WEDNESDAY, OCTOBER 28, 1981
18
WARNING OVER GROWING RATE OF PUBLIC SPENDING
*****
THERE IS EVIDENCE TO SUGGEST THAT THE GOVERNMENT HAS LOST, OR AT LEAST IS IN DANGER OF LOSING, CONTROL OVER THE GROWING RATE OF PUBLIC EXPENDITURE, THE HON LYDIA DUNN WARNED, IN A SPEECH ABOUT DOMESTICALLY GENERATED INFLATION.
TO SUPPORT HER VIEW, SHE REFERRED TO THE REVISED FORECAST GROWTH RATES OF EXPENDITURE ON THE VARIOUS COMPONENTS OF THE G.D.P. IN 1981 RELEASED LAST MONTH.
SHE SAID: THE GROWTH RATE OF GOVERNMENT CONSUMPTION EXPENDITURE IN REAL TERMS IS NOW FORECAST TO BE 22 PER CENT AS OPPOSED TO AN ORIGINAL FORECAST OF 15 PER CENT.
+AND THE GROWTH RATE OF GOVERNMENT EXPENDITURE ON BUILDING AND CONSTRUCTION IS NOW FORECAST TO BE 13 PER CENT AS OPPOSED TO AN ORIGINAL FORECAST OF EIGHT PER CENT.
+DESPITE THE ACCELERATING GROWTH RATES NOW APPARENT, THE GOVERNMENT DOES NOT SEEM TO BE WORRIED BY THEM OR EVEN ANXIOUS TO DEFEND THEM.+
MISS DUNN RECALLED THAT IN RESPONSE TO HER COMMENTS ON THE SUBJECT DURING THIS YEAR'S BUDGET DEBATE, THE GOVERNMENT GAVE EXPLICIT ASSURANCES THAT THE APPROVED ESTIMATES ON EXPENDITURE WOULD BE OBSERVED FOR IT WAS ADMITTED THAT THE HIGH LEVELS OF EXPENDITURE ACHIEVED LAST YEAR, AND PROPOSED FOR THIS YEAR ONLY BE TOLERATED IN THE CONTEXT OF SUBSTANTIAL PUBLIC SECTOR SURPLUSES+.
COULD
THE GOVERNMENT VOLUNTEERED THAT THE SCOPE FOR FURTHER ENLARGEMENT OF THE PUBLIC SECTOR WAS VERY LIMITED AND, INDEED, NON-EXISTENT IN THE SHORT TERM, AND ALSO PROMISED THAT EVERY EFFORT WOULD BE MADE TO AVOID OVER-EXTENDING OURSELVES.
BUT IS THIS PROMISE BEING FULFILLED? SHE ASKED.
SHE SAID IT NOW TRANSPIRES THAT, ENCOURAGED BY THE POSSIBILITY OF THE BUDGETTED FOR SURPLUS FOR 1981/82 OF NEARLY $8 BILLION BEING EXCEEDED, TOTAL EXPENDITURE WILL EXCEED THE APPROVED ESTIMATES BY AT LEAST TEN PER CENT.
AND THE FINANCIAL SECRETARY HIMSELF RECENTLY ADMITTED THAT THE RELATIVE SIZE OF THE PUBLIC SECTOR WOULD SOAR THIS YEAR TO 24 PER CENT, EVEN THOUGH THE FORECAST GROWTH RATE OF THE G.D.P. HAS ALSO BEEN REVISED UPWARDS.
+SO IT IS FAIR TO ASK: HAS THE GOVERNMENT LOST CONTROL OF THE GROWTH RATE OF PUBLIC EXPENDITURE? IF SO, WHY HAS THIS HAPPENED?+ SHE ASKED.
+PERHAPS THE GOVERNMENT WAS SEEKING TO IMPLEMENT PROGRAMME PLANS MORE QUICKLY THAN INTENDED.
+PERHAPS THERE