Written question asked by Lord Willetts (Conservative) on Monday, 28 February 2005, in the House of Commons. It was due for an answer on Friday, 4 March 2005. It was answered by Stephen Timms (Labour) on Friday, 4 March 2005 on behalf of the Treasury.

Treasury

Question: To ask Mr Chancellor of the Exchequer, what estimate his Department has made of the effect of migration on the underlying growth rate of the UK economy. - Inc figures and ref to 'Trend Growth: Recent Developments and Prospects'.

Answer: Mr. Willetts: To ask the Chancellor of the Exchequer what estimate his Department has made of the effect of migration on the underlying growth rate of the UK economy. [219561] Mr. Timms: The Treasury's projection for the trend growth rate of the economy is built up from projections of growth for the different components that drive trend growth, one of which is the population of working age. As referred to in the 2004 pre-Budget report, the trend growth assumption is 2 per cent. over the current economic cycle, with growth in the working-age population contributing around 0.5 percentage point. Included in this 0.5 percentage point is a contribution from net migration of slightly over 14 percentage point. The paper "Trend Growth: Recent Developments and Prospects" published alongside Budget 2002 explained the Treasury's approach to assessing trend growth, and further relevant material is published in the economy chapter of each pre-Budget and Budget report.

Secondary information