Economy: Productivity

Lord Harrison Excerpts

Monday 5th September 2016 Lords Chamber

Asked by

[Lord Harrison]

To ask Her Majesty’s Government what plans they have to improve the United Kingdom’s productivity.

[The Commercial Secretary to the Treasury (Lord O'Neill of Gatley) (Con)]

My Lords, UK productivity performance remains a fundamental challenge. The Government set out their approach to tackling the issue in their productivity plan, Fixing the Foundations. The Government have since introduced further measures that will help productivity growth—for example, the apprenticeship levy, proceeding with investments in UK infrastructure such as High Speed 2 and the biggest investment in road and rail for a generation.

[Lord Harrison (Lab)]

My Lords, given the Prime Minister’s welcome focus on our poor and parlous situation in regard to productivity in this country—we stand some 18 percentage points below the average of our rivals in the G7—what is the purpose of, and how will competitiveness and productivity be generated by, our leaving the single market within the context of Brexit?

[Lord O'Neill of Gatley]

My Lords, the decision to leave the EU was the result of a democratic question put to the people of this country—it was the result of that choice. What that means for the future of UK productivity remains to be determined. As I am sure many Members of the House are aware, in the past couple of weeks in particular there has been a somewhat surprising upbeat tone to some of our economic data. Among other things, this raises the possibility that productivity has not slipped any further or as much as many people may have thought.