HM Treasury News Release

197/98                            20 November 1998
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CHANCELLOR LAUNCHES NATIONAL DEBATE 
ON BRITAIN'S PRODUCTIVITY

An open national debate on how to boost Britain's productivity
performance was launched today by Chancellor Gordon Brown as part
of the Pre-Budget Report consultation. Together with Scottish
Office Business and Industry Minister, Lord Macdonald, the
Chancellor hosted the first nationwide "Productivity Challenge"
roadshow in Edinburgh.  

Speaking before an audience of local business people and others
from the world of education and training, the Chancellor said:

     "Britain today faces a major challenge - the productivity
     challenge.  Our productivity is now way behind that of our
     major competitors.  Productivity levels in the US are 40 per
     cent higher than in Britain, and 20 per cent higher in
     Germany than here.

     "This problem has been ignored for too long.  We need to
     tackle it now.  We need to raise our game.  Improving our
     productivity is the key to a stronger economy - to higher
     growth, more jobs and opportunities, and better living
     standards for us all. We have made a good start through the
     Government's Private Finance Initiative, which expects to
     invest over #300 million this year and over #1 billion in
     the next three years in Scotland alone.

     "The Pre-Budget Report has begun to set out what we must do
     to equip the British economy for the challenge ahead.  The
     Government wants to work together with business and
     educators to raise our productivity and match the best in
     the world.

     "That is why I am here today, to discuss what needs to be
     done to meet the productivity challenge."

Lord Macdonald said:

     "I am delighted to welcome the productivity roadshow to
     Edinburgh.  Scotland has a vital role to play in meeting the
     productivity challenge.  This morning's event will do much
     to focus attention on how to boost our productivity
     performance in Scotland." 



The roadshow will travel round the UK over the next few months,
as part of the Government's consultation on the Pre-Budget
Report.  Ministers from a number of Government Departments will
be involved - they will want to discuss directly with local
business people and others possible solutions for closing the
productivity gap.  The roadshow will end in Birmingham on 5
February.  
  



NOTES FOR EDITORS

1.   The roadshow launch was held at TSB Bank Scotland's
     headquarters in George Street, Edinburgh.

2.   The Pre-Budget Report was published on 3 November.  As well
     as setting out the steps needed to secure high and stable
     levels of employment, it forms the basis for a wide-ranging
     consultation on the steps that need to be taken to  address
     the UK's long-standing productivity gap.


# = pounds sterling