asked the Chancellor of the Exchequer what is his estimate of the likely rate of inflation for the next six months.

asked the Chancellor of the Exchequer what is the estimated annual rate of inflation from May 1979 to the following May.

I expect the annual rate of inflation to increase to above 17½ per cent. by the year end before falling to about 13½ per cent. by the third quarter of 1980.

Is it not right that, when coming to any such estimate, one must allow for a margin of error of at least 2 per cent., so that it is quite possible that inflation by the end of this year will reach 20 per cent?

There are always margins of error in any forecasts, but the hon. and learned Gentleman would be ill advised to make his presumption in that direction in this case. The House must recognise that the kind of change I have described in my expectation is the kind of change which would have followed from a Budget introduced by the right hon. Member for Leeds, East (Mr. Healey).

Is it not clear that over the next 12 months the rate of inflation will be well above 20 per cent? What possible moral authority have the Government to ask for restraint from working people when the Budget has well rewarded the rich and the privileged, and all forms of price restraint have been abolished by the Government?

The hon. Gentleman should not continue enthusiastically to expect and hope for and, indeed, encourage the worst expectations. He should recognise, as most people in the country do, that the Budget produces very substantial reductions in direct taxation for taxpayers at every level, that it releases 1,300,000 people from the obligation to pay tax, and that for those dependent on social benefits it produces very substantial increases—the largest in money and real terms ever given.

Does not my right hon. and learned Friend agree that the rate of inflation this winter will reflect to a considerable extent the rate of growth in the money supply 18 months previously and changes in the exchange rate up to six months previously? If that is the case, does it not follow that the figures in the Red Book are really worth very little more than the estimates of Old Moore's Almanack, a cheap production of private enterprise? In those circumstances, what in God's name is the point of publishing it?

My hon. Friend is right to draw attention to the impact of the money supply on the likely outlook for inflation. It is right to underline the qualification plainly set out in the Red Book about the very wide margin of error contained in that document.

Even before this further shocking increase in inflation, is the right hon. and learned Gentleman aware that already there have been some tragic victims of his increases in value added tax and the minimum lending rate? Is he aware that Motability, the organisation which exists to help disabled people have cars, has now ceased to trade? Is this not disgraceful and scandalous? What does he intend to do to save an enterprise of which the Prime Minister herself is a patron?

The right hon. Gentleman must understand that the prospect for inflation in the light of what was happening to the money supply and the control of the money supply when this Government came into office was set on a bad course anyway. We inherited a very substantial difficulty. The House knows that Motability was supported by my right hon. Friend the Prime Minister and, indeed, by right hon. and hon. Members on both sides of the House. Certainly, the hazards referred to by the right hon. Gentleman are under examination, and we want to examine the prospects as sympathetically as we can.

Will my right hon. and learned Friend confirm that in August 1975, after 16 months of Labour Government, the inflation rate was 26·9 per cent.? Why should any housewife listen to grumbles from the Labour Party in this matter?

My hon. Friend is entirely right to underline the disastrous record of the last Administration. I remind the House yet again of the extent to which this incoming Government inherited substantial difficulties created by the last Administration.

Does not the right hon. and learned Gentleman agree that he told us himself last Tuesday that his Budget measures—the increases in indirect taxation, the increase in mortgage rate and the increase in rents, rates and public sector charges as a direct result of the Budget—would increase the retail price index by 5 per cent.? Was it not insane, if he believes that inflation is set on a rising course, to produce a Budget of this nature to finance tax cuts which benefit mainly the better off?

The right hon. Gentleman protests too much and protests in vain. He knows that the direct effects of the Budget did not produce price changes on anything like that scale. More important, he knows that if he was to achieve his own target for the public sector borrowing requirement he would have had to introduce increases in indirect taxation and increases in nationalised industry prices that would have produced at least equivalent increases in prices without any offsetting advantage in the form of lower taxes.

asked the Chancellor of the Exchequer what is the latest rate of inflation as measured by the retail price index.

asked the Chancellor of the Exchequer what is the latest annual rate of inflation.

asked the Chancellor of the Exchequer what is the annual rate of inflation.

The retail price index rose by 10·3 per cent. over the 12 months to May 1979.

Does the Chancellor realise that if the increase continues, as forecast, to 17 per cent. or 18 per cent., the cost of indexing personal allowances, when he comes to draw up his Budget next April, will be more than £2 billion, which exactly matches the extra VAT, or will he adopt, as an excuse, the fact that the Government raised personal allowances more than required this year and use the Lawson part of the Rooker-Wise amendment to get out of their obligations, so imposing a worse burden on working people?

The hon. Gentleman should not make the worst assumptions about the way in which the rate is likely to move. The rest of the Government's policies are designed to secure a reduction in the rate of inflation. I have already indicated the expectation that one can have for a year beyond that. The success of that policy in securing a reduction in inflation, together with a sensible outcome in terms of employment, depends to a considerable extent on the way in which people are prepared to bargain pay responsibly during the year which lies ahead.

While I commend my right hon. and learned Friend for his evident intention not to be deterred from taking the right decisions for the economy by the prospect of a rise in the RPI, may I point out that there remains a serious problem of presentation to the public? Will he consider publishing, in addition to the cost of living index, a standard of living index which would, for example, present the increases in VAT in the perspective of reductions of tax at all levels?

My hon. Friend's point is of course important. It is important for people to understand the offsetting effect of the substantial reductions in personal taxation and the extent to which the change in the retail price index is a change once for all, while those income tax cuts are taking place. We shall give consideration—indeed, we are already doing so—to the suggestion my hon. Friend makes.

Does my right hon. and learned Friend agree that the figure that he has given shows how false were the claims made in the election campaign by the Labour Party that the then Government had inflation under control? By how much does he expect prices to rise in the next 12 months as a direct consequence of the policies of the former Chancellor of the Exchequer?

My hon. Friend is right to remind the House of that. The former Chancellor had forecast that price inflation could be rising by 13 per cent. now as a result of what had happened so far, and that that could be increased by changes in the price of oil. As I have already said, the plans which would inevitably have been contained in the Budget which, to his relief no doubt, the right hon. Gentleman never had to introduce would have involved an increase in the RPI at least comparable to that which I announced last week.

The right hon. and learned Gentleman really cannot get away with that. The fact is that he will spend £2,000 million in the coming year in cutting the standard rate of tax and giving £600 million worth of relief to those on the higher rates. It is because he has to finance that £10,000 million—[HON. MEMBERS: "Ask a question."] Is it not the case that this is the reason why he is increasing the RPI at a stroke by 5 per cent. in his Budget?

The right hon. Gentleman, characteristically, underlines the folly of his own position. The reality about the Budget that he would have had to introduce is that he would have been making increases in indirect taxation to produce these increases in the RPI, without any reductions in the burden of income tax corresponding to those that I have made. The greater part of the reductions go in the improvement of thresholds and the reduction of the basic rate.

Since the most important part of the Financial Statement is that dealing with economic forecasts, and since the forecasts say that past errors should not be treated as a guide for future errors, what is the purpose of publishing these inflation forecasts anyway?

My hon. Friend will recollect that there is a legal obligation to publish the document and those forecasts in this way. However, I agree with him that the increasing experience about the margin of error of forecasts of that kind casts some doubt on the value of making them.

Since the poor suffer most from inflation, has the right hon. and learned Gentleman's attention been drawn to the statement of the chairman of the Supplementary Benefits Commission, in which he said that people living in poverty will have their standards reduced unless £200 million is found for them? Will he comment on that statement please?

It is for my right hon. Friend the Secretary of State for Social Services to comment on that specific matter, but I remind the right hon. Member that, as a result of the changes announced last week, benefits are being increased by substantial sums and a large number of the poorer lower paid are being taken out of the tax system altogether. No doubt my right hon. Friend will give further consideration in due course to the report produced by the SBC.

asked the Chancellor of the Exchequer what was the increase in the National Debt between April 1974 and April 1979; and what is the annual cost of servicing that debt.

Between 31 March 1974 and 31 March 1979, the outstanding National Debt increased by some £46,526 million. The cost of servicing the outstanding National Debt in the last financial year, 1978–79, was £6,458 million. For the current year, 1979–80, the cost is estimated to be £8,150 million.

Would my right hon. Friend care to indicate what the servicing of that enormous debt means in terms of taxation? Does he not agree that it comes to more than the whole of the cost of income tax and the consequential tax which might be called the Healey head tax and must be ranked along with scutage, Morton's fork, ship money and the window tax as some of the more outrageous impositions placed by bad or evil British Governments upon the people of this benighted country?

If I may be a little more prosaic in answer to my hon. Friend, it is true that the servicing figure of £8,150 million exceeds what is now spent on health and nearly matches what is spent on education.

If it had not been for the financial incontinence of the previous Chancellor, by how much could VAT have been reduced?

That depends upon the incontinence.

Given that the cost of servicing the debt is so high, is it not true that the 14 per cent. minimum lending rate will not reduce the cost of servicing that debt? Will the Chief Secretary comment on views held in financial circles in this country and elsewhere that the 14 per cent. minimum lending rate is not likely to be the rate for a few weeks but could be the rate for a few months or even longer?

As the right hon. Gentleman knows, no one from this Dispatch Box will postulate when expected changes shall take place in minimum lending rate. He should also know that a 14 per cent. minimum lending rate was a necessity arising from our poisoned inheritance from the previous Administration.

asked the Chancellor of the Exchequer whether he will review the present arrangements under which nurses, health visitors, midwives, radiographers and others are assessed for tax on their mileage allowances which are reimbursement for expenses incurred in carrying out their duties; and if he will make a statement.

Nurses, health visitors, midwives and radiographers, like all other employees, are assessed to tax on their mileage allowances only to the extent that these exceed the reimbursement of expenses necessarily incurred in the performance of their duties. I see no reason to review the arrangements recently entered into between the Inland Revenue and the National Health Service as to the tax treatment of these allowances.

Will my hon. Friend reflect on the widespread resentment of those working in the Health Service that their mileage allowances, particularly when they are called out at night, should be taxed? Would it not be more sensible to arrange that the mileage allowance should cover expenses? How did the mileage allowance come to include a profit element that the Inland Revenue thought fit to tax? How can that be substantiated, in view of the recent increases in motoring costs?

As I explained in my original answer, there is no special discrimination against health workers. The law applies equally to all workers. The agreement between the Inland Revenue and the National Health Service was that a taxable surplus would normally arise only when fewer than 3,000 miles were travelled. Round figures are negotiated for tax liability in those circumstances. This is meant to assist the workers concerned. If they think that it is wrong and that they would benefit from individual arrangements, they can contest the agreement.

Does the Minister accept that members of the Health Service, especially those who go out in the middle of the night, have made a substantial protest over the last year to 18 months since the change was made? Will he have conversations with National Health Service representatives to see if a more satisfactory arrangement can be made?

This is a very complicated question. Taxation of the emergency call-out payment is separate from the taxation of car allowances. The expenses of travelling from home to work, whether in normal hours or during an emergency call-out, do not normally qualify for tax relief because they are regarded as being incurred to put the employee in a position to perform his duties rather than in their performance. In an emergency, to which my hon. Friend refers, when an employee has actually embarked on his duties before starting his journey to work and is then travelling in the performance of those duties, he is entitled to relief for those expenses. A simplified procedure has been negotiated to which I have referred. I hope that my hon. Friend is now fully satisfied.

asked the Chancellor of the Exchequer whether the Government will reimburse individuals for interest charges incurred as a result of their having to take out loans whilst unable to cash national savings certificates because of industrial action.

I have already made clear that we will honour the commitment of the previous Government to recompense those affected by the industrial action by computer staff at the Department for National Savings. This, of course, includes holders of national savings certificates who may have had to borrow because they were unable to encash the certificates during the strike. The precise terms on which the recompense is to be offered and the necessary administrative arrangements are still under consideration, but I hope to be able to make an announcement soon.

I welcome that reply so far as it goes, but will the Financial Secretary give an assurance that this matter will be treated with the utmost urgency? A lot of people are affected.

I agree entirely with my hon. Friend: I treat this as a serious matter. It is being dealt with with the utmost urgency. The question is extremely complicated, and I hope very much that I shall be able to make an announcement soon. It is important to get it right and to see that justice is done.

asked the Chancellor of the Exchequer what are the latest figures for the yield of corporation tax and income tax, respectively.

Receipts in 1978–79 were—corporation tax, £3,938 million; income tax, £18,776 million. The estimates for 1979–80, after the Budget changes, are £4,850 million and £19,655 million, respectively.

How can it be right for the average low-paid worker to have to pay about 15 per cent. of his gross income in income tax while in the last company accounting year BP paid literally nil corporation tax out of profits of £1,800 million and 11 others of the top 20 companies also paid nil corporation tax? What is the hon. Gentleman doing to rectify that massive under-taxation of top companies?

The average rate of tax over trading profits is 24 per cent. for companies as a whole—not nil. However, the hon. Gentleman should realise that the economy would be a great deal healthier and that the living standards of the poor, about whom he professes such concern, would be a great deal better if British companies made bigger profits—if they were more profitable rather than less.

Does not my hon. Friend agree that the figures that he has just given prove my point that, if it were not for the "Healey head tax", the Chancellor would have been able to reduce income tax to 16p in the pound and not only to 30p?

I congratulate my hon. Friend on having been called a second time so soon. Once again, he has made a good point.

Bearing in mind the low and declining rate of growth bequeathed by the previous Government, and the measures in the Budget, when does the Financial Secretary expect the rate for corporation tax to be positively buoyant?

I am not in the business of giving forecasts, but it is certainly our hope that there will be a recovery in corporate profits. I am glad to have the support of the Liberal Party to this end, even if not of the main Opposition party.

The hon. Gentleman says that he is not in the business of giving forecasts. Will he confirm that the 9 per cent. figure for money supply in the Red Book is a target and not just one of the vague forecasts that he seems to like to put in the rest of the Red Book?

I am glad that the right hon. Gentleman raised that. Indeed it is a firm target, and we shall attempt to hit that target.

Can my hon. Friend arrange for every taxpayer to be informed that a third of his income tax is spent on servicing the debt incurred by the last Government?

My hon. Friend is absolutely right that the last Government succeeded in an event unparalleled in history—getting at the same time a massive depreciation of the currency and an increase in real terms in the National Debt. I do not think that that double had ever been achieved before.

asked the Chancellor of the Exchequer what was the total revenue in each of the last four fiscal years from (a) capital gains tax, (b) capital transfer tax, and (c) estate duty, respectively.

Since the answer contains a number of figures, I hope that the hon. Gentleman will forgive me if, with permission, I circulate it in the Official Report.

Since I have a good idea that the figures will show that we in this country are still raising a smaller proportion of the total tax take from taxes on capital than is done even in the very un-Socialist United States, will the Treasury consider increasing the amount taken in taxes on capital and reducing taxes on expenditure among the weakest and poorest in the community?

If the hon. Gentleman had already had the figures, I should have been surprised at his asking that question. What he fails to recognise is that capital taxation in this country at the present level, which is very high by international comparisons, is having a damaging effect on enterprise and initiative, and particularly on small businesses, agriculture and our national heritage. This is not, of course, reflected in the absolute figures at present, but we see it reflected in the yield of capital taxes at the end of the day, and the truth is that, because of the transitional arrangements, the full yield of capital transfer tax has not yet been felt. This is why we intend to introduce relieving measures.

asked the Chancellor of the Exchequer what was the annualised rate of growth in the money supply, according to the M1 and M3 definitions respectively, in the latest period of three months for which the figures are available; and whether this was in accord with the monetary policy of Her Majesty's Government.

In the three months to mid-May, M1 grew at an annual rate of 12·9 per cent. and £M3 grew at an annual rate of 7·9 per cent. However, in the last six months £M3 had grown at an annual rate of nearly 14 per cent., which was above the upper end of the target range of the previous Government, and there were signs that the rate of growth was increasing. My right hon. and learned Friend accordingly raised MLR to 14 per cent. in order to help bring the rate of growth of £M3 into line with the new target range which has already been referred to of an annual rate of 7 per cent. 11 per cent. for the next 10 months.

Is it not painfully apparent that the reins of monetary control had slipped from the palsied hands of the right hon. Member for Leeds, East (Mr. Healey)? May I congratulate my right hon. and hon. Friends on vigorously recovering them? Can my hon. Friend assure the House that his right hon. and learned Friend will not be dissuaded by any recidivist neo-Keynesians in Great George Street from his professed intention of publishing rather longer-term objectives for money supply, going on into the next financial year?

I am sure that my right hon. and learned Friend is well able to look after himself when it comes to dealing with recidivist neo-Keynesians or any one else. The issue of publishing longer-term monetary forecasts raises complicated matters. This point is under review and the idea has not been ruled out.

Since it has been suggested that there has been a certain amount of double counting in the PSBR forecasts and since we have been told that the money supply is now running at 14 per cent., may I ask whether the hon. Gentleman is satisfied that interest rates will not have to go higher to bring the money supply down to the target of 9 per cent. announced by the Chancellor?

My right hon. and learned Friend has pointed out already the unwisdom of making forecasts of the interest rates. The previous Chancellor did this and was proved wrong time after time. We do not intend that to happen. If the right hon. Gentleman is worried about the public sector borrowing requirement and possible double counting—I assure him that there is none—let him look at the public sector financial deficit. He will find there that, as a proportion of GDP, it is projected this year to be at its lowest level for seven years—lower than at any time under the previous Administration.

Is the hon. Gentleman rebuking the Governor of the Bank of England for suggesting in his speech to the Leasing Association two days ago that MLR will have to stay at 14 per cent. throughout the summer?

No. I was making no comment on the Governor of the Bank of England whatsoever.

asked the Chancellor of the Exchequer what is the latest estimate for the public sector borrowing requirement.

asked the Chancellor of the Exchequer what is his forecast of the public sector borrowing requirement for 1979–80.

I refer the hon. Members to my right hon. and learned Friend's Budget Statement.

Will the right hon. Gentleman refer to the article written by his hon. Friend the Financial Secretary headed:

"The Economic Perils of Thinking for the Moment"

I always pay the closest attention to the views of my hon. Friend the Financial Secretary, certainly to his thinking on long-term economic matters. The public sector borrowing requirement is the centrepiece of the Government's economic policy. We attach the greatest importance to its being reduced from 5½ per cent., expressed as the gross domestic product last year, to 4½ per cent. for the gross domestic product for the year in question. We regard that as being a major part of our attack upon inflation.

Does the right hon. Gentleman agree that there will be much hardship as a result of this attempt to cut the PSBR by a savage attack on public expenditure, upon which the Government are about to embark? Would it not be more meaningful if the Government were determined to tax the big multinational corporations properly and so get their yield of corporation tax nearer to the level of income tax yield, at around £20 billion per annum? Does he not agree further that if cuts in public expenditure are required anywhere, our contribution to the Common Market could be one likely area? Will he also contemplate a savage cut in the amount of money spent on defence, which reaches almost £10 billion?

We have always made it clear that we understand that there will be severe strain involved in the public expenditure cuts that have been presented to the House, both at the time of the Budget and in the Gracious Speech. There is no disposition on the Government Benches towards heavier corporate taxation. We believe that a revival of profitability in the private sector is essen- tial to national economic regeneration. My right hon. and learned Friend the Chancellor has made the most robust speeches about the necessity of reducing Britain's net contribution to the European Community. To deal with the hon. Gentleman's fourth point, we have made it clear, and we are happy to stand by our declaration, that we believe that this country's defences need restoring rather than further undermining.

Order. I hope that Ministers will not feel obliged to answer four supplementary questions in future, because they should not be asked in the first place. One supplementary question is the custom in the House, and it is unfair to other hon. Members for an hon. Member to push in questions which amount to his making a speech.

Will my right hon. Friend tell the House what policy the Government have decided upon to control foreign borrowing by nationalised industries? Has any directive been given on this, or do the Government wish to encourage a further amount of that type of borrowing?

No directive has been issued.

Is the right hon. Gentleman aware of the impact the cuts in the PSBR will have on the low paid? Is he aware further that, on the strength of answers given to me by the Financial Secretary to the Treasury, the taxpayer with £2,000 taxable a year will be better off by less than 5p a week as a result of the last Budget? Does the right hon. Gentleman realise that when we take into account increases in council rents and in mortgage repayments, such a person will be worse off while his standard of living will be cut as a result of the cuts in public expenditure?

It is easy to make the assertion that the standard of living of the lower paid is being cut as a result of the public expenditure cuts, but I have seen no evidence to sustain that assertion

asked the Chancellor of the Exchequer whether he will now give details of the Government's policy on public expenditure.

I refer the hon. Member to my right hon. and learned Friend's Budget Statement.

What estimate has been made of the effect of the public expenditure cuts on unemployment in view of the reports that the Treasury has secret forecasts of unemployment running at the level of 2 million at the turn of the year, due partly to the savage cutback in public expenditure? Is the Minister afraid to come clean and tell the truth because of the possible social and political repercussions of his Government's disastrous economic policies?

I simply do not believe that it would be possible to forecast with any degree of precision the increase in unemployment that might arise from the package of spending cuts announced at the time of the Budget.

Does my right hon. Friend agree with the economic commentary in yesterday's Bank of England Quarterly Review on page 112, where it is said that sales of public assets are to some extent in competition with sales of gilts? Does my right hon. Friend go on to conclude that sales of public assets could not properly be described as a reduction of the public sector borrowing requirement?

I have not had the benefit of reading the Bank of England Quarterly Review to which my hon. Friend refers, but I would not endorse what is stated there.

asked the Chancellor of the Exchequer whether he will make a statement on his proposals for development land tax.

As I am sure my hon. Friend was glad to see, my right hon. and learned Friend the Chancellor of the Exchequer did so in his Budget Statement.

Now that many small transactions will be exempt from this tax, will my hon. Friend turn his attention to the gross overstaffing of the development land tax office, on which there was a critical Inland Revenue report to the Labour Government but on which no action has been taken?

I am well aware of the close interest my hon. Friend has been taking over a long period in the development land tax office. It is too soon to settle the future staffing needs of that office. For one thing, as a result of the removal, by the measures introduced in the Budget, of the major uncertainties that have been hanging over the development land market, I expect that there will be an increase in the number of disposals. We have this matter closely under review.

Is the hon. Gentleman aware that any benefit—and the Opposition dispute that there will be any—which might come to the building industry as a result of cuts in development land tax will be far outweighed by the damage caused by the Budget, especially the public expenditure cuts and the punitive rates of interest?

The right hon. Gentleman characteristically seems to assume that the building and construction industry is concerned solely with the public sector. What he fails to appreciate is that, as a result of the Budget measures and the long-term strategy of the Government, we expect over the coming years a revival in the private sector, which will give a lot of business to builders and to the construction industry generally.

asked the Chancellor of the Exchequer what, at the present time, is the estimated annual rate of growth of gross domestic product.

The economic forecast published last week in the Financial Statement and Budget Report suggested that gross domestic product in the first half of 1979 was more than 1 per cent. higher than a year earlier.

In view of that only modest improvement, and in order that enterprising people may see some light at the end of the tunnel, will the Chancellor say in what year he aims to see a substantial upturn in the rate of growth of gross domestic product?

I am grateful to the hon. Gentleman for his emphasis on the need for enterprising people to see some light at the end of the tunnel, since it must be understood plainly that it is beyond the power of any Government, by expansion or contraction of money supply or demand, to guarantee the delivery of any forecasts of output growth at all. What the Government are seeking to do in the Budget is to change the tax environment, to improve incentives for the enterprising, to whom the hon. Gentleman refers, and to examine and remove regulations and obstructions which stand in the way of enterprise. Only when we secure improvements of that kind in the performance of the supply side of the economy is there any real prospect of expansion of output, prosperity and employment.

At the Heads of Government meeting now taking place, at which the Prime Minister is in attendance, will the response to the Commission's concern about unemployment and the decline in growth in the EEC countries be to put forward the same ridiculous policies for solving this problem as have been put to the House and the country by this Government?

It is my plain impression from discussions with Finance Ministers in other countries, and it clearly emerged, for example, at the OECD meeting last week, that throughout the world economy attention is focusing increasingly on the need to improve the supply side of the economy. Indeed, the Secretary for the Treasury in the United States, speaking in London last Wednesday, drew attention to the failure in that economy of persistent reliance on short-term demand management as an answer to economic problems and emphasised exactly the same diagnosis and prescription as I gave in my Budget speech the day before.

But is not the Chancellor aware that one of the most serious consequences of his Budget will be in the investment intentions of manufacturing industry? Since the worrying forecasts that we are now hearing about manufacturing industry's investment intentions give cause for great concern, will the right hon. and learned Gentleman give to industry generally at least the modest assurance that he has no intention whatever of reducing the capital allowances?

The outlook for manufacturing investment depends essentially on the long-term prospect for economic success and prosperity, and depends therefore upon the measures that I announced in the Budget. I made plain also in my Budget Statement that it would be wrong to contemplate any substantial change in the structure of corporate taxation without consultation, and I have no such intention at present.

asked the Chancellor of the Exchequer what examination he is making of the taxation treatment of working widows.

All widows who are liable to tax will benefit from the very substantial reductions in income tax which my right hon. and learned Friend has proposed in his Budget; but we shall, of course, keep the effects of the tax system on widows under careful review.

What does "under careful review" mean to the Financial Secretary?

It means under careful review.