Economy: Productivity
Debate between Lord Popat and Lord Lea of Crondall
Lord Popat
My Lords, let me cover the European Union. We need the European Union for trade and the European Union needs us so exit is not an option. What is important is that we negotiate reforms within the European Union to make it more practical in terms of business and productivity. The noble Lord is quite right. One of the areas in which we invest heavily to increase productivity is research and development. It is important that we continue doing that.
Lord Lea of Crondall (Lab)
My Lords, does the Minister agree that productivity has something to do with the 30 million workers out there? If the Minister agrees with that, is he aware that many of the countries doing much better than us—10%, 15% or 20% better in northern Europe—have something called works councils where everybody is involved in looking at all the questions about world market share, technology, productivity and so on? There is a big gap in this country, under this Government, who are doing nothing about it.
Lord Popat (Con)
My Lords, there are several reasons why our productivity has been a little weak. The good news is that it has gone up by 0.6% in the first quarter of 2014. Yes, we need more investment to increase our productivity. Compared to the G7 countries, a larger proportion of our productivity comes from our active involvement in the financial services industry. We need to encourage more manufacturing. We have the right tools and policies in place for that to happen. It is happening but it will take time to filter through the system.