Thursday 18th February 1982
Carrington asked PM how she liked Doris Day (PM of Iceland) - PM said Who?
Burns memo recommending 1½ NIS reduction caused me to write urgent memo to the PM arguing for a RW [Rooker Wise] +5% and 1% NIS. M. Scholer [Michael Scholar] thought that PM would be with me!
New budget forecast suggests that unchanged PSBR is back to £7½bn. So we have £1½bn leeway but virtually none for next (1983/4) year on these forecasts - but since they change so much why should we knock ourselves out this year.
Cabinet discussion of US interest rates, defence spending, hilarious. “Europe will pay for US defence spending by high interest rates”
2.45 Chancellor’s crunch budget meeting - much leaning towards 1½ NIS now - and against RW +5% in spite of plea by Lawrence Airey (IR) that our thresholds are higher than most other countries.
Caroline [sic: Carol] Thatcher’s house mortgage interest relief. Chancellor suggested look at Stamp Duty again!
Patrick Minford - willing to do foreign studies provided that we provide data - M Beenstock is doing a study for Treasury on benefits/earning levels
- CPRS said they would look at anything he did
- Patrick would like to help - Layard has no explanation of unemployment.