth, but it is not possible to say by exactly how much. Underlying average earnings growth has since fallen back, from 4 per cent. in March to 3er cent. in April and May. Bonus payments are a matter for individual firms and their employees.
VAT Tribunals
Mr. Wallace : To ask the Chancellor of the Exchequer what information he has regarding diverging standards of proof required by VAT tribunals in England and Scotland in respect of the evidence required to establish error for purposes of imposing civil penalties ; and if he will make a statement.
Mr. Kenneth Clarke : The VAT tribunals are independent bodies. Her Majesty's Customs and Excise are not aware of any diverging standards of proof required by them.
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Exchange Rates
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer if he will publish a table showing the percentage change for the United Kingdom and each EC country in imports and exports to the EC in terms of value in dollar terms together with (a) the average exchange rate against the dollar, (b) the increase in producer prices and (c) the increase in current or average value for September 1992 to the latest available date.
Mr. Nelson : The data on exchange rates and trade are given in the EUROSTAT publication "Eurostatistics, Data for Short-term Economic Analysis", published monthly. Producer prices are published by the Organisation for Economic Co-operation and Development in "Main Economic Indicators", also published monthly.
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer, (1) pursuant to his answer of 4 July, Official Report , columns 13-14 , what account he takes of overall living standards in deciding his objectives for exchange rate and competitiveness policies in relation to the total output and employment ;
(2) pursuant to his answer of 4 July, Official Report, columns 13-14, through what mechanism a sustained growth in output and employment may be combined with the elimination of the balance of payments deficit other than through a fall in the exchange rate to a more competitive level ;
(3) what assessment he has made of the contribution made by exchange rate changes to the change in export levels to other EC countries since February 1993 ;
(4) what evidence he has about the effect of excluding rates in the United Kingdom's levels of production, export, import, investment and employment ;
(5) pursuant to his answer of 4 July, Official Report, column 14, concerning the exchange rate and competitiveness, what effect he expects output and employment of recessions in the EEC and other industrial countries to have on his policies ; and what evidence he draws from other countries that his policies will have the effects intended ;
(6) what evidence he has on the effect of falls in the nominal exchange rate which have not resulted in a fall in the real exchange rate have raised the rate of inflation : and what is the mechanism by which a fall in the nominal rate unaccompanied by a fall in the real rate results in a higher rate of inflation ;
(7) what is the Government's policy on the extent to which interest rates and the rate of exchange can fall in order to reduce import penetration of the United Kingdom market for consumer goods ; (8) pursuant to his answer of 4 July, Official Report, columns 13-14, whether he regards as inflationary for the purposes of monetary and exchange rate policy the increase in rail fares as shown in the retail prices index since (a) January 1987 and (b) August 1992 ; and how much of the increase in each case was due to a (i) reduction in Government subsidies and (ii) an increase in unit labour costs ;
(9) in which periods since 1970 falls in the nominal exchange rate have been greater than that required to compensate for an increase in the general level of prices ; and what evidence he has that such falls in the real exchange rate have been inflationary.
(10) pursuant to his answer of 4 July, Official Report , columns 13-14 , what assessment he has made of the effect
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of consumer prices and on the balance of visible trade of the fall in and real value of (a) the Italian lira and (b) the pound sterling against the ecu and other currencies since August 1992 ; if he will publish a table showing for Italy and the United Kingdom (i) the fall since August 1992 in the nominal exchange rate against the ecu and other currencies, (ii) the increase in the latest period of 12 months in producer and in consumer prices, (iii) the increase since August 1992 in import and export unit values for total trade and for manufactures and (iv) the balance of visible trade each year from 1990 and the current year to date at an annual rate ; (11) what comparison he has made between the effects of exchange rates on inflation in Italy and the United Kingdom since September 1992 ;(12) pursuant to his answer of 4 July, Official Report , column 14 , concerning the exchange rate and competitiveness, what effect he expects his policies to have on the share of manufacturing in gross domestic product ; and what this share was in 1964, 1973, 1979, 1989 and at the latest available date ;
(13) pursuant to his answer of 4 July, Official Report , columns 13-14 , what assessment he has made of the effect on the United States and United Kingdom economies of the fall in real interest rates and in the nominal exchange rate for the dollar since August 1992 ; and if he will publish a table showing for the United Kingdom and the United States of America the reduction in real interest rates and the nominal exchange since August 1992 and the increase since 1992 in (a) real GDP, (b) manufacturing output, (c) unit wage costs in manufacturing, (d) producer prices, (e) employment and (f) the percentage rate of unemployment ;
(14) what is his estimate of the reduction in unit labour costs in the import-competing and export industries required to reduce or increase the real value of sterling to its current nominal value : and what is his forecast of the likely effect of such a reduction on output and employment in those industries ;
(15) if he will list the industrial countries whose trade-weighted real rate of exchange for manufactured goods has appreciated more since the second half of 1973 than that of the United Kingdom, as measured by (a) the terms of trade for manufactures, (b) relative producer prices and (c) relative export unit values ;
(16) pursuant to his answer of 4 July, Official Report, columns 13-14, whether he regards as inflationary for the purposes of monetary and exchange rate policy increases in the retail price of beer, wines and spirits and tobacco ; what was the increase in retail prices in each case since (a) January 1987 and (b) August 1992 ; and how much of the increase was due to increases in (i) taxation, (ii) unit labour costs in production and (iii) unit labour costs in distribution.
(17) what assessment the Government made before joining the ERM of the effect on output and employment in manufacturing industry ; and what was the actual outcome for the period considered ;
(18) further to his written reply dated 4 July, c. 13-14, concerning the exchange rate and competitiveness, in what respects his monetary and exchange rate policies have changed since October 1989 ;
(19) what evidence he has of the effect of changes in the exchange rate have been greater than that required to compensate for an increase in the general level of prices ; and what evidence he has that falls in the real exchange rate have been inflationary.
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Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
Corporation Tax
Mr. Steen : To ask the Chancellor of the Exchequer how many draft version CT200 Inland Revenue corporation tax returns have been printed ; and at what cost to public funds.
Sir George Young : The Inland Revenue produced three versions of the corporation tax return CT 200 which consisted of the original sample ; modified samples which were circulated for comment to the professional bodies ; and the first issue during 1993-94. A total of 2,193,050 were produced at a cost of £542,696 excluding VAT.
Competitiveness
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer what effect his policy on competitiveness will have on the rate of increase of the real incomes before tax of the top and bottom deciles of incomes.
Mr. Kenneth Clarke : Government policies are focused on improving incentives, encouraging enterprise and helping to create a well-educated, highly skilled labour force. That is the best way to ensure rising incomes for all.
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Industrial Output
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer, pursuant to his answer of 4 July, Official Report, column 14, which industries he expects to increase their share of gross domestic product within the framework provided by his policies.
Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
Ministerial Visits
Mrs. Roche : To ask the Chancellor of the Exchequer how many overseas visits he and each of his Ministers have made between 1 January and 30 June ; during how many he, or each of his Ministers, participated in fund-raising activities for the Conservative party ; and if he will name the Ministers and the countries in which these activities took place.
Mr. Kenneth Clarke : The overseas visits made by Treasury Ministers between January and June 1994 are listed below :
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|Attending
--------------------------------------------------------------------------------------------------------------------------
Chancellor of the Exchequer
Indonesia and the Philippines-January 1994 |Trade Mission
Switzerland-January 1994 |World Economic Forum Meeting
Germany-February 1994 |G7 Meeting
France-February 1994 |Bilateral talks with French Government
Belgium-February 1994 |ECOFIN
United States of America-March 1994 |Jobs Conference
Belgium-March 1994 |ECOFIN
Sweden-March 1994 |Speech engagement
Greece-April 1994 |Informal ECOFIN
Poland-April 1994 |Bilateral talks with Polish Government
Russia-April 1994 |EBRD Annual Meetings
United States of America-April 1994 |IMF Spring Meetings
Belgium-May 1994 |ECOFIN
Luxembourg-June 1994 |ECOFIN
France-June 1994 |OECD
Greece-June 1994 |European Council
Germany-June 1994 |Bilateral talks with German Government
Chief Secretary
Brazil-March 1994 |Trade Mission
Chile-March 1994 |Representing United Kingdom Government
| at inauguration of new President
Spain-June 1994 |Speaking engagements
Economic Secretary
United States of America-May 1994 | Trade Mission
Japan-May 1994 |Trilateral Meetings
None of these visits involved fund-raising activities for the Conservative party.
European Structural Fund
Mr. Fatchett : To ask the Chancellor of the Exchequer what arrangements have been made to ensure that structural fund resources are being made available now to national and local agencies and under (a) objective 2 and (b) objective 3.
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Mr. Kenneth Clarke : These arrangements are the responsibility of the President of the Board of Trade and of the Secretary of State for Employment respectively.
Share Dividends
Mr. Fisher : To ask the Chancellor of the Exchequer (1) what proportion of personal wealth is attributed to dividends in each of the last 15 years ;
(2) what proportion of distributed dividends by companies has been paid to (a) individual shareholders and (b) institutions in each of the last 15 years ;
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(3) what was the ratio of distributed dividends to retained profits in companies of the last 15 years in (a) the United States of America, (b) Japan, (c) Germany, (d) Canada, (e) France, (d) Italy, (f) Hong Kong and (g) the United Kingdom. (4) what are the figures for distributed dividends by private companies as a percentage of after-tax earnings in each of the last 15 years.Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
Mr. Meacher : To ask the Chancellor of the Exchequer, pursuant to his answer of 5 July, Official Report, column 107, what is the geographic breakdown of the payments ; what is the approximate value of the assets against which these claims are being made ; what amounts of these payments are going to residents of (a) Switzerland, (b) the Channel Islands and (c) offshore tax havens ; what estimate he makes of the extent to which these payments are being made to corporations or trusts whose ultimate beneficiary or owner is resident in the United Kingdom ; what is the total value of dividends or other payments in the United Kingdom, for each of the years given in his answer ; and what proportions of overall tax credits are represented by the figures he gives in his answer, for each of the years given.
Sir Kenneth Clarke : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
Capital Gains Tax
Mr. Meacher : To ask the Chancellor of the Exchequer if he will estimate the probable loss of capital gains tax arising from the foreign ownership of United Kingdom assets involved in transactions each year from 1981 to 1993-94 ; and if he will estimate the volume of United Kingdom assets in foreign ownership in which transactions occurred for each of these years.
Mr. Kenneth Clarke : The information on which to base reliable estimates is not available.
Mr. Meacher : To ask the Chancellor of the Exchequer what estimate he has made of the loss to the Exchequer in each year since 1981 from non- payment of capital gains tax on capital gains accruing to (a) United Kingdom residents and (b) foreign claimants on offshore tax havens.
Mr. Kenneth Clarke : The figures for uncollected capital gains tax for each year since 1981 are as follows :
Year |Amount in
|thousands
------------------------------
1981 |2,734
1982 |4,868
1983 |6,496
1984 |5,998
1985 |7,562
1986 |10,064
1987 |8,822
1988 |12,680
1989 |10,864
1990 |12,002
1991 |29,721
1992 |57,836
Information is not available to break down the figures between United Kingdom residents and foreign claimants.
Mr. Meacher : To ask the Chancellor of the Exchequer if he will list those reports and studies made or commissioned by his Department into the loss of capital gains tax arising from foreign ownership of United Kingdom assets since 1981 ; and if he will list each of those occasions when the Inland Revenue has requested a study of the potential loss of capital gains tax arising from foreign ownership of United Kingdom assets.
Mr. Kenneth Clarke : We have made no such studies.
Inflation
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer (1) what distinction he draws in measuring inflation and assessing its importance between demand-pull, cost-push, leading-sector and asset inflation ; how he assesses the damage done by each form ; and if he will publish figures giving the relative impact of each form of inflation for each year between 1980 and 1990 ;
(2) pursuant to his answer of 4 July, Official Report, columns 13-14, if he regards as inflationary for the purposes of monetary and exchange rate policy the increase in the retail price of personal articles between August 1992 and May 1994 as shown in the retail prices index ; what kind of articles were covered ; and how much of the increase was due to increases in labour unit costs in production and distribution, respectively.
Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer what evidence he has from the monetary experience of individual countries of a link between increases in the money supply and the rate of inflation ; what assessment he has made of the direction of any causal link ; and if he will publish his evidence.
Mr. Nelson : It is the role of monetary policy to deliver the Government's inflation objective. Monetary policy influences inflation with a lag ; the assessment of prospects for inflation in one or two years' time is based on a range of indicators and other data. Two of the main indicators are narrow and broad measures of the money supply. MO has proved a reliable indicator, primarily to signal current trends in the economy rather than to warn of future changes. M4 and its components and counterparts, such as lending by banks and building societies, contain important information on monetary conditions. However, experience indicates that the relationship between these aggregates and future inflation cannot always be relied upon.
Domestic Credit
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer what considerations underlie his preference for the use of monetary targets instead of domestic credit as a measure of inflationary risk ; and if he will publish a table showing the expansion of domestic credit each year since 1979 as a percentage of money gross domestic product along with the the actual increase in the measure of the money supply that he uses in measuring inflation and assessing its impact.
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Mr. Nelson : Monetary policy decisions are based on an assessment of a range of monetary indicators and other data, in particular the growth of narrow and broad money and movements in the exchange rate and asset prices.
Domestic credit expansion statistics are no longer collected. Statistics covering MO, M4 and its counterparts are published monthly by the Bank of England in "Monetary Statistics" ; a longer run of data is contained in the Bank of England "Statistical Abstract", part 2. Gross Domestic Product data are included in table 2 of "Economic Trends", June 1994.
VAT Headquarters
Mr. Parry : To ask the Chancellor of the Exchequer how many people are currently employed at the VAT headquarters building at the Queens dock, Liverpool.
Mr. Kenneth Clarke : Currently 752 staff are based in the building and 490 customs regional HQ and operational staff will move into the building in September 1994.
The change of emphasis from a pure HQ building to a mixed HQ and operational building has created a need to provide space for facilities for public callers, VAT traders and shipping agents from September 1994.
The space not required by customs has been re-allocated to the Charity Commission by Property Holdings, the managers of the Government's estate. The Charity Commission intends to move 236 staff into the building in November 1994.
Company Profits
Mr. Fisher : To ask the Chancellor of the Exchequer what are the figures for retained after-tax profits by companies in each of the last 15 years.
Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
Wealth Creation
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer what assessment he has made of the level of under-utilisation of the nation's wealth-creating capacity of the costs of this
under-utilisation.
Mr. Nelson : The Government's latest assessment of the degree of spare capacity is set out in paragraphs 1.58 and 1.59 of the "Summer Economic Forecast 1994", published on 28 June. The summer forecast also predicted that real GDP growth of 2 per cent. this year would continue at the same rate next year, accompanied by low inflation.
Overseas Residents (Assets)
Mr. Meacher : To ask the Chancellor of the Exchequer what estimate he has for the value of United Kingdom assets owned by residents of (a) Jersey, (b) Isle of Man, (c) Guernsey and (d) Switzerland.
Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
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Isle of Dogs
Mr. Cousins : To ask the Chancellor of the Exchequer whether 100 per cent. capital allowances are still allowable on properties bought unused or within two years of use in the Isle of Dogs enterprise zone ; and if he will estimate the revenue forgone in the 1993-94 financial year by the relaxations in enterprise allowances announced on 16 December 1991.
Mr. Kenneth Clarke : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
Prepared Meals
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer what was the percentage change in the price of prepared meals between August 1992 and May 1994 ; and how much of the increase was due to the increases in common agricultural policy and other food prices and how much to an increase in unit labour costs.
Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
Companies' Capital Needs
Mr. Fisher : To ask the Chancellor of the Exchequer what proportion of the capital needs of companies have been met by (a) equity, (b) short- term bank finance, (c) term debt and (d) preference shares in each of the last 15 years.
Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
Rents
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer what has been the change in rent as measured for the retail prices index since (a) January 1987 and (b) August 1992 distinguishing between local government, housing association, central Government and private rents.
Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
Industrial Output
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer what is the Government's policy on increasing output in the principal import- competing and export industries ; and what steps he is taking to achieve it.
Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
Companies (Rights Issues)
Mr. Fisher : To ask the Chancellor of the Exchequer what has been the amount of capital raised by companies in the form of rights issues in each of the last 15 years.
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Mr. Nelson : The amount raised in rights issued by companies quoted on the official list of the London stock exchange and on the unlisted securities market is as follows :
Listed United Kingdom and Irish
Year |Number |Proceeds
|(£ million)
------------------------------------------------
1979 |97 |974.267
1980 |95 |1,059.785
1981 |108 |1,971.974
1982 |75 |901.707
1983 |134 |2,007.043
1984 |113 |1,674.182
1985 |135 |4,054.753
1986 |194 |5,618.673
1987 |215 |8,452.950
1988 |132 |5,745.810
1989 |117 |4,604.129
1990 |101 |4,890.901
1991 |158 |10,133.388
1992 |74 |4,134.339
1993 |171 |11,377.609
1994 |85 |4,715.607
Unlisted Securities Market
1980 |1 |1.456
1981 |4 |9.296
1982 |5 |12.132
1983 |24 |81.231
1984 |19 |66.394
1985 |26 |127.450
1986 |32 |109.646
1987 |52 |404.114
1988 |37 |277.757
1989 |53 |316.397
1990 |42 |348.833
1991 |28 |139.360
1992 |21 |94.078
1993 |22 |70.686
1994 |17 |102.162
Source: London Stock Exchange
Manufacturing
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer (1) what was the share of manufacturing in gross domestic product in 1974, 1979, 1986, 1990 and at the latest available date ; and what is his estimate of the level of the share needed to balance Britain's trade in manufactured goods ;
(2) by how much output in the metal, metal product and mechanical engineering industries has changed since 1986 ; and what is his assessment of the extent to which this was affected by changes in the exchange rate.
Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
Price Stability
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer if he will list the economic benefits arising from making price stability the objective of monetary policy.
Mr. Nelson : I regret that it has not been possible to provide a substantive answer before the summer recess. I shall write to the hon. Member shortly and place a copy of the letter in the Library.
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Economic Growth
Mr. Austin Mitchell : To ask the Chancellor of the Exchequer what annual rate of economic growth he regards as unsustainable in considering the case for higher interest rates and a higher exchange rate.
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