 |
| Lord Lamont was chancellor from 1990 to 1993 |
The government will find it difficult to influence productivity in the economy, according to former Chancellor, Lord Lamont.
His
comments follow the allocation of £23bn in Wednesday's Autumn Statement
to tackle the UK's poor record on raising output per person.UK productivity has lagged well behind other advanced economies.
But Lord Lamont told BBC 5 live's Wake Up to Money that the government would struggle to make much of an impact.
"If you want complete honesty I do think it is very difficult for governments to influence the level of productivity. Backing science and R&D is one of the few ways in which you can do it," he said.
Spending large amounts on infrastructure projects, such as roads and railways, will not solve the problem, he said. "I don't think it's a silver bullet."
"I think infrastructure can help productivity, but it will only help productivity if it's built to time and to cost and we haven't always had a very good record in that respect in this country."
"I think the chancellor was right to concentrate a lot of what he was talking about in infrastructure on local schemes - smaller schemes that are, as people say, more shovel ready," said Lord Lamont, who was chancellor from 1990 to 1993.
Lagging behind
Presenting his Autumn Statement, Chancellor Philip Hammond said: "In the real world, it takes a German worker four days to produce what we make in five, which means in turn that too many British workers work longer hours for lower pay than their counterparts."We lag the US and Germany [in productivity] by some 30 percentage points. But we also lag France by over 20 and Italy by eight."
To help the UK catch up, the chancellor announced on Wednesday a National Productivity Investment Fund which will oversee £23bn to be invested over the next five years. Areas to receive investment include:
- £7.2bn for new homes
- £4.7bn on science and innovation
- £2.6bn on roads and railways
- £1bn on improving broadband services
Some economists think that even £23bn is not enough to tackle the productivity problem.
"He [the chancellor] has correctly identified the long-term problems faced by the UK economy, and this Autumn Statement is a move in the right direction," said Aberdeen Asset Management chief economist Lucy O'Carroll.
"But there isn't really enough money being spent here to solve these long-term problems - hardly surprising, perhaps, when there is so much uncertainty around Brexit."
0 Response to "Difficult for UK to raise productivity"
Posting Komentar