Economy: Productivity Measurement

Lord Fox Excerpts

Thursday 28th March 2019 Lords Chamber

[Lord Young of Cookham]

It is certainly the case that cost per Member is much lower in your Lordships’ House than in another place, although of course there are reasons for this. So far as productivity in your Lordships’ House is concerned, one possible measure would be the number of questions we get through in 30 minutes adjusted for quality.

[Lord Fox (LD)]

My Lords, without bringing the analysis down, it is a fraction; it comes down to that in the end. The denominator is something that the Government like to talk about a lot. Employment levels are high and that is a good thing. However, the numerator is GDP. Last year, we saw GDP grow at only 1.4%—the worst performance since 2009—and the ONS predicts that the figure this year will be 1.2%. Clearly, the chaos we are seeing is driving down GDP growth. How can we ever have the productivity levels that the Government aspire to when the chaos around us prevents investment and confidence in business?

[Lord Young of Cookham]

The noble Lord goes back to an issue raised by the noble Lord, Lord Haskel, which is the industrial strategy. Its main thrusts were driving up productivity, backing businesses with high-quality and well-paid jobs, and investing in skills, growth industries and infrastructure. Investment in infrastructure is up 3%. Private sector investment totalled over £358 billion in 2018, combined with public sector investment. We also have long-term partnerships in 10 key sectors, so we are making progress. One reason that productivity has not been as good as it might have been is that, after the downturn, industry tended to keep people on, but at the same time, investment fell. Of course, that had an impact on productivity.