House Of Commons
Friday 13 March 1992
The House met at half-past Nine o'clock
Prayers
[MR. SPEAKER in the Chair]
Orders Of The Day
Consolidated Fund (No 3) Bill
Order for Second Reading read.
Question, That the Bill be now read a Second time, put forthwith pursuant to Standing Order No. 54 (Consolidated Fund Bills), and agreed to.
Bill accordingly read a Second time.
Question, That the Bill be now read the Third time, put and agreed to.
Finance Bill And Further And Higher Education (Scotland) Bill (Allocation Of Time)
9.35 am
I beg to move,
That the following provisions shall apply to the proceedings on the Finance Bill and the Further and Higher Education (Scotland) Bill:—
Second Reading, Committee, Report And Third Reading: Finance Bill
1.—(1) The proceedings on Second Reading, in Committee and on consideration and Third Reading of the Finance Bill shall be completed at this day's sitting and, if not previously brought to a conclusion, shall be brought to a conclusion four hours after the commencement of the proceedings on this Order.
(2) Any stage of the Finance Bill may be proceeded with at the conclusion of the preceding stage, notwithstanding the practice of the House as to the interval between stages of a Bill brought in on Ways and Means resolutions.
(3) On completion of Second Reading of the Finance Bill any Question necessary for the House immediately to resolve itself into a Committee of the whole House shall be put forthwith.
(4) On the conclusion of the proceedings in Committee on the Finance Bill the Chairman shall report the Bill to the House without putting any Question and, if he reports the Bill with amendments, the House shall proceed to consider the Bill as amended without any Question being put.
(5) No Motion shall be made to alter the order in which proceedings in Committee or on consideration of the Finance Bill are taken.
(6) Standing Order No. 80 (Business Committee) shall not apply to this Order.
Lords Amendments: Further And Higher Education (Scotland) Bill
2. The proceedings on Consideration of Lords Amendments to the Further and Higher Education (Scotland) Bill shall be completed at this day's sitting and, if not previously brought to a conclusion, shall be brought to a conclusion one hour after the commencement of those proceedings.
Conclusion Of Proceedings
3.—(1)This paragraph applies in relation to any proceedings on the Finance Bill which are to be brought to a conclusion at this day's sitting in accordance with paragraph 1.
(2) For the purpose of bringing to a conclusion any proceedings which have not previously been brought to a conclusion, the Chairman or Mr. Speaker shall forthwith put the following Questions (but no others) —
(3)Proceedings under sub-paragraph (2) shall not be interrupted under any Standing Order relating to the sittings of the House.
4.—(1) This paragraph applies in relation to any proceedings on the Further and Higher Education (Scotland) Bill which are to be brought to a conclusion at this day's sitting in accordance with paragraph 2.
(2) For the purpose of bringing to a conclusion any proceedings which have not previously been brought to a conclusion—
(2) Proceedings under sub-paragraph (1) shall not be interrupted under any Standing Order relating to the sittings of the House.
Dilatory Motions
5. No dilatory Motion with respect to, or in the course of, the proceedings at this day's sitting on either of the Bills to which this Order applies shall be made except by a Minister of the Crown, and the Question on any such Motion shall be put forthwith.
Extra Time
6.—(1) Paragraph (1) of Standing Order No. 14 (Exempted business) shall apply to proceedings at this day's sitting on both of the Bills to which this Order applies.
(2) If the proceedings on the Motion for this Order were interrupted, or the proceedings on the Finance Bill are interrupted, under paragraph (4) of Standing Order No. 11 (Questions of an urgent character which relate to matters of public importance etc.), the time at which proceedings on that Bill would otherwise be brought to a conclusion in accordance with paragraph 1 shall be extended by a period equal to the duration of the interruption.
(3) If the proceedings of the Further and Higher Education (Scotland) Bill are interrupted under paragraph (4) of Standing Order No. 11, the time at which proceedings on that Bill would otherwise be brought to a conclusion in accordance with paragraph 2 shall be extended by a period equal to the duration of the interruption.
Supplemental Orders
7. (1) The proceedings on any Motion made by a Minister of the Crown for varying or supplementing the provisions of this Order shall, if not previously concluded, be brought to a conclusion one hour after they have been commenced.
(2) If at this day's sitting the House is adjourned, or if this day's sitting is suspended, before the time at which any proceedings are to be brought to a conclusion under this Order, no notice shall be required of a Motion moved at the next sitting by a Minister of the Crown for varying or supplementing the provisions of this Order.
Saving
8. Nothing in this Order shall prevent any proceedings to which this Order applies from being taken or completed earlier than is required by this Order.
Recommittal
9.—(1) References in this Order to proceedings on consideration or proceedings on Third Reading include references to proceedings at those stages respectively, for, on or in consequence of, recommittal.
(2) No debate shall be permitted on any Motion to recommit either of the Bills to which this Order applies (whether as a whole or otherwise), and Mr. Speaker shall put forthwith any Question necessary to dispose of the Motion, including the Question on any amendment moved to the Question.
Further And Higher Education (Scotland) Bill Stages Subsequent To First Consideration Of Lords Amendments
10. Mr. Speaker shall put forthwith the Question on any Motion made by a Minister of the Crown for the consideration forthwith of any further Message from the Lords on the Further and Higher Education (Scotland) Bill.
11. The Proceedings on any such further Message from the Lords shall, if not previously brought to a conclusion, be brought to a conclusion one hour after the commencement of those proceedings.
12. For the purpose of bringing those proceedings to a conclusion—
Supplemental
13.—(1) Mr. Speaker shall put forthwith the Question on any Motion made by a Minister of the Crown for the appointment and quorum of a Committee to draw up Reasons.
(2) A Committee appointed to draw up Reasons shall report before the conclusion of the sitting at which it is appointed.
14. In this Order "the proceedings", in relation to the Further and Higher Education (Scotland) Bill includes proceedings on any further Message from the Lords on the Bill, on the appointment and quorum of a Committee to draw up Reasons and on the Report of such a Committee.
The timetable motion provides for debates on the Finance Bill to be concluded within four hours from now. We have already had three full days of debate. Indeed, we finished early on Tuesday night. Four hours should give sufficient further time for us to demolish the Opposition's criticisms of the Budget and to demonstrate, yet again, that Labour is a party with a fundamental belief in high taxation for everyone. It will also enable the House to get on the statute book some of the key points of my right hon. Friend the Chancellor's Budget.
The motion also provides for the consideration of Lords amendments to the Further and Higher Education (Scotland) Bill within one hour immediately following the proceedings on the Finance Bill. Again, I believe that that arrangement is right for the country. Just as with the Bill relating to England and Wales, the Scottish Bill is already widely welcomed by further and higher education institutions. It will continue the Government's reforms in further and higher education, which have brought about a vigorous expansion in the places in higher education being taken up by our young people.
We heard yesterday from the hon. Member for Copeland (Dr. Cunningham) the predictable dirge about the use of the guillotine. I wholly reject his charge that we are ending this Session with our legislative programme in disorder. The truth is quite the opposite, as the facts show. The hon. Gentleman is never very good with facts, but I shall give them to him. We are, in fact, ending this Session as we began it, with our legislative programme under firm control and in excellent order. It is yet another example of good, effective and successful Government.
Will the right hon. Gentleman give way?
I was about to give the facts, but I shall give way to the hon. Gentleman.
I invite the right hon. Gentleman to give the philosophy behind the facts. If, as he claims, the Government's legislative programme is in good order, is not that because he applied guillotines to so many Bills, as he is now doing again? Are there any circumstances in which he thinks it inappropriate to put a timetable on a Bill from the beginning and without consultation?
I have already made it clear—and it is a personal view—that I believe it right to timetable Bills. I have said that the way in which that is done is still a matter for discussion. The principle of timetabling is good because it enables us to have effective consideration of legislation. No one could argue that the way in which we conducted our practices on some Bills in the past, where there has been filibustering, has been effective in ensuring proper scrutiny. I am glad that the Select Committee under my right hon. Friend the Member for Westmorland and Lonsdale (Mr. Jopling) has followed that through.
I shall explain how that has worked in this Session. The Gracious Speech mentioned 12 Bills. I hope that, by the conclusion of business on Monday, 21 Government Bills will have been enacted. Very few Bills will not reach the statute book. If the Asylum Bill is one of those, it will be because the opposition parties have opposed various parts of that important piece of legislation, which I believe the country wants on the statute book.I think that my right hon. Friend is interrupting what I was about to ask him. He is very perceptive. Does he agree that whatever the result of the general election—and we are buoyant by the prospect of another Conservative victory—and whichever Government come to the House, the Asylum Bill will have to be one of the first measures to be reintroduced?
Mind reading is one of my hobbies, but my skill does not extend to interrupting something that my hon. Friend had not yet said. I agree with him about the importance of having the Asylum Bill on the statute book. If that cannot be by Monday, I trust that it will be done soon thereafter. I hope that at least 21 Government Bills and a number of private Members' Bills will be enacted by the close of business on Monday. The Government are full of new ideas, and our first programme in the new Parliament will include many measures to build on our achievements since 1979.
There are two main reasons why we must proceed with speed, so that the Finance Bill receives Royal Assent before the House rises. First, the Bill contains a number of measures that it is essential to have in place on the statute book. The changes in excise duties contained in resolutions that the House approved last night must be enacted in a Finance Bill, otherwise the extra tax collected would have to be repaid. The Finance Bill provides also for the renewal of income tax and for the continuation of tax relief on mortgage interest, which are also essential. If the powers to collect income tax are not renewed by 5 May, no income tax could be collected for the financial year ahead. — [Laughter.] That might be attractive to some of my hon. Friends and to many in the country. We have been working to ensure throughout our period of government that taxpayers pay less income tax, but I do not imagine that any right hon. or hon. Member expects no income tax at all to be collected. Also, mortgage payers would not thank us if we could not continue interest relief. The Finance Bill makes provision for value added tax monthly payments on account, to put beyond doubt the legal position on VAT monthly returns that are currently subject to judicial review. The Finance Bill provides also for the introduction of the new lower rate of income tax of 20p for the first £2,000 of taxable income, and for the halving of car tax—both highly desirable measures that the country wants implemented and operating as soon as possible.Four weeks today.
I hope that the whole country notes that—as I understand last night's vote and that which we expect today—the Opposition oppose the 20p reduced income tax band. That will be an important issue during the forthcoming election.
The Leader of the House must be disappointed with the public's reception of the Budget, as shown by opinion polls and City reaction.
Not at all. Like all good things, people will come to appreciate the Budget's provisions better the more that they study them.
I can give my hon. Friend some interesting information. In a by-election in my constituency yesterday, the Conservative candidate came top of the poll, 400 votes ahead of the runner up, and neither Labour nor the Liberals bothered to contest the seat.
The longer that we debate the Finance Bill and our tax and expenditure policies, the more support we will gain during the general election campaign.
If a 20p tax band is such a good idea, why did the right hon. and learrned Member for Surrey, East (Sir G. Howe), as Tory Chancellor of the Exchequer, get rid of it in 1980? Is it not the case that the Government are reintroducing it as a bribe? The electorate understand that a 20p tax band is being reintroduced just prior to a general election to give the impression that the Tories are helping them out. If that tax band had been any good, we would have had it for the past 11 years.
At the beginning of this Government's first term, we faced a need to reduce a truly horrendous public sector borrowing requirement. I will make very clear later in my speech the relative position of the PSBR now. Today, the position is wholly different. The 20p band continues our policy of bringing down direct tax rates and of achieving the long-term target of a basic rate of income tax of 20p in the pound. The reference by the hon. Member for Bolsover (Mr. Skinner) to a bribe is very revealing of Labour's philosophy. The suggestion that one can bribe people by enabling them to keep more of their earnings demonstrates Labour's thinking, which is, "We can spend your money better than you." That is why Labour is a party of high taxation, and why it will never understand that the electorate do not believe that they can be bribed by being allowed to keep more of their own money.
The debate of the past three days has clearly shown how wide of the mark are Labour's criticisms of the Budget. The Opposition attempt to give the impression that because the Budget contains nothing specific about capital spending and training, nothing is being done about them, but they know very well that under the present system—which my right hon. Friend the Chancellor has indicated will be changed anyway—decisions on capital expenditure and training for the year ahead were announced earlier. It is not the case that those decisions—and they are substantial—are announced in a Budget. We plan capital expenditure of about £30 billion next year, on top of steadily increasing capital programmes. We will take no lessons from the Opposition on capital expenditure. We have steadily increased it, whereas Labour cut that expenditure during its period in office. Since 1988, capital spending on roads and transport increased by more than one third. British Rail's capital expenditure has nearly doubled, and London Transport's has trebled. Expenditure on training is in real terms two and a half times more than when we took office, which is additional to the high levels of training expenditure undertaken by industry, totalling some £20 billion. Next year's public expenditure programmes include a substantial proportion devoted to capital spending.Lancastrians have not forgotten that the last Labour Government cut all hospital and school building in the county. It has been catching up steadily under a Conservative Government, but Lancastrians will not forget in a hurry the policies of the right hon. Member for Leeds, East (Mr. Healey).
My hon. Friend is right. We plan for the country as a whole a programme of more than 600 new hospital buildings. Schools capital expenditure has risen by 35 per cent. in the last two years. It is nonsense for Labour to claim that the PSBR is being devoted to income tax cuts. One can split the expenditure programme whichever way one likes.
Labour claims also that we are doing nothing for business and investment—ignoring the fact that commerce and manufacturing industry are encouraged to invest by the right economic framework, confidence in Government policies and long-term strategy, low corporation tax and good profitability. Those are the policies which ensure a good level of business investment. We have provided all these and that is why we have seen an unparalleled investment boom. Investment in plant and machinery increased by almost 50 per cent. from 1979 to 1991 and business investment increased by almost 45 per cent. from 1986 to 1989, the fastest three-year growth since the war. Business investment in 1992 is forecast to be a third higher than in 1979. There is substantial business investment and it has been brought about by the policies that we have created. The Labour party has ignored the fact that about £6 billion in cash flow is coming into business as a result of interest rate reductions over the past 18 months. There is a further £1 billion as a result of last year's corporation tax reduction. There is also a significant improvement in business cash flow as a result of action already taken. That is why it is right to claim that the Budget, as a Budget for business, adds to what has already been done. The Labour party does not understand that business men's confidence to press the button to implement new investment plans depends in part on their sales forecasts. Labour behaves as if there is something deeply wrong in giving a modest boost to consumer expenditure through the tax cuts that we propose. There is no black-and-white choice between encouraging investment and encouraging sales. It is not either/or. We need a balance. I shall use the example of the motor industry, an industry in which there is no shortage of capital investment. Indeed, over recent years it has been massive. That is why there has been a greatly improved export record over the past few years. However, the industry needs a boost to its sales. The halving of the car tax will help business and business investment, not the reverse.I shall illustrate the public's reaction to the Budget and in so doing take up some of my right hon. Friend's remarks. Yesterday, there was a by-election in my constituency, one ninth of which was involved. In the ward there is almost exactly a 50–50 split between what might be described as private property and the public sector property. We, the Conservative party, took 50 per cent. of the vote and won the seat comfortably. Councillor Tim Bowler will be a great addition to the city council. That was the public's verdict yesterday in my Nottingham constituency.
My hon. Friend's return to the House will be of great benefit to his constituents, as his presence has been in the past.
The result of the by-election in Nottingham illustrates that the Labour party's approach—that a tax cut does nothing to help the economy or to help business confidence—reflects a complete misunderstanding of business investment. It is important to have increased sales and that was illustrated recently in the results of a survey that was undertaken by Goldman Sachs International Ltd. The likelihood is that between £2·5 billion and £3 billion of potential extra spending power will come into the economy between the end of December 1991 and April of this year as a result of the reduction in mortgage interest rates. The fact that about 40 per cent. of mortgages are based on annual interest rate adjustments will have a considerable impact and the adjustments are taking place now. As a result of the measures that we have taken, there has been a considerable boost to business confidence within the economy. Because of our policies, the results of many surveys, including that of the Anglo-German chamber of commerce, which is composed mainly of German companies that are investing in the United Kingdom and of those who have invested in the United Kingdom—inward investors—demonstrate that investors believe that the United Kingdom is an attractive place in which to do business. That is the result of the Government's policies. That is also the answer to the Labour party's charge that the Budget is not one for business and that we have not been pursuing policies that are attractive to business. The Confederation of British Industry and many other organisations have supported the approach that we have taken throughout. I noted the other day the result of a survey of the top 200 companies that was undertaken by James Capel and Co. When the companies were asked whether they thought that a Labour victory would be good or bad for the economy, 86 per cent. said that it would be bad. That is the reaction and judgment of business on the alternative policies that will be put to the country in the general election. Criticisms about the public sector borrowing requirement come ill from the Labour party when we recall both its record in government and its published spending commitments. It is worth reminding the country, as we shall be doing constantly, that when the last Labour Government were in office, the equivalent PSBR as a proportion of gross domestic product—this is an average —was £40 billion. In the Labour Government's worst year it was the equivalent of £55 billion. Our PSBR still remains, as a proportion of GDP, the lowest within the European Community, apart from that of Luxembourg. That is why we can rightly claim to be the party which has pursued sound finances. We have heard little from the Labour party about how well the Budget is targeted on other groups, such as the small business group in which I take a particular interest. I regret that it has not been possible to include some of the very welcome measures in the Finance Bill that were proposed by my right hon. Friend the Chancellor of the Exchequer in his Budget statement. We shall certainly be including them in legislation as soon as we return after the election. The targeting on pensioners helps to increase spending and is important for pensioners on income support who, from October, will see an increase in their incomes of at least £5·70 a week. In some instances, it will be as much as £10·70. I come to the crucial element of the debate, which is the shrillness of the Opposition's reaction to the proposed 20p rate for the first £2,000 of taxable income. The reaction—Order. There is a disturbance coming from the Opposition Front Bench, but the debate has hardly been about the guillotine motion since it began; it has been wider than that. I have been rather tolerant this morning.
I am grateful, Madam Deputy Speaker. To judge from the interventions in my speech, the House wants to debate the motion.
The Opposition's reaction to the 20p proposal reveals them in their true colours. The proposal is worth £100 a year to almost 21 million taxpayers. It is skilfully targeted to give the most assistance proportionately to the lower paid. Seventy five per cent. of the benefit will go to those on below average earnings. The marginal tax rate will be reduced for nearly 4 million taxpayers.The right hon. Gentleman has made a rather important point. He said that 75 per cent. of the benefit will go to people on below average earnings. Is that now the Government's definition of the lower paid?
No, because I was talking about skilful targeting to those on lower incomes. I was simply making a point about what the impact of the measure would be.
Does my right hon. Friend think that the casual disregard of £100 is because it would not even pay for the first course of the gala dinner in Park lane?
My hon. Friend makes his point.
It was interesting that the Opposition got into a muddle in their reaction to the 20p proposal, as they do on every other tax matter. The hon. Member for Norwich, South (Mr. Garrett) described it as a good idea. The hon. Member for Great Grimsby (Mr. Mitchell) said that he would support it. The hon. Member for Wrexham (Dr. Marek) was quoted in the Liverpool Daily Post as saying:As always, the Labour party got into a muddle and tried to retreat. In truth, it believes in and stands for higher taxes, not only for those on higher incomes, but for those on middle and lower incomes. That is demonstrated by its attitude to the 20p proposal and by everything that it says about taxes generally. The country will be able to judge from the way in which Opposition Members vote whether the Labour party is for or against lower taxes, for or against directing the benefit of tax cuts to the least well off and for or against an economy that is competitive with other countries. We Conservatives know that the role of government is to get economic fundamentals right, to keep them right, to create conditions for growth and opportunities for enterprise and to provide scope for freedom of choice. As the Finance Bill demonstrates, we know that the money that Governments spend comes from taxpayers. We believe it right to leave people with as much of their own money to spend as is possible. We believe in reducing taxes, increasing incentives and enhancing opportunities for all our people. The Labour party does not believe in any of those things. It will be demonstrating that again today by voting against our proposals. The country will soon judge. I have no doubt that its verdict will be the same as it has been for the last 13 years."There may be a way we can accept this tax band because we believe the lower paid pay too much tax already."
9.59 am
I hope that I do not embarrass you, Madam Deputy Speaker, if I say that we think we heard a note of irony in your voice when you reminded us what the debate is about. I shall return to that point in a moment, but I begin by saying genuinely to the Leader of the House that, in so far as he has been involved in work on House of Commons affairs, he has been a good Leader. I thank him for his courtesy to me personally in the way that we have tried to work together to improve matters in the House of Commons—but there, I am afraid, the felicitations must end.
As you said, Madam Deputy Speaker, with a note of irony in your voice, when you reminded us of the nature of the debate and why we are here, the reason why we are here this morning is that the Leader of the House is asking us to agree to the guillotining of three Bills. In round numbers, that means that in this Parliament the Government, with their large majority, will have guillotined about 40 measures—more than twice the number of guillotines used by the Labour Government between 1974 and 1979, when we did not even have a majority in the House of Commons. The Government will finish as they began—unable to persuade people by argument and debate, but determined to railroad their ideas through Parliament regardless. At least two or three Conservative Members are in the Chamber today who, in the past, had the courage and conviction to stand up and oppose in principle the guillotining of Bills and also to vote against measures such as the poll tax when that, too, was guillotined. The Government have never learnt from their mistakes throughout this Parliament in the way that they have approached the business of the House. This morning's proceedings are unprecedented. The Budget debate has been curtailed and we face the savage guillotining of the Finance Bill through all its stages in a few hours today. No Government of any persuasion, however great their difficulties, ever conducted proceedings on the Finance Bill and the Budget in such a way. The right hon. Gentleman leaves this Parliament with an unenviable record in that regard, as well as in some others, to which I shall turn later. The Leader of the House says that we have to have a Finance Bill. He is absolutely right. Despite what he said yesterday, we recognised that need from the outset—but we did not have to have a Finance Bill in these circumstances and we did not have to have a Budget debate in these circumstances. We could have had the Budget a week earlier or we could have had the general election a week later. Either way, the Government simply messed it up. The Chancellor of the Exchequer—he was here a few moments ago, but has vanished again, no doubt having put on his Vatman cape—and the Prime Minister were responsible for fixing these dates and this timetable. What we now see clearly is that they made a complete mess of fixing the dates. The result is the guillotining of the Finance Bill today. We see a flight from responsibility by the Government. They deny that the recession has anything to do with their policies. They deny that homelessness has anything to do with their policies—it is the fault of the homeless. Unemployment is the fault of people who do not have jobs. The recession is the fault of the Americans. The Government accept no responsibility for anything. Even after 13 years in office, with large parliamentary majorities and advantageous world circumstances, and with oil revenues in excess of £100 million, the Government leave the nation's affairs in a shambles. They leave Parliament in a shambles, too. The Finance Bill is the most important measure to be guillotined this morning, but the Education (Schools) Bill is also guillotined, as is the Further and Higher Education (Scotland) Bill, even though we have expressed our acceptance of the Bill in its present form. I assume that the Leader of the House is guillotining it because he is concerned about the Scottish Nationalists, but as they are not here I am not sure what he is worried about. He is guillotining that Bill without the Labour party opposing it. The Leader of the House said that the Government's conduct of the final aspects of their business was orderly, so whatever happened to the Asylum Bill? I hope that the right hon. Gentleman was not implying, or trying to convince the House, that the Asylum Bill is not here because we oppose it. The truth of the matter is that the right hon. Gentleman was offered a compromise on that Bill by my right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) but the Government rejected it. The real reason why the Asylum Bill is not in the House now is because the Government have signally failed to convince the other place—a combination of Tory peers, Cross Benchers and others—that it should be allowed through. That is why the Asylum Bill has not come back from the other place—it has nothing to do with obstacles in the House of Commons and it is quite out of order to suggest anything to the contrary. The reality is that the Government are staggering through these last few days of Parliament, desperate to get out of here before even their last act of folly—their Budget —is rumbled. They have even missed the boat on that. Their timetable has gone wrong on that, too. As reactions from the City and from people around the country show, the Budget has had a big thumbs down. The great launch for the Tory campaign has stalled. The rocket motor has fizzled out like a damp squib. How can any Conservative Member or anyone else in the forthcoming campaign believe that the person on £70 a week, whom the Chancellor told us he had in mind when he made his tax changes, will be delighted by the proposals? The tax reduction offered to that taxpayer is just under 19p per week. As my right hon. and learned Friend the Member for Monklands, East (Mr. Smith) said, that is equivalent to the price of a box of matches. Anyone who thinks either that that will motivate voters to support his discredited Government or that it will electrify the economy must be living in cloud cuckoo land.Will the hon. Gentleman give way?
In a moment.
The truth is that even before my right hon. and learned Friend the shadow Chancellor unveils his alternative budget next week, our own proposals on child benefit, a minimum wage and attendant policies will do far more for the low paid than anything in this Budget.If the Labour party is voting against the lower band of income tax, will it consider most carefully the fact that the main reason for it is to give every possible incentive to the unemployed to get into work? Due to the poverty trap, there has been no incentive for them to take low-paid jobs. Is this not the best way to bring about a fall in unemployment?
The hon. Gentleman must be absolutely confused about the position of people who are out of work. They are out of work as a result of the Government's policies. If he thinks that 19p per week is all that is stopping people who are out of work from getting jobs, he is fundamentally mistaken. I can tell him from my experience throughout the country, and in particular from my experience in my own constituency of Copeland, that what he says is incorrect. There are 3,000 people out of work in Copeland. If I include the unemployment in the constituency of my hon. Friend the Member for Workington (Mr. Campbell-Savours), there are between 6,000 and 7,000 people out of work in west Cumbria. An extra 19p a week will do nothing to create additional employment in west Cumbria. Indeed, a further unemployment calamity is coming to west Cumbria due to the running down of the nuclear industry's construction programme and a further 3,000 people will lose their jobs in my constituency. The hon. Member for Chorley (Mr. Dover) knows the building and construction industry. He knows that it is in a calamitous state across the country. Nothing in the Budget—certainly not the 19p reduction for an employed person earning £70 per week—will resolve the problems. The hon. Gentleman knows that.
rose—
I have not given way, but as the hon. Gentleman has been so courteous, I will do so now.
Will the hon. Gentleman assure the poor people of Cumbria that a future Labour Government would take a positive attitude to the nuclear industry and the construction thereof?
Yes. I did not want to be diverted to the subject of nuclear power, but, as the hon. Gentleman has mentioned it, I can say that it is important in my constituency, where it employs 14,000 people directly. The Government took office 13 years ago, full of bold, brave things to say about nuclear power, but what is their record? They started but did not finish even one nuclear power station in 13 years.
Thank goodness.
The hon. Gentleman says, "Thank goodness." He is entitled to his point of view, but for the Government to talk as though they are the saviours of the nuclear industry is one of the long-running myths of this and previous Parliaments. If we take into account the privatisation of the electricity industry—
Order. We are straying too far by talking about privatisation measures. I am sure that the hon. Gentleman is about to return to the motion on the allocation of time.
That shows that I should not have been tempted to allow an intervention by the hon. Member for Southend, East (Sir T. Taylor). However, to conclude the point, the privatisation of the electricity industry above all wrecked the prospects of the industry to which the hon. Gentleman referred. That was another of the Government's terrible mistakes.
I deal again with the reason for the guillotine as you rightly reminded me to do, Madam Deputy Speaker. The motion is intended to force through the Budget proposals with the claim that somehow at the 59th second of the 59th minute of the 23rd hour, as the Government stagger out of office, they have suddenly become concerned about lower-paid people. That is absolutely bogus. As my hon. Friend the Member for Bolsover (Mr. Skinner) has said, in one of their first Acts the Government abolished the lower rate. Now, 12 years later—just before a general election—they are reintroducing it. What has happened in the intervening decade? What has happened since Conservative Members voted to freeze child benefit? Were they thinking about low-income families then? Of course they were not. What happened when they trooped through the Lobbies to impose the poll tax on low-income families? Where was their concern for the low paid then? What were they thinking when they agreed to legislation that, for the reasons that we advanced, no political party in any other democracy would support? When they agreed to introduce the poll tax, what did they think about sending poll tax bills to people who had no income? That is the Government's record on taxation—to say nothing of the 2·5 per cent. increase in VAT in the last year's Budget to buy off poll tax anger.I thought that we had come to hear about the guillotine.
The hon. Gentleman did not come here for that purpose—he knows that and so do we.
As I was saying, that is the Government's record, not to mention imposing the highest tax burden in history on all of us as they leave after 13 uninterrupted years in office. The Government have got the Budget wrong, and they have got it wrong for 13 years. If they have not got it right in 13 years, they never will. That is what people think. At the end of the debate, my hon. Friend the Member for Brent, South (Mr. Boateng) will remind hon. Members of the comments of City analysts on the Budget. They said that it was a flop and gave it the thumbs down. One Thatcherite supporter in the City gave it one out of 10. It was remarkable to sit here while the Chancellor introduced the Budget and to observe the look and demeanour of the right hon. Member for Finchley (Mrs. Thatcher). She looked absolutely livid throughout the whole performance. I asked the Leader of the House yesterday about the Conservative campaign guide for the coming election. I do not know whether Conservative Members have seen it, but if they would like to come to my office afterwards, they can have a copy. The guide is already out of date because it contains figures that are nonsensical. It talks about a PSBR of £10·5 billion, which is already 50 per cent. too low. It says nothing about the PSBR of £28 billion for the coming financial year or one of £32 billion for the year after that. What happened to sound money? What happened to balanced Budgets? What about the chairman of the Conservative party who said that large borrowing was simply deferred taxation, a burden for future generations? All those arguments have gone out of the window—whoof!—because there is a general election on the way. That is what the Budget is all about, and that is why the Government have made such a reckless economic misjudgment. As my hon. Friends have said, and as the polls show today, the Budget was also a huge political misjudgment. People do not want it. It means nothing to them in the face of higher tax bills, higher poll tax bills, higher charges for electricity, for gas and for water, and higher petrol prices. Those higher prices will override any benefits to low-income families which might have resulted from these policies.rose—
I will give way in a moment.
The Budget will not wash. Even the people who are struggling, as I know from my constituency experience —who are faced with schools without sufficient text books or learning materials for their children, and with the appalling circumstances which led to the tragic death of Georgina Norris—would rather have borrowing for investment, to build for the future. They know that investment for the future is the best way to get a better deal for themselves and their families, rather than a tax bribe a few weeks before a general election.The hon. Gentleman is attacking the Government for their imprudent level of borrowing. Will he let us into the secret of the shadow Budget to be published tomorrow? Will the level of borrowing under a Labour Government be lower or higher than that which we propose?
I cannot let the hon. Member for Chichester (Mr. Nelson) in on the secret of my right hon. and learned Friend's Budget to be revealed tomorrow because it will be revealed next week. All will be revealed. My right hon. and learned Friend made it clear in the Chamber that we shall have to work within the circumstances that we inherit. [Interruption] Hon. Members say that we shall have to stay with it. Of course, an incoming Labour Government—and that is what we shall have—will have to work within the circumstances that they inherit. I suspect that, as in the past, the mess of the nation's finances will be even worse when we open the books and take a thorough look, but we shall have to deal with that. The hon. Member for Chichester must contain himself for a few days more. He will discover that my right hon. and learned Friend's alternative proposals are better not only for individuals but for Britain as a whole.
The hon. Gentleman has just talked about capital spending in the national health service, with the implication that somehow or other Labour would do better. During the forthcoming election campaign, will he keep reminding the electorate that the Government have increased capital spending on hospitals by 76 per cent., compared with the 30 per cent. cut made by the Labour Government in that same capital spending?
Indeed, I am more than happy to respond to the right hon. Gentleman's challenge that we should debate the circumstances of the national health service during the election campaign. We know that people are deeply unhappy about the Government's policies and, notwithstanding what the right hon. Gentleman says about expenditure, he and his right hon. Friends must explain why wards are continuing to close, why emergency beds are not available and why desperately ill children are turned away from hospitals. Why is that happening, if the Government's record on health is so wonderful? Why is the number of beds available for private patients who need urgent treatment increasing while the number of beds available to NHS patients is declining? Why is that happening if the Government have made such a good job of their health service reforms?
The hon. Gentleman knows perfectly well that we have substantially increased spending on the health service in real terms, by about 55 per cent. overall. [HON. MEMBERS: "Not enough."] Labour Members, say that that is not enough. How, then, do they explain what the right hon. and learned Member for Monklands, East (Mr. Smith) is clearly saying to the hon. Member for Livingston (Mr. Cook)—that the Labour party would not be able to spend more on the health service and that, because of its policies on a national minimum wage, on pay beds and on prescription charges, it would substantially reduce the amount actually spent on patients within the health service?
We are right at the nub of the dispute between us. This is the choice which people face. They must choose whether the money that is still available, even in these desperately difficult financial circumstances—the mess that the Tory Government are leaving—should be spent on tax cuts or on investments. That is the clear choice which we shall put to the people and we are happy to put it in those clear terms. I am quietly confident that people will see the difference and make the choice—and that choice will be for Labour. The evidence emerges again and again from the debate.
Will the hon. Gentleman tell the House how much the Labour party, in a quite revolting fashion, has spent on advertising which exploits the death of a child?
The tragedy of Georgina Norris, who was twice taken to hospital to have an operation and twice sent home, is appalling. It is a stain on a civilised society that that child should have died in those circumstances.
The hon. Gentleman does not know what the circumstances were.
I know very well what the circumstances were, and we stand by what we have said —the child's parents wanted the nation's attention drawn to what happened to their little girl as a result of the Government's mismanagement of the national health service. For the hon. Member for Thanet, North (Mr. Gale) to suggest otherwise is a deliberate attempt to mislead the House and the country. I have all the correspondence here and he is welcome to see it all if he wishes.
Order. I shall not allow further discussion on an individual case. We are discussing principles.
Thank you, Madam Deputy Speaker —I might have known that that was the kind of intervention that the hon. Member for Thanet, North would make.
On this penultimate day of our deliberations, the Government are desperate to get their fag-ends of legislation through—desperate to get their bribes on to the statute book—so they are guillotining our procedure. They have used the guillotine a record number of times. The Leader of the House smiles. I do not think that he should smile, because, as well as being fed up with the Government's economic and social policy failures the people are fed up with the abuse of Parliament which has been a recurring feature of the Government's term of office. The Government are concluding their term of office with another abuse of Parliament—and that, too, will count against them in the ballot box on 9 April.10.26 am
The debate has ranged rather widely, but its subject is rather narrow— whether it is wiser for us to carry on discussing the Finance Bill in detail for a week or to rush on with the election now. The evidence so far suggests that it would have been better for us to go on for another week on the Finance Bill, because the signs for the election campaign appear rather depressing. There are a few exceptions—the hon. Member for Copeland (Dr. Cunningham), who has just spoken, is an obvious exception. I asked him a straight question and he gave me a straight answer. I hope that that will be a sign of what will happen in the campaign.
I asked the hon. Member for Copeland simply whether a Labour Government would be in favour of expanding a nuclear power programme and he said, "Yes." Presumably, that would be at the expense of coal-fired power stations. There are some such subjects on which it is good for politicians to give a straight answer. We know that some people feel that we should have more coal-fired power stations, while some favour gas-fired power stations and some want to cut the nuclear construction industry. At least we have had a straight answer from the hon. Member for Copeland. That is the sort of thing that we should have. There have been other signs that are not so good. I understand that the Leader of the Opposition will be in Scotland today. We always regarded him as one of our staunch friends in the battle against all the nonsense about devolution—but now he seems to be one of its greatest supporters. It is tragic that, during the election campaign, nonsense will be talked by people who used proudly to support strong policies. I shall ask the Leader of the House three questions. He will know that many Back Benchers have strong feelings on taxation issues and that they want to bring those feelings before the House when debating the Finance Bill. Yet it seems that, because of the guillotine, we shall be denied that opportunity. If, as we hope, the Conservative Government are re-elected, will there be an early opportunity to consider various tax anomalies? I want to talk about simple things—for instance, beach huts, which, as my right hon. Friend probably knows, are important to the tourist industry. Suddenly, in the course of last year, beach huts became liable to VAT. That was done not by primary legislation but by some funny order that went to a Committee and it is obviously grossly discriminatory against the leisure and tourism industry. It is unfair and people are fed up about it. We wondered how we could resolve the matter and we thought that we would be able to do so in the Finance Bill— but now we shall not be able to, which means that a great injustice to seaside areas, including Southend-on-Sea, will continue for another year unless we can have a detailed discussion on the subject. Another great anomaly concerns the sale of secondhand furniture. It is ridiculous that, although almost every other industry pays VAT only on added value, sadly, on second-hand furniture the gross amount must be paid. That is unfair to the industry, especially to the minority of people in it who are registered for VAT. Another anomaly concerns people with working wives. If someone who is unemployed has a working wife, it will be almost impossible to get the mortgage paid, whereas if the wife is not working the mortgage can be paid. That is the kind of anomaly which we would like to discuss on the Finance Bill, but we shall not be given the opportunity. I simply ask my right hon. Friend whether, if we approve the motion, there will be another opportunity for considering detailed points about unfairness and distortion in tax legislation. Secondly, I believe that it would be best if, in advance of the election, the Leader of the House introduced a simple motion outlining issues on which all the parties could agree. The motion could be discussed for about three hours and those issues could be left out of party politics. We could send them for local decision making. That is not a silly idea. Hon. Members from all parties are aware that whenever there is a general election many people face total uncertainty. I shall cite one little example, which concerns the 2,500 children in Southend-on-Sea who attend grammar schools. There are arguments for and against grammar schools. I believe that if grammar schools are abolished, the people who will suffer will be able children from working-class areas. That is a political argument which is not relevant to the motion. What is terrible is that, at this election, the next election and the election after that, the children, teachers and parents face uncertainty. They know that if one party wins, the grammar schools will be closed. If another party wins, the schools will stay open. Is it not possible to get some agreement between the parties before the election that there are some issues that we all agree should be left to the decision of local people? That is not an attack on the Labour party or on the Liberal Democrats: it is simply a suggestion that there must be some issues that we could agree to leave to local decision making. I hope that the House will consider that possibility instead of using the motion. I hope that the House will decide to have short discussions with all the parties to see which issues we could leave to local decision making. We should not then have this terrible position of total uncertainty. The Labour party used to believe in nationalisation and we had terrible problems. Industries did not know where they were, the employers did not know where they were and the workers—I have some sympathy with what the hon. Gentleman says about local decision making. However, we have had 13 years of a Tory Government who have continually undermined local democracy, local accountability and local decision making. I should have liked to hear the hon. Gentleman's voice raised more sternly when local accountability was effectively being removed by the House.
I am trying terribly hard not to be political. Even if the hon. Gentleman were absolutely accurate, even if the Conservative party were a crowd of rascals who wanted to interfere with everything—I do not think that they are, because some of them are very nice blokes—surely we should not go further.
Why does the hon. Gentleman think that it is right that a political party should say what kind of educational arrangements there should be in an area? Why not leave it to the local people? If they want to change, let them change. The hon. Member for Newham, North-West (Mr. Banks) will remember that when his party used to believe in nationalisation, which it does not believe in now, the same uncertainty applied to many jobs and many industries. Happily, the Labour party has moved away from that position and from many of its former policies. Would it not be sensible to have an arrangement whereby the parties could say, "Let the people decide locally and do not let the centre do so"? As we shall not have a lengthy discussion of the Finance Bill, people like me—I call us a growing minority—who feel that all the parties, unfortunately, are being prevented from going ahead with more flexible economic policies because of their commitment to the exchange rate mechanism, are unable to ask the Government whether there is anything in the Bill which will remove the freedom of a Conservative, a Labour or a Liberal Democrat Government to withdraw from the ERM if they wish. Only about 11 Conservative Members voted against the decision, but the Leader of the House will be aware that there has been a big change of opinion. The Times has changed greatly and now says that it is in favour of a free pound. That is wonderful. It is rather like getting the Church of England to say that it is opposed to fox hunting. It is a major change in opinion which has spread throughout the House and elsewhere. There is a growing belief that, if one tries to create an artificial price for anything, one simply creates distortions elsewhere. We see the same problems arising under the EC agricultural policy, which we cannot discuss under the motion. As artificial prices are created, one has distortions—Order. Will the hon. Gentleman oblige me by relating what he says far more to the motion? He is now straying quite far away from it.
You are quite right, Madam Deputy Speaker. I am trying to speak briefly.
I am simply trying to say to my right hon. Friend the Leader of the House about the motion, which cuts the time for discussion on the Finance Bill, that we should be allowed just a little more time to answer my simple, clear question, to which I want just a yes or no answer. Is there anything in the complicated Bill, which I have just seen, which removes the freedom of future Governments of any party to withdraw from the ERM if they wish to do so? The Government have made it abundantly clear that they do not want to withdraw. Their commitment is firm. We simply want an opportunity, which I hope we may get, to be given the answer yes or no. My right hon. Friend may find that increasing numbers of people are moving towards my position. It would be terrible if we lost our freedom. I hope that we shall be given positive answers to my three questions before we vote on the motion. I hope that, in the forthcoming election contest, all people from all parties will give clear, decisive and positive answers—as the hon. Member for Copeland did when I asked him a simple and clear question about nuclear power. Let us hope that all the answers and questions will be as clear and decisive during the election.rose—
rose—
Mr. Dennis Skinner.
10.34 am
The hon. Member for Berwick-upon-Tweed (Mr. Beith) has had his chance already, because he was on television last night. He is a bit upset because I have got in before the Liberal Democrats. It is a great day and I am all in favour of it. The hon. Gentleman talked a bit about the guillotine a bit last night on television and he made it plain that the 20p band was going down like a lead balloon.
The atmosphere in the House today is different from the atmosphere on Tuesday. All the euphoria on the Conservative Benches has gone. I admit that when I heard the Chancellor say that he was introducing the 20p band for the first £2,000, I got out my little Labour party pocket book and I saw that the proposal was still there. Many things have been whittled away in Labour party policy reviews over the past few years, yet that policy still remains. I thought, "Here the Conservatives are, stealing our clothes. Ain't it smart?" I decided that it would not worry me, because I vote against Labour party policy from time to time. Outside this place, within seconds, people were not taking the view that the 20p rate that many Conservative Members and some Labour Members took. I have another answer. I would have added another 5 per cent. to the 50 per cent. tax band and got the money back that way. That is still a threat if I get the job of Chancellor of the Exchequer, although I do not think that I am in line for it. It is a pointer. The whole environment in which we debate today has changed completely. The Leader of the House talked about having to get the matter dealt with by 5 May. I must tell my hon. Friends who were not here before that if we do not get the Finance Bill on to the statute book by 5 May, all the taxes that should be collected will not be collected. If I can find a parliamentary procedural way in which to keep things going beyond 5 May, I shall be a bigger hero than Robin Hood. I am working on that one. Are any by-elections pending?About 650.
I am not so sure about mine. It is important that, after the initial bout of enthusiasm, the markets and the stock exchange took a completely different view. The problem that the Government must face in their dying days is not only the level of the public sector borrowing requirement at £28 billion, but the dramatic increase over 12 months.
The Leader of the House referred to the large PSBR between 1974 and 1979. He forgot to mention that part of it was due to the quadrupling of oil prices just before the Labour Government were elected. He forgot to mention that we inherited a bigger PSBR, in percentage terms, in 1974 than we left. I hope that all my hon. Friends remember that. When the Conservatives talk about the PSBR, we must realise that, in the middle of Labour's period of office, the PSBR went up dramatically, but if we take into account the beginning and the end, the PSBR was less than the PSBR that we inherited. Over the past 12 months, the PSBR has increased from £14 billion to £26 billion. The Government have now added another £2 billion. The City is saying that that is a dangerous and dramatic increase. That is its verdict. Those in the City are also bearing in mind the fact that the Government have picked up £100 billion-worth of North sea oil tax receipts and another £42 billion-worth of privatisation receipts. It is almost incredible that a Government who have had £142 billion extra should have managed to end up with a public sector deficit of £28 billion after 13 years in which they have had all that money from North sea oil. That is the difference between the 1980s and the 1970s. We could have done a lot with that 2 billion quid. Only 4·75 million people are now engaged in the manufacturing industry—the lowest figure ever. This year, fewer people will be engaged in manufacturing than will be working in hotels and shops. I am not knocking people who work in hotels and shops, but we must remember that Britain imports about 50 per cent. of its food. We now have a net deficit on manufactured goods and there is no way in which we can allow the manufacturing capacity of Britain to continue as it is and pay for that imported food—let alone imported coal, imported oil and imported manufactured goods; it is impossible. My hon. Friends on the Front Bench who will inherit the positions of those on the Treasury Bench in a month's time can forget about the £28 billion, because when they open the books they will find that matters are dramatically worse than that. That is the position and there are people out there in the City who know it. They are closer to reading the books than we are and they have friends on the Conservative Benches who tell them things—some of the dries in the Tory party who may not even be voting Tory at the election. I shall not name names, but a few of them are not looking forward to the Government getting back into power. They know, and their friends in the City know, that the situation is dramatically worse than it appears. The £2 billion could have been used to boost manufacturing industry. It could have been used to boost housing. The state of housing in Britain after 13 years of Tory government is a crying shame. They called 1979 a bad year for Labour, yet in that year we built 80,000 public sector houses. My hon. Friends and I used to complain that that was not enough; we wanted 160,000 or 280,000, but we only got 80,000. Last year, only 8,000 public sector houses were built—8,000. There are elderly people waiting for bungalows and other forms of accommodation. I am talking not just about London, although in parts of London homelessness is worse than it is anywhere else. I am also talking about places such as Bolsover, where the housing waiting list is longer now than when I was first elected in 1970. Every one of us knows that there is a crying need for houses. The £2 billion could have been used to kick-start the housing economy and get rid of cardboard city, which is an utter scandal. We ought to have a party political broadcast showing people in door holes in the Strand, showing the piles of bricks at the London Brick Company and the 250,000 construction workers who do not have jobs. It does not take a Pythagoras to put those three things together and put roofs over people's heads. Yet the Tories have the cheek to talk about putting £100 per annum into the pockets of Members of Parliament and Cabinet Ministers—because that is where the money will go, despite all the talk about its going only to the lower-paid. Let us get the facts straight: if people are on family credit, the money will be taken away from them pound for pound. The 3 million people who are unemployed will not get a penny piece out of this bribe of a Budget. We have housing squalor all around us and that is one of the things that the next Labour Government will have to sort out. There is also the question of education. Some £4 billion needs to be spent on repairs to educational establishments, but nothing has been done in that regard either. What else could we international socialists have done with the money? We could have used some of it to help pay off some of the debts of the third-world countries. We could have used a little of it to double the amount of money that we pay in overseas aid to some of those impoverished nations. Instead, the Government have chosen to line their own pockets and the pockets of their friends out there in the City.The hon. Gentleman is right that the £2 billion could have been well used in ways that would have helped low-paid people more than the £100 tax cut, which many of them will not get. But he has spent it several times. If he is to tackle education, investment and overseas aid and kick-start the economy, he will either have to borrow more or raise more revenue—and on that, those on the Labour Front Bench seem a little hesitant.
I am merely giving examples of the way in the which the money could have been used. There are many options. I am not saying that we would need all the £2 billion to kick-start the housing economy. I think that the hon. Gentleman knows that. We could start to do that by using some of the capital receipts that are held by the local authorities. Then we would not even need to start on the £2 billion. But as the hon. Gentleman is an economist, he has probably missed that point. It is early in the morning and I understand his problem. He is probably having to prop up Paddy Backdown or Captain Mainwaring or whatever they call him now. I understand his difficulties.
The public know—the voters know—that we could have done a lot with that money. We could have used it for child benefit or to help the old-age pensioners. We could use it to help implement the Elimination of Poverty in Retirement Bill introduced by my hon. Friend the Member for Islington, North (Mr. Corbyn). All those issues need to be dealt with, but instead the Government said, "Let's introduce the 20p band. That'll embarrass the Labour party. It's in their little pocket book document." Somebody said to them, "Do you remember that we got rid of it in 1980?" The reply was, "Did we?" "Yes. It was the right hon. and learned Member for Surrey, East." "Oh, we're not bothered about him. He's going; he's on his way. Nobody will remember anyway. They'll not think about it on the Labour Benches." The Government abolished the 20p tax band 1 I years ago. They introduced a poll tax to hammer the low paid. They cut social security benefits to hammer the low paid. They took away the death grant, the maternity grant, income support for 16 and 17-year-olds to hammer the low paid. Every time they walked into the House of Commons, they did something else to hit the low paid. Then, a few weeks before a general election, some tin-pot ideologue said, "Let's introduce a 20p band and trap the Labour party." They might have done that momentarily, but the people out there understand it for what it is: it is a dirty, stinking Tory bribe, and they will pay the penalty for it at the general election.10.47 am
The House has just heard a vintage performance from one of its favourite performers. I remember the day when I had to congratulate the hon. Member for Bolsover (Mr. Skinner) on his maiden speech, and I did so with great sincerity. I forecast then that the House might hear from him occasionally in the future.[Laughter.] That prediction was absolutely right and I am sure that many Treasury forecasters would like to be able to emulate its accuracy.
I want to say a few words about the guillotine motion, you will be glad to hear, Madam Deputy Speaker. The hon. Member for Copeland (Dr. Cunningham), who has a nice line in affable invective, began his speech by paying a graceful tribute to my right hon. Friend the Leader of the House. As I have served on a number of House of Commons Committees, I should like to associate myself with those words. For a very long time, the House has not had a Leader of the House who has devoted more time to its affairs. My right hon. Friend has been a particularly effective Leader of the House and I should love to see him in the job again after the general election, although he deserves promotion because of what he has achieved. The hon. Member for Copeland has been an excellent shadow Leader of the House and I wish him many happy years in that position. We had the usual synthetic rhetoric about guillotine motions. I have never been an enthusiast for guillotine motions introduced by either party, as the hon. Member for Copeland knows, but this is one occasion on which I speak quite gladly in support of such a motion. I have one reservation: we have been given only four hours. In common with hon. Members on both sides of the House I have cancelled all my constituency engagements, so I could willingly have managed another two. That reservation notwithstanding, I support the guillotine motion. The hon. Member for Copeland and other hon. Members know that all we are concerned about now is to tidy our business, make sure that the Finance Bill is passed, and get to the hustings. We are anxious to put the respective cases of the various parties. I am glad that the hon. Member for The Wrekin (Mr. Grocott) is nodding his head. It is absolutely necessary. It is important that we get back to the country. Dissolution must take place on Monday. I, for one, am delighted to pursue a vigorous campaign in support of policies in which I have great faith.Unfortunately, that belief will not be shared by the electorate.
It has not always been the case—the hon. Member for Newham, North-West (Mr. Banks) is right.—but I am delighted that it now is.
The sooner we can conclude our business tidily and in good order, the better. My right hon. Friend the Leader of the House has my full support. In spite of all that the hon. Member for Bolsover said a few moments ago with great eloquence, fervour, passion and sincerity, as the House has heard from me and my hon. Friend the Member for Nottingham, South (Mr. Brandon-Bravo), yesterday these were two tests of public opinion in by-elections. They are real tests of real voters' feelings. In both cases there was a resounding victory for the Conservative party. I have great faith in the policies that we will put forward in the general election. I want to get to the hustings as quickly as possible. The sooner we can finish our business today and wrap up the formalities on Monday, the better. The hon. Member for Copeland, for all his invective, knows that I am absolutely right and he, in his heart, agrees with every word.10.51 am
We probably could have finished our business a couple of hours earlier if we had not had this timetable motion. We could have got on with dealing with the Finance Bill instead of spending several hours discussing whether we should discuss it and, if so, at what length. The fact that we have it illustrates the attitude which the otherwise genial and affable Leader of the House displays to the conduct of parliamentary business. One of his phrases should chill any support of democracy to the bone. He said to his hon. Friends, "If we do not have the Asylum Bill here today and do not have it on Monday, it is because Opposition parties are opposing some parts of the Bill." I thought that that was what we were here for—to find out what features of Bills will not work very well or were wrong in principle, and oppose them, make it difficult for the Government to get them through, and subject them to the most careful scrutiny. The fact that somebody has thought of engaging in that act—in some cases the people involved, horror of horrors, are actually Conservatives: in this case, Conservatives in another place—has caused the Government such apoplexy that they produce a reason not to proceed with the Bill.
When Governments are brought under pressure as at the end of a Session, it is normal for them to try to seek accommodation, rather as the hon. Member for Southend, East (Sir T. Taylor), to see whether parties can agree on parts of the Bill that are important and should go ahead and it is in the general interest that they should go ahead. That process has gone on at the end of every Parliament I have served in. I have taken part in discussions with Ministers in previous Parliaments. It is funny that, all of a sudden, what the Liberal Democrats think becomes terribly important because the Government have realised that they cannot get their Bill through if we subject it to any scrutiny. Under previous Governments there were discussions designed to get maximum agreement between the parties on what could go ahead. That could have occurred in respect of these proceedings. The timetable motion is particularly vicious. It is a "Heads I win, tails you lose" motion. It contains the provision that the proceedingsThe object is quite simple. It is to escape the requirement that the House of Commons has traditionally had, that if a Government are to timetable a Bill there should be some obstacle to their doing so. The obstacle is removed, because if we discuss the timetable motion all the time taken is lost from the discussion of the Bill. I favour the timetabling of Bills. It is a sensible way to proceed. I was a member of the Committee chaired by the right hon. Member for Westmorland and Lonsdale (Mr. Jopling), to which the Leader of the House gave evidence. I was also a member of the Procedure Committee, chaired by the hon. Member for Honiton (Sir P. Emery). Both Committees recommended that there should be a timetable procedure for all Bills, but one based on a mechanism of consultation which ensures that the Government do not have total control over the amount of time available and the way in which it is divided, because if they have such control it is too easy for them. There is nothing in the proceedings of the House to prevent the Government from coming forward with a motion such as this, saying that proceedings on the Finance Bill shall end five minutes after they have begun —indeed, five minutes after the order to discuss the timetable has began. There is absolutely nothing to prevent them from doing so, other than the possibility that there may be more than a handful of determined democrats on the Conservative side of the House. Whenever such issues arise, and whenever we criticise timetable motions, the Leader of the House says how valuable the Bill is and that everybody agrees what a good Bill it is. That is not the point. Parliament must ensure that legislation on the statute book has been properly discussed and considered and is in a fit state of law to be put on the statute book. That will not happen if parliamentary procedures can be manipulated by the Government to suit their own convenience. That is what they are able to do with such a motion. That is why I oppose the motion, both the way in which it is being used and its form. The Leader of the House has explained that the motion is necessary in order to consider the Finance Bill. It is the thinnest Finance Bill I have ever seen. I am accustomed to sitting on Finance Bill Committees and carrying around a half inch thick Finance Bill and endless notes on clauses. This is a slight document. We could have disposed of the Bill fairly quickly. Perhaps there could have been a case for the timetable motion which set aside reasonably short periods in which we could have dealt with Second Reading, the principal clauses of the Bill, enabled hon. Members to vote against one or two features of it, and end the proceedings in perfectly good time. The Leader of the House chose not to do that because he prefers the nice easy device of saying, "I decide how long it is. Nobody else has any say in the matter. If they dare to challenge the timetable, that will be taken off the time available to discuss the Bill." That is a disgraceful way to run a Parliament. The next Parliament will not accept that treatment. That is because there will be plenty of Liberal Democrats who will be determined that Parliament should not be run in that way. I hope that members of other parties will feel that that is not the way to run Parliament and will take on board the recommendations of the Committees which have examined the matter in detail, and ensure that we do not consider business in this way in future. What I say applies not only to the dying days of the Session, but to the way in which the Government handle business all the time. These proceedings are much like those that we have had on many other Bills. Far from being in a hurry to have an election, the Government were putting the election off for as long as possible. They had all the time in the world. The Prime Minister did not want an election date. It used to be said that one of the Prime Minister's great advantages is being able to choose the date for the general election, but I get the impression that lately it has been one of the Prime Minister's main handicaps. He has had to go to bed each night wondering, "How can I put off having a general election? I wish that I did not have that awful decision." That has ceased to be one of his principal advantages. The Government are organising a closing-down sale: "Everything must go. Buy now before the end of today's business.""shall he brought to a conclusion four hours after the commencement of the proceedings on this Order."
Get on with it.
The Government Whip, the hon. Member for Derby, North (Mr. Knight) says, "Get on with it." The Government Whip is responsible for the timetable motion which ensures that, if any hon. Member actually wants to debate the details of the Bill, there is no provision to enable him to do so. Coming from the cesspit of the Government Whips office—[Interruption.] I am almost quoting the Prime Minister's words from the Dispatch Box yesterday. He said that Mr. Speaker seemed remarkably untainted by the years he spent in that evil institution. That is only the slightest of paraphrases. When hon. Members get into the Whips Office and into the office of the Leader of the House, they spend their lives devising ways of making sure that matters are not discussed and that there is no trouble. It is like a fire brigade equipped with a foam that is blown over the proceedings of Parliament with the sole objective of ensuring that the Government get their business through with as little proper consideration as possible.
We are considering a measure which has been introduced at the end of a Parliament and at the end of a term of office of a Government who chose to get rid of the same measure in the early years of their office. How can they come before the House today and say that we must hurry up and introduce a low tax rate band without any detailed discussion of its disadvantages because there are only a few minutes left in which to do it? They have had 12 years in which to explain why they were wrong in 1980. The Government have had 13 years during which, if a lower rate tax band would have been a great advantage, they could have allowed all the low-paid workers whom they believe will benefit from it to enjoy it—but no, it is simply part of the last minute closing down sale. During the debate there has been much discussion about the public sector borrowing requirement and the need to resolve matters today in the light of what the future PSBR might be. Here there is a problem for the Labour party. The Government are spending £2 billion on the lower rate band. The Labour party and my party agree that that is not a good way to behave in the present circumstances and that the measure is not an effective way of helping the low paid. The Labour party could spend that £2 billion on education, on investment to kick-start the economy or on the national health service, but it could not spend it on all three. If it did, the effect on any one of them would not be significant. It is our judgment that education needs an injection of about £2 billion to make up just some of the current deficiencies and shortcomings. It is our view that a great deal more than £2 billion needs to be injected in the way of investment in the economy to bring us quickly out of recession. We believe that such an injection could bring us out of recession if it got the construction industry moving, but it is not possible to spend the same £2 billion three times over, so the Labour party is faced with the prospect of borrowing more—not allowing the Conservative Government to choose the borrowing requirement for it —or raising more revenue by increasing taxes, or possibly both. The Labour party has an added problem. The Finance Bill and the Budget contain provisions for receipts from privatisation, which flow through every year and are part of the Government's assumptions about their borrowing requirement. I reckon that the Government will take about £1 billion per year from selling shares which they now hold in industries that they have already privatised. That is a significant sum of money. Presumably, the Labour party will not have that money from selling shares. Presumably it would not sell shares in the already privatised industries. In that case, it would have not £2 billion but £1 billion to spend. It would save only £1 billion by not introducing the tax reduction and could use only that sum for spending purposes. So the right hon. and learned Member for Monklands, East (Mr. Smith) has a great deal to think about between now and Tuesday if he is to find some way of making £1 billion stretch over all the problems that he has correctly identified, and on which I agree with him. The huge gap in the fabric of our society which we have to repair in the ways that I outlined last night, needs to be filled. It will not be filled by the Finance Bill. Those who would most benefit if we attended to creating jobs in the economy and getting out of recession would be the very low paid, who will benefit to only a limited extent from the key feature of the Finance Bill. If we had time to discuss the lower rate band in detail today, to obtain evidence from the Institute for Fiscal Studies, or to consider the leader in today's Financial Times, we would see what an inadequately and ineffectively targeted measure it is. The Finance Bill is fairly pathetic. We could have disposed of it in a couple of hours, without the need for the guillotine motion.11.3 am
I shall be brief. There is a procedural point, which was mentioned by the hon. Member for Berwick-upon-Tweed (Mr. Beith), on which we must have an assurance from my right hon. Friend the Leader of the House. We must have an assurance that this guillotine motion does not set a precedent. Following the report of my right hon. Friend the Member for Westmorland and Lonsdale (Mr. Jopling), the Chairman of the Select Committee on Sittings of the House, there is a strong body of opinion in the House that we should move towards allocation of time for all legislation.
It is fairly unusual—although not an absolute precedent—for a Finance Bill to be guillotined. The Procedure Committee and the Select Committee on Sittings of the House have accepted that the allocation of time for legislation should ensure that all clauses are properly debated. As Chairman of the Procedure Committee, I stand absolutely by that premise. I hope that my right hon. Friend the Leader of the House will endorse that when he replies. This allocation of time motion does not ensure that all clauses will be properly debated. The House understands—as, I believe even the hon. Member for Berwick-upon-Tweed accepts—that there is a desire to finish up the business, ensure that taxes can be collected and get on the hustings. That is a fair excuse and a good reason for the allocation of time motion. However, we must ensure, and I must ask my right hon. Friend to give an undertaking, that this motion will not be taken as a precedent for allocation of time motions in normal circumstances. It may be claimed that any allocation of time motion is not normal. If we are to move towards some allocation of time for all or most legislation at the start, we must ensure that it does not follow the precedent set today. I congratulate the shadow Leader of the House, who has been almost revolutionary in moving towards reform of the procedures of the House. I am grateful for the support that he has given to the Procedure Committee. Of course, I have thanked my right hon. Friend the Leader of the House on more than one occasion for the excellent way in which he has attempted to ensure that our procedure is more reasonably and properly carried through. However, it cannot be accepted that an allocation of time motion should form part of the time scale that it allocates to legislation. That is the danger of this motion, if it were copied in any other circumstances. The hon. Member for Berwick-upon-Tweed made that clear. It is possible that at the end of four hours we would not be able to debate any clause of the Finance Bill. That has not happened because, under the terms of the motion, the opening speeches and most of the other speeches have been allowed to go much wider than the allocation of time and to deal with the whole of the Finance Bill. Procedurally, that is not what an allocation of time motion ought to be about. Therefore, in procedural terms, such motions should not be emulated.It could easily happen that a Government legitimately believe that an Opposition party intend to frustrate the proceedings on a Bill—say, the Finance Bill. The Government could therefore table a timetable motion such as this one. Government Back Benchers who did not want the Bill to be discussed could then deliberately occupy the whole of the time allocated by the timetable motion, thereby preventing discussion on the Bill.
In theory, that is right; but the opposite case is that so long as the Chair does not call successive Members from one side, the opportunity is given, even with this allocation of time, for Opposition Members to raise any matter on the Finance Bill that they wish. Although in theory what the hon. Gentleman says is true reductio ad absurdum it is not correct in practice.
As it is possible to debate the Finance Bill, I shall spend two minutes on an aspect of the 20 per cent. band which has not been discussed. It is important in my constituency and many parts of the south-west. The 20 per cent. band is normally talked about in relation to low-wage earners. Another section of the community willl benefit considerably from that band—pensioners who have saved all their lives and put by a little money. They paid taxes on that saved money and hope to have a little extra in addition to their pension from their savings after they retire. They often have a decreasing income as a result of the ever-increasing cost of living and they will welcome the 20 per cent. band. It is a direct benefit to some extent to those pensioners who have saved and live on their pension and their savings. It will be of particular benefit to many people in the south-west. That argument has not been mentioned in the House and it ought to be understood and appreciated. In closing, will my right hon. Friend the Leader of the House give us his assurance that this type of allocation of time motion will not he used as a precedent in any move forward associated with the recommendations in the reports of the Select Committees on Procedure and on Sittings of the House?11.9 am
The hon. Member for Honiton (Sir P. Emery) need have no fears. The Government have had their time—13 years—and it is up. That is why they come to the House today as a Government on their uppers—buffetted, battered and bewildered. We can see that by the state that the Financial Secretary is in. They are bewildered by the reception that their Budget has received throughout the land, and especially within the square mile.
I have here a little list which follows something that the hon. Member for Honiton said. The Leader of the House has a fair amount of responsibility for much that is on it, because it is a list of all the Bills that have been truncated by the Government since they took office in 1979 and back to 1945. When one examines the list, one realises that this is only the third time in the history of the House that a Finance Bill has been truncated in this way. We are to be allowed four hours, while in 1968—when the House first truncated a Finance Bill—three days were spent on recommittal, four days on Third Reading and there were 10 sittings in Committee. In 1975, my hon. Friend the Member for Bolsover (Mr. Skinner) spoke in such a debate—about 17 years ago almost to the day—when four days were allowed for Third Reading. In all those other instances there was an opportunity for the House to consider the substance of the Bill, an opportunity to peruse it and to study it. I was amused, as were other Opposition Members—and, I fancy, some Conservative Members—at the opening words of the Leader of the House, because he told us that the Budget was a document which improved with the reading. That was the explanation of why it has taken so long to receive wider appreciation. We know that this morning the Government trail three points behind in the polls. We know that the Budget has been poorly received wherever it has been read. If it is a document that improves with study, why are we not being given more time to study it? Surely, if one uses that argument, the more we study it the better the Government will do in the opinion polls and the greater will be their opportunity to win the next general election, or so they believe. It does not make sense to truncate the Bill in this way. The Leader of the House went on to say that another reason why the Bill should be pushed through in this way is because we had an opportunity to consider it during the two-day debate on the Budget. Anyone who believes that any contribution that we heard from the Treasury benches and the Conservative side of the House assisted that debate in any way, has not heard the speeches that we heard. We only have to recall the lamentable performance of the Chancellor of the Exchequer last night. His speech consisted of a number of readings from a variety of responses by Tory hacks, posing as industrialists, up and down the land. They were Tory to a man—there was not a woman among them, because no woman reading the Budget would see anything in it for her. His quotations from those Tory hacks were reminiscent of a fading impresario. That was the guise of the Chancellor of the Exchequer last night—a fading impresario, knowing that his production was dead in the water, seeking by selective quotes to talk it up, in the hope that more people would attend the show. I wish that the Chancellor of the Exchequer had read a little more widely. I wish that he had opened the Financial Times the morning after the Budget to read the little item that I have here. I am anxious that the Leader of the House should have the opportunity to see and to study it. Indeed, I intend to give it to him so that he can respond appropriately when summing up. It says simply: "Economists give their ratings". Six exconomists—a broad cross-section of the City, none of whom could be described as "youthful scribblers"—Useless scribblers.
We shall let them know about that. Mr. Bill Martin, a well-known supporter of many of the Government's policies in the past, gives the score "1 out of 10". He said:
Mr. Kevin Gardiner of S. G. Warburg Securities gave it "4 out of 10" and said:"The budget will not act as a significant stimulus to the economy. The budget deficit is almost certainly out of control."
So it goes on, and it does not get any better. However, one has to be fair, so let us look at one higher mark. Mr. Gavyn Davies of Goldman Sachs gave the Government "6 out of 10", saying:"The chancellor was neither bold nor coherent. It was rather a mismash."
The Budget's contribution to that has been to make them slip further in the polls. Those were the reviews in the City on the following day. Is it any wonder that the Government want to truncate the debate? I did not hear any response to the valid constitutional argument of the hon. Member for Honiton and the valid constitutional arguments of my hon. Friend the shadow Leader of the House. There has been no response from the Government Benches about the propriety of what they are seeking to do. My hon. Friend the Member for Bolsover will remember—he was on the Government Benches at the time—the nature of the contribution made by Conservative Members during the debate in March 1975 on the truncation of the Finance Bill. I have read his contribution—"It falls between every conceivable stool. It does not put Labour on the spot and it does not transform the Conservatives' electoral position."
You are not going to read it, are you?
I shall not embarrass my hon. Friend by reading it, out, save to say that it is well worth reading. Conservative Members made a number of contributions —a number are voices from the past. Two former Chancellors spoke during that debate. The right hon. Member for Blaby (Mr. Lawson) was among them, as was his predecessor. They spoke against the use of a guillotine on Finance Bills. They produced a variety of constitutional arguments why it was totally improper and absolutely wrong ever to use such a guillotine. They are figures of the past. As my hon. Friend the Member for Bolsover said, to some extent they can be put to one side, because that is precisely what their party has done to them.
One other person spoke with great force and vigour in that debate against the Government of the day for introducing a guillotine motion in relation to the Finance Bill. Who might that have been? Let me say this: he is a former chairman of the Conservative party.The right hon. Member for Chingford (Mr. Tebbit).
The right hon. Member for Chingford (Mr. Tebbit) is another figure from the past. We can discount him. This person is still hanging around. That is surprising, bearing in mind the muddle and confusion that he has created in every Department of state that he has ever sought. [HON. MEMBERS: "Ah."] My hon. Friends recognise the person, and I suspect that right hon. and hon. Gentlemen will also recognise the person. In those days, that person was going under the guise of the hon. Member for St. Marylebone. Since then, he has been translated into the right hon. Member for Mole Valley (Mr. Baker). Yes, I speak of no less a person than he. The right hon. Gentleman is very much around and will undoubtedly be very much in evidence on the hustings during the next few weeks. I hope that he is very much in evidence, because every time that man shows his face on the hustings or on television, it is another vote for us. The more the Tories put him forward, the better it will be. He should be a member of the A-plus team, because he can only benefit our campaign. What did the right hon. Gentleman have to say on 4 March 1975 during the allocation of time motion on the Finance Bill? He said:
that is not something that he always does or says in a speech— "I end very much as I started"—
blah, blah, blah. He went on in the usual vein: "by regretting the need for guillotine motions in general: but the particular character of this guillotine motion makes it unique. Since the war only one Finance Bill, that in 1968, has been guillotined. I believe that that was a very regrettable precedent because the unique power that we have"—
Characteristically, the right hon. Gentleman, by talking about "Tory, Liberal or Conservative" omitted altogether the Labour party. Indeed, he was subsequently taken to task by the House for that omission—a characteristic omission, because for him, we on this side of the House have no rights. Those who represent the interests of the people are not to be regarded. It was a Freudian slip. The right hon. Gentleman continued: "It is because we have the right to deny the executive of the day, whether Tory, Liberal or Conservative, Supply before there has been adequate debate or redress of grievance."
That is the right hon. Member for Mole Valley. We look forward very much to seeing in which Division Lobby he will pass in a few moments' time. Will he adhere to his principles? Will he stand firm and fast? If he does, it will be the first time we see him do anything of the sort. I suspect that he will vote to impose a guillotine on this Bill. In doing so, he will deny the British people redress for their grievances."If we surrender that right we are surrendering one of the very reasons that have brought us into being as a legislative House. For these reasons I very much oppose this guillotine measure."—[Official Report, 4 March 1975; Vol. 887, c. 1331.]
Will the hon. Gentleman give way?
Not at the moment.
The right hon. Gentleman will deny the homeless, the jobless, mothers of young children who want an increase in child benefit and pensioners the opportunity to have their grievances properly aired in this Chamber today. But we will go out and about on the hustings and do more, much more than truncate the timing of this debate: we will truncate for the foreseeable future the political future of that discredited and redundant Government opposite.11.23 am
I thank the hon. Member for Copeland (Dr. Cunningham) and my hon. Friends the Members for Staffordshire, South (Mr. Cormack) and for Honiton (Sir P. Emery) for their kind remarks about me in my role as Leader of the House. I am glad to have this opportunity to thank the hon. Member for Copeland for the courteous and constructive way in which he has made it possible for us to work together on the affairs of the House. We have made considerable progress in several directions, and I pay tribute to him for the part that he has played in that.
My hon. Friend the Member for Southend, East (Sir T. Taylor) asked whether there would be some opportunity to discuss other detailed points of taxation, including the taxation of beach huts. I cannot promise him that beach huts will feature immediately in the next Finance Bill, but when the House returns we shall have the opportunity to have a second Finance Bill which will implement the other areas of the Budget and no doubt my hon. Friend will wish to table his amendment on beach huts then. My hon. Friend the Member for Honiton raised a procedural point on this allocation of time motion, and the hon. Member for Brent, South (Mr. Boateng) made heavy weather of it. My hon. Friend made a fair point. It is fairly obvious to the whole House that this Finance Bill is being considered in rather unusual circumstances. That destroys the whole of the hon. Gentleman's argument when he complained about my right hon. Friend the Home Secretary. My right hon. Friend's remarks were made in relation to a large Finance Bill well ahead of a general election, so the position is not comparable. It was interesting that the hon. Gentleman wanted to continue debating this Finance Bill. I suspect that that is because at the back of his mind he would rather postpone going to the country at this election. He has every reason to do so from his point of view. I hope that that is an appropriate answer to my hon. Friend's question.The point I wanted to make to the hon. Member for Brent, South (Mr. Boateng) was that the debate in March 1975 was followed by an election. The Labour party lost its first by-election when it was in government, and virtually every other by-election until 1979. Labour Members should therefore be rather more careful about their approach to finance and taxation.
As I must be brief, I shall not respond to my hon. Friend's point.
In response to the hon. Gentleman's comments about the reactions to the Budget, I have a whole string of favourable responses from large sections of industry, including the CBI, which I do not have time to repeat but which put it in the right context. Just as the hon. Gentleman's response was a travesty of the general reactions to the Budget, so were the remarks of the hon. Member for Copeland about the economy as a whole. During the overall period of Conservative government, the United Kingdom economy has grown faster than that of almost every other economy in Europe for most of the 1980s. GDP, investment in manufacturing and productivity have grown faster than in Germany or France in the 1980s. There has been an increase in real take-home pay for a married couple on average earnings with two children. It is up by £78 a week at today's prices. The majority of pensioners have seen an increase in their real living standards of over one third and there has been a heavy concentration of Government resources on less well-off pensioners, including £700 million to the over-80s on income support. We have seen 4 million families buying their home for the first time. There are a third more businesses than there were in 1979. We have seen an increase of more than 1·5 million in the self-employed. A higher proportion of the work force is in employment than in any other European country, except Denmark. Our manufacturing industry has taken a greater share of world trade in each of the past three years. I have already referred to the massive increase in business investment, capital investment and training. One aspect of that is inward investment. The right hon. and learned Member for Monklands, East (Mr. Smith) in his speech on Wednesday fantasised about the thoughts of Japanese business men and what they say about the economic policies that we have been pursuing. He does not need to fantasise. We see what they think from their reactions in surveys when they have invested here and, above all, in their practical actions and the amount of inward investment that they have made here, accounting for more than half of all Japanese investment into the European Community in the latest year for which figures are available. Those are the actual reactions of business men to our economic policies. It is that solid record of economic achievement that has led the CBI to say that Britain is now incomparably better placed to met the competitive challenges of the 1990s than it was at the start of the 1980s. This Budget carries that process on. My hon. Friend the Member for Staffordshire, South refered to yesterday's local by-elections, in which we saw a good response. That also shows that the contortions that the Labour party has performed over its tax proposals and spending commitments in recent weeks mean that the people of this country do not trust Labour. They can be sure that the Labour party is the party of high spenders, high taxers, high borrowers and high inflation. That is why I have no doubt what the response will be when we go to the hustings. The Budget will help us in that process.Question put:—
The House divided: Ayes 321, Noes 149.
Division No. 110]
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AYES
| |
Adley, Robert | Allason, Rupert |
Alexander, Richard | Amess, David |
Alison, Rt Hon Michael | Amos, Alan |
Arbuthnot, James | Farr, Sir John |
Arnold, Jacques (Gravesham) | Fenner, Dame Peggy |
Ashby, David | Field, Barry (Isle of Wight) |
Aspinwall, Jack | Finsberg, Sir Geoffrey |
Atkins, Robert | Fishburn, John Dudley |
Atkinson, David | Fookes, Dame Janet |
Baker, Nicholas (Dorset N) | Forman, Nigel |
Banks, Robert (Harrogate) | Forsyth, Michael (Stirling) |
Batiste, Spencer | Forth, Eric |
Beaumont-Dark, Anthony | Fowler, Rt Hon Sir Norman |
Bellingham, Henry | Fox, Sir Marcus |
Bendall, Vivian | Franks, Cecil |
Bennett, Nicholas (Pembroke) | Freeman, Roger |
Bevan, David Gilroy | French, Douglas |
Biffen, Rt Hon John | Fry, Peter |
Blaker, Rt Hon Sir Peter | Gale, Roger |
Body, Sir Richard | Gardiner, Sir George |
Bonsor, Sir Nicholas | Gill, Christopher |
Boscawen, Hon Robert | Gilmour, Rt Hon Sir Ian |
Boswell, Tim | Glyn, Dr Sir Alan |
Bottomley, Peter | Goodhart, Sir Philip |
Bottomley, Mrs Virginia | Goodlad, Rt Hon Alastair |
Bowden, A. (Brighton K'pto'n) | Goodson-Wickes, Dr Charles |
Bowden, Gerald (Dulwich) | Gorman, Mrs Teresa |
Bowis, John | Gorst, John |
Boyson, Rt Hon Dr Sir Rhodes | Grant, Sir Anthony (CambsSW) |
Braine, Rt Hon Sir Bernard | Greenway, John (Ryedale) |
Brandon-Bravo, Martin | Gregory, Conal |
Brazier, Julian | Griffiths, Peter (Portsmouth N) |
Bright, Graham | Ground, Patrick |
Brooke, Rt Hon Peter | Grylls, Sir Michael |
Brown, Michael (Brigg & Cl't's) | Hague, William |
Bruce, Ian (Dorset South) | Hamilton, Rt Hon Archie |
Buck, Sir Antony | Hampson, Dr Keith |
Budgen, Nicholas | Hanley, Jeremy |
Burns, Simon | Hannam, Sir John |
Burt, Alistair | Hargreaves, A. (B'ham H'll Gr') |
Butler, Chris | Hargreaves, Ken (Hyndburn) |
Butterfill, John | Harris, David |
Carlisle, John, (Luton N) | Haselhurst, Alan |
Carlisle, Kenneth (Lincoln) | Hawkins, Christopher |
Carrington, Matthew | Hayes, Jerry |
Carttiss, Michael | Hayhoe, Rt Hon Sir Barney |
Cash, William | Hayward, Robert |
Chalker, Rt Hon Mrs Lynda | Heath, Rt Hon Edward |
Channon, Rt Hon Paul | Heathcoat-Amory, David |
Chapman, Sydney | Hicks, Mrs Maureen (Wolv' NE) |
Churchill, Mr | Hicks, Robert (Cornwall SE) |
Clark, Rt Hon Alan (Plymouth) | Higgins, Rt Hon Terence L. |
Clark, Dr Michael (Rochford) | Hill, James |
Clark, Rt Hon Sir William | Hind, Kenneth |
Clarke, Rt Hon K. (Rushcliffe) | Howard, Rt Hon Michael |
Colvin, Michael | Howarth, Alan (Strat'd-on-A) |
Conway, Derek | Howarth, G. (Cannock & B'wd) |
Coombs, Anthony (Wyre F'rest) | Howe, Rt Hon Sir Geoffrey |
Coombs, Simon (Swindon) | Howell, Rt Hon David (G'dford) |
Cope, Rt Hon Sir John | Howell, Ralph (North Norfolk) |
Cormack, Patrick | Hughes, Robert G. (Harrow W) |
Couchman, James | Hunt, Sir John (Ravensbourne) |
Cran, James | Hunter, Andrew |
Critchley, Julian | Irvine, Michael |
Currie, Mrs Edwina | Jack, Michael |
Curry, David | Jackson, Robert |
Davies, Q. (Stamf'd & Spald'g) | Janman, Tim |
Davis, David (Boothferry) | Jessel, Toby |
Day, Stephen | Johnson Smith, Sir Geoffrey |
Devlin, Tim | Jones, Gwilym (Cardiff N) |
Dickens, Geoffrey | Jones, Robert B (Herts W) |
Dorrell, Stephen | Jopling, Rt Hon Michael |
Douglas-Hamilton, Lord James | Kellett-Bowman, Dame Elaine |
Dover, Den | Key, Robert |
Dunn, Bob | Kilfedder, James |
Durant, Sir Anthony | King, Roger (B'ham N'thfield) |
Dykes, Hugh | Kirkhope, Timothy |
Eggar, Tim | Knight, Greg (Derby North) |
Emery, Sir Peter | Knight, Dame Jill (Edgbaston) |
Evans, David (Welwyn Hatf'd) | Knowles, Michael |
Evennett, David | Knox, David |
Fairbairn, Sir Nicholas | Lamont, Rt Hon Norman |
Fallon, Michael | Latham, Michael |
Lawrence, Ivan | Rost, Peter |
Lawson, Rt Hon Nigel | Rowe, Andrew |
Lee, John (Pendle) | Rumbold, Rt Hon Mrs Angela |
Leigh, Edward (Gainsbor'gh) | Ryder, Rt Hon Richard |
Lennox-Boyd, Hon Mark | Sackville, Hon Tom |
Lester, Jim (Broxtowe) | Sainsbury, Rt Hon Tim |
Lightbown, David | Sayeed, Jonathan |
Lloyd, Sir Ian (Havant) | Scott, Rt Hon Nicholas |
Lloyd, Peter (Fareham) | Shaw, David (Dover) |
Lord, Michael | Shaw, Sir Giles (Pudsey) |
Luce, Rt Hon Sir Richard | Shaw, Sir Michael (Scarb') |
Lyell, Rt Hon Sir Nicholas | Shelton, Sir William |
McCrindle, Sir Robert | Shephard, Mrs G. (Norfolk SW) |
MacGregor, Rt Hon John | Shepherd, Colin (Hereford) |
MacKay, Andrew (E Berkshire) | Shersby, Michael |
Maclean, David | Sims, Roger |
McLoughlin, Patrick | Skeet, Sir Trevor |
McNair-Wilson, Sir Michael | Smith, Sir Dudley (Warwick) |
McNair-Wilson, Sir Patrick | Smith, Tim (Beaconsfield) |
Malins, Humfrey | Soames, Hon Nicholas |
Mans, Keith | Speed, Keith |
Maples, John | Speller, Tony |
Marland, Paul | Spicer, Sir Jim (Dorset W) |
Marlow, Tony | Spicer, Michael (S Worcs) |
Marshall, John (Hendon S) | Squire, Robin |
Marshall, Sir Michael (Arundel) | Stanbrook, Ivor |
Martin, David (Portsmouth S) | Stanley, Rt Hon Sir John |
Mates, Michael | Stern, Michael |
Maude, Hon Francis | Stevens, Lewis |
Mawhinney, Dr Brian | Stewart, Allan (Eastwood) |
Maxwell-Hyslop, Sir Robin | Stewart, Andy (Sherwood) |
Mayhew, Rt Hon Sir Patrick | Stewart, Rt Hon Sir Ian |
Mellor, Rt Hon David | Stokes, Sir John |
Meyer, Sir Anthony | Sumberg, David |
Miller, Sir Hal | Summerson, Hugo |
Mills, Iain | Tapsell, Sir Peter |
Mitchell, Andrew (Gedling) | Taylor, Ian (Esher) |
Mitchell, Sir David | Taylor, Sir Teddy |
Moate, Roger | Tebbit, Rt Hon Norman |
Monro, Sir Hector | Temple-Morris, Peter |
Montgomery, Sir Fergus | Thompson, Sir D. (Calder Vly) |
Morris, M (N'hampton S) | Thompson, Patrick (Norwich N) |
Morrison, Sir Charles | Thorne, Neil |
Morrison, Rt Hon Sir Peter | Thornton, Malcolm |
Moss, Malcolm | Thurnham, Peter |
Moynihan, Hon Colin | Townend, John (Bridlington) |
Neale, Sir Gerrard | Townsend, Cyril D. (B'heath) |
Nelson, Anthony | Tracey, Richard |
Neubert, Sir Michael | Tredinnick, David |
Newton, Rt Hon Tony | Trotter, Neville |
Nicholls, Patrick | Twinn, Dr Ian |
Nicholson, David (Taunton) | Vaughan, Sir Gerard |
Nicholson, Emma (Devon West) | Viggers, Peter |
Norris, Steve | Waldegrave, Rt Hon William |
Onslow, Rt Hon Cranley | Walden, George |
Oppenheim, Phillip | Walker, Bill (T'side North) |
Page, Richard | Waller, Gary |
Paice, James | Walters, Sir Dennis |
Parkinson, Rt Hon Cecil | Ward, John |
Patnick, Irvine | Wardle, Charles (Bexhill) |
Patten, Rt Hon John | Warren, Kenneth |
Pattie, Rt Hon Sir Geoffrey | Watts, John |
Pawsey, James | Wells, Bowen |
Peacock, Mrs Elizabeth | Wheeler, Sir John |
Porter, Barry (Wirral S) | Whitney, Ray |
Porter, David (Waveney) | Widdecombe, Ann |
Portillo, Michael | Wiggin, Jerry |
Price, Sir David | Wilkinson, John |
Raison, Rt Hon Sir Timothy | Wilshire, David |
Rathbone, Tim | Wolfson, Mark |
Redwood, John | Wood, Timothy |
Renton, Rt Hon Tim | Woodcock, Dr. Mike |
Rhodes James, Sir Robert | Yeo, Tim |
Riddick, Graham | Young, Sir George (Acton) |
Ridley, Rt Hon Nicholas | Younger, Rt Hon George |
Ridsdale, Sir Julian | |
Rifkind, Rt Hon Malcolm | Tellers for the Ayes:
|
Roberts, Rt Hon Sir Wyn | Mr. John M. Taylor and
|
Roe, Mrs Marion | Mr. Neil Hamilton.
|
Rossi, Sir Hugh |
NOES
| |
Allen, Graham | Jones, Martyn (Clwyd S W) |
Anderson, Donald | Kumar, Dr. Ashok |
Archer, Rt Hon Peter | Leadbitter, Ted |
Armstrong, Hilary | Leighton, Ron |
Ashley, Rt Hon Jack | Lestor, Joan (Eccles) |
Banks, Tony (Newham NW) | Lewis, Terry |
Barnes, Harry (Derbyshire NE) | Litherland, Robert |
Barron, Kevin | Livingstone, Ken |
Battle, John | Lofthouse, Geoffrey |
Beckett, Margaret | Loyden, Eddie |
Beith, A. J. | McKay, Allen (Barnsley West) |
Bell, Stuart | McWilliam, John |
Benn, Rt Hon Tony | Madden, Max |
Bennett, A. F. (D'nt'n & R'dish) | Mahon, Mrs Alice |
Benton, Joseph | Marek, Dr John |
Blunkett, David | Meacher, Michael |
Boateng, Paul | Meale, Alan |
Boyes, Roland | Michael, Alun |
Bradley, Keith | Michie, Bill (Sheffield Heeley) |
Brown, Nicholas (Newcastle E) | Mitchell, Austin (G't Grimsby) |
Caborn, Richard | Morgan, Rhodri |
Callaghan, Jim | Morley, Elliot |
Campbell, Menzies (Fife NE) | Morris, Rt Hon A. (W'shawe) |
Campbell, Ron (Blyth Valley) | Morris, Rt Hon J. (Aberavon) |
Campbell-Savours, D. N. | Mowlam, Marjorie |
Cartwright, John | Mullin, Chris |
Clark, Dr David (S Shields) | Murphy, Paul |
Clelland, David | Oakes, Rt Hon Gordon |
Clwyd, Mrs Ann | O'Brien, William |
Cohen, Harry | O'Hara, Edward |
Cook, Frank (Stockton N) | Orme, Rt Hon Stanley |
Corbyn, Jeremy | Owen, Rt Hon Dr David |
Cousins, Jim | Patchett, Terry |
Cox, Tom | Pendry, Tom |
Crowther, Stan | Powell, Ray (Ogmore) |
Cummings, John | Prescott, John |
Cunliffe, Lawrence | Primarolo, Dawn |
Cunningham, Dr John | Quin, Ms Joyce |
Davies, Rt Hon Denzil (Llanelli) | Radice, Giles |
Davies, Ron (Caerphilly) | Randall, Stuart |
Dixon, Don | Redmond, Martin |
Dobson, Frank | Rees, Rt Hon Merlyn |
Duffy, Sir A. E. P. | Richardson, Jo |
Dunwoody, Hon Mrs Gwyneth | Robinson, Geoffrey |
Eastham, Ken | Rooker, Jeff |
Edwards, Huw | Ross, Ernie (Dundee W) |
Enright, Derek | Rowlands, Ted |
Evans, John (St Helens N) | Ruddock, Joan |
Faulds, Andrew | Sedgemore, Brian |
Fearn, Ronald | Sheerman, Barry |
Field, Frank (Birkenhead) | Sheldon, Rt Hon Robert |
Fisher, Mark | Shore, Rt Hon Peter |
Flannery, Martin | Skinner, Dennis |
Flynn, Paul | Smith, Andrew (Oxford E) |
Foster, Derek | Smith, C. (Isl'ton & F'bury) |
Fraser, John | Smith, Rt Hon J. (Monk'ds E) |
Garrett, Ted (Wallsend) | Spearing, Nigel |
Gilbert, Rt Hon Dr John | Steinberg, Gerry |
Golding, Mrs Llin | Straw, Jack |
Gould, Bryan | Taylor, Mrs Ann (Dewsbury) |
Grant, Bernie (Tottenham) | Taylor, Rt Hon J. D. (S'ford) |
Griffiths, Win (Bridgend) | Thompson, Jack (Wansbeck) |
Grocott, Bruce | Turner, Dennis |
Hain, Peter | Walley, Joan |
Hardy, Peter | Wardell, Gareth (Gower) |
Hattersley, Rt Hon Roy | Welsh, Andrew (Angus E) |
Haynes, Frank | Welsh, Michael (Doncaster N) |
Henderson, Doug | Williams, Rt Hon Alan |
Hinchliffe, David | Williams, Alan W. (Carm'then) |
Howarth, George (Knowsley N) | Winnick, David |
Howells, Geraint | Wise, Mrs Audrey |
Howells, Dr. Kim (Pontypridd) | Young, David (Bolton SE) |
Hoyle, Doug | |
Hughes, Roy (Newport E) | Tellers for the Noes:
|
Hughes, Simon (Southwark) | Mr. Eric Illsley and
|
Janner, Greville | Mr. Robert Wareing.
|
Jones, Barry (Alyn & Deeside) |
Question accordingly agreed to.
Resolved,
That the following provisions shall apply to the proceedings on the Finance Bill and the Further and Higher Education (Scotland) Bill:—
Second Reading, Committee, Report And Third Reading: Finance Bill
1.—(1) The proceedings on Second Reading, in Committee and on consideration and Third Reading of the Finance Bill shall be completed at this day's sitting and, if not previously brought to a conclusion, shall be brought to a conclusion four hours after the commencement of the proceedings on this Order.
(2) Any stage of the Finance Bill may be proceeded with at the conclusion of the preceding stage, notwithstanding the practice of the House as to the interval between stages of a Bill brought in on Ways and Means resolutions.
(3) On completion of Second Reading of the Finance Bill any Question necessary for the House immediately to resolve itself into a Committee of the whole House shall be put forthwith.
(4) On the conclusion of the proceedings in Commit tee on the Finance Bill the Chairman shall report the Bill to the House without putting any Question and, if he reports the Bill with amendments, the House shall proceed to consider the Bill as amended without any Question being put.
(5) No Motion shall be made to alter the order in which proceedings in Committee or on consideration of the Finance Bill are taken.
(6) Standing Order No. 80 (Business Committee) shall not apply to this Order.
Lords Amendments: Further And Higher Education (Scotland) Bill
2. The proceedings on Consideration of Lords Amendments to the Further and Higher Education (Scotland) Bill shall be completed at this day's sitting and, if not previously brought to a conclusion, shall be brought to a conclusion one hour after the commencement of those proceedings.
Conclusion Of Proceedings
3.—(1) This paragraph applies in relation to any proceedings on the Finance Bill which are to be brought to a conclusion at this day's sitting in accordance with paragraph 1.
(2) For the purpose of bringing to a conclusion any proceedings which have not previously been brought to a conclusion, the Chairman or Mr. Speaker shall forthwith put the following Questions (but no others)—
(3) Proceedings under sub-paragraph (2) shall not be interrupted under any Standing Order relating to the sittings of the House.
4.—(1) This paragraph applies in relation to any proceedings on the Further and Higher Education (Scotland) Bill which are to be brought to a conclusion at this clay's sitting in accordance with paragraph 2.
(2) For the purpose of bringing to a conclusion any proceedings which have not previously been brought to a conclusion—
(2) Proceedings under sub-paragraph (1) shall not be interrupted under any Standing Order relating to the sittings of the House.
Dilatory Motions
5. No dilatory Motion with respect to, or in the course of, the proceedings at this day's sitting on either of the Bills to which this Order applies shall be made except by a Minister of the Crown, and the Question on any such Motion shall be put forthwith.
Extra Time
6.—(l) Paragraph (1) of Standing Order No. 14 (Exempted business) shall apply to proceedings at this day's sitting on both of the Bills to which this Order applies.
(2) If the proceedings on the Motion for this Order were interrupted, or the proceedings on the Finance Bill are interrupted, under paragraph (4) of Standing Order No. 11 (Questions of an urgent character which relate to matters of public importance etc.), the time at which proceedings on that Bill would otherwise be brought to a conclusion in accordance with paragraph 1 shall be extended by a period equal to the duration of the interruption.
(3) If the proceedings of the Further and Higher Education (Scotland) Bill are interrupted under paragraph (4) of Standing Order No. 11, the time at which proceedings on that Bill would otherwise be brought to a conclusion in accordance with paragraph 2 shall be extended by a period equal to the duration of the interruption.
Supplemental Orders
7. (1) The proceedings on any Motion made by a Minister of the Crown for varying or supplementing the provisions of this Order shall, if not previously concluded, be brought to a conclusion one hour after they have been commenced.
(2) If at this day's sitting the House is adjourned, or if this day's sitting is suspended, before the time at which any proceedings are to be brought to a conclusion under this Order, no notice shall be required of a Motion moved at the next sitting by a Minister of the Crown for varying or supplementing the provisions of this Order.
Saving
8. Nothing in this Order shall prevent any proceedings to which this Order applies from being taken or completed earlier than is required by this Order.
Recommittal
9.—(1) References in this Order to proceedings on consideration or proceedings on Third Reading include references to proceedings at those stages respectively, for, on or in consequence of, recommittal.
(2) No debate shall be permitted on any Motion to recommit either of the Bills to which this Order applies (whether as a whole or otherwise), and Mr. Speaker shall put forthwith any Question necessary to dispose of the Motion, including the Question on any amendment moved to the Question.
Further And Higher Education (Scotland) Bill Stages Subsequent To First Consideration Of Lords Amendments
10. Mr. Speaker shall put forthwith the Question on any Motion made by a Minister of the Crown for the consideration forthwith of any further Message from the Lords on the Further and Higher Education (Scotland) Bill.
11. The Proceedings on any such further Message from the Lords shall, if not previously brought to a conclusion, be brought to a conclusion one hour after the commencement of those proceedings.
12. For the purpose of bringing those proceedings to a conclusion—
Supplemental
13.—(1) Mr. Speaker shall put forthwith the Question on any Motion made by a Minister of the Crown for the appointment and quorum of a Committee to draw up Reasons.
(2) A Committee appointed to draw up Reasons shall report before the conclusion of the sitting at which it is appointed.
14. In this Order "the proceedings", in relation to the Further and Higher Education (Scotland) Bill includes proceedings on any further Message from the Lords on the Bill, on the appointment and quorum of a Committee to draw up Reasons and on the Report of such a Committee.
Finance Bill
Order for Second Reading read.
11.41 am
I beg to move, That the Bill be now read a Second time.
This short Bill contains those Budget measures that the Government consider it essential to pass into law before Parliament is dissolved and they put the Budget changes implemented on Budget day beyond legal doubt. I shall set out for the House what each of the clauses contain and then say something about the principal point of controversy, the reduction in the rate of income tax to 20p for the first £2,000 of income. Clauses 1, 2, 3 and 4 confirm changes to excise duties implemented on Budget day. Clause I confirms the indexation of duties on alcohol—the rise of 4½ per cent. that my right hon. Friend the Chancellor announced. Clause 2 confirms the increase in duties on tobacco by about indexation on pipe tobacco and by 10 per cent. on cigarettes and other tobacco products. Clause 3 covers duty on petrol, diesel and other oils and confirms the indexation of duty on petrol and unleaded petrol and the rise in duty on leaded petrol by 7½ per cent. All those changes, as is normal with excise duties, came into force at 6 o'clock on Budget day. In addition, at midnight on Budget day, vehicle excise duties on cars went up to £110; clause 4 confirms that change. It also reduces the duty on small tricycles from £50 to £15—a small but welcome change to the users of those tricycles. Clause 8, which reduces car tax from 10 to 5 per cent.—we know that that has already had a beneficial effect on the retail sales of motor cars—falls into the same category. So, too, does clause 7, which cuts the rate of VAT serious misdeclaration penalty and default surcharge. The lower rate of serious misdeclaration penalty has effect from Budget day. The lower maximum for default surcharge has effect from 1 April because this penalty is linked to monthly accounting periods. The House gave provisional statutory effect to these changes on Budget day, but, under the Provisional Collection of Taxes Act 1968, they must be confirmed by a Finance Bill before Parliament is dissolved. If not, Customs and Excise would be obliged to repay the extra tax that it had collected. Clause 5 concerns another excise duty, betting duty. The reduction from 8 to 7 per cent. will have effect from 1 April, which is a convenient date for bookmakers who pay tax monthly. Clause 6 deals with monthly payments on account for the largest VAT traders. I should perhaps say a word or two of further detail about that. I am sure that the hon. Member for Brent, South (Mr. Boateng), having recovered from his exertions earlier this morning, is interested in this.We are waiting for a joke.
If the hon. Gentleman is looking for a joke, I will show him a mirror. That is just to show that I am awake and not entirely reliant on my brief.
Last autumn, my right hon. Friend the Chancellor announced that, with the completion of the single market, some 90,000 businesses which bring goods and services into the United Kingdom from the rest of the EC would benefit from changes to VAT accounting procedures, but the reintroduction of the system known as postponed accounting carries a once-off cash-flow cost. So as not to increase the public sector borrowing requirement in 1992–93, my right hon. Friend announced that the largest VAT payers would be required both to account for and pay VAT monthly from the autumn of 1992. A number of companies have suggested that the requirement to make monthly returns as well as monthly payments imposes a needless burden, so my right hon. Friend the Chancellor acknowledged in the Budget that there was something in this point and agreed to drop the requirement to make monthly returns. Therefore, companies will now be asked only to make monthly payments on account. In the meantime, some companies have raised questions, as they are fully entitled to do, about the Government's powers in this area and have instituted proceedings for judicial review. With some six months to go until monthly payments are to be introduced, it is important to end uncertainty. Businesses require a clear basis on which to plan and that is provided for in clause 6, which puts beyond doubt the Government's powers to require some traders to make monthly payments on account. The two remaining substantive clauses deal with income tax. Income tax must be renewed each year and, if that is not done, no income tax can be collected. The tax has to be renewed by 5 May every year. There would not be time to be sure of doing this after the election, so clause 10 reimposes income tax for 1992–93. Nearly 25 million people pay income tax and most never see an income tax return. They pay all their tax through PAYE and each year the Budget requires the Inland Revenue and employers to undertake a major recoding exercise for everyone on PAYE. If the Government had renewed income tax before the election and done nothing else, all the income tax allowances and the basic rate limit would have been raised under the statutory indexation provisions. The Revenue would have had to undertake one recoding exercise to implement those changes and a second after the election to implement any changes contained in the second post-election Finance Bill which would be necessary. That would have been wasteful for the Inland Revenue and employers and confusing for taxpayers. That is why the Government have concluded that it is right to ask Parliament to confirm all the major income tax changes in the Budget and that is why clause 9 provides for the introduction of a lower rate of income tax, chargeable on the first £2,000 of taxable income. It also gives us a chance to establish a serious difference of view on this matter between the Conservative party and Opposition parties.In discussing the effect on the Inland Revenue, will the Chief Secretary confirm or qualify the report in the Financial Times this morning that the Inland Revenue will need 800 additional staff to deal with all the pensioners who, in order to obtain the lower rate band for their savings, will have to put in a claim for the difference between the standard rate and the new lower rate? Is the figure of 800 initial jobs in the Inland Revenue correct or will it be a lower figure? If so, can the right hon. and learned Gentleman say what it will be?
The figure is not correct. I do not have the exact figure, but it will be a great deal lower.
It is astonishing that the Chief Secretary does not know that figure, as the additional staff required is one of the strongest arguments against the proposal for a lower rate band. I am in favour of lower rate bands, but I accept that that costs a considerable amount in payments for additional staff. The number of civil servants in the Inland Revenue has been reduced. I do not know how they will cope unless there is a large increase in numbers to deal with the large number of inquiries from those who have paid tax at 25 per cent. on dividends, interest or whatever. Even with quite small sums, they will want to reclaim the difference between the 25 per cent. and the new 20 per cent. band. Inland Revenue officials could be dealing with sums as small as £5, £10 or £20, which are out of line with the amount of time that such claims will take to process.
I understand that the Inland Revenue anticipates a need for up to 300 additional staff in the first year and possibly more in subsequent years, depending on the take-up rate. The right hon. Gentleman's intervention makes clear the Labour party's extraordinary intellectual contortions. On the one hand, he says that he favours a reduction in the tax rate, but, on the other, he made a lengthy intervention putting the case against that. The fact that he is here shows that he is willing, ready and able to vote against the proposal. I find his position unconvincing. Indeed, my respect for him would be enhanced if I thought that he also found that unconvincing. I am sure that he does in his innermost thoughts, but I leave it to him.
Was not the right hon. Member for Ashton-under-Lyne (Mr. Sheldon) Financial Secretary to the Treasury when the Labour Government reduced the rate of income tax? He knows that the Inland Revenue can cope with that. Is not the real point the fact that, whereas under his Labour Government the standard rate was 30p and the reduced rate 25p, now the standard rate is 25p and the reduced rate 20p?
As I have reminded the House before, the right hon. Member for Ashton-under-Lyne was a Treasury Minister throughout the chaos and confusion of Labour's last period in office.
As well as renewing tax, clause 10 sets the lower rate at 20 per cent. and overrides indexation for the basic rate limit and the married couple's allowance for those under 65. The other allowances—personal and age-related allowances—are indexed under the statutory provisions.I wish to raise a matter of some urgency as Easter is the traditional time for weddings. When double taxation relief was abolished on 31 August 1988, the consequence was that if a couple living together subsequently decided to marry, the tax cost to one or other of them on a £30,000 mortgage would be about £750. Does the Chief Secretary think that the Bill should include a minor change to enable such people to be married without being penalised? There is currently an adverse tax consequence in legitimising one's children.
I am not aware that couples are penalised in the way that the hon. Gentleman suggests. However, he makes a perfectly fair point and I shall have it investigated. I hope that my hon. Friend the Financial Secretary will be able to deal with it when he replies to the debate.
I note that the Bill includes no reference to the important and progressive changes in inheritance tax for independent family businesses, which were proposed by my right hon. Friend the Chancellor. His proposal was well received throughout the small business community. It is important that businesses are passed down to the next generation so that they can grow under that and subsequent generations. The current levels of taxation, although better than previously, are still quite heavy. What is happening with that proposal? Has my right hon. and learned Friend any idea of the Opposition's views? The small business community will want to know Labour's thinking. Will it support the Government's important proposals?
My hon. Friend speaks with authority on these matters and I well understand his point. After the election, we will have to introduce another Finance Bill, with at least 75 pages dealing with a range of issues, including the important one mentioned by my hon. Friend. On the question of what the Opposition might think—or what their view is this morning, because it changes so often—I am sure that the hon. Member for Derby, South (Mrs. Beckett) will be only too happy to deal with that in her speech.
Clause 10 also sets the limit on mortgage interest relief at £30,000. The limit must be set each year, but it is no increase on what has prevailed for some time. I want to say a few words about the principal matter of controversy, which is the 20p tax band. There has been an astonishing volte face by the Labour party on that matter. As recently as 25 February, the shadow Chancellor, the right hon. and learned Gentleman for Monklands, East (Mr. Smith), was reported as saying that we should have a lower starting rate because that would be fairer to people at the bottom. Within a matter of a few days, he and his party have been prepared to eat their words and vote against the proposal—as they have already done once. So that people are not mistaken, they are poised to do so again. They are ready to sacrifice the least well-off on the altar of a false and superficial commitment to fiscal probity. During our debates on the Budget, the Opposition have failed to tell us why they are taking that view. No doubt, one reason is that they are probably too busy thinking up new taxes to levy. They have failed to give a proper account of why they are behaving in that way. Instead, an alleged commitment to and concern about the public sector borrowing requirement has emerged. I am sure that the right hon. Member for Ashton-under-Lyne (Mr. Sheldon), who served in the Treasury for all those years, can confirm that under the last Labour Government there was never a time when there was not a PSBR. If the Labour party believes that there should not be tax cuts while there is a PSBR, we can be absolutely sure that there will never be a tax reduction under a Labour Government. The only issue is by how much taxes will rise.We never said that.
The hon. Gentleman should be cautious, because that is certainly what the Opposition have said. Rather like some of the clients that the hon. Gentleman used to defend in his days in court, they want to change their story before they give evidence the next time. We shall be only too interested to hear today's story.
I do not—
Perhaps the hon. Gentleman would allow me the courtesy of giving way to him before he speaks—
rose—
The hon. Gentleman should resume his seat. If he asks me nicely, I will give way.
I need no lessons from that colossus of the petty sessions on how to defend an indefensible case. The right hon. and learned Gentleman has done that every single day of this Parliament's life.
That was not much of a political intervention, but it was a fine bid for the Sir Donald Wolfit acting award.
In so far as the Labour party has a case on this issue, its entire basis is that the PSBR should not be increased to reduce taxation. If that is not Labour's argument, it is hard to see what shadow of an argument it has. Happily, we will hear the Opposition's view in due course, but it is already clear that under the last Labour Government the PSBR was higher on average than it has ever been under this Government, and it only temporarily fell to 3½ per cent. in 1977–78 following International Monetary Fund intervention. In an astonishing move that destroyed whatever claim the Opposition make to being qualified to pass judgment on such matters, the PSBR was then permitted—notwithstanding that the economic cycle was moving upwards, at a time when a prudent Government would have put further pressure on the PSBR to bring it down into balance, as we succeeded in doing in the 1980s—to increase from 3½ to 5½ per cent. once the IMF's back was turned, so that the Labour Government could increase public expenditure and finance substantial tax cuts. There was a 2p cut in income tax and reductions in value added tax. The shadow Chancellor was a member of that Labour Cabinet and was perfectly happy with that action, whereas the Leader of the Opposition—then a Back Bencher—was ranting, in opposition to his own Government, about the reckless nature of the proposals that they were carrying into effect. We should not hear too much more about fiscal probity from Labour Members.Does my right hon. and learned Friend agree that if, by some strange development, Labour's concern about the PSBR were to be genuine and if the Liberal Democrats were also serious about it—I believe that their I p on income tax is hypothecated to education—does not that cast considerable doubt on Labour and Liberal Democrat pledges in respect of pensions, child benefit and various other benefits? Would both parties keep faith with the electorate?
Labour needs to answer several questions, and the fact that it chose not to produce its shadow Budget until after Parliament has been dissolved—[Interruption.] The hon. Member for Newcastle upon Tyne, East (Mr. Brown) is here again with that laugh of his, which he must practise in the bathroom every morning. It is about as fake as the canned laughter that one must endure on those awful television comedy shows. The funny thing is not that I have misspoken but that the Opposition think that it is funny that we appreciate that even when Labour did not know that Parliament was to be dissolved, it nevertheless timed the publication of its shadow Budget for the day after the end of the Budget debate. What is the point of Parliament? The Opposition are always complaining that Ministers make announcements before bringing them to the House.
The Opposition did that in the belief that their Budget would escape scrutiny. As always, they were overoptimistic. They are right only to be properly pessimistic about the ability of their proposals to withstand scrutiny. It is a reflection of the chaos and confusion into which Labour has sunk that it feels compelled to produce a shadow Budget at all. The hon. Member for Copeland (Dr. Cunningham) said earlier—Order. I ask the Serjeant at Arms to investigate a report which I have just received of a burning smell that seems to be coming from one of the Government Benches. Meanwhile, the Chief Secretary may continue.
I will continue even as the flames lick around my ankles, Madam Deputy Speaker, and I shall direct a little cold air on them, in the hope that they will die down. I have been interrupted by many things in the House, but never before by an outbreak of fire. That is going a bit far. Obviously there are no lengths to which Opposition Members will not go to prevent democracy working properly.
The burning started on the Government Benches.
We shall find out whoever was responsible. My only fear is that you are about to be asphyxiated, Madam Deputy Speaker.
In September, the hon. Member for Copeland said that Labour would not produce a shadow Budget, but it has done so—not because Labour feels any need to be more candid with the electorate but because Labour has been driven to it by the number of holes punched in its proposals over the past eight weeks. My hon. Friend the Member for Taunton (Mr. Nicholson) asked about the PSBR. Among the muddles that Labour needs to clear up—[Interruption.] I wish that I could have the attention of Labour Members for a moment. Are they worried that they will get burnt to death?I was just discussing my insurance policy.
I shall keep a sepulchral silence on that.
For once.
Indeed. It would be helpful if the hon. Member for Derby, South will clarify Labour's view on the PSBR when she addresses the House. The PSBR has reached its present level because of a fall in receipts occasioned by the present economic downturn and by necessary public expenditure commitments which the Government feel it is their duty to sustain over the cycle but which the Opposition—erroneously—have always condemned as derisory.
The shadow Chancellor admitted in his article in The Mail on Sunday two weeks ago that the PSBR would rise under Labour—but it would be for virtuous spending. Labour would take a convenient chunk of expenditure, dub it virtuous and say that it would then be all right to borrow for that purpose. However, on "Newsnight" this week, the hon. Member for Derby, South said that Labour had no plans to increase the PSBR. A lot turns on that —all the commitments that Labour has made to interest groups throughout the country to spend more money on this, that and the other. They will be rendered nugatory if Labour stick with the PSBR as it now is, unless the party is prepared to increase taxes. We know that Labour is prepared to increase taxes to a significant degree, but the question remains: how significant—or are Opposition spokesmen merely hoping to con the electorate into voting for Labour, knowing full well that Labour does not have the slightest intention of undertaking any of the expenditure that it has pledged? That is a real case for the Labour party to answer. The hon. Member for Brent, South should do what he did when he practised law—get a barrister to answer. We look forward to hearing the shadow Chancellor give his account. Why has Labour decided to oppose the 20p tax band? It stems from an urgent and overwhelming desire to spend, which we know about, but also from Labour's desire to hide a number of its other spending pledges behind the notional availability of revenue—if Labour really is prepared to penalise those whose taxable incomes begin as low as £3,500 per year, by increasing their marginal rate of tax by 25 per cent.—so that it will then be able to peg on to that a large number of public spending commitments. They include, most ludicrous of all, the cost of implementing Labour's minimum wage proposals, which are meant to benefit the very people from whom Labour would raise taxes to pay for them. I am sure that all the graduates on the Labour Benches of the Robert Maxwell school of creative accounting will be only too ready to ensure that money is spent not once, not twice, but many more times. I believe that Thames area water is consumed seven times before it reaches us here. Similarly, Labour's taxes will be spent time and time again in the election campaign, as promise is overlaid by promise. Labour's original proposal was to soak the rich. Its definition of rich began with a person having an income of £20,400—which includes police sergeants, deputy head teachers and middle management, and that is pretty well the average wage for people working in my constituency and those of my hon. Friends the Members for Surbiton (Mr. Tracey) and for Chichester (Mr. Nelson) and others in the south. The shadow Chancellor has been criticised over that policy and I suspect that one of the reasons for his shadow Budget is to give him the opportunity to respond to criticisms of Labour's proposed national insurance hike and 50 per cent. rate. I wonder whether the Labour party is proposing to move away from some of those policies. A climbdown would involve it in soaking the poor to save the rich. Is that why the Labour party requires money from those on £3,500, £4,000, £5,000 or £6,000 a year? Does it want to have a few more resources to allow it to cover its tracks on national insurance contributions or the 50 per cent. taxation proposal? That demonstrates the ludicrous situation into which it has put itself. The Labour party's attitude to what people might do with the extra money that they will have in their pockets as a result of the change in taxation is an interesting one. What is its attitude to our belief that people have a right to keep more of their money? The Leader of the Opposition talked about borrowing for a day at the races, as if putting more money into the pockets of those who are at the bottom of the income scale is giving them money for a day at the races. I was enchanted. The more that we see of the right hon. Gentleman during the election, the better. When I returned home last night I wished quietly as a consenting adult to turn on BBC2 to get my nightly dose of Jeremy Paxman. It is something that I cannot go to bed without. I found that "Newsnight" had disinterred the right hon. Member for Leeds, East (Mr. Healey). I hope that the right hon. Gentleman appears a great deal during the election, too. No one more typifies the abject failure of the Labour Government than he. He was asked about the 20p rate and he said, from the position of the quite comfortable old age that I dare say he is now enjoying, that he was against it becauseHe then said that it might not be spent at all. What do the Opposition think that they will gain by making these offensive and patronising remarks about ordinary people making normal spending decisions? Those people are entitled to have a little more money in their pockets. If they work hard, they are entitled to earn money and to spend it in ways that they choose to enhance their lives. They are not to be patronised by failed retired Labour politicians because they might choose to buy a radio made somewhere other than in the United Kingdom rather than, according to the Labour party, pursuing some allegedly socially more desirable objective. It reminds me of the old attitude, "Don't give them a bath because they will put coal in it." It seems that the Labour party is saying, "Don't let people keep money in their pocket because they might do something with it that we do not approve of." That is astonishing. It is the attitude of an aristocratic elite. The Labour party is the "people's party". Labour Members are the people whose sole purpose in this place is, allegedly, to represent the interests of the very people whose faces they propose to grind down by increasing the marginal rate of taxation by 25 per cent. I support the tax changes because they represent a further step on a road that has brought about so many benefits to our country in the past decade or longer. That can be summed up with one statistic; the average family, even when we knock out the effect of the ravages of inflation, is £70 a week better off—it has £70 more spending power in its pockets—than it was in 1979. We know that that same family's living standards barely grew between 1974 and 1979. Money wages may have increased by 100 per cent., but the tide of rising prices meant that there was no real benefit at the end. What has this meant in terms of the enlargement of the lives of those in all sections of our community? I am thinking about the way in which wealth has been created throughout society. There are now 10 million shareholders, 65 per cent. of whom are not in the professional and managerial classes. That is a real revolution in popular capitalism. Nearly 70 per cent. of the public are now home-owners. In this decade 4 million families have become home owners. This has come about because of the Conservative party's instinctive understanding of the basic beliefs of the British people. How many people go to the surgeries of my hon. Friends and say, "My great ambition for me and my children is to be a tenant"? If we had not rescued council tenants from perpetual tenanthood under the Labour party, that would have been their prospect. We know that 76 per cent. of homes have central heating, that 90 per cent. have colour televisions and that two thirds, from a standing start in 1979, when the technology was barely known, have videos. The number of people taking foreign holidays has doubled since—"it would be spent on imports."
Will the Minister give way?
I shall carry on for a while.
The number of people taking foreign holidays has doubled since 1981. That is the revolution in which my right hon. and hon. Friends and I will have so much confidence during the next three weeks. Whatever the ups and downs of the economic cycle, people realise that we have managed to improve the wealth and prosperity of the nation. We have done so by running a successful and dynamic economy. That has been achieved partly by—[Interruption.] I have now emptied the Strangers Gallery. It is one of those days when I should have stayed in bed. I was sorely tempted to do so. Perhaps it would have been the best decision. Usually it is necessary for the doors of the Strangers Gallery to be locked when I am speaking.Order. I have been told by the Serjeant at Arms that fumes in the area of the Strangers Gallery are causing discomfort and that the Gallery has been evacuated for the time being.
Would that that opportunity had been offered to us on the Floor of the House. The least that I can do at this stage is to give way to the hon. Member for Walsall, North (Mr. Winnick).
A short time ago, the Minister said that no one tells his Member that he wishes to be a tenant. Perhaps the right hon. and learned Gentleman's surgeries are different from mine and those of my right hon. and hon. Friends. In most instances, people come to see us because they have housing problems. At my surgeries and in correspondence, 70 per cent. of the matters with which I am asked to deal are housing problems. The people who come to see me cannot afford to buy. They would be unable to do so even if interest rates were lower. They are desperate for somewhere to live. These are single people and families with one child or even two children. They have to wait years because since 1979 there has been a sharp decline in the number of council dwellings. If it is right to sell council dwellings—we are not in dispute about that—why should not those dwellings be replaced so that the people whom I have been describing are not punished and can be housed?
I am glad that the hon. Gentleman made that point. He has allowed me to make it clear that no one comes to my advice centre—I suspect that this is true of his —saying that his ambition is to be a tenant. I accept entirely, however, that there are people who will be tenants. I accept also that there is a need for tenanted accommodation. There is an argument about how that should be produced.
The conversion of the hon. Gentleman to accepting the selling of council houses would not have occurred, I think, if it had not been for the success of the Government's policy. He would certainly not have thought of the idea. The atmosphere in the Chamber, Madam Deputy Speaker, is pretty awful. I am finding the fumes irritating. I know that I should be the last one to want to resume my seat, but—Order. On that basis, I shall suspend the sitting for 10 minutes.
12.18 pm
Sitting suspended.
12.28 pm
On resuming—
As I was saying, Madam Deputy Speaker, the tremendous increase in prosperity throughout society during the past 13 years was due in part to the fruits of a successful, dynamic economy during the 1980s. It was also due to the Government's constant attention to reductions in the direct rate of tax: 3p off in the first Parliament, 3p off in the second Parliament and 2p off plus the 20 per cent. band in the third Parliament. If we go back to that typical family which is £70 a week better off, more than £20 a week of that is accounted for by the tax that it no longer has to pay but which it would have had to pay if the rates of taxation that prevailed under the Labour party had been continued.
The debate provides us with the chance to make clear a great difference between ourselves and the Opposition. They proceed under a fundamentally false assumption. Taxation is a takeaway, and a reluctance to tax is not a giveaway or a bribe. We cannot emphasise that point too much. The Opposition say that public services are underfunded, but, in deference to the time problems, I shall not deal with that issue in detail. I merely point out, as I did during the Budget debate, that the health service and all other substantial public services have gained enormously from increased public expenditure, the better direction of that expenditure and the more effective management that has been possible under the Government. On health, we know that the Labour party would have to spend £1 billion extra on the minimum wage and on getting rid of charges and competitive tendering before a penny could be spent on patient care. That, of course, explodes the myth that the Labour party would spend wisely the money that it would get back out of tax cuts. I had a good illustration of that this morning as I was coming from my home in Putney through the borough of Lambeth to Westminster. Wandsworth has a nil community charge under Conservative-controlled council. Lambeth has a community charge of £449.Pillock.
The hon. Gentleman, with charm, says, "Pillock" but the pillocks are the members of Lambeth council, not us. I wonder when he will be prepared to do something about it. Is he embarrassed by the fact that Lambeth has a community charge of £449? He is now tight lipped—not even the word "pillock" escapes his poetic lips. If he is not embarrassed, he should be, because I have the 1992–93 figures of Government assistance per head to those two London boroughs. Wandsworth, which has a nil community charge, gets £1,424 per head from the Government. Lambeth, with a community charge of £449, gets £1,628 per head from the Government.
We know that far from spending wisely the money that it is not prepared to let the public keep, Labour will scatter it around as it is scattered in Lambeth, Haringey, Hackney and various other boroughs. People said that the pathetic fallacy was believing that animals think like human beings. The truly pathetic fallacy is that people could believe that the Labour party would spend more wisely than they could spend it themselves. To sum up, we have established the real difference between the parties. The Labour party began by believing that the rich began at £20,400. No one below that, it said, was to be inconvenienced by its tax proposals. We now learn that a single wage earner is rich, starting at £3,500 a year. That is the point at which the Labour party proposes to increase the marginal rate of tax by 25 per cent. It is a rake's progress as the Labour party moves from Robin Hood to Robbin' Everybody.That is very original.
The hon. Gentleman has come alive again, like something out of the Hammer films that used to delight me as a child. Truth, not originality, is the name of the game. Originality is what the hon. Gentleman makes up. In any event—and certainly in political terms—it is not a compliment. The hon. Gentleman is a past master at it. He owes his facts to his imagination and his jokes to his memory.
If the Labour party is prepared to increase the marginal rate for the least well-off, what does that tell us about what it might be prepared to do about the 25 per cent. rate? After all, Labour opposed the reduction from 33p to 25p every step of the way. We must now ask ourselves, what other tax plans is Labour concealing up its sleeve to satisfy the restless desire of each and every member of the Labour Front Bench to spend.rose—
I am just about to finish.
I welcome the opportunity for the Labour party to confirm its complete addiction to the taxation of each and every person in the community. No one is safe, and we shall prove that this afternoon.12.34 pm
We can be under no illusion today that those of us who have been fortunate enough to catch your eye, Mr. Deputy Speaker, are speaking for the benefit of anyone except those present in the Chamber, for Hansard and for posterity. None of us will nurture any illusions about what the media will report of today's debate.
Nevertheless, in the Finance Bill, the Conservative party is offering a "buy now, pay later" Budget for a "buy now, pay later" election. It shows that one cannot teach an old Government new tricks. It is, after all, the same stunt that they pulled in 1983, when they cut taxes a month before the election and spending a month after. It is the same stunt that they pulled in 1987, when they cut taxes before the election and the spending promised at election time never materialised. As a Second Reading of a Finance Bill, this must be one of the oddest in history—odd even before we had the fire, and heaven only knows why that happened. Four hours for all the stages of a Finance Bill from start to finish—including a debate on the guillotine motion—is certainly a most extraordinary precedent, even for this Government. It is an extraordinary precedent and an extraordinary procedure, due not to accident or misfortune but to the sheer incompetence and mismanagement of the Government, who cannot get right even the timing of the election. On Second Reading, the House weighs legislation, considers the circumstances with which it is designed to deal and its fitness for the purpose. One only has to consider this cursory Bill to realise that the circumstances with which it is designed to deal are the problems that the Government face in getting from here to 9 April. It is visibly designed to deal not with the country's circumstances but with the narrow purposes of the Conservative party. In many ways, the Bill characterises the Government's approach. The Secretary of State for Employment said that this Budget would be a Budget for jobs. It is not. The Chancellor said that it was a Budget for recovery. It is not. The Bill contains some measures that will be of help to business, and we welcome them, but the problems with which they are designed to deal were created by the Government. Some of the measures, such as those for car tax, will alleviate the strains of the recession that the Government have caused. However, it is only under this Government that the overall burden of taxation on cars and on people has become so high that the measure is needed. The weight of the car tax plus the value added tax that they have more than doubled in their 13 years in office have made taxes on cars so high. The Bill contains other measures, such as the easing of the business rate. The Government introduced the business rate, ignored the cries of small business and then, miraculously, on election eve they listen at last. Then they expect credit for easing problems that they, and they alone, created. There are no other measures of any weight to promote recovery. Why? The answer can be found in the Red Book. Yet again, the Government tell us that recovery has already begun and will accelerate from the end of this month. We certainly hope that they are right, but, of course, that is what they told us last March, last April, last May, last June, last July, last August, last September, last October, last November, last December, last January and last February. What is holding up the recovery? The Government are. It is held up by the uncertainty of waiting and waiting while they have tried and failed to find a favourable time to go to the country, by the damage caused by their prolonged use of high interest rates to squeeze out inflation which they fuelled for so long, and by the fear of the unemployment that they have fostered and to which they remain supremely indifferent. In their private briefings, Conservative Members and Ministers still tell the press, "Unemployment didn't lose us the election in 1983 or 1987, and it won't lose us the election this time," as if that were all that mattered. Of course it is all that matters—to them. Never mind the costs to the country directly or indirectly—such as the £8,000 per person unemployed. Never mind the devastation to millions of individuals and millions of families. There is nothing in the Bill that begins to tackle the problems of unemployment, nothing to stimulate the construction industry and nothing to deal with skill shortages, which are damaging in themselves as well as damaging to the prospects for inflation. There is nothing to build for the longer term and nothing directly even for families with children—although there is what I can describe only as a sop for some pensioners. Seventy-five per cent. of pensioners do not pay income tax—they do not have big enough pensions—so they cannot benefit from the lower band. The Government have given an increase in a means-tested benefit, but they must know that the poorest pensioners of all are the million or so who will not claim means-tested benefits because they were raised in a generation which regards such benefits as charity, so they live below the poverty line. The Budget does nothing for them. The main measure in the Budget—as the Chief Secretary implied at the end of his speech, it is the only measure that the Government care about—is the tax cut, which, we are told, has been carefully targeted. Ministers, including the Prime Minister, who sat smirking on the Front Bench as the Chancellor revealed the mechanism of the tax cut, are so thrilled with their own cleverness that they have given the game away. The tax cut is carefully targeted not on the poor, but, as Ministers told Lobby journalists, on trying to embarrass the Labour party. Well, it does not. What a revealing glimpse those comments give us into the minds of the men who govern us. Here we are in the depths of recession, with, high unemployment, negative growth—with, at best, the prospect of a return to low growth—record bankruptcies and record home repossessions. What weighs on Ministers' minds? What keeps them awake at night? They ask themselves not, "What can we do to solve the problems of the country?" but, "How can we dish our opponents?" Where is the vision? Where is the foresight? Where, even, is the responsibility? Plainly, those qualities are not to be found in the Cabinet. And the Government have the gall to say that we are not fit to govern. The Government have had 13 years of unbroken and secure rule. They have had more than £100 billion from the North sea, where we made the investment and they have reaped the returns. They have made billions of pounds from selling the family silver. Three times they have doubled inflation between elections. Three times they have raised interest rates between elections. This is the third time that they have cut taxes before an election, and three times they have broken their promises after elections.The hon. Lady says that the Government have no vision, yet, for a long time now, the Government have been committed to achieving a 20 per cent. basic rate of income tax. What does the hon. Lady think would be the best way of doing that—to cut the standard rate or to introduce a lower band for low-paid workers?
I am so glad that I gave way to the hon. Gentleman. His intervention speaks for itself. I mention vision, and what comes into his mind is money.
The Bill represents the way in which the Government will end—not with a bang but with a whimper of a Finance Bill. That whimper is not loud enough to drown the cries from outside the Chamber, such as the cries of youngsters with no job, no home, no security, no prospects and no hope. There are the cries of the pensioners who are slipping further and further behind the standard of living of people in work, and the cries of the sick, who cannot make themselves heard above the racket of Ministers boasting about their record on the health service. There are the cries of the victims of crime, which is at record levels—those are the people who have been exposed to the full consequences of the creed that the Conservatives have preached for 13 years—"Look after yourself, and the devil take the hindmost." One of the few things that the Chief Secretary said with which I could agree is that the Bill throws into relief the nature of the choice before the British people. The Government say, "We shall take less from you in taxation, and that will leave you free to make your own choices." They mean choices such as what kind of health care to buy, and how much, and what kind of education to buy, and how much—choices such as how much pension to buy, and what kind of transport to use. "Make your own choices," the Government say to the people of this country, "because you are on your own." For most people, even for those in work, those are choices which they cannot exercise on their own. In the days before we contributed to fund a national health service, a national education service and nationally guaranteed pensions—the good old days when income tax was only a few pence in the pound; the days to which Conservative Members tell us that it is their vision to return us—harsh experience taught our forebears—at least, the Opposition's forebears—the limits of the freedom that today's Conservative party extols. Our forebears found that to survive, and certainly to prosper, they had to work together. They set up their own schemes to which each contributed a little when he or she could, so as to help one another when that was needed. That worked, so we, as a country, made it the basis of so much that people take for granted today, such as the health service, the education service and so on. The tax system is the structure for that pooling of resources. We neither want nor propose a harsh tax system. We want a tax system that is fair and seeks, as nearly as possible, to treat people in the same circumstances in the same way. We shall make proposals and lay them before the country in the next few days, and we want everyone to see them. The structure of taxes that we propose will be designed not to fuel the politics of envy, but to fund the ethics of community. This is not the right Finance Bill for this time. It is time for a different Finance Bill; it is time for a Labour Government.12.47 pm
The speech of the hon. Member for Derby, South (Mrs. Beckett) was both depressing and patronising. That might not be so exceptional in itself, were it not intended to perpetrate yet another fraud on the British taxpayer and on the electorate. The hon. Lady sought to criticise a wholly welcome measure which reduces taxes, but she did not spell out her alternative. She sold the pass by not delivering the secret Labour Budget which is apparently to be declared after Parliament has prorogued. What sort of choice has anyone listening to the debate here or outside the House if we are not to be privy to Labour's formula for success? What are the Labour party's credentials for criticising the Government?
I believe that the Budget was a winning Budget for taxpayers and for business, and that the Finance Bill— the provisions of which are wholly welcome—should have been nodded through the House. I was dismayed and shocked that the Labour party and other Opposition parties could find fault with and question a Bill which will bring relief to businesses and individuals throughout the country. I certainly welcome the Bill wholeheartedly, as I welcome the whole strategy underlying my right hon. Friend the Chancellor's Budget. I should tell my right hon. and hon. Friends the Treasury Ministers that I especially welcome the intention behind the Bill—to ensure that central to our economic policy is a determination to reduce the rate of inflation and keep it low. I know that you, Mr. Deputy Speaker, will be interested to know that this week, for the first time in nearly 30 years, the latest figures announced show that our rate of inflation is lower than that of Germany. Britain is now leading the way in the European Community with policies determined to pursue sound currency, low inflation and low interest rates. Those who seek to pursue policies of higher taxation, of redistribution towards the centre and of the devaluation of currency will find that the inevitable consequence will be higher interest rates borne by individuals, by mortgage payers and by businesses throughout the land. Only by making our centrepiece a determination to restore sound money and to keep down the rate of inflation can we regenerate sustainable growth, the prosperity that it brings and the jobs that will be derived from it.I wish that the hon. Gentleman had not repeated the slur on Germany. Does he not find it remarkable that the German economy is as strong as ours despite having taken on a decrepit country and welded it into its own economy, while this Government have made our economy into a decrepit economy?
The new Germany may be held back in its progress by the socialist domination of part of it in the past. I was not knocking Germany—my point was that we now have a lower inflation rate than Germany has, and people should know that because it is very good news. All that we heard from the hon. Member for Derby, South was the carping, the criticism, the self-effacement and the deprecation for which the Labour party has made its name and which is so injurious to public and international confidence.
I especially welcome the introduction of the 20 per cent. band. I hope that, even in the short time left, we shall have an opportunity to vote on the clause which implements it. The proposal will be the litmus test for the public to see where the Labour party really stands. The logic of Labour's position must be to vote against the proposal. Labour will then have to go to the public and argue that the return of a Labour Government would not result in a significant increase in taxation. That would perpetrate yet another fraud on the public and it is right that we should decry it. The Bill follows a Budget which brought one measure of relief on which I especially congratulate the Government. Those of us who represent constituencies in the south of England, where the recession has been hard and deep, are conscious of the impact of the recession on the cash flow of many businesses, especially small businesses. Even with the transitional arrangements, the impact was especially marked when the uniform business rate was introduced. With Conservative colleagues in Kent, Hampshire, East Sussex and West Sussex, I wrote to my right hon. Friend the Chancellor, went to see him and approached the Prime Minister and others. We urged the case for freezing the transitional element of the UBR so that an additional burden was not placed on such businesses in the forthcoming year. My right hon. Friend the Chancellor has announced such a measure, which is wholly welcome in my constituency and elsewhere and shows yet again that the Government listen to people. The Government respond to representations made to them. The Government are not unbending. The Conservative party heeds the voices of those who express concern and it adjusts its policies. That worked for my constituents and the representations were listened to. I thank and congratulate my right hon. Friend the Chancellor. I should appreciate an answer from my hon. Friend the Financial Secretary on one narrow point. The relief brought with the reduction in the car tax will be of immeasurable help to the car industry, to employment and to the national economy. However, one aspect has aroused concern among many dealers who have already bought cars in stock and among many finance houses that have bought cars for sale through dealerships. They have had to pay the full rate of car tax, although people who buy those cars after the Budget date will expect to pay only the 5 per cent. rather than the 10 per cent. rate of car tax. With the large stock of cars currently held by dealers and by leasing and finance houses, there will be some perverse results if there is not a change. Just as my right hon. Friend the Chancellor was good enough to listen to the reasonable concerns expressed by business about the UBR, I hope that in the limited time that, rightly, we have to debate the matter, some further relief can be announced or some clarification given about the car tax on vehicles that have not yet been sold to buyers but are held in stock by finance houses and dealers. If the Government do that, it would help to get the economy moving even faster than the Budget and the Bill will. The Bill is a winning Bill for my constituents, for businesses in my area and for the economy as a whole. It follows the Conservative policies that we have set from the beginning of this Parliament. It is wholly prudent, it reduces taxation and it draws out the fundamental differences and the choice for the electorate at the election. The Bill is worth supporting and it goes to the heart of what we in the Conservative party stand for.12.55 pm
The hon. Member for Chichester (Mr. Nelson) advanced the astonishing proposition that the Bill should go through on the nod without any debate. He then proceeded to give two clear reasons why it should not. First, he made a perfectly legitimate inquiry about the detailed application of the car tax provisions, on which he hopes to get a useful answer which might be of some assistance to his constituents. Secondly, he talked about provisions for small business and about the uniform business rate. He was obviously ignorant of the fact that such provisions are not included in the Bill. One purpose of this debate is to discover what the Bill actually contains.
My first question to the Financial Secretary is: why are provisions on the uniform business rate not in the Bill? Does he doubt whether the Labour party, if in office, would implement the provisions? They are important provisions. If he entertained any doubt, that was all the more reason why such provisions should have been included in the Bill because there would then have been no doubt that they would be enacted. The Financial Secretary may argue that the provisions are complicated. One of the ways in which he could have got round part of that difficulty would have been to accept our proposal—which is similar to his, but a little greater in cost—to freeze the 4·1 per cent. increase in the UBR. That could have been achieved with fewer legislative complications than the arrangements he described. I agree that the transitional provisions should be extended and we welcome that part of the Budget. However, it would have been far better for that provision to be included in the Bill and I hope that the Financial Secretary will tell us why it is not. It is important that business should get that relief. It will not be a massive stimulus to the economy, but it will save some small businesses from going to the wall and it will relieve the cash flow problems in others. I welcome the fact that something on an equivalent scale to what we asked for is being done. Much has been said about the lower rate band at 20 per cent. The truth is that the lower rate band is abolished by Conservative Governments when they come into office and reintroduced on the eve of their departure. That has happened in this case. The lower rate band was abolished by the right hon. and learned Member for Surrey, East (Sir G. Howe). Conservative Members should remember that he said:He mentioned another advantage of abolishing the lower rate band. He said:"The case for the lower rate band was never at all clear. The 25 per cent. rate was not the effective marginal rate for more than a small number of full-time adult workers. For those on lower incomes an increase in the personal allowance would always have been more valuable than the lower rate band, and the existence of this lower rate band added significantly to the complexity of the tax system."
When I challenged the Chief Secretary this morning on the point, he could not tell us how many extra staff would now be required simply to enable pensioners to reclaim their lower rate. Now that the composite rate has thankfully been abolished—it is right that it was—pensioners who want to take advantage of the lower rate band on their savings to get the £100 will have to apply to the Inland Revenue for it at the end of the tax year. Those applications will have to be processed, so to dispense the £100 or less, the Financial Times estimates that 800 additional jobs will be required. The Chief Secretary said that the increase would be 300 jobs in the first year and perhaps more in the second. No doubt, we shall get a precise figure later. It is probably the greatest job creation element in the Budget. That does not seem to me to be the most productive area in which to engender jobs. I would much rather we were engendering jobs in more productive sectors of the economy."there will be a valuable staff saving of 1,300 persons."— [Official Report, 26 March 1980; Vol. 981, c. 1475.]
The hon. Gentleman is being unfair. A few weeks ago when we were debating the impact of the business rate, he and I made the same recommendation. My right hon. Friend the Chancellor has done exactly what he and I recommended and that will help jobs.
The hon. Gentleman must have missed the first paragraph of my speech. I welcomed what the Chancellor had said he would do and pointed out that it was not in the Bill and that it would have been very much better if it had been. The hon. Gentleman should not intervene in speeches that he has not heard or has not listened to.
The best demolition of the lower rate band appears in this morning's editorial in the Financial Times. The point is made clearly:In a Budget dictated mainly by the priorities of partisan politics, the Government have selected the least effective means of targeting help to the low paid because it happens to have been espoused by the Labour party. It would be hard to imagine a more ludicrous basis on which to make Finance Bill and Budget decisions. We are talking about £100 for those whose income carries them right through the lower rate band. That is everyone in the Chamber you, Mr. Deputy Speaker, our Clerks and our Serjeant at Arms. Many low-paid people earn less than that income band and therefore will not get tax relief on the full amount. They will not get £100 and some people who do get it will have some of it deducted from their family credit. For many of them, the benefit will be much less than £100. Spent in investment measures, that money would have brought more help to those people. That money spent on measures that would give some of them better-paid jobs would have been a great help. That money would have been spent more effectively providing employment for their children and families in the construction industry and in the trades and professions that can gain from an advance in the construction industry. The Government have revealed in their Budget a PSBR of £28 billion and have sought to criticise those of us who argue for an even higher figure. I have argued that, if we are to secure investment, we need a combination of revenue-raising measures and a PSBR of £30 billion. The Government had better not launch an attack on our £30 billion proposal, because their PSBR proposal for next year is £32 billion and our proposed £30 billion includes money for measures that would give us a return in future years. The truth about the Budget is that it offers no hope of getting Britain out of recession, no hope of reversing the pattern of decline in manufacturing industry and no hope of providing what is needed to make industry prosperous and competitive in future. It is a political gamble. It is not a measure of economic commitment and progress at all."If the Government wishes to offer the flattery of imitation, it should restrict itself to Labour's good ideas and not its bad ones."
The Front-Bench spokesmen intend to restrict their winding-up speeches to five minutes each. If those hon. Members who have been rising would do likewise, it should be possible for me to call them all
1.3 pm
Even though this will be my last speech in the House after 23 years here—not for the first time, to a Chamber that is nearly empty—I shall not detain the House by adding my praise for an excellent Budget which will help those most in need and boost our economic recovery.
I should like merely to express a reservation about clauses 3 and 4 which deal with fuel taxes and car tax. Although I warmly welcome the wider differential between lead-free and leaded petrol, I should have liked a similar differential in respect of diesel fuel. Such a measure is much needed and would have provided a stronger market signal to consumers to use an environmentally more acceptable and desirable fuel. Other countries have provided such encouragement. In a number of reports on the threat of global greenhouse warming and energy efficiency, the Select Committee on Energy has made such recommendations. In making proposals for tackling the difficult question of energy and transport, the Government's own White Paper, "Our Common Inheritance", makes similar suggestions. Moreover, the European Community has been advocating from Brussels that member states promote diesel rather than petrol. A slightly wider differential in the tax regime would have triggered a stronger signal. We are all aware that energy and the environment are increasingly matters of great international concern. We also know that energy use in the transport sector is the fastest growing, the most difficult to tackle and the most polluting. Had we introduced such a measure this year, we should have provided the right signal to consumers. I hope that my right hon. Friend the Chancellor will consider introducing one after the election. I hope that he will seriously consider giving this important environmental boost through the Budget and the fiscal system and encouraging more use of diesel for the sake of reducing global greenhouse warming emissions and other emissions.1.5 pm
It is claimed that this is a Budget for recovery, but mocking that claim is the news from my constituency this morning that the INMOS company is definitely to close its operation there and move its production to Agreti in Sicily and Roullet in France. The Finance Bill contains many measures which will affect my constituents—on car tax and income tax, for example. The very cars that are the subject of that tax—intelligent cars—have at their heart a thing called a transputer, as will colour fax machines and the miraculous virtual reality high-definition computers that will be selling in vast numbers over the next decade. Where in the Finance Bill is the commitment to British industry to allow a product that is British invented, British designed and the result of investment by a Labour Government to continue to be manufactured here? The transputer is about to take off internationally, but it will be manufactured outside Britain. This is not a Budget for recovery but a Budget for the Conservative party.
Following this morning's announcement, redundancies will be announced immediately and will continue to be announced for a long time. Already, 400 jobs have been lost and 450 more are to go. Although that is a devastating blow for Newport, it is also a mortal blow for the sunrise high-tech industries in Britain generally, because the transputer—the miracle computer on a chip—is going. We shall become the customers—the buyers of the transputer and its applications throughout the world. That British invention will be manufactured in Texas, Malta, Singapore, Sicily and France. It is an utter disgrace. This morning, the Chief Secretary did not tell jokes as he did last time. Last time, he told one parrot joke and one haggis joke. I can understand his not wanting to tell a parrot joke because of the sensitivities about Polly Peck. The right hon. and learned Gentleman also accused the Labour party of being anthropomorphic and said that we attributed to animals the feelings of human beings. It struck me forcefully this morning that, when he leaves Parliament in a month's time, the Chief Secretary can get an alternative job delivering gorillagrams without the aid of a monkey suit. It also struck me, when our sitting had to be suspended because of a fire elsewhere in the Palace that the event was reminiscent of what happened many years ago when a repressive Government burnt the Reichstag and made van der Lubbe the fall guy. When the Government collapse in burning ruins in a month's time, the fall guy will be the present Prime Minister.1.8 pm
This is a sensible and prudent Budget. It is such a prudent Budget that it has upset Labour Members. The Budget is being implemented when we do not have the crisis that Labour had in 1976 and 1978. We have not had to cut the hospital building programme as Labour did in 1976. We do not have the situation which occurred in 1978, when taxes were so high under the Labour Government that they led to massive strikes and inflation. Surely, the point about the Budget is that income tax reductions and job creation go side by side.
The Budget will produce a further £2 million of disposable income in my constituency. That money will be welcome. Such money helps the Dover ferry industry. Every tax reduction under the present Government has resulted, two years later, in significant increases in passengers and freight carried by the Dover ferry industry. I have every confidence that this tax reduction will result in more freight and passengers using the Dover ferry industry. I also commend to the House the reduction in the uniform business rate, which has been achieved by freezing the transitional element. That will be good for small businesses and the many shopkeepers in my constituency. Of particular interest to me is what the Budget does for pensioners. Less well-off pensioners will receive benefits through the income support mechanism. Under Labour, not only was the inflation calculation fiddled in 1976 so that pensioners lost out, but inflation destroyed every pension increase that the Labour Government gave between 1974 and 1979. Pension increases and promises of pension increases in election campaigns arc not worth the paper they are not printed on unless they are real pension increases and inflation rates are low. That is the only way to give pension increases. That will be achieved by the Finance Bill because this is a prudent and sensible Budget. The measures are recognised by the City of London and the outside world community as prudent and sensible.
1.11 pm
I do not know how Conservative Members were able so easily to convince themselves that the Budget is enormously popular. There were no street parties in Newham and no dancing on Stratford High road when the Budget was announced. The Budget means very little to the people I represent in the east end of London. What will the Budget do for jobs? What will it do for people who find that what little has been given to them will be reclaimed through the withdrawal of means-tested benefit? That is the whole point. The Budget means nothing for the real problems of people in my area.
Since 1979, unemployment in the London borough of Newham has gone up by about 326 per cent. We have seen an 84 per cent. decline in job vacancies. We have an unemployment rate of 18 per cent. in the London borough of Newham. We have lost about 40 per cent. of manufacturing jobs. The Budget will do nothing whatever to address those real problems. The day after the Budget, a cordial gentleman stopped me on the street, as they often do in my area, and said, "Give 'em a good kicking, Tone." Those were his precise words. Obviously, I cannot endorse the proposed action, but I sympathise with the sentiment. The people of the east end have been kicked around by the Government for 13 years. They want an opportunity to give the Tories a good kicking, and on 9 April that is exactly what they will do.1.13 pm
The hon. Member for Newham, North-West (Mr. Banks) says that the lower rate band means nothing. If it means nothing, why was it Labour policy until a few days ago? We knew that Labour wanted to tax the higher paid. We now know that Labour wants to tax the lower paid as well. That should come as no surprise to anyone who remembers the record of the last Labour Government, because that is the best indication of what a future Labour Government are likely to do.
In 1974, only a few days after the general election, the standard rate of income tax was increased from 30 to 33 per cent. In the Budget of 1975, it was increased again from 33 to 35 per cent. By 1976, public sector borrowing had reached 9 per cent. of GDP. It was so huge that the then Chancellor of the Exchequer, the right hon. Member for Leeds, East (Mr. Healey), had to go to the International Monetary Fund and Britain had to be bailed out. It was only when the IMF imposed some discipline on the Labour Government that things started to return to a more sensible arrangement. It was in the following Budget, in 1977, that the standard rate of income tax was cut from 35 to 33 per cent. As a result, public sector borrowing went up once again. If it was right to do that in 1977, why was it wrong to do it in 1992? We have not been told. If it was right, at the end of the previous Labour Government, to have a lower rate band of 25 per cent., why is it wrong to have a lower rate band of 20 per cent. now? We have not been told. The hon. Member for Derby, South (Mrs. Beckett) complained that I mentioned money during proceedings on the Finance Bill. I found that rather strange. The Government are committed to reducing the standard rate of income tax to 20p in the pound, and that is a very welcome target. Opposition Members do not seem to understand that it is not their money—it is taxpayers' money—and we need to keep to a minimum the amount that we tax people in order to pay for decent public services. That is the object of the Budget. The Budget is a step on that road, and I welcome the Finance Bill.1.15 pm
It is not surprising that the country's reaction to the Budget has been negative. The country knows what every hon. Member knows—that the Budget was determined not by the country's needs but by the needs of the Conservative party and the Government's wish to be re-elected. It is a negative Budget, and that is why it has been rejected by the country.
Let us consider, for instance, the small increase that was given to pensioners on income support. Any help for pensioners is to be welcomed, but that increase, which has been given to a relatively small number of pensioners, is derisory compared with what pensioners have lost as a result of the decision in 1980 that pensions would no longer be increased in line with earnings. What have pensioners lost? For a single pensioner, it is £17 a week—I emphasise "a week"—and for married pensioners it is £26 a week. That is how pensioners have been cheated by the Government. Of course, there were also the changes in housing benefit in 1988. That is the year, incidentally, when the top rate for income tax was reduced from 50 to 40 per cent. At the same time, many people on relatively low incomes found that, as a result of the changes in housing benefit, they had to pay far more in rent and poll tax. Pensioners—admittedly single pensioners—in my constituency receive about £60 a week, but they must pay £10 in rent and poll tax. That is totally unfair. Even the increase announced in the Budget will be subject to means testing. Not all pensioners on income support will get that £2 or £3, because they will pay more in rent and poll tax. My region, the west midlands, has been devastated as a result of Government policies. There have been two major recessions. We lost many jobs in the early 1980s. In the first recession, in the early 1980s, 280,000 manufacturing jobs were lost in the west midlands. In the black country, 70,000 jobs were lost. Far too many people in my part of the world find that they cannot get jobs. If they have reached a certain age group, their chances of getting work are remote. In the metropolitan part of the west midlands—Birmingham, Walsall, Coventry, Dudley, Sandwell, Wolverhampton and Solihull, the very heart of the west midlands—more than 40 people chase each vacancy. There is no sign that there will be a significant change as a result of present policies. Of course, there has been no help for the construction industry. Eighty-one per cent. of building firms in the west midlands expect less work in the next 12 months and 78 per cent. of such companies expect to employ fewer people. That is the dismal scene. That is why we are so concerned. That is why we wanted a Budget for the country's future and not the future of the Conservative party.Does my hon. Friend agree that perhaps even in Beaconsfield, the constituency which the hon. Member who spoke before my hon. Friend represents but will not represent for much longer, there are many people who hated or disliked the Budget? The hon. Gentleman has been disregarding them for years, but on 9 April he will get the message about the Budget loud and clear.
One thing is absolutely clear: the Government will get the message on 9 April. We have been waiting for the election for some time. When the Prime Minister succeeded the right hon. Member for Finchley (Mrs. Thatcher), he did not have the courage to go to the country. He did not have the courage to go to the country last June or in the autumn. Now, with only three months before he is forced to go to the country, he has screwed up enough courage to call the election. We welcome the election. I notice that, after the Budget, the latest opinion poll shows a 3 per cent. Labour lead.
The past 13 years have been a nightmare for Britain and its people and certainly for those who have suffered most such as the unemployed, the low-paid and pensioners. Time and again, in every Budget up to now, they have seen how a Tory Government have benefited the rich and penalised the poor. So we welcome the election. On 9 April, the people of Britain will decide. When people ask me whether I am optimistic, I immediately go back to 1983 and 1987. Frankly, I do not deny, and my colleagues would not deny, that we knew that we stood no chance in those two elections. When we left the House of Commons, we knew only too well that the opinion polls were right and that, unfortunately, we would see the return of a Tory Government. But the people have now decided. That has been shown in by-elections and local elections. They want a change. They will vote Labour in millions more than they did in 1983 and 1987. The Government are a dying Government. They will end their life on 9 April. We shall .have a Labour Government to determine the progressive policies to rebuild our country.1·21 pm
In proceedings on the previous four Finance Bills on which I and my hon. Friends have served, we were able to tackle clause by clause and issue by issue the case that the Government made. We were able to table amendments. Through reasoned argument rather than weight of numbers, we secured change in those measures.
This occasion deprives us of the opportunity to secure any change in the measures before us. Indeed, it deprives us of the opportunity even to table amendments so that we can discuss the changes that we would like to see. That is a fundamentally undemocratic way to proceed. It is made much worse by the intervention by the hon. Member for Chichester (Mr. Nelson), who is not in his place. He said that we should not discuss these matters and that the Finance Bill should be put through on the nod. That shows a complete contempt for the democratic process. It was not surprising to me that, as the Chief Secretary to the Treasury tried to justify these things, we could smell the flames of sulphur coming up around him. So confident is the Conservative party of the strength of its argument that it is bullying through a Bill of 11 clauses containing all the major tax changes, without allowing any opportunity to discuss amendments. It is putting the Bill through on a guillotine with only two hours of debate. That is not evidence that the Conservative party has great confidence in its arguments. I should like to deal with several issues which arise from various clauses, but I cannot, so I shall concentrate on the main question, which is, of course, the lower rate tax band. The hon. Member for Beaconsfield (Mr. Smith) asked why, if the Labour party believed in a lower rate tax band in the past and had a policy proposal to introduce one for the future, it intended to vote against such a proposal now. In asking the question, as he probably most certainly knows, he answers it. The reason why we oppose the lower rate tax band is not because we are against it in principle. We are not. It is because we are against it now. We are saying that resources should not be borrowed, thereby effectively increasing the public sector borrowing requirement, to fund a tax giveaway. That is effectively what the Government are doing.Will the hon. Gentleman give way?
No, I shall not give way, because time is short.
The Government argue that somehow the lower rate tax band can be afforded and will be repaid over the cycle. I return to the argument that I put to the Chancellor yesterday. The argument is set out in the Government's Red Book. The Government clearly say that there will be a public sector borrowing requirement for the forecastable future. In other words, there will be a PSBR over the cycle. On the Government's own evidence, the Budget will not be balanced over the cycle. An on-going, and in my view unhealthy, deficit is forecast for the future. The Chief Secretary to the Treasury had the cheek to say that we had changed our minds. [HON. MEMBERS: "What minds?"] I am talking about the minds. The hon. Gentlemen must keep quiet. What about the minds of Conservative Members? They always opposed the lower rate tax band on the grounds of cost and efficiency. They said that it would be too expensive. They opposed it because they said that they would prefer a streamlined tax system and did not agree with extra bands. They admired the elegance of the two rates, which in time they said they hoped to see reduced to one. The hon. Member for Beaconsfield argued previously against an extra tax band. He said that the eventual objective of the Conservative party—although one would not think it from reading the Red Book—was a 20 per cent. basic rate. He used to use that as an argument against lower rate bands. He now stands that argument on its head and uses it—as, of course, he has to—as an argument for lower rate bands. The Conservative party always advances the argument that the tax rate for everyone should come down to 20 per cent. It does not argue for a special lower rate band. Indeed, the right hon. and learned Member for Surrey, East (Sir G. Howe) said when he abolished it that the case for the lower rate band was never clear. However, solely for reasons of expediency, it seems that the case is becoming clear to Conservative Members. It is reasonable to ask why the Government are introducing the lower rate band. Are they doing it to help the poor? Does anyone really believe that the inventors of the poll tax are doing it to help the poor? There are much more tax-efficient ways of helping the poor. The Conservative party has not adopted those methods. The Chancellor has claimed that every average single-earner family will gain £2·64 per week as a result of the Budget, but 72p of that is as a result of the annual indexation of allowances in line with inflation. Again, the quarter of a million people in tax-paying families on family credit gain less. They lose 70p in benefit for every £1 that they gain in tax cuts. Moreover, the increases in excise duties which we are voting through without amendment or any real chance of discussion will cost such people an extra £1·56 per week on average. So the result is a net loss for the low-paid of 76p per week. In those circumstances, it is the most grotesque hypocrisy for the Conservative party to say that the lower rate band is intended to advantage the poor. It is clearly nothing of the kind. It is not intended to be anything of the kind. It is being introduced for one reason only—to confuse the debate about taxation in the run-up to the general election. It is intended specifically to confuse the debate about the Labour party's tax policies. The Chief Secretary said that he wanted to hear the Labour party's Budget proposals. Of course, after the general election, the House will have an opportunity to discuss the Labour party's Budget. It will be formally presented to the House, with a proper Finance Bill. The measures will be discussed in detail, not bullied through on a guillotine. My only regret—I have to say that it is not an overwhelming regret—is that the Chief Secretary and the Financial Secretary will not be present to hear our Budget.1.28 pm
The hon. Member for Berwick-upon-Tweed (Mr. Beith) asked why the important provisions on the unified business rate are not contained within the Bill. They relate to a tax introduced under the Local Government Finance Act 1988 and not under an ordinary Finance Act. They would have to be amended by a separate Act, which we propose to introduce after we are re-elected.
On excise duties, and especially the question raised by my hon. Friend the Member for Erewash (Mr. Rost) in his valedictory remarks to the House, we have increased the differential between leaded and unleaded petrol. We have also increased, in cash terms, the differential between unleaded petrol and diesel. I hope that he finds that a welcome development. My hon. Friend the Member for Chichester (Mr. Nelson) mentioned car tax. He was right to do so, and I may be able to give some comfort. The reduction in car tax has been widely welcomed and I am happy to say that it has already given a substantial boost to the motor industry. In a few cases, as my hon. Friend pointed out, tax had already been paid by manufacturers and importers at the higher rate before the Budget. Some traders would therefore stand to lose. I am pleased to be able to tell the House that Customs and Excise have introduced an extra-statutory class concession to enable refunds of car tax to be made in respect of chargeable vehicles held by dealers as 10 per cent. tax-paid stock and unsold to final consumers on 10 March 1992. Those refunds will ensure that such vehicles will bear an effective car tax rate of 5 per cent., and will bring consistency of treatment to manufacturers and importers, who opt to deal on a tax-paid rather than a tax-free, sale or return, basis. I hope that that announcement is welcome to the House, as I am sure it will be to the industry. Much of the debate has focused on income tax. It is right that it should, and we have been treated to some remarkably dishonest speeches and some contempt by Opposition Members. The Labour party asks us to believe that it now reckons that 25 per cent. is right for the basic rate of income tax. Labour Members tell us, hand on heart, that a Labour Government would not increase the basic rate of income tax. They say that 25 per cent. is just about right and that they will not put it up, adding, "There is no need to do so. We wouldn't want to do anything like that." In that case, when we reduced the basic rate of income tax from 33p to 30p, why did Labour Members vote against it? Do they now admit that they were wrong to oppose that reduction? When we reduced the rate from 30p in the pound to 29p, why did they oppose it? Do they now admit that they were wrong? When we reduced the tax from 29p to 27p, they opposed it. Do they now admit that they were wrong and that we were right?rose—
If the hon. Lady is prepared to stand up and admit that, every time that we reduced the basic rate of tax, they were wrong to oppose it, and to apologise to the House and to the country for what the Opposition have done, we will happily accept their apology.
Sadly, the Financial Secretary will not have the opportunity to repeat these remarks, but I recommend that he reads the book by the Chancellor of the Duchy of Lancaster, who is now chairman of the Conservative party, in which he says that the case for further tax cuts has been much over-egged and that there should not be further tax cuts. At that stage, the top rate of income tax was 60p in the pound and the standard rate was 30p.
If that is the best that the hon. Lady can do by way of an apology to the nation, she has some further learning to do. Every time that the Government have properly reduced the basic rate of tax, Labour has opposed it. Now Labour Members say that they have changed and that they do not want to increase the basic rate. Why, then, did they oppose it? They owe the House and the country an apology, but the House and the country will not believe them. They know that a future Labour Government, like every other Labour Government in history, would increase the basic rate of income tax. We know that because they are giving a signal of it today. We are introducing a lower rate for the lower paid, as an important first step towards a 20 per cent. basic rate for everyone. What does the Labour party do? Labour Members say that they will increase the rate, despite the fact that it has been their stated policy to move towards it. They are saying that, although they believe that it is a good idea, they will oppose it because they want to increase the tax on the lower-paid.
As every Labour Government increased the basic rate of tax for everyone, a future Labour Government would do the same, because they do not know any other way. They would increase the basic rate of tax for the lower paid, the middle paid and the higher paid—for everyone —because they believe that the money that people work hard to earn does not belong to the people. They believe that it belongs to the Government. Every time a tax is reduced, the Opposition think that it is a giveaway. I have news for them, and the British people who work hard for their money have news for the Labour party: they believe that it is their money, and they want to decide how to spend it and what to do with it. That is what they are telling the Labour party.It being four hours after the commencement of proceedings on the motion relating to the Finance Bill and Further and Higher Education (Scotland) Bill (allocation of time), MR. DEPUTY SPEAKER. put the Question already proposed from the Chair, pursuant to Order this day.
Question agreed to.
Bill accordingly read a Second time.
Bill committed to a Committee of the whole House.— [Mr. Greg Knight.]
Bill immediately considered in Committee.
Clauses 1 to 9 ordered to stand part of the Bill.
Clause 10
Charge Etc For 1992–93
Motion made and question put, That the Clause stand part of the Bill:—
The Committee divided: Ayes 325, Noes 143.
Division No. 11]
| [1.36 pm
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AYES
| |
Adley, Robert | Carlisle, John, (Luton N) |
Alexander, Richard | Carlisle, Kenneth (Lincoln) |
Alison, Rt Hon Michael | Carrington, Matthew |
Allason, Rupert | Carttiss, Michael |
Amess, David | Cartwright, John |
Amos, Alan | Cash, William |
Arbuthnot, James | Chalker, Rt Hon Mrs Lynda |
Arnold, Jacques (Gravesham) | Channon, Rt Hon Paul |
Ashby, David | Chapman, Sydney |
Aspinwall, Jack | Churchill, Mr |
Atkins, Robert | Clark, Rt Hon Alan (Plymouth) |
Atkinson, David | Clark, Dr Michael (Rochford) |
Baker, Nicholas (Dorset N) | Clark, Rt Hon Sir William |
Banks, Robert (Harrogate) | Clarke, Rt Hon K. (Rushcliffe) |
Barnes, Mrs Rosie (Greenwich) | Colvin, Michael |
Batiste, Spencer | Conway, Derek |
Beaumont-Dark, Anthony | Coombs, Anthony (Wyre F'rest) |
Bellingham, Henry | Coombs, Simon (Swindon) |
Bendall, Vivian | Cope, Rt Hon Sir John |
Bennett, Nicholas (Pembroke) | Cormack, Patrick |
Bevan, David Gilroy | Couchman, James |
Biffen, Rt Hon John | Cran, James |
Blaker, Rt Hon Sir Peter | Critchley, Julian |
Body, Sir Richard | Currie, Mrs Edwina |
Bonsor, Sir Nicholas | Curry, David |
Boscawen, Hon Robert | Davies, Q. (Stamf'd & Spald'g) |
Boswell, Tim | Davis, David (Boothferry) |
Bottomley, Peter | Day, Stephen |
Bowden, Gerald (Dulwich) | Devlin, Tim |
Bowis, John | Dickens, Geoffrey |
Boyson, Rt Hon Dr Sir Rhodes | Dicks, Terry |
Braine, Rt Hon Sir Bernard | Dorrell, Stephen |
Brandon-Bravo, Martin | Douglas-Hamilton, Lord James |
Brazier, Julian | Dover, Den |
Bright, Graham | Dunn, Bob |
Brooke, Rt Hon Peter | Durant, Sir Anthony |
Brown, Michael (Brigg & Cl't's) | Dykes, Hugh |
Bruce, Ian (Dorset South) | Emery, Sir Peter |
Buck, Sir Antony | Evans, David (Welwyn Hatf'd) |
Budgen, Nicholas | Evennett, David |
Burns, Simon | Fairbairn, Sir Nicholas |
Burt, Alistair | Fallon, Michael |
Butler, Chris | Farr, Sir John |
Butterfill, John | Fenner, Dame Peggy |
Finsberg, Sir Geoffrey | Lee, John (Pendle) |
Fishburn, John Dudley | Leigh, Edward (Gainsbor'gh) |
Fookes, Dame Janet | Lennox-Boyd, Hon Mark |
Forman, Nigel | Lester, Jim (Broxtowe) |
Forsyth, Michael (Stirling) | Lilley, Rt Hon Peter |
Forth, Eric | Lloyd, Sir Ian (Havant) |
Fowler, Rt Hon Sir Norman | Lloyd, Peter (Fareham) |
Fox, Sir Marcus | Lord, Michael |
Franks, Cecil | Luce, Rt Hon Sir Richard |
French, Douglas | Lyell, Rt Hon Sir Nicholas |
Fry, Peter | McCrindle, Sir Robert |
Gale, Roger | MacGregor, Rt Hon John |
Garel-Jones, Rt Hon Tristan | MacKay, Andrew (E Berkshire) |
Gill, Christopher | Maclean, David |
Gilmour, Rt Hon Sir Ian | McLoughlin, Patrick |
Glyn, Dr Sir Alan | McNair-Wilson, Sir Michael |
Goodhart, Sir Philip | McNair-Wilson, Sir Patrick |
Goodlad, Rt Hon Alastair | Madel, David |
Goodson-Wickes, Dr Charles | Major, Rt Hon John |
Gorman, Mrs Teresa | Malins, Humfrey |
Gorst, John | Mans, Keith |
Grant, Sir Anthony (CambsSW) | Maples, John |
Greenway, Harry (Ealing N) | Marland, Paul |
Greenway, John (Ryedale) | Marlow, Tony |
Gregory, Conal | Marshall, John (Hendon S) |
Griffiths, Peter (Portsmouth N) | Marshall, Sir Michael (Arundel) |
Ground, Patrick | Martin, David (Portsmouth S) |
Grylls, Sir Michael | Mates, Michael |
Hague, William | Maude, Hon Francis |
Hamilton, Rt Hon Archie | Mawhinney, Dr Brian |
Hamilton, Neil (Tatton) | Maxwell-Hyslop, Sir Robin |
Hampson, Dr Keith | Mayhew, Rt Hon Sir Patrick |
Hanley, Jeremy | Mellor, Rt Hon David |
Hannam, Sir John | Meyer, Sir Anthony |
Hargreaves, A. (B'ham H'll Gr') | Miller, Sir Hal |
Hargreaves, Ken (Hyndburn) | Mills, Iain |
Harris, David | Mitchell, Andrew (Gedling) |
Haselhurst, Alan | Mitchell, Sir David |
Hawkins, Christopher | Moate, Roger |
Hayes, Jerry | Monro, Sir Hector |
Hayhoe, Rt Hon Sir Barney | Montgomery, Sir Fergus |
Hayward, Robert | Morris, M (N'hampton S) |
Heathcoat-Amory, David | Morrison, Sir Charles |
Hicks, Mrs Maureen (Wolv' NE) | Morrison, Rt Hon Sir Peter |
Hicks, Robert (Cornwall SE) | Moss, Malcolm |
Higgins, Rt Hon Terence L. | Moynihan, Hon Colin |
Hill, James | Neale, Sir Gerrard |
Hind, Kenneth | Nelson, Anthony |
Hordern, Sir Peter | Neubert, Sir Michael |
Howard, Rt Hon Michael | Newton, Rt Hon Tony |
Howarth, Alan (Strat'd-on-A) | Nicholls, Patrick |
Howarth, G. (Cannock & B'wd) | Nicholson, David (Taunton) |
Howell, Rt Hon David (G'dford) | Nicholson, Emma (Devon West) |
Howell, Ralph (North Norfolk) | Norris, Steve |
Hughes, Robert G. (Harrow W) | Onslow, Rt Hon Cranley |
Hunt, Rt Hon David | Oppenheim, Phillip |
Hunt, Sir John (Ravensbourne) | Owen, Rt Hon Dr David |
Hunter, Andrew | Page, Richard |
Irvine, Michael | Paice, James |
Irving, Sir Charles | Patnick, Irvine |
Jack, Michael | Pattie, Rt Hon Sir Geoffrey |
Jackson, Robert | Pawsey, James |
Janman, Tim | Peacock, Mrs Elizabeth |
Jessel, Toby | Porter, Barry (Wirral S) |
Johnson Smith, Sir Geoffrey | Porter, David (Waveney) |
Jones, Gwilym (Cardiff N) | Portillo, Michael |
Jones, Robert B (Herts W) | Price, Sir David |
Jopling, Rt Hon Michael | Raffan, Keith |
Kellett-Bowman, Dame Elaine | Raison, Rt Hon Sir Timothy |
Key, Robert | Rathbone, Tim |
King, Roger (B'ham N'thfield) | Redwood, John |
Kirkhope, Timothy | Renton, Rt Hon Tim |
Knight, Greg (Derby North) | Rhodes James, Sir Robert |
Knight, Dame Jill (Edgbaston) | Riddick, Graham |
Knowles, Michael | Ridley, Rt Hon Nicholas |
Knox, David | Ridsdale, Sir Julian |
Lamont, Rt Hon Norman | Rifkind, Rt Hon Malcolm |
Latham, Michael | Roberts, Rt Hon Sir Wyn |
Lawrence, Ivan | Roe, Mrs Marion |
Lawson, Rt Hon Nigel | Rossi, Sir Hugh |
Rost, Peter | Thompson, Sir D. (Calder Vly) |
Rowe, Andrew | Thompson, Patrick (Norwich N) |
Rumbold, Rt Hon Mrs Angela | Thorne, Neil |
Ryder, Rt Hon Richard | Thornton, Malcolm |
Sackville, Hon Tom | Thurnham, Peter |
Sainsbury, Rt Hon Tim | Townend, John (Bridlington) |
Sayeed, Jonathan | Townsend, Cyril D. (B'heath) |
Scott, Rt Hon Nicholas | Tracey, Richard |
Shaw, David (Dover) | Tredinnick, David |
Shaw, Sir Giles (Pudsey) | Trippier, David |
Shaw, Sir Michael (Scarb') | Trotter, Neville |
Shelton, Sir William | Twinn, Dr Ian |
Shephard, Mrs G. (Norfolk SW) | Vaughan, Sir Gerard |
Shepherd, Colin (Hereford) | Viggers, Peter |
Shepherd, Richard (Aldridge) | Waldegrave, Rt Hon William |
Shersby, Michael | Walden, George |
Sims, Roger | Walker, Bill (T'side North) |
Skeet, Sir Trevor | Waller, Gary |
Smith, Sir Dudley (Warwick) | Walters, Sir Dennis |
Smith, Tim (Beaconsfield) | Ward, John |
Soames, Hon Nicholas | Wardle, Charles (Bexhill) |
Speed, Keith | Warren, Kenneth |
Speller, Tony | Watts, John |
Spicer, Sir Jim (Dorset W) | Wells, Bowen |
Spicer, Michael (S Worcs) | Wheeler, Sir John |
Squire, Robin | Whitney, Ray |
Stanbrook, Ivor | Widdecombe, Ann |
Stanley, Rt Hon Sir John | Wiggin, Jerry |
Steen, Anthony | Wilkinson, John |
Stern, Michael | Wilshire, David |
Stevens, Lewis | Wolfson, Mark |
Stewart, Allan (Eastwood) | Wood, Timothy |
Stewart, Andy (Sherwood) | Woodcock, Dr. Mike |
Stewart, Rt Hon Sir Ian | Yeo, Tim |
Stokes, Sir John | Young, Sir George (Acton) |
Summerson, Hugo | Younger, Rt Hon George |
Tapsell, Sir Peter | |
Taylor, Ian (Esher) | Tellers for the Ayes:
|
Taylor, Rt Hon J. D. (S'ford) | Mr. David Lightbown and
|
Taylor, Sir Teddy | Mr. John M. Taylor.
|
Temple-Morris, Peter | |
NOES
| |
Allen, Graham | Davies, Rt Hon Denzil (Llanelli) |
Anderson, Donald | Davies, Ron (Caerphilly) |
Archer, Rt Hon Peter | Dixon, Don |
Armstrong, Hilary | Dobson, Frank |
Ashley, Rt Hon Jack | Duffy, Sir A. E. P. |
Banks, Tony (Newham NW) | Dunwoody, Hon Mrs Gwyneth |
Barnes, Harry (Derbyshire NE) | Edwards, Huw |
Barron, Kevin | Enright, Derek |
Battle, John | Evans, John (St Helens N) |
Beckett, Margaret | Faulds, Andrew |
Beith, A. J. | Fisher, Mark |
Bell, Stuart | Flannery, Martin |
Benn, Rt Hon Tony | Flynn, Paul |
Bennett, A. F. (D'nt'n & R'dish) | Foster, Derek |
Benton, Joseph | Fraser, John |
Bermingham, Gerald | Garrett, Ted (Wallsend) |
Blair, Tony | Gilbert, Rt Hon Dr John |
Boateng, Paul | Golding, Mrs Llin |
Boyes, Roland | Gordon, Mildred |
Bradley, Keith | Grant, Bernie (Tottenham) |
Brown, Nicholas (Newcastle E) | Griffiths, Win (Bridgend) |
Caborn, Richard | Grocott, Bruce |
Callaghan, Jim | Hain, Peter |
Campbell, Ron (Blyth Valley) | Hardy, Peter |
Campbell-Savours, D. N. | Hattersley, Rt Hon Roy |
Clark, Dr David (S Shields) | Haynes, Frank |
Clelland, David | Heal, Mrs Sylvia |
Clwyd, Mrs Ann | Henderson, Doug |
Cohen, Harry | Hinchliffe, David |
Cook, Frank (Stockton N) | Hoey, Kate (Vauxhall) |
Corbyn, Jeremy | Howarth, George (Knowsley N) |
Cousins, Jim | Howells, Geraint |
Cox, Tom | Howells, Dr. Kim (Pontypridd) |
Crowther, Stan | Hoyle, Doug |
Cummings, John | Hughes, Roy (Newport E) |
Cunliffe, Lawrence | Hughes, Simon (Southwark) |
Cunningham, Dr John | Illsley, Eric |
Janner, Greville | Redmond, Martin |
Jones, Barry (Alyn & Deeside) | Rees, Rt Hon Merlyn |
Jones, Martyn (Clwyd S W) | Richardson, Jo |
Kilfoyle, Peter | Robinson, Geoffrey |
Kumar, Dr. Ashok | Rooker, Jeff |
Leadbitter, Ted | Ross, Ernie (Dundee W) |
Leighton, Ron | Rowlands, Ted |
Lestor, Joan (Eccles) | Ruddock, Joan |
Lewis, Terry | Sedgemore, Brian |
Litherland, Robert | Sheerman, Barry |
Lofthouse, Geoffrey | Sheldon, Rt Hon Robert |
Loyden, Eddie | Shore, Rt Hon Peter |
McKay, Allen (Barnsley West) | Short, Clare |
McWilliam, John | Skinner, Dennis |
Madden, Max | Smith, Andrew (Oxford E) |
Marek, Dr John | Smith, C. (Isl'ton & F'bury) |
Marshall, Jim (Leicester S) | Smith, Rt Hon J. (Monk'ds E) |
Meale, Alan | Soley, Clive |
Michael, Alun | Spearing, Nigel |
Michie, Bill (Sheffield Heeley) | Steinberg, Gerry |
Mitchell, Austin (G't Grimsby) | Straw, Jack |
Morgan, Rhodri | Taylor, Mrs Ann (Dewsbury) |
Morris, Rt Hon A. (W'shawe) | Turner, Dennis |
Mowlam, Marjorie | Walley, Joan |
Mullin, Chris | Wardell, Gareth (Gower) |
Murphy, Paul | Wareing, Robert N. |
Oakes, Rt Hon Gordon | Welsh, Michael (Doncaster N) |
O'Brien, William | Williams, Rt Hon Alan |
O'Hara, Edward | Williams, Alan W. (Carm'then) |
Orme, Rt Hon Stanley | Winnick, David |
Patchett, Terry | Wise, Mrs Audrey |
Pendry, Tom | Young, David (Bolton SE) |
Powell, Ray (Ogmore) | |
Primarolo, Dawn | Tellers for the Noes:
|
Quin, Ms Joyce | Mr. Jack Thompson and
|
Radice, Giles | Mr. Ken Eastham.
|
Randall, Stuart |
Question accordingly agreed to.
Clause ordered to stand part of the Bill.
Clause 11 ordered to stand part of the Bill.
Schedule agreed to.
Bill reported, without amendment.
Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 58 (Third Reading), and agreed to.
Bill accordingly read the Third time, and passed.
Further And Higher Education (Scotland) Bill
Lords amendments agreed to. [One with Special Entry.]
Education (Schools) Bill (Allocation Of Time)
1.50 pm
I beg to move,
That the Order of the House [30th January) be supplemented as follows:
Lords Amendments
1. The proceedings on Consideration of Lords Amendments shall be completed at this day's sitting and, if not previously brought to a conclusion, shall he brought to a conclusion two hours after the commencement of the proceedings on this Order.
2.—(1) For the purpose of bringing any proceedings to a conclusion in accordance with paragraph 1 above—
(2) Proceedings under sub-paragraph (1) above shall not be interrupted under any Standing Order relating to the sittings of the House.
Stages Subsequent To First Consideration Of Lords Amendments
3. Mr. Speaker shall put forthwith the Question on any Motion made by a Minister of the Crown for the consideration forthwith of any further Message from the Lords on the Bill.
4. The proceedings on any such further Message from the Lords shall, if not previously brought to a conclusion, be brought to a conclusion one hour after the commencement of those proceedings.
5. For the purpose of bringing those proceedings to a conclusion—
Supplemental
6.—(1) Mr. Speaker shall put forthwith the question on any Motion made by a Minister of the Crown for the appointment and quorum of a Committee to draw up Reasons.
(2) A Committee appointed to draw up Reasons shall report before the conclusion of the sitting at which it is appointed.
7.—(1) In this paragraph "the proceedings" means proceedings on Consideration of Lords Amendments or on any further Message from the Lords on the Bill, on the appointment and quorum of a Committee to draw up Reasons and on the Report of such a Committee.
(2) Paragraph (1) of Standing Order No. 14 (Exempted business) shall apply to the proceedings.
(3) No dilatory Motion with respect to, or in the course of, the proceedings shall be made except by a Minister of the Crown, and the question on any such Motion shall be put forthwith.
I hope that the Opposition will not claim that the Education (Schools) Bill has not been given full scrutiny by Parliament or that they require longer than the two hours that we are making available for the House to consider amendments made in another place. The Bill has had more than 40 hours of debate in the House and more than 30 hours of debate in the House of Lords.
I have no doubt that the hon. Member for Blackburn (Mr. Straw) will remind us that the Bill was guillotined on Report, but he should also remember that that was done in curious circumstances. We had first agreed that it would be reported in one day, but the first day was taken up with delaying tactics and most of the second day was taken up with talking about the guillotine motion. The Bill was, ultimately, fully debated in Standing Committee without any need for timetabling. The final sitting agreed for Committee discussion was not used and the Bill had more than 36 hours of Committee debate.
There was full debate on the Bill in another place. We responded to suggestions with flexibility and tabled amendments at the request of the Opposition, sometimes, in the other place. We have accepted the results of Divisions there that were carried against us. The Bill as it now stands should be reasonably non-controversial and widely welcomed, if the Opposition now support the fundamental aspects of the parents charter.
The Government were defeated twice in the House of Lords and propose to accept those defeats. I have with me the parents charter. The changes made in the House of Lords do not alter one word of the document. It has been
fought ferociously up and down the country by some elements of the Labour party, who have refused to distribute it to schools as they say that it is some sort of political document.
In so far as I understand the Labour party to have an education policy at all, I think that it is now converted to the idea of league tables for schools so that the public are aware of the comparative performances of different schools. I hope that it is converted to the idea of independent inspection and the notion that inspectors' reports should be sent unsolicited to parents.
No.
No.
In that case, some members of the Labour party, including the hon. Member for Newham, North-West (Mr. Banks) who speaks for one of the more reactionary sections of the Labour party, will continue to argue that education, at least in Newham, should remain a closed world without a great amount of information being given to parents or the public in that borough.
rose—
rose—
I believe that we shall find that the country is anxious to receive the benefits of the parents charter and that we can now proceed, in a fairly rapid debate, to take the Bill on to the statute book. I admit that there are many issues to be encompassed by our debates. The Bill secures regular inspection to high standards; reasonable, published reports to parents; follow-up action by governors; and comparative tables of key information to parents. The changes made at this stage are largely those of organisation, not substance. The parents charter Bill is now ready for enactment.
Does my right hon. and learned Friend agree that two of the most important aspects of the parents charter are that people will know the staying-on rates of children at school and, in districts such as London, they will also know the truancy rates?
They will know the staying-on rates, the truancy rates and the examination results of all the schools so that it will be possible to compare the performances of all the schools that are in similar circumstances.
The hon. Members for Newham, North-West and for Newham, South (Mr. Spearing) exploded with rage when I mentioned those provisions, and appeared reluctant to have such information given to the parents of Newham.rose—
rose—
I shall give way in a moment, but that is all of a piece with the attitude of both those Newham Members who have used the difficulties in Stratford school as an excuse to try to get rid of Mrs. Snelling, who has done a great deal to improve that school. They are still demanding her head on a salver because she defied the Newham Labour party and Newham council by giving the school grant-maintained status, which she successfully achieved. Having criticised the voice of Newham when it barracked me, I shall give way to it.
I hope that I shall talk about Stratford school later in the debate. My hon. Friend the Member for Newham, South (Mr. Spearing) and I wanted to challenge the Secretary of State's reference to independent inspectors. Is he saying that, in that sense, Her Majesty's inspectorate is not independent? If so, that is a slur on HMI.
HMI will continue to carry out inspections, and always would under the Government's proposals. HMI has never gone in for systematic inspection of all schools and reporting to parents. Indeed, it would have taken it more than 100 years to produce individual reports on primary schools at the rate at which it was going. The Government proposed that the inspection of schools should be carried out by inspectors registered with HMI—some would be local government inspectors, some would be outside consultants and experts approved by HMI.
We accepted amendments that proposed that HMI should have a veto over a school's choice of inspectors. Their lordships have taken the matter further and stated that HMI should not only register for the inspectors carrying out the systematic inspectors but should select the inspectors in the case of each school. The Government are prepared to accept that. I think that the principal practical difference will be that more schools will choose independent, non-local authority inspectors than would otherwise do so. HMI would be unlikely to choose local authority inspectors in every case, whereas the average body of school governors would be likely to choose the local authority inspectors in its district if the local authority had inspectors that come up to HMI standards, which quite a few local authority inspectors would do.That is a slur on local authority inspectors.
Everyone considers local authority inspection to be patchy and of variable standards, and that has always been the opinion of HMI. I think that that view is widely accepted by those involved in the subject.
In future, under the Bill, all inspection will be carried out by people who comply with the criteria laid down by HMI and meet HMI standards. We are prepared to start on the basis that HMI will select the inspectors for each school. As a result, the parents charter Bill is now ready for enactment. It is a great change in the culture of education in this country. It has not been rushed through but has received all the necessary scrutiny. I hope that, now, the Opposition will not try to make it fall victim to time-wasting and delaying tactics.I confirm that my outburst and that of my hon. Friend the Member for Newham, North-West (Mr. Banks) was targeted not only at what the Secretary of State said but at the fact that he did not have the courtesy to give way. What he said about inspectors was clearly a reflection on the independence of the existing inspectorate. He may be quite right in saying that inspectors cannot go to all schools, but that is a different issue.
On the subject of what the Secretary of State asks of the inspectors, is he aware that, despite his ministerial colleague stating that Stratford school was working well—or words to that effect—the Secretary of State's answer to us was that the last time that an inspector of his Department went into that school was 1991? If he has not received any reports on that school recently, how can he tell the House accurately how that school is progressing?If the outburst of the two hon. Members was caused by taking my reference to independent inspectors as an attack on Her Majesty's inspectorate, that was simply a complete misunderstanding on their part. The hon. Member for Newham, South will know that the Bill makes Her Majesty's inspectorate more independent of the Government than hitherto. In future, Her Majesty's chief inspector will be a much more powerful and independent watchdog figure than he was before and than he would be under Labour's proposals. The Labour party would promptly make him subordinate to a new quango of the great and the good and the usual educational interests that it proposes to set up. We are setting up the post of HMCI, who will have an important role in monitoring inspection of schools and advising the Government—that has never been threatened by the Bill. He will play a key role in the selection of those inspectors who carry out the parents charter type inspections of 6,000 schools a year and report to parents.
I have always believed that inspectors should be independent of schools. I do not think, as Labour appeared to believe until it voted otherwise in the House of Lords, that all the inspectors should be employed by a local authority to inspect only that local authority's schools and should then be expected to be critical of that local authority if there were failings when they reported to parents. The system that we envisage is much better and the whole education world will be opened up to much more independent, open scrutiny. That can only benefit the good schools and the many dedicated teachers we have, as it will identify weaknesses and correct them, and build on strengths school by school. That is why I hope that the Bill will proceed without any further delay of the rather absurd kind that we had on Report.2 pm
I am sorry to disappoint the Secretary of State, but we oppose this guillotine. If anybody wanted any convincing about our justification for opposing it, he need only look at the Amendment Paper and see that the Secretary of State is expecting the House to debate 38 groups of amendments and amendments to amendments in eight separate debates, and have votes, within a single hour. That shows an arrogance and a contempt of democratic procedures which have typified this Administration. The guillotine is doubly unacceptable, given that the Bill and the amendments were not delivered back to the House until this morning and hon. Members on both sides had only a few hours in which to table amendments to amendments and to consider the merits of amendments made in the other place.
The Secretary of State said that it had been agreed that the Report stage in the House of Commons should last one day. I should put it on record that there was never any such agreement either between the Front Bench teams or through the usual channels. Such an agreement was neither entered into nor even sought by the Minister of State or by the Government Whip. We ran into two days solely because of the incompetence of the Government Whips Office.
The Opposition filibustered.
We had no need to do so, as 23 debates were to be squeezed into one day because of the incompetence of the Government Whips Office, who did not understand that there was no way in which those 23 debates could conceivably be contained within the six hours of debate allocated.
Thirteen years ago, this Administration came to power promising that they would "promote higher standards" in basic educational skills. Today, the public learned more of the truth of the Government's failure to achieve that promise and their neglect of a whole generation of the nation's young. A major study, including work by the National Foundation for Educational Research, shows Britain bottom of the class in terms of shortages of primary school books, almost bottom on shortages of secondary school books and just one from bottom on overcrowding of classrooms. We are in a worse position in comparison not only with our major competitors, but with Hungary, Portugal, Jordan and even Slovenia. Four weeks ago, we learned in another NFER report that reading standards for seven-year-olds had shown an alarming decline of three months in the four years since 1987, when the latest and largest round of experiments on other people's children were introduced under the euphemism of "reforms". Last week, we saw the Secretary of State wriggling, squirming and blaming everyone but himself for yet another damning report by HMI, showing that 20 per cent. of children continue to be poorly taught in reading. In an unusually candid admission last year, the Secretary of State told the House that after 12 yearsTo answer that dismal record, the Secretary of State introduced his so-called parents charter and the Bill on which he is now seeking to curtail discussion. It was Lord Beloff—a Conservative peer, and one who, as the Secretary of State would concede, is no wet—said that the Bill was:"we still lag behind our competitors in the participation of our school leavers in further education and training, and their achievement of useful qualifications."—[Official Report, 21 March 1991; Vol. 188, c. 432.]
He went on to say that the other place had never been given "the slightest indication—""the silliest Bill that any Parliament has ever had to consider." —[Official Report, House of Lords, 11 February 1992; Vol. 535, c. 634.]
Order. I am sorry to interrupt the hon. Gentleman, but he cannot quote a Member of the other place who is not a Minister. Therefore, will he please paraphrase?