Skip to main content

Commons Chamber

Volume 224: debated on Monday 10 May 1993

The text on this page has been created from Hansard archive content, it may contain typographical errors.

House Of Commons

Monday 10 May 1993

The House met at half-past Two o'clock

Prayers

[MADAM SPEAKER in the Chair]

Oral Answers To Questions

National Heritage

Tourism

1.

To ask the Secretary of State for National Heritage what measures he is proposing to promote tourism in East Anglia; and if he will make a statement.

The English tourist board, which receives grant in aid from my Department, will allocate at least £400,000 to the East Anglia tourist board during this financial year. The total allocation to each regional board has not been settled yet, as a proportion of regional funding will be distributed later in the year by means of a new scheme aimed at directing resources to areas where the industry is most in need of support.

Is my hon. Friend aware of the opening earlier this year of the Manor House museum in Bury St. Edmunds, which will house the borough's collection of paintings and porcelain and, in particular, its unique collection of clocks? That will further enhance the reputation of Bury St. Edmunds as a great jewel in the crown of East Anglia. Does my hon. Friend agree that the opening of the museum, and so many others like it, demonstrates the flowering of—and interest in—the arts that has come about in the past 10 years?

I have indeed heard about the Manor House museum and its collections, and I know that my hon. Friend has supported it over the past year. It does, of course, represent, a jewel in the crown of East Anglia's tourist attractions; moreover, it confirms the flowering of the arts that has developed over the past decade or so. It is a little-known fact that, over the past 10 years, roughly one museum has opened every two weeks.

Royal Opera House

2.

To ask the Secretary of State for National Heritage what involvement his Department has had in discussions to increase private charitable funding to secure the future of the Royal Opera House.

It is for the Royal Opera House to take the lead in seeking sponsors for its proposed redevelopment scheme. I welcome the fact that it has already received pledges of significant private contributions to its appeal fund.

Does my right hon. Friend agree that that redevelopment scheme is essential to the future of the Royal Opera House, or does he endorse the more sceptical view expressed by the Arts Council? What specific response have the Government made to the magnificent pledges of Mrs. Vivien Duffield and Lord Sainsbury?

As the local Member of Parliament, I could not but be aware of the physical circumstances of the Royal Opera House. They have been described as Dickensian; I would say that, backstage, they owed even more to Gustave Dore. The ROH is clearly right to propose a redevelopment scheme.

As for the view of the Arts Council, it has of course asked for reports, but it has also engaged in a continuing dialogue with the ROH. Mrs. Duffield and Lord Sainsbury, who have already been generous to the Tate and National galleries respectively, came to see the Prime Minister recently to describe developments in the scheme.

I wish the appeal well, but does the Secretary of State agree that it is very difficult for people of moderate or poor means—as opposed to a person who is rich, corporate and probably a subscriber—to see world-famous singers at the Royal Opera House, because the numbers are limited to about 2,000? Following the example of President Mitterrand, has the right hon. Gentleman considered building a larger opera house, in which ordinary working-class people of moderate means, along with those who take advantage of corporate hospitality, could see world-famous singers?

I thank the hon. Gentleman for wishing the appeal well. The Royal Opera House has made it clear that it wants access to be improved, and the scheme will afford that not only in terms of the number of seats available, but in terms of the number of performances that can be accommodated. While I do not wish the French President ill in any way, I think that the hon. Gentleman has been more generous to the new French opera house than other critics might be.

Windsor Castle (Fire)

3.

To ask the Secretary of State for National Heritage whether he is now able to give a formal estimate of the cost of the Windsor castle fire; and if he will make a statement.

As I said in my statement to the House on 29 April, early estimates suggest that the reconstruction will cost £30 million to £40 million over five years. That is the estimate which I gave to the hon. Gentleman on 22 February.

There have been estimates of up to £44 million in the newspapers recently. Does the right hon. Gentleman recall that it has been alleged that the fire was caused as a result of criminal neglect, because of the removal of fire service cover? Why is it that they do not call upon the Queen to pay the lot and foot the bill, because they were responsible at the beginning? Why should there be one law for the Queen and another for the rest of the British public? Why is it that they have got the gall to charge people for going into Buckingham palace to pay for the fire and to pay for her taxes? They are just a bunch of cheapskates.

I take it that in his initial remarks the hon. Gentleman was referring to the Berkshire fire service report, which was made available within government on 19 April but which saw the light of day two days before the county council elections, which some may think was a remarkable coincidence. That report, as the chief fire officer has said, has been selectively quoted by others. As for the financing and maintenance of the royal palaces, the hon. Gentleman knows from our long-running dialogue that this was settled in 1831. Many hon. Members would welcome, as he did not, the Queen's decision to open Buckingham palace to the public and to make sure that the contributions are given to the restoration of the castle.

As we have the finest Queen in the world, who is hugely admired and respected by the vast majority of people everywhere, will my right hon. Friend totally repudiate the unrepresentative view of the hon. Member for Bolsover (Mr. Skinner) Can my right hon. Friend give a forecast of how much money the opening of Buckingham palace is likely to raise towards the Windsor castle repairs?

My hon. Friend, as the Member of Parliament for Hampton Court palace, does admirably in terms of his expressions of loyalty. I absolutely endorse what he says. The ticket sales for Buckingham palace will reinforce the ticket sales for Windsor castle. It is expected that that revenue will provide the clear and vast majority of the funds necessary for the restoration.

Freedom Of The Press

4.

To ask the Secretary of State for National Heritage when he next plans to meet representatives of the newspaper industry to discuss freedom of the press.

I met the chairman of the Press Standards Board of Finance Limited on 9 March to discuss the newspaper industry's response to Sir David Calcutt's review of press self-regulation. I look forward to a future meeting with the board in due course.

Will the Secretary of State make it clear on the next occasion that he meets representatives of the press that the public will no longer tolerate chequebook journalism that destroys lives for the sake of the cheap, ephemeral headline and then moves on to the next headline, leaving shattered lives behind? Will he make it clear to them that they have failed lamentably in their paltry efforts to regulate themselves and that it is high time that they were subjected to external sanction and regulation?

The hon. Gentleman will have made his point to what is called Pressbof more vividly than any words that I could use. However, I join him in hoping that the press will continue to look at ways in which their methods of regulation can be improved.

Will my right hon. Friend reiterate that a free press is a guarantee of our own freedom? Nazi Germany did not have a free press; South Africa did not have a free press. We are lucky to have a free press. Will my right hon. Friend reiterate that fact?

I share my hon. Friend's support and acclaim of a free press. All hon. Members recognise that, although the press sometimes views the House with suspicion in case we should seek to encroach on its freedom, the responsibility for ensuring that we retain a free press, which I agree is one of the glories of our constitution, rests on the press itself.

While the right hon. Gentleman is considering his response to the Calcutt and National Heritage Select Committee reports on press regulation, will he invite representatives of newspapers, magazines and broadcasting to talks about how the present laws, which inhibit press freedom, might be changed, and will he consider the threat of the concentration of ownership and cross-ownership of the media to the plurality of views and voices? In particular, will he now use powers contained in the Broadcasting Act 1990 to require Mr. Rupert Murdoch to choose between his ownership of BSkyB and five national newspapers?

The hon. Gentleman is correct in his description of the need for the Government to determine their response to Sir David Calcutt's report and the Select Committee report. I pay tribute to the comprehensiveness of the latter. Its comprehensiveness sets the Government a considerable task in responding to it. As we wish to observe due courtesies to the House and to the speed at which we respond, it might be a mistake to enlarge the agenda further, but the question that the hon. Gentleman asked remains under review.

British Amateur Rugby League Association

5.

To ask the Secretary of State for National Heritage what assistance has been given to the British Amateur Rugby League Association through the Sports Council in 1992–93.

The Sports Council provided £160,000 in grant aid payments to the British Amateur Rugby League Association in 1992–93. In addition, it provided considerable advice and expertise to BARLA on sports science, coaching and international issues.

Will the Minister pass on my appreciation of, and gratitude for, the excellent grant that the Sports Council gave the sport of amateur rugby league last year? Does he accept, however, that it is not only a question of the allocation of funds and will he undertake that until the increasingly professional sport of rugby union ends its policy of discrimination against rugby league it will not receive a donation from the national lottery?

We had an excellent debate on this, albeit in the middle of the night, on 28 April which was initiated by the hon. Member for Wakefield (Mr. Hinchliffe), who is in his place today. It is not in my gift to do what the hon. Gentleman asks. It is crucial that we maintain the arm's-length principle of funding and Ministers will not decide who benefits from the lottery. However, as I said on 28 April, it is important to have a wide debate on the issues and, as I suggested at the end of my speech, perhaps a few heads need knocking together.

Does my hon. Friend agree that the opportunities to support rugby league and amateur rugby union have increased dramatically in recent years, and will he join me in praising all those who encourage and educate children in those sports, especially those who are involved in amateur rugby league and rugby union in Blackpool, which is a home for both sports?

Yes, of course, my hon. Friend is absolutely right and I welcome his comments. As a former teacher, it would be surprising if I did not recognise the importance of sport for young people.

Monuments (Greater London)

6.

To ask the Secretary of State for National Heritage what representations he has received in the last six months as regards the future maintenance and stewardship of monuments within Greater London.

I have received various representations from organisations and individuals about the future maintenance and stewardship of monuments in Greater London.

Is the Secretary of State aware of the widespread concern not only among professionals in conservation work but ordinary, proud Londoners, who see their capital city falling into decay? Will he address himself to the fact that there are 831 grade I and grade II listed buildings on English Heritage's at-risk register in Greater London? Does he accept that the Albert memorial, shored up as it is, is just a symbol of greater decay throughout the capital? What will he do about it? Does he understand that the fact that he might universally be considered a nice man is twinned with the fact that he is considered to be a totally useless Minister?

I thank the hon. Gentleman for the cordiality of his question. I recently announced the Government's determination of the English Heritage strategy on the care of listed buildings in London. I am conscious that it decided recently to place the Albert memorial on the list of buildings at risk. It is an issue on which there is some disagreement between my Department and English Heritage, but we recognise the point that it wished to make and, as has been made clear, we will return to the restoration of the Albert memorial as soon as appropriate funds allow.

Does my right hon. Friend accept that the comment that he just heard is not typical of the House? Most hon. Members see him as a living memorial to the triumphs of the arts and Conservative policy, and long may that continue to be the case. May I endorse what the hon. Member for Thurrock (Mr. Mackinlay) said about the Albert memorial—he will know that I have taken up that issue—which is a memorial not only to Prince Albert but to the triumph of the arts and sciences during that age of British history and is precious to Londoners and people throughout the country.

I am grateful to my hon. Friend for his remarks although, as the hon. Member for Thurrock (Mr. Mackinlay) had adopted an antithetical style by saying something friendly followed by something disagreeable, I had the faintest misgiving that perhaps my hon. Friend was going to reverse the process. I have made it clear that, by definition, the Government recognise the importance of the Albert memorial. As and when funds allow—we shall approach the subject during the future public expenditure round—we will resume its restoration.

Is not it the case that Buckingham palace is the most popular, well-known and often-visited of all the monuments, memorials and historic buildings in inner London? In view of that fact, will the Minister tell us what projection the Government have made of the income that the Queen will receive during the next five years? As he has decided to issue tickets in advance, through travel operators and others, what considerations are the Government giving to the prospect of those awful west end parasites, the ticket touts, meandering their way in front of Buckingham palace? Have they considered that and would it not be a demeaning spectacle if the residence of the head of state were to be marred by those very parasites?

I am grateful to the hon. Gentleman for his praise of Buckingham palace as a symbol of our nation, although architectural critics have not always been so kind. The decisions about access to Buckingham palace were taken by the royal household, which will be in charge of access arrangements. As I understand it, the group tickets have already sold out and I imagine that the old-fashioned British principle of queuing will apply to people applying for tickets individually.

Television Licence Fee (Abolition)

7.

To ask the Secretary of State for National Heritage what consideration he has given to abolition of the television licence fee.

The licence fee will continue at least until the expiry of the present royal charter in 1996. The longer-term future of the licence fee will be considered as part of the charter review.

Has my hon. Friend read in the newspapers during the past few days about the massive windfall that some directors of independent television companies have picked up simply because they managed to gain one of the franchises? Does not that show that there is masses of money in the private sector that could fund television programmes on BBC, just as well as it funds programmes on ITV? Is not it quite wrong that if grandad wishes to watch "Coronation Street" on ITV as opposed to "EastEnders" on BBC, or grandma prefers "This is your Life" on ITV to "One Foot in the Grave", they must pay £85 a year for a lot of programmes that they do not want to watch, when private sector money is available to fund the BBC?

My hon. Friend has put her finger on an important point. Indeed, it was a point raised by her constituent Mr. Leonard Jones of 77 Belmont avenue, Wickford in his letter to her of 20 October which she forwarded to me. I am grateful to her for raising that point. It is part of the charter review process and we will consider that representation.

Given the limitations of the licence fee, especially as it affects pensioners, will the Minister accept that many Labour Members would be sceptical about any alternative form of funding the BBC that left it open either to crude market forces or to increased Government intrusion in programme making?

I accept that very important point. There are two sides to the argument. I also take the point about concessionary licences over which the House and successive Governments have wrangled for many years. It would be very expensive to change the position. Conservative Members and, I suspect, all other Members do not regard the licence as an instrument of social policy.

Many years ago, I asked for the television licence to be completely abolished and I supported a Labour Bill on that. Will my hon. Friend try to get away from the licence fee? We employ many people to go round with detector vans, and we have to replace and maintain those vans. It costs a lot of money that could go towards television programmes. There must be a better way. It would help pensioners tremendously not to have to pay those large bills.

Of course I recognise my hon. Friend's point about the cost to pensioners. It is also worth making the point that the BBC licence fee costs about 23p a day. My hon. Friend's representation will be taken into account and we shall have to work out a way forward. It is worth noting that we have received more than 6,000 representations in response to the paper that we published before Christmas. I do not think that there has ever been such a widespread review of broadcasting policy.

I am sure that the Minister agrees that among the vast amount of evidence that he has received, no coherent argument is emerging for changing the current system of financing the BBC through the licence fee. The debate on the future of the BBC cannot be seen in isolation from the wider broadcasting industry and from the chaos caused by the Broadcasting Act 1990. Will the Minister admit today that ITV is in danger of being swamped by imported American programmes and that the BBC could become the only significant source of original, high-quality United Kingdom production? When will he face up to his responsibilities and take up his responsibility to amend the invidious and infamous Broadcasting Act 1990?

I accept my responsibilities; I have broad shoulders and I intend to use them. However, I do not accept for one moment that the ITV companies are in danger of being swamped by anything. They are vibrant and strong, and they are making programmes that are held in worldwide esteem. Of course there are coherent arguments on all sides of the debate about the future funding of the BBC. The hon. Lady has done her bit to destroy confidence in the ITV companies by some of her recent comments.

Millennium Fund

8.

To ask the Secretary of State for National Heritage what plans he has for the millennium fund; and if he will make a statement.

Subject to the views of another place, the millennium fund will finance a number of projects, large and small, throughout the United Kingdom to celebrate fittingly the beginning of the third millennium. I hope that the fund will also endow a system of bursaries.

May I have my right hon. Friend's assurance that the millennium fund will not be used only to fund monuments in London and in the rest of the country, although they may have a place? Could not an imaginative scheme be developed to advance the cause of individuals and the welfare of people as we move into the third millennium and seek to establish a completely new spirit for the whole nation and for the world?

In 1851 and in 1951, which are the most recent parallels and analogies, when my party was not in power, the monuments were concentrated heavily in London. I do not know who will be in power when the millennium is celebrated, although I have great confidence in my own party. One thing of which I hope I can be certain is that the monuments will be spread throughout the United Kingdom.

In the context of my hon. Friend's question, as I said, I hope that there will also be bursaries. I hope that they will be enjoyed not only by those starting out on their careers but by those starting out in retirement and that that will be in the spirit of what my hon. Friend seeks.

Could millennium funds be diverted to the Albert memorial? Is it not a fact that, because of deterioration related to copper sulphate and iron oxide, any repairs will be more difficult and infinitely more expensive in 1994 than they would be if they were done straight away, in 1993? Is not this a classic case of a stitch in time saving nine?

All uses of lottery funds will be decided by those named as the distributors under the National Lottery etc. Bill. It will be for the distributors to decide on the quality of applications on the basis of the advice that they receive. I recognise that the Albert memorial might be such a candidate—

The Bill does not become an Act until later this year. The use of millennium funds may fall foul of the principle of additionality, which is important to Opposition and Conservative Members alike.

I appreciate that there are difficulties in deciding what should mark the millennium, but will my right hon. Friend bear in mind that our music industry, and the popular music industry in particular, has some of the greatest talent in the world? Does he agree that the establishment of a great music palace, within whose walls the popular music of previous decades and of the present could be played, would be a fitting and exciting way in which to mark the millennium?

I have no doubt that a series of imaginative proposals will be put to the Millennium Commission when it is established. My hon. Friend's idea seems a good candidate, but applications will be treated on their merits by the commission.

Does the Secretary of State know why questions such as that raised by the hon. Member for Ealing, North (Mr. Greenway) are being posed now? Could it be because of the secrecy that has been a hallmark of his Department's approach to certain aspects of the National Lottery etc. Bill? Is he aware that the GAH report, which his Department commissioned but refused to publish, has now been published—conveniently, after the Bill has received its Third Reading and at the exorbitant cost of £695 a copy? Does the right hon. Gentleman agree that it would be a scandal if GAH made a financial killing on the back of public money, especially given that hon. Members were denied access to the contents of that report during the passage of the Bill?

I take mild exception to the hon. Gentleman's observation about the Government's secrecy in the context of the millennium fund. We have sought to be open in every answer that we have given. The report published by GAH earlier today was not commissioned by the Government and has not yet been seen by my Department.

May I ask my right hon. Friend to be a little less modest about who will be in power at the time of the millennium and a little less cautious in his replies about the Albert memorial? Can he not put in a good word, as it is a total scandal that that great memorial is rotting away under scaffolding?

I am certain that, with the continuing and robust support of my hon. Friend, my party will be in power at the time of the millennium. I hope that my hon. Friend will ensure that his support is robustly given during the seven years from now. As regards the Albert memorial, I can only repeat what I said and draw my hon. Friend's attention to the principle of additionality, which is of some importance in the overall lottery equation.

Arts Council For Wales

9.

To ask the Secretary of State for National Heritage when he next intends to meet the Arts Council for Wales to discuss funding.

When the Secretary of State meets the Arts Council for Wales, will he use his good offices to press for additional funding for the Pontardawe international music festival? That unique and excellent local event attracts 20,000 spectators and participants to its annual August festival. Although it has received some additional grant aid in the past few years, it is run by an enthusiastic bunch of volunteers who need permanent funding to assist them of the kind that goes towards specialist but narrowly based forms of music. Will the Secretary of State press for that funding on a permanent basis? I invite him to attend the festival over the weekend of 20 to 22 August, if he is in that part of the world.

I am grateful to the hon. Gentleman for giving me advance warning that he intended to raise the subject of the Pontardawe music festival. I gather that, last year, West Wales Arts began to give a development grant to the festival of £5,000 for each of three financial years. That grant attracted funds from other sources for the 1992 festival. I hope that the organisers achieve the same this year. As to the future, the hon. Gentleman will know that my right hon. Friend the Secretary of State for Wales will take responsibility for the Arts Council for Wales on I April next year. For future years, perhaps the hon. Gentleman's request should be more locally delivered.

Midlands Mainline Rail Services

10.

To ask the Secretary of State for National Heritage what assessment he has made of the impact on the tourist industry in the east midlands of the level of service on the midlands main line; and if he will make a statement.

English tourist board research indicates that 8 per cent. of trips to the east midlands in 1991 were made by train. British Rail has already invested significant sums to upgrade the line.

Is there not a danger that the east midlands will become a backwater in terms of tourism, commercial provision and industrial activity unless it has an effective rail link in the midlands main line, for which electrification is required? If the line is to link with the heart of Europe through St. Pancras, electrification begins to be required. Could the Secretary of State for Transport be informed that it is no to privatisation and yes to electrification?

As far as I am concerned, it is yes to tourism in Derbyshire. I shall visit Derbyshire on Thursday to launch the Peak tourism partnership. I shall, of course, explain to the people of Derbyshire the benefits to tourism of privatisation and of electrification, which may or may not happen. Railtrack will be financed primarily through charges to the users, but, as it was originally a nationalised industry, it will have access to Government loans. Privatisation will therefore increase the range of public support mechanisms for infrastructure spending.

Does my hon. Friend agree that tourists who wish to visit the east midlands, and Derbyshire in particular, have benefited considerably in recent years by continued and sustained investment in the rail infrastructure on that line? Does he agree that the journey time for tourists to reach the east midlands is now 30 to 45 mintues quicker than it was five or six years ago?

Of course, my hon. Friend is right. I travel on that line. I know that it is an excellent line. I wish that some of the other lines in Britain were as good.

Freedom Of The Press

11.

To ask the Secretary of State for National Heritage what steps he intends to take to protect a free press.

In deciding our response to the recommendations of Sir David Calcutt and the National Heritage Select Committee on press self-regulation, we shall be guided by our commitment to freedom of the press, which is a cornerstone of our democracy.

Does the Minister agree that it is something of a paradox that we have more television stations, more newspapers and thicker newspapers, yet they appear to be in the ownership of fewer and fewer hands? Should not the Minister be wary about the freedom of the press in Britain after the experience of self-censorship of those people who worked for the Mirror Newspaper Group during Maxwell's days? Should he not cite as an example the Scott trust, which was supposedly a good thing but which has used the Manchester Evening News and The Guardian to increase its share of newspaper ownership in Greater Manchester?

It is perfectly valid to talk about concentration of media ownership, but that is a slightly different issue from the freedom of the press to comment on events, people and activities. As I have just said, that is the cornerstone of our democracy.

Television Franchises

12.

To ask the Secretary of State for National Heritage what plans he has to review the television franchise system.

It is too early to consider changes to the arrangements which came into effect at the beginning of the year, but I shall keep the working of the Broadcasting Act 1990 under review.

Does the Minister agree that the crazy auction system by which the franchises were allocated has already led to severe problems, particularly in the case of Tyne Tees Television? Is he aware of the great concern in the north-east of England about job losses at Tyne Tees, about the failure to deliver the regional programmes that were promised and the effect on the region's media industry, which many of us want to see expand? What specific steps will he take to resolve the matter?

The hon. Lady takes a more pessimistic view of the working of the Act and of the health of the federal system than other, more objective, critics might. I made it clear on 6 May, in answer to a question that she tabled, that the Independent Television Commission was looking at the Yorkshire-Tyne Tees merger and its consequences, and I look forward to its report.

Does the Minister care about broken franchise promises and companies using every ruse in the book to deny the truth to the ITC? Is it not a fact that the Broadcasting Act 1990 has led to a big increase in acquired programmes, with the obligation to produce 86 per cent. of programmes falling to only 65 per cent., with worse to come? Surely even the Minister must realise that the Act will result in less innovation and a narrower range of programmes for viewers. That must call for some concern from him.

I yield to none in wishing to sustain the production base of television and broadcasting in this country. It underlay the Green Paper that we issued on the BBC last November, and I regard it as important in national and international terms. The hon. Lady constantly tempts me to interfere with the ITC, which has responsibility under the Act, and, in the process, interfere with the arm's-length principle which governs most of the activities in which my Department is engaged and which we regard as an admirable part of the British system. The hon. Lady would do more justice to her overall position if she did not constantly ask me to interfere in matters of particulars.

Duchy Of Lancaster

Disabled People

29.

To ask the Chancellor of the Duchy of Lancaster what steps he is taking to ensure that specific provision is made in the various charters for the needs of disabled people.

Charters should take account of the needs of all customers and set standards of service which apply to all of them, including people with disabilities.

Is the Minister aware that since, tragically, the Conservatives came to power in 1979, there have been five private Members' Bills, including two of mine, designed to outlaw discrimination against disabled people? When will the Government break the habit of a lifetime and listen to people, including every disabled persons' organisation? Is he aware that they all believe that those measures should have been allowed through by the Government? Will he make sure that there is early legislation to ensure that, in future, disabled people in Britain are regarded as first-class rather than second-class citizens?

That comes ill from the Labour party. There has been a 300 per cent. real-terms increase in spending on the disabled since the Labour party was last in power. That is a record to be proud of.

Does my right hon. Friend agree that the publication of charters for individual services was the best way to proceed, rather than publication for groups of services? Does he further agree that the publication of individual services must improve a particular service, rather than that of a whole sector?

My hon. Friend is entirely right. Much the best way to get better standards from organisations is to set targets for them. That is why I am pleased to say that 27 of the 31 existing charters have specific targets aimed at helping disabled people, and I hope that the other four will be improved so that they do, too.

Does the right hon. Gentleman agree that an important need for people in receipt of disability benefit and those in receipt of other benefits, such as pensioners, is flexibility and choice as to how the benefit is paid? Does he realise that the Department of Social Security is introducing new forms that do not give the option of payment through post offices? Given the inconvenience and hardship that that will cause to all those claiming benefits, particularly the disabled, will he stand up for the citizen's right to choose and stop the DSS acting in such a devious manner?

There is no intention to infringe in any way the right of people to choose how they want their pensions or other benefits paid. I believe that the DSS has been carrying out experiments to find out whether various alternative methods of payment are acceptable, but no decisions have been taken on any changes.

Does my right hon. Friend agree that the system of charters brings great benefits to people with disabilities, in housing, transport, education, and so on? Will my right hon. Friend ensure, as and when new charters are developed and introduced, that he always bears in mind the need to consult people with disabilities and their organisations, in order to produce all consultative documents in forms that people with visual handicaps can understand?

I thoroughly agree with my hon. Friend's point. We have produced a range of tapes and material in Braille for that very purpose. I had a useful meeting with members of the all-party disablement group recently, including my hon. Friends the Members for Bolton, North-East (Mr. Thurnham) and for Exeter (Sir J. Hannam), at which we discussed those issues.

Psoriasis And Acne

30.

To ask the Chancellor of the Duchy of Lancaster what support he gives to research on psoriasis and acne, and other related dermatological topics; and what representations he has had in relation to such research from the National Eczema Society.

The Parliamentary Secretary, Office of Public Service and Science
(Mr. Robert Jackson)

The main agency through which the Government support research into skin disease is the Medical Research Council. In the financial year 1991–92, the MRC's expenditure on research directly relevant to psoriasis and other dermatological disorders was more than £2·3 million.

As one who was a spotty teenager, greatly embarrassed by acne during my national service, may I ask the Government sympathetically to monitor the representations that have been put forward, on supposedly relatively minor disorders, by the National Eczema Society? What is the Government's response on the effort on research of the limited list procedures put forward to them by Rona MacKie, professor of dermatology at the university of Glasgow, and John Hunter, head of the big dermatology department in Edinburgh?

To look at the hon. Gentleman's elegant countenance, one would never have thought that he was a spotty youth. The Government are aware of those concerns. It is necessary to balance the costs and the benefits to patients, to the industry and the taxpayer. I assure the hon. Gentleman that the Advisory Committee on NHS Drugs will look this summer at all the dermatological drugs available on the NHS and will take into account the perspective to which he referred.

Will my hon. Friend confirm that over the past 10 years there has been a significant increase in asthma and eczema cases and other atopic illnesses? Does he agree that that may be linked to environmental factors relating to car pollution? Will he therefore liaise with his colleagues in the Department of the Environment to make sure that any research carried out takes cognisance of that fact?

I will draw those comments to the attention of my right hon. and learned Friend the Secretary of State for the Environment. The Medical Research Council is at arm's length from the Government—it makes decisions about priorities—but it is important that it should reflect on that important aspect, and I will ensure that it is aware of what has been said.

Charters

32.

To ask the Chancellor of the Duchy of Lancaster what steps his Department is taking to ensure that individual charters are systematically reviewed and strengthened.

Charters are a baseline for continued improvement. As standards are met, they are reviewed and raised and new standards are developed as appropriate. Delivery is for the service providers in the first place, but my Department keeps a sharp eye on it through, for example, the Prime Minister's seminars and our published reports.

I urge my hon. Friend to ensure that the parents charter is regularly revised, and in particular to take account of the additional information that will be available to parents once full testing of the national curriculum is introduced.

My hon. Friend is absolutely right about the importance of testing and the connection between that and information. The recent polls show that parents want more information about the performance of schools and their children. They have not yet seen perhaps as clearly as they should the connection between testing and that information. We have to explain that connection, but it is vital that we continue with the testing programme to ensure that the information that parents want is available to them.

Will the hon. Gentleman say what remedy the charters provide against the squandering of taxpayers' money by the Benefits Agency? For example, £2·1 million has been spent on health screening programmes in private clinics for staff aged 35 and over, 86,000 individual items of corporate clothing costing £2·1 million have been provided and £6·8 million has been spent on overtime because of the total incompetence with which the disability living allowance system has been administered. That makes a total of £10 million already, which could have been spent on benefits instead of nonsense. Will the hon. Gentleman now sack Mr. Michael Bichard and restore parliamentary accountability for the Department of Social Security?

I am surprised that the right hon. Gentleman regards expenditure on health screening as squandering money. I am also surprised that he has attacked good employment practice in the civil service. He asked about the relationship between those factors and the charters, which focus on outputs from public services. There have been problems with the DSS agency's outputs— they have been clearly recognised and are being tackled. The charters do not involve the sort of expenditure to which the right hon. Gentleman referred, as that would not be sensible when trying to manage an organisation that provides good outputs for patients, clients and customers.

Market Testing

33.

To ask the Chancellor of the Duchy of Lancaster if he will report regularly on the progress of the market-testing programme.

I am happy to be able to tell the House that when the current market-testing programme for the year to September 1993 is completed, I shall publish the outcome in line with our citizens charter principle of providing more information on Government activities.

I have also set in hand the publishing of a contracts bulletin which, from this summer, will announce all Departments' future programmes and then all individual market-testing contracts when they are under competition.

Will my right hon. Friend ensure that when the bulletin is published, it will be made fully available to the small business community, which will find it extremely useful when tendering for contracts that were previously not available to it? Will he ensure that it is widely available and written in plain English?

My hon. Friend makes a good point. The work that we have done makes it clear that the bulletin will be particularly helpful to smaller companies that may be interested in smaller contracts.

Does the right hon. Gentleman agree that, since his appointment last year, his disagreements with Cabinet colleagues and his lack of political will have turned the market-testing programme into a fiasco, produced the chaos that we now see in the civil service and stalled his commitment to open government? We are still awaiting the White Paper on science. What steps will he take to ensure that when the inevitable Cabinet reshuffle takes place, after the fiasco last week, it will not result in the right hon. Gentleman being replaced by one of his more dynamic colleagues?

One thing that was made perfectly clear by all the commentators over the weekend was that we had reached another stage in the terminal decline of the Labour party. Having listened to the hon. Lady's contribution, one can see why. The hon. Lady hopes that the market-testing programme will go away, but she will find that it will not—we will proceed with it for the benefit of taxpayers and those who use public services.

Does my right hon. Friend agree that many of the civil servants who have been involved in market testing have demonstrated that once their sense of enterprise is released, they are able to do their jobs much better? Certainly, the agencies demonstrate good enterprise within the civil service and the Government.

My hon. Friend is right. Indeed, many in the public service are far more forward looking than the hon. Member for Redcar (Ms Mowlam). As Jo Rogaly said in the Financial Times last week, the Labour party stands for nothing except "the maintenance of bureaucracies".

Citizens Charters

34.

To ask the Chancellor of the Duchy of Lancaster what further plans he has to review and amend citizens charters.

I refer the hon. Member to the reply I have just given to my hon. Friend the Member for Milton Keynes, South-West (Mr.Legg).

Is the Minister aware that the citizens charter's list of performance indicators for local government includes hardly any that relate specifically to services to ethnic minority communities and contains no mention of major services such as education? Does he accept that record keeping and monitoring are an essential part of ensuring that equal opportunities policies operate effectively? Will he ensure that charters and performance indicators do not continue simply to ignore them?

The hon. Gentleman makes a fair point. It is important to monitor the participation of ethnic minorities in a range of activities. I will certainly draw the attention of the Audit Commission, which is responsible for local government performance indicators, to what the hon. Gentleman said about ethnic minorities. We shall certainly bear in mind the interests of ethnic minorities in drawing up all the charters so that, where appropriate, they can be taken into account.

Will my hon. Friend, in reviewing and amending the citizens charter, recognise that in local government the achievement of a charter mark was accepted with pleasure by competent local authorities at the top of the scale? However, there is considerable wastage at the bottom end of the scale and it would benefit the public, in terms of the quality of services and potential savings, if heavier pressure were placed on local authorities at the bottom end of the charter list.

My hon. Friend, with his great experience of local government, is absolutely right. I should like to draw the attention of the Opposition Front Bench to a statement made recently in the Municipal Journal by the leader of the Labour party on Berkshire county council, Dr. Lawrence Silverman, who seems to be well in advance of his party in the House. He said:

"if the private sector can provide computing, payroll and other financial services cheaper than the in-house bureaucracy, then we owe it to the people…to make these savings and to put the money saved into direct services".
My hon. Friend and Dr. Silverman are absolutely right; it is Opposition Members who have not quite got the point.

In reviewing and amending charters, the Minister placed considerable emphasis on responsiveness to public demand. On the education charter and particularly testing, given the thumbs down from teachers, the public at the polls and even education advisers to the Secretary of State for Education, will the Minister at least draw the Secretary of State's attention to the fact that the citizens charter is meant to pay attention to other people's views and, one hopes, will do so before the system descends into chaos?

Of course we have to pay attention to people's views and explain our policies clearly and effectively. But, as I said earlier, we have to explain that there is a vital connection between testing and the information that parents are seeking about the performance of schools.

In reviewing charters, is my hon. Friend aware that the passengers charter is working very well? Last weekend, I was on a train from Truro to London which was an hour and a half late. Every courtesy was extended to me, plus an offer of compensation. Does that not show that the Government put people first and that they care?

There is no doubt that an improvement in performance has been effected by the way in which the charters are picking up the performance of public services through monitoring, and a significant contribution is being made.

Taurid Object (Debris)

35.

To ask the Chancellor of the Duchy of Lancaster what assessment the Government have made about the Earth's vulnerability from debris shed from the Taurid object; and in what scientific and international initiatives the Government are involved in order to gather intelligence about the threat presented by asteroid strikes generally.

The chief scientific adviser last year consulted extensively on the threat posed by asteroids. The conclusion reached was that the United Kingdom should not divert major Government resources to research in this area, although work on asteroid collisions is going on at Sheffield university.

The United States have been looking at the matter carefully, and I understand that its conclusions have led it to fund a limited detection programme. Clearly, it would be pointless to duplicate that research. We shall, however, continue to monitor the research undertaken and keep our approach under review.

I am grateful for the Minister's reply. Does he understand that large numbers of distinguished scientists and experts throughout the world are alarmed by their inability to alert Governments to the gravity of the situation? Will he give the matter further consideration? In particular, I commend to him an article in the Sunday Telegraph on 25 April by its science correspondent which explained with great clarity the seriousness of the matter, which really should not be treated with levity by the House.

Let no one say that Members representing Essex take only a parochial view of matters. The hon. Gentleman is right. I have read the article to which he refers, and there is a real issue here. At this stage, it is a research issue. We are well in touch with the international network studying it.

Will my right hon. Friend consider the theory that the dinosaurs' lives came to an end as a result of an asteroid? [Interruption]

Order. I want to listen to the hon. Gentleman, but there is a great deal of noise going on. Let me hear whether his question is in order.

Would my right hon. Friend agree that the concern shown by the Labour party is deeply ironic in this context and that research, at this stage, is as far as it need go?

Research Foresight Concepts

36.

To ask the Chancellor of the Duchy of Lancaster what recent discussions he has had with industry about research foresight concepts; and whether these will be covered in his science and technology White Paper.

The Office of Science and Technology published a report by the science policy research unit at Sussex university on research foresight in March this year. I and my officials have had many discussions on such foresight with major British companies and the Confederation of British Industry in preparing for the White Paper.

I am grateful for that reply. We greatly look forward to the publication of the White Paper as a result. Is my right hon. Friend aware that a number of our competitors, including the United States and Japan, already participate in such foresight exercises?

Indeed they do, and so do the Germans, the Dutch and people from other competitor countries. There may well be lessons to be learnt, which is why I have been in touch with the Sussex university unit, one of the centres of expertise on this subject.

Is the Chancellor of the Duchy aware that other Governments in Europe and the European Commission take a considerably greater interest in this matter than do the British Government and that, in the conferences planned on the European Community fast programme, he and his colleagues are participating but little?

We shall be coming to the discussion on the fourth framework programme, where a great deal of work is going on in this country, to make sure that our negotiating position is properly organised. The hon. Gentleman will find that we do not hold back when it comes to putting forward Britain's views on this matter.

Order. I have a Standing Order No. 20 application to hear from the hon. Member for Wakefield (Mr. Hinchliffe).

Lyons Bakeries (Wakefield)

3.31 pm

I beg to ask leave to move the Adjournment of the House, under Standing Order No. 20, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,

"job losses in the Wakefield metropolitan district".
At 5 pm last Friday evening, I was informed by Lyons Bakeries (UK) Ltd of its intention to close down its Wakefield bakery and transfer the production of Lyons cakes elsewhere. Currently, about 334 full-time and 147 part-time staff are employed at the bakery, the plant being one of the largest employers in my constituency.

The announcement of the closure comes only a fortnight after the announcement of the closure of the Lofthouse Foods factory in Wakefield. Although that factory is in the constituency of my hon. Friend the Member for Normanton (Mr. O'Brien), several hundred of the 1,300 people losing their jobs there live in my constituency. Indeed, only the other day a neighbour came around asking for a reference for another job, having lost his job at that plant after nearly 40 years of working there.

The loss of nearly 2,000 jobs in such a short space of time would have a devastating impact on any area, but the impact on Wakefield is even more acute, because of the huge loss of employment that the district has faced owing to the rundown of coalmining and associated industries.

Since 1979, more than 20,000 such jobs have disappeared from Wakefield, and about 2,000 mining engineering jobs have gone in my constituency alone since 1987.

The consequence of this job haemorrhage in coal has been that women have increasingly become the main breadwinners in many homes. Female employment provided by companies such as Lyons Bakeries, even part-time, has often been the sole source of income of a growing number of families. On the latest available official estimate, 15,533 people were unemployed in the Wakefield district. That is a 7·5 per cent. increase over the previous year.

There are further huge projected job losses on the horizon, with 700 likely to lose their jobs when Sharlston colliery, in the adjacent Normanton constituency, closes shortly. The Wakefield area simply cannot take any further job losses, and there is a need to give urgent consideration to steps that must be taken to stop further redundancies and create new employment opportunities. Assisted area status is long overdue.

I appreciate the importance of today's business, Madam Speaker, but I am sure that you will understand—

Order. I am afraid that the hon. Gentleman has not timed himself, and his time is now up. I have given very careful attention to what he has said, and I have to give my decision, as he knows, without stating any reasons. I am afraid that I do not consider that the matter that he has raised is appropriate for discussion under Standing Order No. 20. I cannot, therefore, submit his application to the House.

Points Of Order

3.36 pm

You will recollect, Madam Speaker, that in the past few months, and particularly a week ago, you had various points of order arising out of what was, parliamentary-wise, in order in relation to Lord Justice Scott and his report. I apologise for not giving you warning of this point of order, but I went to the Scott inquiry at 1 Buckingham gate this morning to see Mrs. Presiley Baxendale QC and others cross-questioning a witness from the Ministry of Defence, Mr. Christopher Sandars. It was quite clear from what was to a layman a very impressive examination that this is an inquiry that will go on for many months. I do not doubt that Lord Justice Scott will take extreme care about this inquiry, as indeed the House of Commons expects of him.

The point of order for you is this. In the light of what you said to my right hon. Friend the Member for Chesterfield (Mr. Benn) and me, and other Members, on previous occasions, could you reflect on whether the House of Commons should be anaesthetised from asking questions about this whole area that is within the remit of Lord Justice Scott so long as this inquiry goes on, because that would mean that we could not ask meaningful questions for perhaps a year?

I have explained to the hon. Gentleman earlier, but he probably has not understood me, that there is no sub judice rule whatsoever in terms of the inquiry. The hon. and learned Member for Fife, North-East (Mr. Campbell) is nodding very wisely, and he understands. I have said this many times in the House. If the hon. Member for Linlithgow (Mr. Dalyell) will take a look at Hansard, he will see that I have spelt this out extremely clearly on more than one occasion.

Last Thursday, Madam Speaker, you told my hon. Friend the Member for Hornsey and Wood Green (Mrs. Roche):

"There can be no Government responsibility for finance given to a political party."—[Official Report, 6 May 1993; Vol. 224, c. 282.]
May I seek your guidance arising from what you said at the time, although obviously the situation has changed somewhat? Yesterday in the Sunday Express, a former treasurer of the Conservative party, Lord McAlpine, said that Mr. Nadir had come to him and said that he had been very good to the Conservative party; that they were the Government and could help him. He added:
"I have given millions for the Conservative party"—[Interruption.]

My point of order, Madam Speaker, is simply this. Since substantial sums of money were given to the party in office, obviously to buy influence, would it be possible—[Interruption.] We cannot be heckled and shouted down, I hope, Madam Speaker. Would it therefore be possible for hon. Members to make a passing reference to the subject of the finances of the Conservative party? I have already brought to your notice what you said last Thursday. I hope that that can now be amended and that, if we make a passing reference to the substantial sums of money that Mr. Nadir gave to the Conservative—

Order. I have got the hon. Gentleman's point of order. The Conservative party is not the Government.—[Interruption.] Order. If hon. Members will reflect on this, they will perfectly understand. The Government have no responsibility for the activities of the Conservative party. The hon. Member knows this full well, as a member of the Procedure Committee. He often reminds the House that he is a member of that Committee. I must remind him now what the procedures are. There is no responsibility, in terms of the Government, for a political party.

Further to that point of order, Madam Speaker. Earlier, we had questions about the freedom of the press. Would it be in order when discussing that subject to refer to the donations by Mr. Maxwell to the Labour party?

On a point of order, Madam Speaker. On several occasions recently, you have deprecated the fact that Ministers have made statements on television before making them to the House. We know that, this morning, there was an important meeting of senior Ministers at Downing street, arising out of the debacle last Thursday in the local government elections. A projection based on the returns in those elections suggests that, in a general election, nine of the 10 parliamentary seats in Derbyshire would return Labour Members. Would it not be right and proper today, as we are discussing the Finance Bill, for the Chancellor of the Exchequer, the Prime Minister and the rest of the ragbag Tory Government to explain their conduct and tell the British people that they will resign, so that we can have a general election?

The hon. Gentleman knows full well that that is not a point of order for the Chair. As is often the case, he is taking advantage of the time of the House.

New Member

The following Member made the Affirmation required by law:

David Digby Rendel.

Statutory Instruments, &C

With permission, I shall put together the motions relating to statutory instruments.

Motion made, and Question put forthwith pursuant to Standing Order No. 101(3) (Standing Committees on Statutory Instruments, &c.).

Unfair Dismissal

That the draft Unfair Dismissal (Increase of Compensation Limit) Order 1993 be referred to a Standing Committee on Statutory Instruments, &c.

Insurance Companies

That the draft Insurance Companies (Cancellation) Regulations 1993 be referred to a Standing Committee on Statutory Instruments, &c.

County Courts

That the draft High Court and County Courts Jurisdiction (Amendment) Order 1993 be referred to a Standing Committee on Statutory Instruments, &c.

Legal Aid

That the draft Civil Legal Aid (Scope) Regulations 1993 be referred to a Standing Committee on Statutory Instruments, &c.

Double Taxation Relief

That the draft Double Taxation Relief (Taxes on Income) (Ghana) Order 1993 be referred to a Standing Committee on Statutory Instruments, &c.

That the draft Double Taxation Relief (Taxes on Income) (India) Order 1993 be referred to a Standing Committee on Statutory Instruments, &c.

That the draft Double Taxation Relief (Taxes on Income) (Uganda) Order 1993 be referred to a Standing Committee on Statutory Instruments, &c.

That the draft Double Taxation Relief (Taxes on Income) (Ukraine) Order 1993 be referred to a Standing Committee on Statutory Instruments, &c.— [Mr. Patnick.]

Question agreed to.

Orders Of The Day

Finance (No 2) Bill

[MR. MICHAEL MORRIS in the Chair]

Ordered,

That the order in which proceedings in Committee of the whole House on the Finance (No. 2) Bill are to be taken shall be Clause 42, Clause 183, Clause 48, Clause 52, Clause 67, Clause 115.[Mr. Portalo.]

On a point of order, Mr. Morris. I understand that in the amendments that we are about to consider is one that, in one of the few instances in the history of Parliament, imposes taxation that no future British Government will be able to remove, in terms of the sixth directive, as amended. So that the House and the public may be fully informed, may I ask whether, in all future cases where taxes are imposed that cannot be removed by a future Government, the clauses concerned will be marked in a special way?

Parliament has always had a tradition that taxes can be raised or reduced by the House of Commons. However, in cases where taxes, once imposed, cannot be removed—and there may be quite a few in the future—is there no way in which the Order Paper, or the Vote, can be specially marked so that hon. Members are well aware that what they are doing cannot be reversed?

That is a matter for the Select Committee on Procedure, rather than for the Chairman of Ways and Means.

On a point of order, Mr. Morris. I note the provisional selection of amendments and the groupings. Would it be in order for us to take all the groups together in a single debate, for the convenience of the House?

Further to that point of order, Mr. Morris. May I say, as the mover of one of the separate groups of amendments, that it might well be for the convenience of the Committee if we took all the groups together, and then moved as soon as possible to a vote in which my hon. Friend the Member for Newbury (Mr. Rendel) could register his constituents' rejection of the proposal to put VAT on fuel?

Hon. Members will be aware that this is a provisional selection of amendments. Although it is fair to say that the Chair has taken some care and time over it, if it is the will of the House for all the groups to be taken together, the Chair is happy with that.

Clause 42

Fuel And Power For Domestic Or Charity Use

3.45 pm

I beg to move amendment No. 1 in page 23, line 40, after 'use', insert

'subject to the exceptions set out in subsection 3A below'.

With this, it will be convenient also to discuss all the other amendments to clause 42: No. 4, in page 23, line 40, after 'shall', insert

'except for supplies for domestic use'.

No. 5, in page 23, line 40, after 'shall', insert

'except for supplies for charity use'.

No. 39, in page 23, line 41, leave out from 'importation' to the end of line 42 and insert

'for domestic use made or taking place on or after 1st April 1994 and on that day notes 1(a), 2, 3 and 5 to the said group 7 shall be deleted.'.

No. 36, in page 23, line 42, at end insert—

'Except where the supply is for use by a charity in either or both of the following ways, namely —
  • (a) otherwise than in the course of furtherance of a business
  • (b) as a village hall or similarly in providing social or recreational facilities for a local community.'.
  • No. 18, in page 24, line 17, at end insert —

    '(3A) The supplies to be excepted are —
  • (a) standing charges in connection with the supply of fuel and power;
  • (b) rental charges for gas and electricity meters; and
  • (c) charges for installation of and connection to fuel and power supplies.'.
  • No. 6, in page 23, line 42, leave out '1994' and insert '1998'.

    No. 9, in page 24, line 4, leave out '1994' and insert '1998'.

    No. 14, in page 24, line 4, leave out '1995' and insert '1999'.

    No. 15, in page 24, line 8, leave out '1994' and insert '1998'.

    No. 16, in page 24, line 8, leave out '1995' and insert '1999'.

    No. 7, in page 24, line 1, after '(2)', insert

    'For the purposes of this section'.

    No. 8, in page 24, leave out lines 3 to 8.

    No.11, in page 24, line 9, leave out '8' and insert '5'.

    No. 17, in page 24, line 9, leave out '8' and insert '0.01'.

    Today, the Prime Minister is having panic meetings to discuss the damage that the country— [Interruption.] Conservative Members do not seem to have noticed what has happened. Perhaps they are not aware that today the Prime Minister is having panic meetings to discuss the damage that the country has just done to the Tory party. Instead, he should be holding a meeting to discuss the damage that the Tory party has done to the country. He is listening to the chairman of the Conservative party—

    On a point of order, Mr. Morris. Would it be appropriate and proper —if so, I should be grateful—for you to tell us on which amendments the Committee is likely to vote later this evening?

    The Chair is, to a degree, in the hands of the Committee. The Chair must listen to the debate before making a decision. I certainly cannot say now when the votes will be.

    The Prime Minister is listening to the chairman of the Conservative party, and to the Government Chief Whip; but he should be listening to the people of this country. Last Thursday, the Government suffered their worst county council election results ever, and their biggest by-election defeat for years. The Tory shires are down to just one. It is time for the Government to show that they are ready to dispense with their usual arrogance and complacency, and that they are now prepared to listen.

    The first thing that the Chief Secretary must tell us today is what changes he will make to his policy. He should announce that he will drop the proposal to put VAT on gas and electricity, and on charities: that proposal had no support in the country on Thursday, and it has no support now.

    The Government have begun to talk of change —

    May I interrupt the hon. Lady before she proceeds too far with her speech? Given that she is urging the Government not to introduce taxation, will she tell us specifically how she would reduce the public sector borrowing requirement?

    The Government have allowed the PSBR to rise beyond their forecasts, and beyond the level to which they said they were prepared for it to go, because of the increase in unemployment and the lack of economic growth. Our proposals are intended to bring down unemployment, and to bring sustainable growth into the economy. That is how we intend to lower the PSBR:, we do not intend to do so by making some of the poorest and most vulnerable people—such as the elderly—pay the price of the Government's incompetence.

    What did the hon. Member for Esher (Mr. Taylor) say in his election address to the people who he asked to vote for him? He did not say that he was worried about the public sector borrowing requirement; nor did he say that he would put up taxes to fill the hole in the public finances. He said, like all his Tory colleagues, that he would put down taxes. Hon. Members have had enough of the hypocrisy of Tory Members of Parliament who say one thing to their constituents before a general election and another thing after it.

    I am sure that the Committee accepts that the hon. Lady expresses genuine concern about the less well-off, but if we are to take her concern to be more than skin deep, will she remind the Committee of what happened to electricity prices between 1974 and 1979, in real terms and, more specifically, what the Labour Government did to help those who were less well-off?

    Under this Government, electricity and gas prices have risen faster than inflation. If the hon. Gentleman is as concerned as we are about the fuel bills of the elderly and families on low incomes, he will vote with us tonight to force the Government to keep their promises.

    The Government have begun to talk about change, but talk, without the prospect of real change in Government policies—not just on VAT but on schools, rail privatisation and, above all, the economy.

    The Prime Minister said on Friday that he would listen, that he had not been humiliated by the electorate and that it was an opportunity for him to learn. The Home Secretary admitted that the Government were in a dreadful hole, but on Sunday, speaking on BBC's "On the Record", the Chief Secretary was in his characteristically buoyant mood. Did he say that he would think again on VAT? Did he say that he would listen? No. Did he say that they had got it wrong? Did he say that they would listen? No, he did not.

    Does the Chief Secretary even begin to recognise the insult that was felt by all those people who have lost their jobs or whose businesses have failed, when the Chancellor said that he had nothing to regret and then went on to hear, privately, Tory Members of Parliament say that the voters are a lagging indicator because they fail to recognise how rosy the economic prospects are? So it appears that the Chancellor regrets nothing. These are not the words of a Government who are prepared to listen but the epitaph of a Government who have been in power for too long.

    We oppose the provision to put VAT on gas and electricity because it breaks a specific election promise that was made before the last general election in the most clear, specific and unequivocal terms.

    I will in a moment.

    We oppose VAT on gas and electricity because that increase will affect everyone. Everyone has to use gas and electricity. It is a basic necessity. It is not some optional extra.

    In a moment.

    We also oppose it because it will hit hardest at the elderly and those on low incomes. We oppose it, too, because it will hit charities at a time when the help that they are giving is needed by a growing number of people but when donations are falling because of the recession. Furthermore, we oppose it because this VAT extension paves the way for further VAT extensions to children's clothes, newspapers and food.

    Before I give way to the hon. Member for Battersea (Mr. Bowis), perhaps he will tell the House whether he is one of those Tory Members of Parliament who, while saying nothing to his constituents, fills in survey forms saying that he is in favour of extending VAT to food, children's clothes and newspapers. Perhaps we shall have a bit of honesty in Committee from Tory Members of Parliament.

    Order. Before the hon. Gentleman replies to the hon. Member for Peckham (Ms Harman), may I remind the Committee that this is a debate on the extension of VAT to fuel and power. It is not a debate on the extension of VAT to children's clothing.

    I am one of those Conservative Members of Parliament who recalls what happened in the past. Will the hon. Lady tell us what happened when the Labour Government put VAT on sweets, ice cream, crisps and soft drinks? Was that in her party's election manifesto? Was that promised beforehand? And what measures did her party introduce to protect the very people on low incomes, including children, who were affected by that step?

    The hon. Gentleman need not delve too far back into his memory. He should cast his mind back to his own election address, in which he promised not to put up taxes but to cut them.

    In a letter sent today to panic-stricken Back Benchers, the Chancellor of the Exchequer has said that it is necessary to put VAT on gas and electricity because it will set the economy to rights.

    The crisis in public finance will not be resolved until we have policies that will build a strong economy and deliver sustainable economic growth. So instead of taxing pensioners on their fuel bills, the Government should direct their attention to training and skilling our work force to the same standard as our competitors, and to creating investment incentives so that we can begin to catch up with the investment levels of our competitors. They should attend to the crumbling social and economic infrastructure that holds our economy back, but instead they are imposing a flat rate tax on one of life's essentials. Everyone will pay.

    Does my hon. Friend agree that some of the worst problems that are faced by the poor and the old are fuel poverty, fuel hardship and fuel misery, and does not evidence show that a higher proportion of Britain's elderly people die during the winter months than in other western European countries?

    Will not the imposition of VAT make the position much worse for so many of our fellow citizens who even now cannot afford to keep their accommodation warm during the winter and who therefore find all kinds of reasons to go out and, when they are in, heat only one room? Is not their life one sheer misery during the winter and are not the Government making it worse?

    I am grateful to my hon. Friend for making that point. Conservative Members would do well to listen to the point that is being made not only by my hon. Friend but by organisations in their constituencies concerned with elderly and disabled people.

    If I may, I will press on and give way later, when, perhaps, the hon. Lady will tell us what she told her constituents in Lancaster about whether she would put VAT on gas and electricity.

    The hon. Lady seems to be suffering from selective amnesia. Has she forgotten—she was not here at the time—that, under the previous Labour Government, electricity prices rose by 2 per cent. every six weeks and that absolutely no help was offered to meet those increases?

    The trouble is that Conservative Members have selective amnesia about what they included in their election addresses.

    Everyone will have to pay VAT on gas and electricity —even those who work but earn too little to pay income tax. Almost three quarters of pensioners pay no income tax, yet all of them will have to pay VAT on their gas and electricity bills. It is unfair, as the least well-off will be hardest hit by this tax.

    For households that are fortunate enough to have more than £800 a week, the imposition of VAT on gas and electricity will increase their bills by only half of 1 per cent., whereas the budgets of households that struggle on less than £60 a week will be stretched by another 3 per cent. After VAT at the full rate of 17·5 per cent. is included, single pensioner households on income support—some of the poorest people in the country—will spend more than one fifth of their entire budget on heating bills.

    This is a Government who do not think about what they are doing, who do not consult anyone about the effect of what they are doing and who do not listen to protests about what they are doing. They have had no discussions with organisations dealing with the elderly. If they had, they might have heard of the survey by Age Concern's institute of gerontology, which stated that pensioners often do not spend enough to heat their homes sufficiently, even to the level necessary to preserve their health. A third of pensioners surveyed did not heat their bedrooms, and nearly one quarter of those elderly people gave up other items to stay warm—mainly food. When we vote tonight, we should bear that in mind.

    4 pm

    As my hon. Friend the Member for Walsall, North (Mr. Winnick) said, this country has a higher death rate from hypothermia than countries with much lower winter temperatures, such as Norway, Sweden and Switzerland and that is because of poverty.

    Age Concern was dismayed when it heard about the proposal, which came as a surprise because the Chancellor had not bothered to discuss it with the organisation. The average cost to a single pensioner will be £2 per week extra on fuel bills. There is also concern for families with children who are trying to live on a low income. In a letter to the Select Committee on Social Security, Barnardo's wrote:
    "We already have contact with many hundreds of families across the UK who have difficulties with fuel payments for whom there are already daily decisions involving a choice such as whether to turn on the heat source or to buy food."
    In this House, none of us is in that position, but when hon. Members vote tonight they should bear in mind the fact that they do not have to face that daily choice and that the lives of the people who do will be made worse if the measure is pushed through.

    Disability Alliance has said:
    "We fear that the imposition of VAT will have a devastating effect on disabled people."
    The National Association of Citizens Advice Bureaux is certain that if the measure is pushed through it will mean more debt and more disconnections.

    If any Tory Back Benchers are wavering—

    When I have finished my sentence.

    Any Tory Backbenchers who are considering their position should think carefully before justifying the measure to themselves on the grounds that compensation will be in the pipeline in a few months' time. They should think carefully whether they can safely rely on that pledge from Ministers.

    I shall give way to the hon. Member for Teignbridge (Mr. Nicholls) on condition that he tells me whether he told his constituents that he would put 17-5 per cent. on the fuel bills of elderly people in his constituency.

    I am grateful to the hon. Lady for giving way, and I am sure that she is right to lay such stress on election manifestos. Will she identify which paragraph of which of the Labour party's two 1974 manifestos stated that it would put VAT on petrol, which is a fuel, and what it did to compensate motorists?

    As there is a vote tonight on the plan to impose VAT on gas and electricity, people outside this House will wonder why their representative is not prepared to deal with the issue but instead seeks to make party political points relating to some years ago. The issue is serious.

    Many Conservative Members are salving their consciences by telling themselves that it will be all right because the worst excesses of the tax will be offset by a compensation scheme further down the line. Let me remind hon. Members that the Government had not contemplated any extra compensation when they first took the decision—they were completely surprised by the outcry. Although there will be some compensation, we do not yet know the details, only that it will certainly not be full compensation, even for the poorest people in the country. Even those people will be made worse off.

    If compensation is to be linked to income-related benefits, there will be two results. First, it will deepen the poverty trap; secondly, it will not reach all those who need it. We know that there is low take-up of income-related benefits. According to the Department of Social Security, as many as one in three pensioners who are entitled to income support do not claim it. Why should hon. Members believe the promises of compensation when nobody believes this Government's promises?

    They said that they would not put VAT on gas and electricity. The Prime Minister said it, the Chancellor said it and members of the Cabinet said it. I hope that tonight, Tory Members will remember that they promised tax cuts in their election addresses. Why should a Government who promised tax cuts, but who have now put up taxes, be believed when they say: "Let us put VAT on gas and electricity now; trust us, and we will give you a compensation scheme in the autumn"? Tory Members should have demanded details of the compensation scheme to cushion the effect of VAT before voting tonight to put VAT on gas and electricity.

    Does the hon. Lady accept that I was one of the Conservative Members who asked for the Chancellor's statement to be clarified? The Chancellor made an excellent statement to help those on income-related benefits. Does the hon. Lady also accept that one of the reasons that I asked for that statement to be clarified was because we on the Conservative Benches have an excellent record of looking after pensioners? We did not do what the Labour party did in government in 1976, when Barbara Castle fiddled the calculation of old age pensions. The Conservative party will make sure that it does not go in for Labour party fiddles on pension increases.

    It is true that the hon. Member for Dover (Mr. Shaw) asked for clarification and raised the question of compensation with the Chancellor. The problem is that he stopped short of ensuring that there would be full compensation. The hon. Gentleman faces tonight exactly the same situation that he was in before he raised queries with the Chancellor. He has no details of the so-called "compensation scheme", which, as yet, simply does not exist, but we have the certainty that it will not be full compensation. We have the absolute certainty that, if the scheme is agreed tonight, even the lowest-paid and those struggling on the lowest benefits will find that they are worse off as a result. The hon. Gentleman may have asked the question, but he failed to take note of the answer.

    The question of the effect of VAT on gas and electricity on charities is of concern to hon. Members on both sides of the Committee. In his Budget statement, the Chancellor boasted of extra help for charities' but charities were horrified to discover that they too are to be hit by the imposition of VAT on gas and electricity—not just VAT on the gas and electricity used by their headquarters, or by their administration, but VAT on fuel for their day centres, for their residential homes, for their respite care, for their hospices, and for the meals on wheels and laundry services.

    That is ironic, because the pattern of provision of the charity services is that it is in what were formerly known as the Tory shires—areas that elected many Conservative Members—that the charities, work is most important. Over the years, the Tory county councils have failed to build up their social services provision, so the charities have stepped in to provide residential care, domiciliary care and day centres. Therefore, the threats to charities, which say clearly that, if they have to give a great deal of money back in tax to the Government, they will have to cut their services, means that the people who will be worst affected are those who live in areas represented by Conservative Members.

    My hon. Friend will no doubt be aware of the figures provided by the Cancer Relief Macmillan Fund. In 1992, that charity disbursed more than £3 million in patient grants, of which about £850,000 were grants for fuel, cancer being one of the conditions that requires its sufferers to be treated in conditions of warmth.

    My hon. Friend draws attention to an irony: at the very time at which people will be looking to charities for more help with their fuel bills, charities will be in a worse position to help because of the tax that they will face on their own fuel bills.

    The figures are significant. In answer to a parliamentary question tabled by me, the Government said that, next year, charities would have to give back £10 million in VAT. The year after, charities will have to give back to the Government £25 million in VAT. That is happening at a time when charities have seen their receipts from individual donors and from companies drop as a result of the recession.

    The Charities Aid Foundation survey in December 1992 found that 64 per cent. of charities had experienced a real decrease in their total income since January 1991. Some 67 per cent. reported a fall in individual donations, and 61 per cent. a fall in corporate donations. At the same time, 90 per cent. said that their demand had increased due to higher unemployment, the fact that there were more people with debt and money problems and local authority cuts. Those were the three main reasons cited for the increased demand for charities' services.

    The work of charities is important, and the Government should reconsider the imposition of tax on them. For that reason, we ask hon. Members to consider voting for amendment No. 5.

    Will the hon. Lady now give the House a pledge that the Labour party would remove VAT from heat and light if they won the next election?

    If the right hon. Gentleman shares our concern—I hope that he does—we need not get that far. He and other Conservative Members should join us today in voting for amendment No. 5 which would remove the requirement to pay VAT on gas and electricity from charities, which are doing such important work.

    The Government have added insult to injury—

    I shall not give way to the hon. Gentleman, because I know that, if I do, he will ask about something that has nothing to do with the debate. I do not want you, Mr. Morris, to have to rule him out of order.

    The Government have added insult to injury by claiming that this is an environmental measure. The use of gas and electricity is particularly insensitive to price. If it was simply an environmental measure, how could the Government justify putting VAT on charges for gas and electricity meters and on standing charges, which, by definition, do not vary with the amount of fuel used?

    This is not a tax to deal with the hole in the ozone layer —perhaps we can lay that suggestion to rest. It is a tax to deal with the hole in the Government's economic policy. It is not a measure from a Government who have gone green; it is a measure from a Government who have gone into the red.

    This is an opportune moment for the hon. Gentleman to rise—although I shall not give way to him —as I was about to say that the knives were out on the Tory Back Benches. The Chancellor may be the ritual midsummer sacrifice. It is said that the Chief Secretary is being mentioned as possible successor; they say that he impresses. I would only say that it would be very hard indeed for anyone not to shine when standing next to the present Chancellor. But a reshuffle at the top and a few changing faces will change nothing and fool no one. On Thursday, the voters were saying not simply that they wanted someone different doing the job, but that they wanted the job done differently.

    It is right that the Chancellor should go. He does not command the confidence of the country. His lack of credibility is yet another obstacle to our sustainable economic growth. But the voters in the shire counties and the voters in Newbury who gave their verdict on Thursday were protesting not only at the economic policies of the Chancellor, but at the economic policies of the Prime Minister.

    4.15 pm

    Does my hon. Friend agree that, if the people of Scotland had been given an opportunity to give their verdict on the Government's policy on VAT on Thursday, they would equally have given a resounding thumbs down? In Aberdeen, temperatures can be 4 deg lower than in the south of England in the winter. Is it not appropriate that the letter sent by the diocese of Edinburgh from the Scottish Episcopal Church speaks for people north and south of the border when it asks me and my colleagues in Scotland to register with the Government

    "our concern at the way in which the proposed increase in heating costs by the addition of VAT will be felt most by people with low incomes"?
    As the Church of England in Scotland is voicing those concerns, is it not appropriate that Tory Members who represent English constituencies take heed?

    One can understand why the Conservatives have no support in Scotland. But Conservative Members should ask why people in Scotland should suffer from the cold as a result of fuel poverty when people in areas with far lower temperatures in Norway, Sweden and Switzerland do not have to suffer the cold because they do not suffer fuel poverty.

    On Sunday, the Chief Secretary rallied to the Chancellor's support. He said that the Chancellor was doing a magnificent job. He said that he was a magnificent Chancellor. He said that the Chancellor has been, is and will carry on doing a magnificent job. The Secretary of State for Social Security thinks that the Chancellor's magnificence is proved by the county council election results and the Newbury vote on Thursday.

    The problem is that, for the Government, hypocrisy has become a way of life. The Government promised not to put VAT on gas and electricity, but they did. They say that they will not extend it to children's clothes or newspapers, but they secretly plan to do just that. They say that they will listen to the voters and respect their views. In private, they insult the electorate by calling them contemptuously "a lagging indicator".

    Yesterday, the Home Secretary told us that the Government were in a dreadful hole. Tonight, Tory Members of Parliament have a chance to decide whether they will dig themselves and the Government deeper into that hole. Tonight, with their votes on VAT, on gas and electricity and on charities, Ministers will have a chance to show the people of Britain whether they are capable of change.

    Tory Back Benchers will have the chance to show the people who elected them that, even if their Government cannot listen, perhaps they can. Even if their Government cannot be trusted, is it too much to hope for that Tory Back Benchers can? Back Benchers owe it to their constituents not to follow discredited Ministers like sheep through the Division Lobby.

    Following your ruling, Mr. Morris, that we may consider all the amendments together, I hope to address all the arguments that were raised by the hon. Member for Peckham (Ms Harman).

    I wish to cover the question of Government finances, which provides the essential background to why the Government are proposing an extension of VAT. I wish also to discuss why the Government have chosen an extension of VAT as the means of raising part of the money that we need to raise. I certainly want to cover help for families and pensioners on low incomes, the question of standing charges, the question of charities and the environmental arguments. On my way through, I shall allude to some policies of other parties.

    I begin by discussing the question of our public borrowing position, a serious matter which requires to be addressed. This year, we have a public sector borrowing requirement which we are estimating at about £50 billion, which is 8 per cent. of GDP. At that level, it is the highest primary PSBR in the European Community. It is obviously extremely important that the Government should have policies—[Interruption.)—for tackling that level of borrowing.

    I hear Opposition Members yelling, "Whose fault is it?" The PSBR has come about partly due to discretionary increases in spending by the Government, such as spending on the health service. At one time we were increasing spending on the health service by 4 and 5 per cent. in real terms every year, not a policy with which the Opposition disagreed. Indeed, I recall the hon. Member for Peckham, the present shadow Chief Secretary, urging us to spend more on health, education and all sorts of things.

    Much of the PSBR has also been due to spending more on the unemployed, and I do not think the Labour party would want us to do other than that. A lot of it has been do do with the fall in revenue due to the recession, which has gone on for longer than anybody realised. The interest burden—

    I shall give way in due course.

    The interest burden that is accruing on those borrowings is also an important matter. Our interest burden is rising by about 9 per cent. in real terms every year. Over the next three or four years, the extra amount of interest alone that we must pay is likely to add about 1 per cent. to the ratio of public spending to GDP.

    Over the next five years, assuming the tax increases proposed in the Finance Bill, assuming that we stick to our ceilings for public spending and assuming that we return to a rate of growth in the later years of 2·75 per cent., we still envisage in 1996–97 a PSBR of £35 billion or 4·5 per cent. of GDP. All the figures are in the Red Book published with the Budget.

    I shall give way in due course.

    The point I am making is that it is absolutely essential for the Government to tackle the PSBR, and the Chancellor has mad& clear in the Budget and in the Finance Bill the means by which he intends to do that. It requires next year £6·5 billion of revenue and, the following year, £10·5 billion of revenue. I believe that we are the only party which is prepared to take seriously the matter of public sector borrowing—[Interruption.] We still hear from the other parties a refusal to take such matters seriously.

    The hon. Member for Dunfermline, East (Mr. Brown) said on BBC radio in January:
    "I am not talking about increasing current borrowing. I am not talking about raising income tax or national insurance or VAT'.
    So what on earth is he talking about, since he and his hon. Friends continue to talk about more public spending? The Liberal Democrats have suddenly discovered an interest in the PSBR. The right hon. Member for Yeovil (Mr. Ashdown) took the matter up with my right hon. Friend the Prime Minister recently. It is a new-found interest of the Liberal Democrats—[Interruption.] I think I hear the right hon. Member for Berwick-upon-Tweed (Mr. Beith) yelling "Nonsense." He was not yelling that in November when he said:
    "What matters to Britain is not so much the level of borrowing. National debt is at an historic low."
    It did not matter to him in March either, because in a publication entitled "The Budget Britain Needs", his party referred to
    "a public investment programme funded by extra borrowing."
    and said:
    "We have argued quite deliberately that it is necessary for the Government to borrow money."
    The interest of the Liberal Democrats in public borrowing is apparently very new-found.

    For all those reasons, I claim that the Government are unique—[Interruption]—in being interested in tackling the PSBR.

    I am more than grateful to my right hon. Friend for giving way. He said that with good luck, a following wind and the help of the good fairy, by 1996–97 our deficit will be 4·5 per cent. of GDP. When does he expect us to meet the convergence critieria of the Maastricht treaty?

    As my hon. Friend can see from the figures published in the Red Book, they would not be met in the period covered by the Red Book. That is the only answer that I can give my hon. Friend.

    I have already dealt with the question of how the PSBR has got to where it is, but many of the Opposition arguments relate to the fact that the Government did not say at the time of the general election that they intended to raise VAT. The Opposition have suggested that the Government were in some way dishonest in not recognising that the recession would go on longer than anticipated. I remind the Committee that the Government were by no means alone in predicting that, throughout 1992, we would see growth in the economy of 1 per cent. Our forecast was very much in the middle of the range of those made by outsiders. We forecast 1 per cent. growth, the Confederation of British Industry forecast 1·7 per cent., the OECD forecast 2·2 per cent., James Capel forecast 1·7 per cent. and Credit Lyonnais forecast 1·7 per cent.

    We forecast a PSBR of £28 billion It has turned out to be higher than that—but the CBI forecast £18 billion, the European Commission forecast £19 billion, Goldman Sachs forecast £25 billion and James Capel forecast £24 billion. There were many other such forecasts. In other words, there is no basis for the Opposition to say that the Government could know, any more than anybody else, that the recession would last longer than we predicted at the time.

    The important point is that the Government stand for sound public finances—that is what we have always put before the people of the country—and, because the recession has gone on for so long, we have an obligation to come to the House and propose measures for dealing with it.

    If the Government are so concerned about the size of the deficit, why on earth did they squander at least £5 billion in an afternoon just to save the Chancellor's face?

    The hon. Lady, I fear, has no understanding of these things. That money does not appear as public spending—it does not appear on the PSBR either—and has no effect on the figure in question.

    Why are the Government proposing to raise money from an extension of VAT? First, it is because VAT is an effective way in which to raise revenue and, by comparison with the rest of the European Community, this country has low rates and a very low range of coverage of VAT. In France, for example, the ratio of VAT to consumer spending is 13·4 per cent., in Germany it is 11·9 per cent., in Ireland 13·8 per cent., and in the United Kingdom it is only 9·6 per cent. We have one of the lowest ratios of VAT to consumer spending of any country in the EC.

    The hon. Member for Peckham, a few moments ago, was citing the practice in Norway and Sweden as an example of what we ought to do. In Norway, the ratio of VAT to consumer spending is 16·6 per cent., and in Sweden it is 14·3 per cent. Both are vastly higher than the ratio of VAT to consumer spending in the United Kingdom, so the hon. Lady is well wide of the mark. She is right to say that those are colder countries—they also have more extensive VAT.

    It is illogical for VAT to apply to commercial supplies and not to domestic supplies. We were extremely concerned in the Budget—at a time when we were anxious to make sure that the recovery could proceed and not be choked off by our measures—that we should not take measures that would hit incentives. Even in a Budget in which we had to raise taxes, we found the means to provide special help to business and raise taxes that did not hit businesses. We also found ways of raising more revenue that were consistent with our principle that we should broaden the base of our taxes rather than increase the rate. We should look to indirect taxes, rather than direct taxes which hit incentives in our economy. We saw VAT on fuel and power as an opportunity, not least because fuel prices in this country under privatisation have fallen by 8 per cent. in real terms since 1986.

    We have also said—I want to make this very clear—that VAT has two effects. It will also help us to achieve our environmental commitments, which is different from saying that we have decided to raise VAT as a means, first and foremost, of achieving our environmental objectives. Of course VAT is intended to raise revenue to tackle public borrowing. However, what the hon. Member for Peckham and the Labour party seem incapable of understanding is that a single measure can achieve two objectives. VAT will both help the public sector borrowing requirement and help us to meet our environmental commitments, to which I shall return.

    4.30 pm

    Are we to understand from the right hon. Gentleman's comments about Norway that he does not accept that we have a higher rate of death from hypothermia in the winter than Norway, Sweden and Switzerland? Is the right hon. Gentleman saying that he does not recognise that the higher death rate here is directly attributable to fuel poverty? Does he understand and accept that point?

    The hon. Lady mistakenly thinks that such conditions are linked to VAT rates, but I have proved beyond doubt that they are not. As I said in my opening words, I shall deal later with fuel poverty.

    No, I shall not give way as I want to make progress.

    The Government need to raise £6·5 billion and £10·5 billion over two years. We have considered how best to raise that money and have spread the load across all sectors of society. In 1995–96 we are looking to raise £10·5 billion, of which only £2·3 billion will come from the extension of VAT. The rest of that money will come from other measures such as tax changes on dividends, company cars and married couples' allowances—changes which will impact particularly on higher rate tax payers. It has been independently estimated by the Institute for Fiscal Studies that the Budget will spread the inevitable need for an increase in revenue across all sectors of society and not, as the Opposition would have hon. Members believe, to pile it on the poorest.

    Extending VAT certainly has an effect on the poorest, and I shall deal with that issue in two sections as I know that there is much concern about it in the Committee—first, in relation to the poorest and, secondly, in relation to pensioners. Those are two different groups, although they overlap.

    When my right hon. Friend deals with those two points in that order, will he bear in mind the fact that merely helping the neediest—the pensioners—through income support will not necessarily help those pensioners who need special help? If we are to broaden the bases, we must understand that the elderly may well need help. Merely saying, as we so often do, that income support will help those in need, and the other pensioners will not need it, will not for one moment satisfy the needs in this case.

    If my hon. Friend will bear with me, I shall make it clear that I want to talk about that very issue.

    Will the right hon. Gentleman give way for a general question on that before he moves on to another topic?

    No.

    I want to talk about our record on helping the poor. Last October the Government raised the income support rates for pensioners by £2 for a single person and £3 for a couple. That was one piece of direct help to people who are the poorest and who are pensioners. The Committee will be aware that from April this year, no one on income support is any longer required to contribute to local taxation. The amounts that have been included wihin income support for the contribution to local taxation were £1·60 for a single person and £2·80 for a couple.

    No.

    Those amounts are greater than the amounts being speculated that people on income support will have to pay extra on their fuel bills as a result of the extension of VAT, even at the full rate of 17·5 per cent. which will not take effect for two years. Those are important changes and I shall tell the Committee how they work out.

    A single unemployed person over 25 on income support has had his average disposable weekly income increased by £3·15 a week, and the disposable income of an 80-year-old couple on income support is now £9·35 more on average than it was last April. That means that, for the first time, the income support for those people has now moved over £100 a week. It may be that the increases that the Government have made in their help to the poorest people have been so numerous and so large that the Committee is out of touch.

    Let me remind the Committee that the higher pensioner premium for those on income support now stands at £23·55 for a single person and £33·70 for a couple who are over 80 or disabled. Those are additional benefits given to those people to take care of their special needs and it is worth bearing them in mind.

    Despite all that I have said, we undertook to give extra help to the poorer pensioners and to those people on income-related benefits and to increase the cold weather payments. Contrary to what the hon. Member for Peckham said, it was included in the Budget statement and stated by my right hon. Friend the Chancellor on Budget day.

    We made it clear that extra help would be available before the first fuel and power bills with VAT arrive next April and that the exact nature of what we intended to do would be included in the autumn uprating statement by my right hon. Friend the Secretary of State for Social Security who is obliged by statute to take everything into account in deciding what the appropriate uprating should be.

    I now turn to the point raised by my hon. Friend the Member for Teignbridge (Mr. Nicholls). I know that he is concerned about pensioners who are not on income support as well as those who are.

    Perhaps I could remind him of some of the Budget arithmetic. We need to bear in mind the fact that it is necessary to raise revenue to deal with the public sector borrowing requirement, and that VAT on fuel and power will raise £2·3 billion in 1995–96. Out of that, automatically through the effect on the retail prices index, and the effect of that on the uprating of benefits, there will be £300 million spent in 1995–96 and £600 million in 1996–97. That is absolutely without reference to the extra help that I referred to previously.

    In a moment.

    Our record on pensioners is also a good one. Pensioners' average income has risen by 30 per cent. in real terms since 1979. Following an amendment, or an innovation brought in by the Labour Government, we now offer all people during their working life times the opportunity to be in SERPS or to be contracted out of the state earnings-related pension scheme into an occupational or personal pension scheme.

    In April, thanks to our success in reducing inflation, the uprating of pensions was 3·6 per cent. whereas the retail prices index figure for April was 1·9 per cent. The effect of that on a pensioner couple's income is compensation of £1·60 over and above the retail prices index. Opposition Members may sneer, but that is very close to the amount which it is speculated the extra cost of VAT on fuel and power will come to when the full 17·5 per cent. rate comes into effect in two years' time.

    I have promised to give way to some other hon. Friends, and I have already given way to my hon. Friend once.

    We have a problem, in that we have scarce resources which we therefore need to be able to target. Wherever we draw the line between those who are defined as in special need, because they are in poverty, and others, there will always be people just above that line whom my hon. Friends will believe to be especially deserving.

    We must also recognise that there are benefits, such as housing benefit and council tax benefit, which are payable to people who are not on income support. One and a half million pensioners will benefit from what we have already announced, and we intend to go on giving extra help to the poorest people. One and a half million pensioners who are not on income support will benefit through council tax benefit and housing benefit —2·25 million households in all will benefit, including the 1·5 million pensioners.

    It is necessary to draw lines somewhere. I believe that it would be unrealistic to give extra help to all pensioners over and above the RPI effect. I remind my hon. Friends that pensioners will benefit from that effect. If we were to take extra measures to try to identify the impact of fuel bills over and above the RPI effect felt by pensioners and all others, we might be talking about another £1 billion on benefits. My hon. Friends will recognise that that would wash away a great deal of the revenue being raised in this way—

    On a point of order, Mr. Morris. Is it in order for the Chief Secretary to address the House with this posture? He seems to be arranged in such a way that he can see all who want to intervene and are sitting behind him but none of those in front of him. Would it be possible to ask you to ask the Chief Secretary to adjust his crooked posture?