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Volume 12: debated on Thursday 12 November 1981

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asked the Prime Minister if she will list her official engagements for 12 November.

I refer the hon. Gentleman to the reply that I gave some minutes ago.

Is the Prime Minister aware that the average family in Great Britain has had to pay an extra £12·25 per week this year in direct and indirect taxation, compared with only 69p extra in rates? Does she agree that even in Greater London her own increases in taxation have been four times the increase in Londoners' rates? Do not those figures show that her unprincipled attack on local government is no more than a smokescreen to cover the fact that she has imposed massive increases in taxation and living costs on all families in this country, in complete contradiction of her election pledges to reduce taxation?

I look forward to receiving the hon. Gentleman's suggestions for reductions in public expenditure on both a national and a local level, so that both national taxes and local rates may be reduced. It would be entirely dishonourable to suggest that one can increase public spending and reduce taxes at the same time. With regard to the figures that the hon. Gentleman gave, the amount of taxation paid by the average family is clearly much greater than the amount paid in rates. If the hon. Gentleman had considered the percentages, however, he would know that the percentage increase in taxes for a typical family with two children was almost exactly the same as the percentage increase in their rates—before the latest supplementary rate increases.

Will my right hon. Friend consider the consequences of the intrusion into Swedish waters of a Soviet submarine, which was clearly established to be there for the purposes of espionage and nuclear warfare? Does not this emphasise the vital importance of unity and co-operation among the countries of the Council of Europe as well as within the EEC? Will she therefore confirm that it remains Britain's policy to support and participate in the Council of Europe?

On the last point, it remains Britain's policy to participate in the Council of Europe, which we recognise performs a valuable function and which includes countries that are not members of the EEC, such as Sweden. The incident to which my hon. Friend refers highlights the need to be extremely diligent and to keep our defences on the alert.

Returning to the question put by my hon. Friend the Member for Blackburn (Mr. Straw), do I take it that the Prime Minister has confirmed the figures that he gave? Does she not find it astonishing that the average family in this country is now paying an extra £12·25 per week in Government-imposed taxation? How does she reconcile that with her election statement that she was determined to build real incentives for all into our tax system?

I repeat what I said to the hon. Member for Blackburn (Mr. Straw). The percentage increase in rates and taxes for the average family was approximately the same before the latest supplementary rate demands were issued. On the right hon. Gentleman's specific question, taxation would have been very much higher under a Labour Government. I look forward once again to hearing his proposals for reducing public expenditure. Otherwise, we must conclude that the right hon. Gentleman is giving notice that he would simply print the extra money so that Britain would once again be on the way to the IMF.

I am asking the Prime Minister to confirm that under the Conservative Government taxes for the average family have risen by more than £12 per week. Does she think that that is what she told the electorate at the general election?

Taxes for the average family have indeed increased. As I have frequently explained to the right hon. Gentleman, if we are to maintain prudent and sound financial policies, we should not finance increases in public spending by printing money, as I believe that the right hon. Gentleman would. At least we have the honesty to finance them properly by taxation.

Will the Prime Minister, in the course of her busy day, find time to consider initiating four or five major capital projects to be financed by the City?

If capital projects can be financed by the City, it is naturally at liberty both to finance them and to set them up. The trouble with some of the schemes put to us is that either they require Government guarantee or they are schemes started by monopoly industries that could put up the price sufficiently to finance the borrowing. That would have a very adverse effect on the private sector.

Can the Prime Minister clear up one discrepancy between her statement about Mr. Leo Long's espionage activities and the statement of the Attorney-General? The right hon. Lady said that there was one other individual to whom inducements had been given, and the Attorney-General said that there were a few other individuals. Will the Prime Minister tell the House what are the facts and what number the Attorney-General was referring to in speaking of a "few" individuals being offered inducements to confess?

If the hon. Gentleman looks closely at both statements he will find that my right hon. and learned Friend the Attorney-General gave the numbers, a few, to whom an informal inducement had been offered. I gave the number—[Interruption.] This is extremely important and I am trying very hard to get it right in response to a question from the other side of the House. I am trying to get it accurate. He gave the number of cases, a few, in which informal inducements had been offered. I gave the number from whom a confession had come as the result of an informal inducement. The two are perfectly compatible.