⁽¹⁾ Regardless of the arguments which we have put in favour of some general reflation it is becoming increasingly clear that there is a very urgent need for as high a level of industrial investment as possible. The recent investigations into various sectors of the motor industry have pointed very clearly to the productivity gap between British and foreign manufacturers. It is likely that this gap exists more generally across manufacturing industry.

Although the attack on inflation has, we think rightly, dominated recent policy, it will not of itself deal with this longer-term structural problem, which is so serious now as to require a broad approach by the government, industry and the unions together.