Economy: Alan Walters diary (budget) [Talks with Chancellor on budget; Governor desires Exchange Rate target][released 2012]

Monday 15th February 1982

9.30 C/E [Chancellor of the Exchequer] - overview of budget - oil price and glut but on balance must improve things (Arthur Cockfield)

Only 1% NIS is considered - can be made to look [sic]

Still playing with 13% rather than 17% rise in thresholds.

Lunch with Layard, Jackson etc. + CPRS on Employment Stduy - not much done

- inflation is the cure!

MTFS [Medium Term Financial Strategy] mtg - Gvr [Governor of the Bank of England, Gordon Richardson] would like Exchange Rate Target - “since that is how we have in fact conducted policy” - but clearly would be awful - especially as oil price falls + £ falls - would we contract M.

Endless discussion on guideline for 1982/3 8-12 or 8-13. C/E had revised our 9-13 down to 8-12 to link in with the old - for good political reasons. Yet, says Gvr, the central forecast is about 11-11¾.

Paddie [Paddie Walters] had purse stolen by Ricky at School. Very upset. I told her to write to USA and get a job - I would follow.

Dinner with Kingsley Amis at the Letwins.