On a point of order, Mr. Speaker. You will be aware that at 8.30 this morning there was a train crash at Hither Green station in my constituency. Indeed, one of the trains involved was probably one that I would normally have used to get to Westminster. Although I am relieved that only nine people were relatively slightly injured and that the emergency services arrived very quickly and dealt with matters as professionally as we have come to expect, more than 1,000 people were on those two trains and many of them were probably standing. Have you heard whether a Minister intends to come to the House to make a statement about whether there will be an inquiry into what happened at Hither Green this morning?

I am sorry to hear that bad news. I have had no contact from any Minister.

On a point of order, Mr. Speaker. I am grateful that you can consider this point, of which I have given you notice. On Friday morning, at column 527 of Hansard, the Minister of State, Home Office, the hon. Member for Norwich, South (Mr. Clarke), gave an undertaking to the House. He said:

"On a point of order, Mr. Speaker. I confirm that the Government will be tabling a motion on Monday to the effect that has been indicated for the House to consider at that time."

My right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) drew attention to the importance of that undertaking, when he said, at column 530:

"I did not catch whether he said 'on Monday' or 'for Monday'. You will know, Mr. Speaker, that there is an important distinction."

At column 531, my hon. Friend the Member for Mid-Worcestershire (Mr. Luff) said:

"I apologise, Mr. Speaker. We need some clarification. I believe that the Minister indicated that he would be tabling a motion today for debate on Monday."—[Official Report, 9 March 2001; Vol. 364, c. 527–31.]

That relates to the motion that appears as No. 3 on today's Order Paper. Some of us consider the motion to be absolutely disgraceful, but that is an issue for tonight, unless, Mr. Speaker, you can give me satisfaction on my point of order. The Minister of State indicated dissent to my hon. Friend, indicating that the motion would not be tabled on Friday. However, it was tabled on Friday, meaning that Back-Bench members of the Committee to whom the proceedings refer, such as myself, who had taken the Minister at his word, did not remain here until the close of business. Having listened to the points of order on Friday, I thought I would have an opportunity to table amendments to the motion today. That has not been the case. Given the Minister's undertakings and the fact that the terms of the motion are outrageous, I ask that the motion not be considered today.

What the Minister said on Friday is not a matter for me. A motion has been tabled, and an amendment has been put down. So far as I am concerned, that is the end of the matter.

On a point of order, Mr. Speaker. Last Tuesday, you were kind enough to hear an application for a debate under Standing Order No. 24 on the situation in southern Serbia and Macedonia. Since then, the situation in the Presevo valley has got even worse. We now have news that Albanian extremists—the UCPMB—have refused NATO' s invitation for there to be Serb troops in the buffer zones. In view of the fact that Peter Feith, Lord Robertson's special envoy, has been rebuffed, that Kalashnikovs—mostly Chinese—are to be found all over the area, and that ground-safety zones are being abused, have you had any request from the Ministry of Defence for permission to make a statement about those dangerous events in the southern Balkans?

No.

On a point of order, Mr. Speaker. By way of brief background, I have been receiving telephone calls all weekend from Eddisbury farmers about the foot and mouth crisis. Following clearance on one suspected case just two miles from my home, Cheshire remains, as of this morning, a clean county—in stark contrast to the 1967 outbreak, when many farms across Cheshire were devastated.

Given reports that carcases from Devon are going to Cheshire for rendering at the Widnes plant, the backlog of burning on farms, the shortage of manpower, sleepers and coal, the need for the Environment Agency, the Health and Safety Executive and the insurance industry to check everything, and despite the superhuman efforts of vets, we need to know whether there will be a statement to address the serious concerns of Eddisbury farmers. They are receiving reports of carcases, lying on disinfected sawdust only, going through their clean county in lorries with open air vents and loose tarpaulins. Live animals are now coming from Scotland through affected areas in Cumbria to St. Asaph. Without assurances, the farmers of Cheshire, and those of Eddisbury in particular, are deeply concerned that, by such action, the clean county of Cheshire will be affected.

I assure the hon. Gentleman that the Minister of Agriculture, Fisheries and Food will be reporting to the House this week. That will give the hon. Gentleman an opportunity to raise these matters with him.

Further to the point of order raised by the hon. Member for Reigate (Mr. Blunt), would you confirm, Mr. Speaker, that the Tories have completely misread the procedure? They have bungled procedurally, allowing the Liberal Democrats to jump in to do what they themselves should have done.

I think that the hon. Gentleman is trying to draw me into the argument.

Further to the point of order of my hon. Friend the Member for Eddisbury (Mr. O'Brien), Mr. Speaker. My point concerns the procedure for getting in touch with the Ministry of Agriculture, Fisheries and Food in relation to foot and mouth.

I received this morning a phone call from Mr. Jan Rowe, a senior member of the National Farmers Union, about the Blakeney outbreak of foot and mouth in Gloucestershire. It is particularly serious because the person who owns the sheep in the Forest of Dean also has sheep running on the two main rubbish tips in Gloucestershire. I understand that hundreds of lorries go to and from those tips each day without any precautions being taken. MAFF will not be able to inspect the sheep until Wednesday.

I immediately phoned the Minister' private office, to be asked by an official, "Have you rung your local animal health office?" I said, "Come on, I am a Member of Parliament. These are strategic issues which need to be dealt with centrally." He then told me, "I will get somebody to phone you back." Nobody rang me back.

I then telephoned the foot and mouth helpline, which is based in Yorkshire. The gentleman who answered the phone said, "It is no good phoning us: we are inundated with inquiries. Our information is way out of date; we are three days out of date on confirmed outbreaks of foot and mouth on farms." I said, "Thank you. You have given me all the information that I need to raise a point of order in the House this afternoon." He said, "I hope you will, and vociferously"—which I am doing now. We need a dedicated person in MAFF to deal with such serious points on foot and mouth—somebody at a senior level who can give us answers.

I am sure that the hon. Gentleman's concerns have been noted.

On a point of order, Mr. Speaker. Following the premeditated and yobbish behaviour of the right hon. Member for Maidstone and The Weald (Miss Widdecombe) and three of her Whip colleagues, who disrupted Standing Committee F on Thursday, do you have any plans to issue guidance to right hon. and hon. Members, and to members of the Chairmen's Panel, about the power that a Chairman has to direct the Serjeant at Arms to deal with the withdrawal of non-members of Standing Committees if they are disrupting proceedings? Please tell us whether you plan to issue such guidance; page 704 of "Erskine May" suggests that the House has made orders relating to such incidents in the past.

The Chairmen's Panel consists of experienced Members. They do not need more guidance. The Chairman of the Committee concerned showed that he has all the experience that is needed. I would be insulting the members of the Chairmen's Panel if I gave them any more guidance.

rose—

Order. The hon. Gentleman has already raised a point of order. He will have to wait until the end of points of order. Members are rationed to one at a time.

On a point of order, Mr. Speaker. My point of order concerns the behaviour of Members. You are old enough, as I am, to remember the Profumo inquiry. Over the weekend, there have been some serious allegations made in newspapers against the Foreign Secretary and his behaviour in the House. I shall not comment on those allegations. However, as the Foreign Secretary—

Order. If the hon. Gentleman wishes to make any comment about a Member, he must write to me about the matter. At the time of the Profumo affair, I was 17 years of age and I had more things on my mind than that affair.

On a point of order, Mr. Speaker. Further to a matter raised earlier, will you clarify what options are open to the House when four Members deliberately flouted the rules of the House by refusing to remove themselves from Standing Committee F last Thursday? It is particularly shocking that the leader of the rule-breaking rabble was the shadow Home Secretary, the right hon. Member for Maidstone and The Weald (Miss Widdecombe). She deliberately broke the rules to prevent the democratic passage of a Bill through Committee; I know that you personally disapprove of that action. What sanctions do we have to punish the right hon. Lady and to prevent a recurrence of her appalling behaviour?

Order. The hon. Gentleman should read Friday's record of events. That is the best advice that I can give him.

On a separate point of order, Mr. Speaker, of which again I have given you notice. I have been passed a letter from the hon. Member for Sutton and Cheam (Mr. Burstow) on House of Commons headed notepaper. I gave notice to the hon. Gentleman that I would be raising the point of order. The letter is marked "in confidence" and it is addressed to two of his constituents. It reads:

"I am writing to ask for your help. The General Election is no more than six weeks away from being called. I can tell you confidentially that we have learned that Labour will be conducting extensive polling after the Budget on 7 March. If the results are positive, Tony Blair will call the Election on Monday 12 March."

It would appear that that polling has not gone terribly well.

The letter continues:

"As things stand, my agent will not be able to give our printer the go ahead for printing my election address. My agent tells me that we are about £1,500 short of our target to cover the cost. That is why I am writing to you to ask if you would make a donation towards my election address …"

I have two points of order. First, the hon. Gentleman has acknowledged to me that it was a mistake and that the letter should not have gone out on House of Commons headed paper. He is making arrangements to repay £1.20 to the House to cover the cost of the stationery. However, it is serious that a Member should importune people for party political funds on House of Commons paper. Is that sufficient recompense to the House, in your judgment?

Secondly, I presume that if the hon. Gentleman is writing to solicit funds for his re-election, his campaign to be elected as candidate for the Liberal party for Sutton and Cheam has begun, and that a record of his election expenses, including the cost of the letters, should also have begun.

That is not a matter for me. Concerning the use of stationery and postage, the regulations have been broken. The Serjeant at Arms has looked into the matter and I understand that the hon. Member for Sutton and Cheam (Mr. Burstow) will repay all the costs of the stationery. That will be the end of the matter.

I beg to move,

That leave be given to bring in a Bill to require air carriers to provide information to passengers on health risks associated with flying and to contribute to research into such risks.

I introduce the motion with sadness and regret—sadness because it relates to the tragic death of one of my constituents last summer, and regret because I fear that we will not get all the airline companies to co-operate on such a matter unless they are forced to take action by legislation or the prospect of legislation.

My constituent, John Anthony Thomas, of Flemingston in the Vale of Glamorgan, was just 30 years old. He was in the prime of life; he was perfectly fit. He was a policeman and had just undergone a five-year police health check and had a clean bill of health. He returned from a dream honeymoon in Honolulu with his new wife and, a couple of days after returning, dropped dead with a pulmonary embolism.

That would be a tragedy for any family. When the Thomases asked me to get involved with the case, I thought at first that it was just one of those human tragedies that can affect anyone, and that there is not much that we can do about it—except that the family told me that had the consultant pathologist not mentioned that he thought that the death was due to a long-haul flight, the Thomases would never have made the connection between their young son's death and his recent honeymoon holiday.

For me, that rang alarm bells. If the Thomases found out only by accident, how many hundreds or possibly thousands of people have died from the same condition, without any such connection being made? Checks are not made in the NHS or in other hospitals to establish whether sufferers of deep vein thrombosis have recently taken long-haul flights.

I found out from my first meeting with the Thomases that it was the personal belief of the same pathologists that as many as 20 per cent. of deaths through DVT handled by the NHS could be due to air travel. If that is true, many thousands of people could be dying, unaware of the risks that they had taken. I, for one, knew nothing about the problem until it came up as a constituency matter, and I suspect that many citizens still know nothing about the possible connection between DVT and long-haul flights.

I know that my hon. Friend the Member for Norwich, North (Dr. Gibson) has done quite a bit in the House on the matter, precisely because his wife had suffered from the condition following a flight. We do not know with certainty whether it is a major public health problem or whether it affects only a small minority of people. Some experts say that scores die from DVT; others say that thousands, or even many thousands, are dying from it.

We must establish scientifically and objectively the scale of the problem. I am delighted that the Select Committee in the House of Lords has introduced an extremely responsible paper calling for more research into this worrying and possibly major public health problem. My Bill attempts to prevent a repetition of mistakes made when we were in exactly the same position regarding the assessment of the implications of other public health problems. In the case of BSE, there was a long time lag before the effects first became apparent and we discovered that many people were dying and, indeed, may still die. In the case of the asbestos industry and the asbestosis connected directly to it, it took decades to make the connection. Some would say that the public health hazards caused by smoking and its connection with lung cancer took even longer.

My Bill proposes that we do not make the same mistakes again. We should undertake research now, but also take sensible, measured steps to ensure that people do not die or place themselves at risk unnecessarily during long-haul air travel. My Bill calls on the airline companies to provide up-to-date and accurate information on current health risks. Some airline companies that recently decided to do that because the public profile of the problem has been raised have, I fear, been slightly disingenuous. As I understand it, the information that they provide is misleading, inadequate and possibly dangerous.

It is said, for instance, that passengers on long-haul flights should stand in front of their seats periodically and exercise their legs and feet. If hon. Members do not already know it, that is virtually impossible in economy class seats where, one hour into the flight, most of the passengers are asleep the seat in front is reclined, and one is more or less pinned to one's seat for however long the journey takes. The exercises are thus impossible. Worryingly, there are also other examples of inaccurate and misleading advice. I wonder what the airlines have got to hide and why they are providing inadequate information.

The second part of the Bill calls on the airlines to update information when, following research, we discover the scale of the problem. Plenty of information is available: the Chartered Society of Physiotherapy has produced a very good leaflet on steps that passengers can take and exercises that they can do to avoid the effect of so-called traveller's thrombosis. It is looking for sponsorship so that is can distribute those leaflets freely to all airline companies to ensure that all passengers can read the information and take precautionary exercise.

It is not just about exercise. One can take steps to minimise the risk, such as taking aspirin before the journey to thin the blood slightly, or wearing compression stockings during the flight to prevent blood pooling in the bottom of the legs and feet, which causes thrombosis and embolism. That is simple, basic advice and, as we learn more about the condition, airline companies have an obligation to distribute information to their passengers to reduce their risk of suffering from it.

Finally, the Bill aims to get airline carriers and companies to co-operate with any research into the scale of the problem. Again, there are worrying signs that our airline companies are not co-operating, and I must ask myself why. Worryingly, they are not providing ready access to passenger lists and medical records and are involved in limiting research. The Bill therefore includes three measured proposals which could make the difference between life and death.

I shall finish by quoting from a letter that I received from the mother of John Anthony Thomas last year. It was the first communication that I had received from her, and in it she said:

"1 beg you Mr. Smith, please do not let my son's death be in vain and do all in your power to ensure airlines face their responsibility for the health and well-being of their passengers."

That letter came from a distraught mother. My asking the House to accept this motion is a direct result of that plea, and of my promise to her and to her family that I would do all that I could to prevent any future deaths.

Question put and agreed to.

Bill ordered to be brought in by Mr. John Smith, Dr. Ian Gibson, Dr. Ashok Kumar, Dr. Doug Naysmith, Dr. Howard Stoate, Dr. Brian Iddon, Dr. Desmond Turner, Dr. David Clark.

In opening this third day of the Budget debate, I make no apology for repeating the accolades that are due to the Chancellor for the way in which he has ensured that our economy is offering prosperity, stability and success for the future. By choice, not by accident, and by conscious and deliberate action, the Government have taken the necessary steps to ensure that the fruits of stability and competence can be reinvested to bring greater prosperity in the years to come.

In lifting debt from the shoulders of the British people and in enabling us to pay our contribution in lifting debt from the developing world, we can ensure that we apply the people's money to the people's priorities. Those priorities, in health, education, regeneration and employment, are critical to a decent quality of life and to a future to be proud of.

In ensuring that we can invest in improved services, and in avoiding the failures of the past, we are turning the fruits of employment and the reductions in benefit payments into an ability to re-apply them for further employment and for reducing the need for those benefits. We have already spelled out the reduction, from 42p in the pound to 16p, of tax revenue spent on debt and on the payment of unnecessary benefits. That is a foundation on which we can build by reinvesting in social cohesion, and today I shall spell out some of the measures that we are taking to underpin that investment to ensure that quality teaching is in place and that we can recruit and retain the teachers that we need.

Having ameliorated the worst evidence of poverty through the measures that the Chancellor has taken since the election in 1997, and through the future measures spelled out in last Wednesday's Budget, we can now begin to concentrate on investment to overcome the need for ameliorative measures by tackling the causes as well as the symptoms. By investing in education and skills, self-reliance and independence, by liberating the talents of all our people so that they can contribute to their own well-being and reach out and contribute to the wider community, by investing in future success and, in particular, by investing in jobs and community regeneration, we can make it possible for those who follow us to continue an upward spiral of investment in key services, rather than the stop-go policies of the past.

Tackling the legacy of neglect has been the major task of the Government; avoiding its recurrence will be the task of the next Parliament. That is why the extra investment of a third of a billion pounds each year in education and extra investment in skills is so important. It is linked with further cash for employment and for our wider welfare-to-work measures. The Opposition would cut, whereas we are reconstructing. The Opposition were prepared to sacrifice services, whereas we are using them not only to ensure the liberation of the talents of the individual but to contribute to economic well-being, because economic prosperity and social well-being go hand in hand.

In the Chamber a few weeks ago, the hon. Member for Maidenhead (Mrs. May), the shadow Secretary of State, painted a picture—a distorted portrait—of my leadership and that of my colleagues, describing it as centralist. She evoked the image of "Thunderbirds". I reminded Lady Penelope that her party introduced the national curriculum, centrally directed tests, the Office for Standards in Education, the predecessors to the Qualifications and Curriculum Authority and the Funding Agency for Schools. [Interruption.] Yes, I did pick up the issue of grant-maintained schools and, yes, Conservative Members introduced the Teacher Training Agency. Lord Dearing, to whom I pay tribute once again, managed to dig them out of a hole by slimming down some measures.

This Government Lave taken further steps to lighten the national curriculum, slim down the TT'A, amalgamate the two predecessor bodies into the QCA, lighten the inspection regime and ensure that it falls less frequently on schools that are doing well and provide through the literacy and numeracy strategies the relevant support to make the tests attainable.

The Secretary of State talks about lightening the administrative burden, but is he aware that teachers in Staffordshire, whether they work in a comprehensive school or not, say that they are bogged down by the administrative burden? Does he not understand the betray 11 that teachers feel, especially given the promise that he and his team made in 1997, when they said that they would produce a new funding system, which was not delivered, whereby Staffordshire would not remain second from bottom in funding per pupil? The combination of burden, red tape and low funding in Staffordshire remains.

I am pleased that the legacy of low funding is nowhere near what it was when we took office in 1997. Direct funding to head teachers, which we enhanced last week to an average of £70,000 for a secondary school and an average of £24,000 for a primary school for running costs, will have helped schools in Staffordshire as it has helped schools across the country. The two-thirds reduction in paperwork over the past six months—the figure for primary schools is 40 per cent.—will have helped to raduce the time taken to access that paperwork.

Paperwork for literacy and numeracy—for example, the grammar guide, which was sent out last term—is not bureaucracy or administration, but direct support. I again make the point to the House that those who want to direct teachers to teach in a particular way and who want to toughen up on phonics should not also claim that teachers should not be directed on how to teach. Those who are prepared to abandon phonics, decent spelling and grammar and the literacy hour should stand up and be counted.

I have made the point before, but it is worth making again, that Conservative Members can hardly claim that they introduced the literacy hour, given that the hon. Member for Maidenhead famously said that 60 minutes is too long for the literacy hour, thus redefining a metric hour, which no doubt will be an interesting feature of any debate on Europe.

The Secretary of State referred to the Teacher Training Agency, and he always tries to convey the impression that he is a sound traditionalist, although it is obvious that Mr. Chris Woodhead, among others, is not so persuaded. Is the right hon. Gentleman aware of the abominable observations of those three supposed specialists in the teaching of reading, Kimberley, Meek and Miller, who are on record as saying:

"Within the psycho-semiotic framework, the shared reading lesson is viewed as an ideological construct where events are played out and children must therefore learn to position themselves in three interlocking contexts."

What assurance can the right hon. Gentleman give that such drivel, which has done so much damage to the life chances of a generation of children in our state schools, is not continuing to spread like a disease?

I congratulate the hon. Gentleman on his reading of that piece of psycho-babble.

My hon. Friend quoted it from memory.

From memory! That is a remarkable achievement. I reinforce my congratulations. What a smart and able Member the hon. Member for Buckingham is, and what a smart Alec, too. As far as I am aware, the three authors to whom he referred had nothing to do with the literacy hour. Fortunately, the phrase that he memorised and quoted has not passed over my desk.

1 am glad to hear it.

I am grateful for the accolade from the hon. Gentleman, and I am glad to hear it, too.

Having disposed of that matter, we can get back to reality, which is the £200 million allocated last Wednesday—£100 million of revenue for running costs, and £100 million of devolved capital for heads and governors to use. Incidentally, that brings the amount of devolved capital available for investment in repair and renewal during the spending period 2003–04 to £600 million a year. That compares with £683 million, which was the total for capital investment in repair, renewal and new build for the whole of England in 1996–97. It clearly shows the transformation that has taken place as we move to an £8.5 billion investment in repair and renewal of our schools, which will help teachers to do the job better, will make the teaching profession more attractive and will ensure that youngsters get the environment they deserve.

Today, we are introducing new measures. Conservative Members raised the issue of administration and bureaucracy. I can announce a £35 million investment from the capital modernisation fund, which is entirely new money that was not announced last Wednesday. I am grateful to my Treasury colleagues for releasing £35 million for us to invest in a new management information system. It will enable us to ensure that we can collect, collate and transfer data, and thus avoid the statistical nightmare of constant data collection for different purposes. It will be possible to transfer data between schools and age groups, so that the unique pupil number and added value measures can be introduced more effectively; so that collated information on children in the primary sector can be transferred easily and quickly to secondary schools; and so that we can reduce the volume of form filling to about one working week per head per year, which will make a substantial contribution to reducing pressure on heads and teachers. I am pleased that we have been able to make a start on that.

I am also able to give details of the additional £200 million programme over three years, which was mooted in the Chancellor's Budget statement, for recruitment and retention measures for teachers.

My party strongly supports the introduction of a bureaucracy-buster and the passing on of records, which is an excellent initiative, but how does the Secretary of State intend to commission the work? One of the great problems in the past has been that schools and education authorities have all gone their own way. Unless the software is consistent, the system will fall down when children transfer from one authority or school to another.

I entirely agree that there has been a problem, although, in the context of Government as a whole, my Department's record on implementing new technology—in the Student Loans Company or in the development of the national grid for learning—is not bad. In the latter context, we shall want to move quickly, in consultation with representatives of heads and with the e-envoy, to ensure that we get it right. Compatibility is an important factor.

The retention and recruitment package will build on steps that we have already taken. Whatever people may feel about the immediate problem of recruitment, there has been a remarkable turnaround in the attitude to teaching, especially among young people. I would not go so far as to say that teaching has become fashionable again, but a 19 per cent. uplift in applications for the next academic year and a remarkable increase in the number of inquiries constitute symbols of hope.

This time last year, there were 51,000 inquiries; this year, there have been 141,000. The 19 per cent. uplift in applications for September—which, of course, will not feed through in terms of teachers in the classroom for another 18 months—includes a 14 per cent. increase in maths applications, a 27 per cent. increase in science applications and a 7 per cent. increase in modern languages applications. That is a substantial and welcome improvement, which we must build on as quickly and effectively as possible; but we must also keep teachers in the classroom, which is why our measures are about retention as well as recruitment.

It will certainly not help if teachers walk away from children, leaving others to cover classes, denying the children an education and reducing their chances of future success. It will not help those children to do well in tests, GCSEs and A-levels. No one will gain unless those in classrooms act as professionals and ensure that cover is provided while we take the measures that have been demanded to lighten the pressure and ensure that enough teachers are in the classrooms. I thank all the professionals who have been doing that job—under considerable strain in some schools—and appeal to others not to make matters worse by walking away from children who need teachers to cover their classes.

This is a real problem, which arises from decades of under-recruitment and loss to the profession. Together, we need to do something substantial to ensure that, while we await the outcome of new applicants' training, a return to teaching is an attractive option.

Two years ago we introduced "golden hellos", and enhanced them for shortage subjects. We introduced training bursaries to give postgraduates an incentive to train. We introduced the graduate teacher programme, which has been such a success in the development of in-school training, and the new training schools: it is working extremely well, as I saw for myself this morning when I visited Southfields community school. This time last year, on the back of the Budget of 2000, we put a further £180 million into the programme. I believe that we are beginning to turn the corner and that the success of our measures is shining through, but the time scales are agin us.

Along with others, I raised a number of problems relating to the graduate teacher programme during a recent Opposition day debate on the teaching profession. We mentioned the calculation of subjects that would qualify for the programme, and various other issues to do with the qualifications of those entering it. The Secretary of State undertook to tackle those problems; what has he done?

I was planning to deal with that matter later, but I shall do so now. The hon. Lady proposed to slim down the administration and application of school-based graduate teacher programmes. I am pleased to tell her that we will take the action that she advocated. I said that we would examine her proposals, and I meant it. We have accepted them and shall implement them. They are part of the programme that we are announcing today.

As we are on the subject, I can also announce that we shall substantially increase the graduate teacher programme by adding another 570 places, bringing the total number to 2,250. That will make a substantial contribution to enabling people with experience to receive a salary while training and to encouraging them. The increase will commence at Easter.

I am seeking to ensure that we do not treat the issue as a football to be kicked around. I am prepared to listen and to learn. I shall continue to offer everyone—Members and members of the public—the opportunity to offer ideas on how to deal with teacher shortages in some of our schools and some of our regions. I assure the House that we will work with people and take those ideas on board.

In our previous debate on the subject, the issue of the degree requirements for those who wish specifically to access key stage 3 teacher training was raised. Graduates who had not trained in a national curriculum subject were being denied access to training. The Secretary of State said that he would investigate the issue and report back. Has there been any progress on it?

Although I shall try to avoid reporting back on everything today, I shall do my best, so that hon. Members can tick off the boxes. I acknowledged that there was an issue, and we have investigated it. We have also agreed with the Teacher Training Agency and institutions that if the course content of a degree is sufficient to provide assurances that an individual has the necessary background and foundation to take on a specialism, that individual may access training for the specialism. In our previous debate, a psychology degree was cited as an example. If graduates are able to show that their psychology degree involved sufficient statistics content to enable them to undertake maths training, they should be able to participate in such training.

I hope that that assures the hon. Member for Harrogate and Knaresborough (Mr. Willis) that we are trying to balance the desire to ensure quality with the relevance of an individual's background. We are trying also to offer upgrade courses in specialised subjects, so that there is not an automatic cut-off for applicants. Those who are particularly committed and interested should be able to take in-service courses, making it possible for them to transfer to those specialisms.

In some schools and some parts of the country, non-specialists have had to take on specialist teaching to ensure that cover is provided. The hon. Member for Harrogate and Knaresborough, as an ex-teacher, will be aware that that has happened for many years. As someone who taught in a college of technology, I was aware that it was happening around me. I shall never forget being asked to teach law. I said that although I had A-level law, I was not intent on teaching it. I think that many teachers have found themselves in a similar position.

Does my right hon. Friend agree that we are victims of our own success? The simple fact that an extra 1.1 million people are in jobs, that wages are increasing and that there are pressures on housing markets in the south-east perhaps helps to explain why, although we are investing enormous sums in teacher supply, it is still difficult to square the circle. Although standards axe rising, there are still many options for good teachers.

There are indeed. By trying to recruit more teachers, rather than fewer; by recruiting an extra 7,000 teachers in the past two years while seeking to reduce class sizes and ensure not only in-service training for mainstream teachers but training for supply teachers; by putting in place booster classes that are attractive to supply teachers; and by offering professional development courses that teachers find attractive, but which require cover, we are perhaps making a rod for our own back in trying to match supply and demand. That is particularly true in high-cost area; in which attractive salaries can be paid and there are additional costs. That is why the review body report recommended substantial uplifts of 30 per cent. in London weighting and outer-London weighting and retention bonuses of £5,000 a year to be rolled into a £15,000 package of retention over three years. That is why performance-related pay, which we introduced, is so critical. It offers not simply an uplift of £2,000 for good teachers but access to new pay scales of an additional £4,000. That will make a difference to retaining as well as attracting teachers.

This afternoon's package will deal with the problem of how we get people back into the profession now. The immediate £2,000 incentive—£4,000 for shortage subjects, which matches the bonus that is already in place for new recruits to the profession—will, I hope, be an attractive proposition, but it needs to be matched by other measures. Those measures will include an acceleration of the graduate teacher programme and a £35 million programme of funded measures this year, to be matched by at least £35 million in the next financial year. The money will go directly to head teachers and governors, without bureaucracy and administrative difficulty. There has to be co-ordination. We want a light-touch approach at local authority or area level, using the recruitment managers who are already paid for by the Department and are in place.

The money will enable head teachers to pay for additional housing costs and for care components, if needed, to help returners with the costs of child care and of caring for older relatives. It will enable travel costs to be met and changes to incremental scales to be offered. The scale on which a post is offered can be changed to meet the needs of a returner, whether that person has just had a family or took early retirement.

I was tickled to hear that one of the agencies had written to the hon. Member for Harrogate and Knaresborough, an ex-head teacher, to ask whether he would like to come back to the profession. I gather that he has reserved his position until after the election—a wise man. I have been out of the profession for so long that no one has sent me anything, but one never knows.

The new funding will be made available immediately, but through the review body we will simultaneously consult to avoid any misunderstandings or allegations that we did not consult. We will ensure that the money is made available as speedily as possible to those who return to the profession.

I hope that the measures will enable us to say to people on the edge of returning to the profession that this is an appropriate moment to do so. We will offer free update courses of six weeks and child care provision. We will also pay a bursary during those six weeks so that there is no disadvantage to the family.

I congratulate the Secretary of State on what he and his colleagues have been doing to improve standards, particularly with regard to the recent intervention on behalf of schools in Thurrock. That was timely and much appreciated by parents and me.

Will my right hon. Friend undertake to revisit a problem with the allocation of scan e resources from the Department? I understand that the indices include the number of children who have free school meals and levels of employment. In my area, although unemployment levels are not high, a lack of wealth and opportunity is disguised by the large retail sector, which pays relatively low salaries. The numbers of the many children who are greatly deprived are not reflected in the indices of free school meals and unemployment. The allocation of funds needs fine tuning to reflect tradition ally poor areas.

There is always a problem with crude measures versus complexity—between trying to set up simple measures of deprivation and the complicated evaluations that inevitably have to be dealt with through greater central administration. There is a dichotomy between what is fair and what is simple, as I can well understand, for example, in relation to the pupil learning credits that we announced in the Green Paper.

This afternoon's package will be aimed at areas where vacancies exist; it will be tailored both to particular geographical areas and to schools with the biggest problems. The money will follow the problem and will thus be related not to prosperity or bidden deprivation but to the specific problem that we want to overcome. As with other measures in the Green Paper, we shall apply some of the resources proposed in last week's Budget, together with the spending review allocations, to ensure that we can be flexible on other measures hat will be attractive and fair to people coming into the profession.

As I said, some hon. Members are concerned about undergraduates taking BEd and BA courses. We want to use some of the Budget resources for experiments in the fourth year of such undergraduate courses to enable students to achieve qualified teacher status early and move into the classroom as appropriate, and to help them financially. I look forward to being able to move on that matter, on which there will be further consultation.

I hope that this afternoon's package will enable us, once again, to appeal to people to work together, rather than against each other, to solve a genuine difficulty. Success breeds success, as schools show through their higher standards and achievement; and, with the additional support and resources that have been made available, they will be able to tell others that teaching is an excellent profession to be in. We can see from the increased number of applications that young people believe that. We can reach out to former teachers and draw them back into the profession.

We cannot solve all the problems that arise from the success of the economy in parts of the country where prosperity puts enormous pressure on housing costs and offers alternative employment. However, we can take steps to match that. We are putting in place the precise measures that most people wanted, ensuring that recruitment, retention and reward go hand in hand. In a spirit of collaboration, we are challenging the main Opposition party to say whether it will match the funding that we are putting in place. The commitment of the Leader of the Opposition and the shadow Chancellor applies only to money allocated to schools. However, there will be allocations from the DFEE budget for many of the measures that we are taking, including the information technology package to reduce administration. Given the extra resources that we are putting in, in the event of the Opposition miraculously finding themselves on the Government Benches, it would be interesting to hear where the cuts of £8 billion and tax cuts of £8 billion would be imposed. I doubt that Conservative Members will answer the question because no one in Conservative central office has worked it out yet. Everyone outside knows perfectly well that the sums do not add up.

The foundations that we are laying today will carry forward opportunity for all our children, investment in schools across the country, greater delegation of budgets and the freedom of heads to use them. We are introducing measures that directly address the problem of recruitment. We are overcoming the legacy of years of neglect that we inherited. We are very pleased indeed to have been able to do that. I am grateful to the Chancellor for enabling me to announce these measures this afternoon.

Four years ago, this Labour Government were elected with the priority, "education, education, education." Four wasted years later, they have manifestly failed to deliver on that promise. That is clear to anyone who visits schools and listens to teachers complaining about the burden of bureaucracy; to head teachers complaining about Government interference; to governors complaining about the overload of red tape; to pupils complaining about disruptive children being kept in class, damaging their education and that of others; or to parents worried about teacher shortages that are creating difficulties in their local schools.

Jenny Short, the head teacher of Loddon junior school in Earley, wrote in her open letter to the Prime Minister,

"As a head teacher of a junior school, I am at a complete loss as to how to cope with the staffing problems I now face."

She set out those staffing problems and continued:

"Whilst I shall continue to make every effort to cover absence in the event of illness, if this proves to be impossible, children will be sent home."

She has subsequently been in touch with me and said:

"I leave my school after five years and two successful OFSTEDs exhausted and disillusioned. Once we could choose our teachers carefully with due regard for the balance of age and experience, ability and expertise, personality and potential to fit in with our high standards and ethos. We could build on our successes, make real improvements …Now …the daily staffing crises reduce us all to firefighters where strategic planning and real improvements are impossible".

On a doorstep in Hurst during the weekend, a parent told me, "The Government promised education would be their priority. I haven't seen any evidence of it."

So as we consider the Budget's impact on education, what is the end-of-term report on the Government and the Secretary of State? "More red tape—done. Increased interference from Whitehall—done. Teachers leaving in droves—done. Larger secondary classes—done. More disruptive pupils in class—done. Grammar schools under threat—done. Abolition of grant-maintained status—done. Fiddled figures—done."

The legacy of the Government's four wasted years is a national crisis of teacher shortages, a demoralised teaching profession, schools threatened with four-day weeks, standards damaged and children's education suffering—for the Government, who came in promising so much, have delivered little, not just in education. The Secretary of State did not refer to any of the comments on the new deal that the Chancellor made in his Budget speech, because the Government have spent hundreds of millions of pounds on the new deal—a scheme that the National Institute of Economic and Social Research has shown has directly resulted in only 13,000 jobs.

The evidence shows that the new deal works when the private sector is involved, using its expertise and flexibility in the interests of unemployed people—for example, Reed Executive in Hackney and Pertemps in Birmingham. We have seen what the private sector can deliver. That is why we will replace the new deal with "Britain works", which will involve private sector expertise and will focus on getting people into jobs as soon as possible and helping them to stay in them. "Britain works" will be a better deal for unemployed people, for employers and for taxpayers. The new deal is a broken pledge.

Does the hon. Lady agree that the shadow Chancellor's policy of keeping inflation below 2 per cent. would inevitably drive up interest rates, thus increasing unemployment and resulting in less money for education?

I suggest that the hon. Gentleman consider the inflation rate at the moment. I understand that it is less than 2 per cent., so perhaps he should reconsider his intervention. He should look at the new deal figures, which show that the programme has failed to provide jobs for young long-term unemployed people; that the rate of decline in long-term youth unemployment has slowed under this Government in comparison with what was happening during the last years of the Conservative Government; and that where the new deal works, it does so because the private sector is involved. With "Britain works", we shall ensure that the private sector is involved, to get people into jobs.

Why has long-term youth unemployment fallen by 75 per cent" Why did the report of the National Institute of Economic and Social Research say that the new deal has added £500 million steady state a year to GDP? Why did it acknowledge that more than 200,000 youngsters have got into jobs faster? Why are 274,000 youngsters who had been unemployed for more than six months now in work when they were not when we came into office? And why are employment zones working so well that even the Conservative party cannot think of abolishing them?

The figure from the National Institute of Economic and Social Research is 13,000 new jobs from the new deal. The report showed that hundreds and millions of pounds hive been spent to find 13,000 jobs. Unemployed people deserve a better deal. They do not want to be put on training programmes only to find that they come off them when they go back on to benefit because there is no job for them. The new deal has become a revolving door for too many of the long-term unemployed, and that is why it needs replacing with a better scheme. "Britain works" will be that better scheme. The new deal is a broken pledge.

Let us consider the Government's education promises and look back on their early claims about extra education spending. Three years ago, in the first comprehensive spending review, the Government announced an extra £19 billion for education. We soon saw how wrong that figure was. As The Guardian said:

"Mr. Blunkett's claim to be spending an extra £19 billion has collapsed in empty rhetoric".

The Times reported:

"Mr. Brown added together increases over three years to produce his global figures of ti billion more for education … This is misleading since it represents triple counting".

[Interruption.] The Secretary of State seems to be commenting on the author of The Guardian report, but perhaps he would like to comment on the rebuke that he received from the Select Committee on Education and Employment, which said that there was

"no cash bonanza of the type which newspaper headlines might suggest".

True to form, the Government have been up to their old tricks. They are perhaps getting a little better at hiding them—as they do in table C13, on page 202 of the Red Book. The Chancellor announced an extra £1 billion of spending on education, but a comparison of the figures on page 202 of the Red Book with the latest comprehensive spending review show s that, as a result of the Budget, the increase in education spending over the next three years is actually £200 million—not £1 billion. The answer is that one simply cannot believe a word that the Government say about their spending.

That is not the only' way in which the Government are fiddling the figures. Ministers welcomed the School Teachers' Pay Review Body recent pay award for teachers, but they did not tell anyone that they were not going to fund the increases fully. Local education authorities will have to find the extra money, and schools will see their budgets being cut to provide the pay for teachers.

Ministers claimed to put £65 million into school budgets this year for the new AS-levels, but how many schools have seen a penny of that money? Their teaching costs have gone up, their resources costs have gone up and their examination costs have gone up, but the Government have not provided them with the extra funding to pay for that.

May I remind the hon. Lady that I spent some years in local government? In every one of the 18 years of the Conservative Government, my local authority had to find a proportion of teachers' salaries—and she can check that point out. She should not complain about this Government when they are trying to do something to right that wrong.

The Government are not doing that; that is the whole point. Local authorities today have to scrape around for the extra cash because the Government are not providing it. The Government hide and fiddle the figures so that schools do not know exactly what they will get, and fail to provide the funding that they promise for schools. The expectations of teachers and parents have been raised, but that is why they are now becoming totally disillusioned and fed up with the Government, They have heard so many promises on which the Government have completely failed to deliver.

We should not be surprised by that, given that, when the Government claimed to be introducing fairer funding, they said that more money would go direct to schools. while at the same time specifying 89 categories of spending that local authorities could hold back from schools. The Government promised that they would change the standard spending assessment within a year of coming to office but they have done nothing about it. Few schools in the numerous authorities—such as Wiltshire, Worcestershire, Dorset, Leicestershire and indeed Staffordshire, to which my hon. Friend the Member for Lichfield (Mr. Fabricant) referred—that have been disadvantaged by that calculation think that funding today is fairer. That is certainly not what I heard last week from heads in Wiltshire who face problems and budget deficits because of the difficulties caused by the Government's lack of funding. In any case, how much of the money announced in the Budget will be top-sliced from local authorities and redistributed to them as new money?

What about the way in which the Government tell schools how to spend their money? During a visit to a secondary school in Formby last week, I was told by the head, "I've got four pages of A4 which describe all the different funding streams that come into this school. One page covers the funding streams over which we have discretion; three pages cover the funding streams over which we have no discretion." The Secretary of State referred to the Chancellor's Budget announcement of an extra sum that will go directly to schools, but that is only true of about 1 per cent. of the money. Money should go directly to schools so that heads have the freedom to spend it in the best interests of children in their classrooms: they should receive 100 per cent. of it directly. Heads should have the freedom to spend the money on what they know is needed in their schools in the interests of their pupils.

The Secretary of State mentioned devolved capital. At a primary school in Woodley this morning, the head told me, "It's all very well talking about this devolved capital, but the problem is that I am only allowed to spend it in chunks of £10,000 and then only on certain priority areas. I can think of a lot of things I want to spend the money on, but I am not allowed to." We are far from the Secretary of State's claim that the people's money is being spent on the people's priority. Instead of the people's money being spent on schools' priorities, it is being spent on Labour's priorities.

It would be unfair to suggest that the Government have not increased spending on education, however. They have increased the amount that is spent on advertising in the Department for Education and Employment and the money that is wasted on bureaucracy. During the past four years, the Government have introduced 530 regulations. In the past year, they have sent out a directive a day to teachers. They have published well over 2,000 press releases and goodness knows how many of the Secretary of State's speeches have been published in glossy booklets. Increased spin—done.

At the top of the Government's list of achievements, however, is the increase in bureaucracy, red tape and paperwork that they have imposed on teachers. The Secretary of State mentioned reducing bureaucracy. In the Green Paper that was published a few weeks ago, the Government claim that they have reduced the number of pages of material sent to primary schools by 1,170 pages to just 490, but it was their fault in the first place that those schools were receiving nearly 2,000 pages of circulars telling them what to do.

What about the time that that bureaucracy, which keeps teachers away from the core job of teaching children, takes up? The Government say in the Green Paper that the standards fund will be changed and not all the money will go directly to schools. Some categories will remain as they are, but the system is apparently being changed to save time in schools. However, according to the Government, schools have spent three months filling in forms for the standards fund. That is hardly a reduction in bureaucracy.

My hon. Friend's concerns reflect those that hundreds of teachers throughout my constituency—from north to south and from west to east—have put to me over the past four years. Is she aware of a written answer given by the Minister of State, Home Office, the hon. Member for Norwich, South (Mr. Clarke) that said:

"The number of people leaving a profession may be taken as an indicator of morale."—[Official Report, 11 December 2000; Vol. 359, c. 65W.]

Given that the vacancy situation is three times worse in the capital than at national level and that one fifth of people who leave their posts are leaving the profession altogether, is that not the most damning indictment of the continuing failure of this Administration?

As ever, my hon. Friend makes a telling intervention. It seems that the Minister of State, Home Office knows a great deal more than the Secretary of State for Education and Employment about what is happening in the education system today. The problem is that people are leaving the profession because of bureaucracy and red tape.

One has only to look at the 2 March edition of The Times Educational Supplement, which has a front-page heading, "Crisis? What crisis?" What annoys teachers, head teachers, governors and parents is that unlike the Minister of State, Home Office, the Secretary of State fails to recognise the impact of his policies on the morale of the profession and the crisis that his actions have generated in our schools. The headlines inside the TES say, "Morale plummets as shortages rise" and "Official denials only add insult to injury". The head teacher of New college, Leicester says:

"We'll reach meltdown unless a miracle happens by September."

The head teacher of the Malling school in Maidstone says:

Don't even let me hear Estelle Morris say again 'there's not a crisis'. Come and spend a week in Kent."

That is what is happening in our schools under the Labour Government.

The Secretary of State tells us that everything is all right because the number of applications at the graduate teacher training registry has gone up. If we look back over the four years of this Government, we see that there are fewer applications than in 1997. Applications to teach maths have fallen by 21 per cent. since that year: applications to teach modern languages have fallen by 26 per cent. and applications to teach English have gone down by 19 per cent.

Despite all the cash incentives and all the money that the Government claim to be spending on the problem, teachers are still not coming forward. Teacher applications have fallen and teachers are leaving the profession because they are demoralised by the red tape and paperwork that the Government have imposed and because the Government's interference means that they can no longer get on with the job that they want to do, which is teaching children.

Will my hon. Friend also comment on the management of the Department? I have just received two written answers to a parliamentary question. I asked the Secretary of State when he would reply to my letters dated 8 November and 21 September 2000 concerning the exclusion from holiday play schemes of children with medical conditions. I wonder if my hon. Friend can help me, because I have had two replies to the same question. The first says:

"I replied to the hon. Member on Friday 9 March".

The second says:

"I will reply to the hon. Member as soon as possible."

Both those answers have just arrived on my desk. Can my hon. Friend tell me which is correct? Do I have a reply or not?

I am sorry to say to my hon. Friend that I know the Secretary of State's mind no better than it seems he or his Ministers do. My hon. Friend makes a telling point about the bureaucracy in the Department—the very bureaucracy that causes problems for our schools and teachers. I can only suggest to him that perhaps the people who were supposed to be responding properly to his question were too busy drafting yet another circular to send to teachers.

We know that because of the shortage of teachers many schools have been able to operate without sending children home only because of the large number of supply teachers from Australia, New Zealand, South Africa and other countries. Unfortunately, those schools may soon find that they face another problem. An article in Sydney's The Sun-Herald yesterday said:

"Australian teachers recruited to work in British schools are quitting in increasing numbers because of poor behaviour by students and alien working conditions."

The headmaster of Chalvedon school and sixth form college in Essex, who recruited nine Australians, finds five months on that four of them have left. As another teacher said:

"Staff shortages are so severe that we are getting Australian teachers who get off the plane one day and are literally standing in front of a class the next".

That is the state to which the Secretary of State has brought our education system in his four wasted years in office.

Let us look at funding for schools and bureaucracy. We know that the Government will never give schools all the money or stop the bureaucracy, because they simply do not trust teachers or parents. The Secretary of State referred in his speech to liberating the talents of individuals. I hardly think that his proposals for advanced specialist schools in the Green Paper represent "liberating the talents of individuals". Advanced specialist schools will be able to

"volunteer to take on a number of innovative ideas".

Good—I am in favour of innovative ideas in education. However, as we read on, we learn that they can only do so

"from a menu developed centrally".

Yet again, the Goverrment are obsessed with centralising and interfering, rather than letting schools get on with doing what they know is right for children in their classrooms.

As the former chief inspector of schools said:

"David Blunkett has presided over a set of initiatives that has wasted taxpayers' mom .y, distracted teachers from their real responsibilities and encapsulated the worst of the discredited ideology that has done so much damage since the 1960s".

That is what this Government have done instead of delivering on education.

I should be ever so grateful if the hon. Lady would tell me whether she agrees with one or two of the initiatives to which she is referring, such as the excellence in cities programme, the new deal for schools, the national grid for learning and the reduction in class size—all of which were listed as initiatives over and above the two with which the former chief inspector of schools agreed. Does she think that all or any of those should have been initiated, or would she abolish them?

The Secretary of State still does not get the point. The point is that schools should be given all of their budget and allowed to spend it on what they think is right for children—not on what the Government think is right. Head teachers constantly tell me that they want the ability to spend the money that is due to their school in the way that they think fit—in the interests not of the Government but of children.

Will the hon. Lady clear up a misunderstanding, probably on my part? Will central funds be the same for each child in a primary school and for each child in a secondary school, wherever in the United Kingdom that school may be?

No, the national funding formula will take account of some differential needs. I am happy to clear that up for the hon. Gentleman.

The next Conservative Government will get rid of the endless bureaucracy that takes teachers' time and resources and means that money is not spent in the best interests of children. We are absolutely clear that we will match the money that the Government are spending, and are proposing to spend, on schools. That will include the increases to which the Secretary of State referred in his speech today, which were announced in the Budget. Perhaps more important, we will tackle serious reform of education by devolving all budgets to schools and by ensuring that money which is currently held back by local education authorities and central Government goes to schools. That will mean hundreds of extra pounds per pupil for schools.

We are not just about devolving money. Head teachers should be given the freedom to do the job for which they were trained. A head teacher from Essex wrote to me recently:

"We as head teachers need more finance into the school with the freedom to be creative with it to suit our needs. We need less paperwork and more encouragement as a profession".

The Secretary of State seems not to understand when teachers' representatives tell him that the introduction of the various initiatives that he has described will not bring teachers back into the profession or help to recruit more of them. Potential teachers do not want to join a profession in which they will be the mouthpieces of bureaucrats in the town hall and at Whitehall.

As the staff at Willowbank junior school said to me this morning, they long to bring creativity and spontaneity, which are now being pushed out because of the imposition of targets by the Government, back into the classroom. The Government are imposing pressure on schools to do things in the way they want. Teachers and young people going into teaching want the freedom to use the skills that they have developed to inspire young people. The Government have yet to learn that inspiration does not come from a Whitehall circular.

Will the hon. Lady give way?

No. I have given way on several occasions and I shall not do so again.

We shall set schools free. Unfortunately, the Government and the Secretary of State cannot and will not see the need to do that. That is why they have failed to deliver. It is why we have teacher shortages, why children are being sent home early and why children are being taught by non-specialist and unqualified staff. It is why the Government will continue to fail.

We need a vision for education, and a Government with that vision. As long as we have a Labour Government who think that education is merely a tool for achieving politically set numerical targets or for meeting politically correct slogans, and as long as the Secretary of State agrees that teachers are learning managers, equipping children with "learnacy" skills, children's education will suffer.

Parents, children and teachers need a Government who value education in its own right, recognise the importance of instilling knowledge and encouraging creativity as well as teaching skills, and above all recognise the importance of inspiring children and young people to achieve. We will be that Government. We will set schools free, let heads manage and let teachers teach. We will raise standards in the classroom. Our children cannot afford another four years of Labour.

After that strange rant about what goes on in our schools, I want to move on, but I have a comment about the speech of the hon. Member for Maidenhead (Mrs. May). When I visit schools in my constituency, I find that teachers and head teachers do not want every penny of spending devolved to them. They appreciate much of what the local education authority does for them and want it to continue to have a role.

I welcome yet another triumph of economic mastery by my right hon. Friend the Chancellor of the Exchequer. I welcome also the money that will be given directly to schools. The move has been welcomed by schools in Lewisham in the past, and it will be welcomed again. However, I hope that the money will be used not only for the bread-and-butter issues of the day but more imaginatively to expand pupils' aspirations through creative projects that will further develop and enhance their future life styles beyond the classroom and after their lives in school.

I welcome my right hon. Friend the Secretary of State's announcement about funding to increase the number of teachers. As he knows, teacher numbers have been a problem in Lewisham, and continue to be. We have a peculiar problem that stems from the inadequacies of the Conservative Government, both in 1989 and 1993, when they did not deal properly with the recruitment and retention of staff in schools.

I shall take an overall view of the Budget. Anthony Crosland, writing in the 1950s at a time of growing prosperity, talked about

"the declining importance of economic problems"

and the need for a greater emphasis on personal freedom, choice, happiness and culture in future. Commenting on the values of those pioneers of the Labour movement, the Webbs, he wrote:

"Total abstinence and a good filing system are not now the right signposts to a socialist Utopia; or at least, if they are, some of us will fall by the wayside."

Almost half a century later, we are again living through a period of growing prosperity. I hope that Tony—Crosland, that is—may yet be proved right. We have in our Chancellor of the Exchequer a true stakhanovite—a man who wears more hair shirts than anyone since Thomas More. We have a Chancellor who has given us economic stability and whose values are work and thrift. In the Budget, he is continuing to make work pay and to make savings pay out more. People will benefit from the Budget if they contribute to the economic prosperity through work.

I do not deny that there are traditional battles that still need to be fought and won. It is an indictment of 18 years of Conservative rule that when we came to power, one in three children were living in poverty. There was hopelessness and despair in some of our inner-city housing estates, including those in my Lewisham constituency. We inherited a Britain in which our NHS, schools and other public services had been run down to the brink of disaster. That is changing, sometimes frustratingly slowly, but the comprehensive spending review and the Budget measures are together building us a better Britain.

We must aspire to do more. Although we are acting to end child poverty—more than 1 million children will be taken out of poverty thanks to the Labour Government's policies—to eliminate sink estates and to provide an education system and an NHS that are second to none, we should not lose sight of the fact that, for many people, the important issues of the future are more leisure time, happiness, the arts, architecture and the environment.

Of course Budgets are important. They can have a real impact on the economy. Over the years, Budgets have become major spectator events, closely watched and extensively commented on by the media. However, for those doing nicely or who are quite well-off—in other words, large swathes of middle England—the Budget is only a sideshow. More important to them are the preservation of the green belt, the quality of local restaurants and the performance of their favourite football team, and rightly so.

Budgets need to strike a balance between helping those in need and rewarding those who contribute to making society a better place. They should expand people's aspirations and creativity and, as my right hon. Friend the Secretary of State said in his opening remarks, liberate the talents of individuals. That is why the changes in funding for churches and renovation have been particularly welcome in my constituency. Only yesterday, I visited St. Margaret's church in Lee to celebrate in choral evensong the magnificent renovations there. During the evening, many of my constituents commented on and welcomed that aspect of the Budget.

Budgets should expand horizons. People in Lewisham, like those elsewhere, want to be able to use their leisure time purposefully. They want their environment to be both preserved and protected. They are concerned about the built environment. They want to ensure that proper respect is given to our heritage, preserving all that is good from the past while also being interested in developing new ideas and constructs for the future. Budgets should aim to create an environment that allows for creative expression in the arts or sport. That is why the changes for museums in the Budget are so important.

The Government are committed to social inclusion. That involves not only work to alleviate poverty, raise standards in schools and reduce crime, all of which collectively improve the well-being of our citizens, but giving them the opportunity to enjoy the arts as both spectators and producers. As we create more wealth, we need to create an environment where more people can enjoy that wealth. Thanks to the Chancellor's successful economic management over the past four years, we can do that. As a modern democratic socialist, I believe that economic policy must be about helping those at the bottom of the pile and creating a good-time society. For that reason, I very much welcome the Budget.

"Education, education, education" was originally a cry from Lenin, who did not mean it. I suspect that the Secretary of State, who has just left, does mean it. He is sincere and, in his unavoidable absence, I should like to congratulate him on graciously adopting some of the: proposals of my hon. Friend the Member for Maidenhead (Mrs. May), who is shadow Secretary of State. That behaviour is as welcome as it is unusual, and I hole that future Governments of both complexions will be inclined to follow that particularly good example.

Turning to the Budget as a whole, I am pleased that the Chancellor has cut taxes and given back to taxpayers a small proportion of the money that he has extracted from them in the past four years. His generosity is not surprising: notwithstanding the problems of foot and mouth, a general election is pending and the public accounts show ample scope for tax reductions and, perhaps, modest expenditure increases. Yet, only a few weeks ago, when the Opposition said that, they were condemned as "irresponsible" by spokesmen from the Treasury and elsewhere. We now see how shallow those attacks were, for if the Opposition were irresponsible, why has the most prudent of Chancellors done what they recommended? In truth, my right hon. and hon. Friends were right to identify the scope for tax reduction. Not only were they right but, if the economy stays on course, there may be scope for even more tax cuts in future.

A principal reason for that remarkable leeway is the sheer size of tax increases over the past four years. We must disentangle fact from fiction. Prior to the Budget, there had been 26 increases in personal taxation and 19 increases in taxes on business in this Parliament. That number has risen slightly although, given the Chancellor's remarkable gift for sleight of hand, one must study the small print carefully to find out precisely how many tax increases there are. However, their sum total is enormous. The abolition of tax credits on dividends alone will cost shareholders about £6 billion in the current tax year. The reorganisation of advance corporation tax at the beginning of this Parliament has affected the quality of pension funds for millions of elderly people and cost those funds more than £5 billion during the course of this Parliament; it will do continuing damage until it is changed.

Even after offsetting tax reductions—of which there have been some, mostly minor, examples—the Inland Revenue's overall tax yield has risen by an astonishing one third during this Parliament. No wonder the savings ratio has fallen so badly. That is not a wicked Tory calculation; an independent survey shows the average family to be worse off than it was in 1996. The old tax-until-the pips-squeak bruiser Lord Healey must be salivating enviously at the extent of the tax rises forced through by the Chancellor.

More people have been dragged into tax. An extra 2 million now pay tax; 28 million pay it, compared with 26 million three years ago.

That is just nonsense. What about unemployment?

If it is nonsense, it is Red Book nonsense. Those figures come from the Red Book. Before the hon. Gentleman mutters into his non-existent beard, he should read the Red Book and check. It is possible that the Chancellor has given us more duff facts; we are used to that. However, if they are duff, that is his responsibility, not mine.

There are 2 million more taxpayers and 700,000 more higher-rate taxpayers than there were four years ago. In addition, mortgage interest relief at source has been scrapped, although I do not object to that particularly. However, not only has MIRAS been scrapped, but stamp duty on home purchase has been increased and national insurance contributions for middle-income earners have risen sharply. So much—on the eve of the next general election—for the promises that the Labour party made to middle England and middle-income groups throughout the United Kingdom on the eve of the last one. Those groups may also care to note that the yield from inheritance tax has soared 50 per cent. during this Parliament. The Chancellor still has no concept—I genuinely believe that he does not understand its value--of letting more of the fruits of a lifetime of work filter down to the people whom the earner most cares about: his own family and the next generation.

It is no wonder, with such tax increases, that the ratio of tax to gross domestic product has risen 2.5 per cent. to 37.7 per cent. The Chancellor, despite all his promises, has not so much wooed middle England as assaulted it.

Does the right hon. Gentleman know that, taking tax and borrowing together as a share of GDP—given that borrowing is deferred taxation—the figure went down two points from 38.2 per cent. in 1996–97 to 36.2 per cent. in 1999–2000, and down to 34.1 per cent. in the current year? The current figure is due to the spectrum auction of mobile phone wavelengths, but for the previous period, those two points represent the equivalent of an increase of 7.3p in income tax. In other words, the right hon. Gentleman simply borrowed instead of taxing, and tried to fiddle the figures.

The hon. Gentleman ought to know that his Chancellor changed the way in which the figures are quoted in the Red Book, and the actual equivalent of what he has done is an extra 10p on tax The hon. Gentleman may care to examine that matter. [Interruption.] If it is nonsense, it is the Government's nonsense in the Government's own figures. Those are the figures that I am using. I am glad to hear from Labour Members that they do not believe them.

It is ironic that the Government and the Chancellor have increased taxes so much. During the last Parliament, I remember vividly the present Chancellor and his colleagues, ever ready to find a catchy slogan, repeating the slander of 22 Tory tax rises, with no acknowledgment whatever of any offsetting tax reductions. To call their attacks disingenuous would be kind. They were patently untrue, and a forerunner of the manipulation of facts that has characterised so much—not all, but so much—of what the Government have said and done in the past four years.

The Government cannot deny that, because the figures for tax increases are now clear. The statistics cast light where the slogans cast deception. Before this Budget, the real increase in taxes over this Parliament was about 4.5 per cent. a year. Obviously, that figure is now a tiny bit lower, but not all that much. That compares with 1.8 per cent. between 1979 and 1997. I am indebted to the Institute for Fiscal Studies for pointing out that there were tax rises of 2 per cent. a year between 1979 and 1990, and of 1.3 per cent. between 1990 and 1997.

So much for the 22 Tory tax rises, or, indeed, the unsustainable proposition—unsustainable except by malice—that the previous Government wrecked the Tory tradition of low taxation. Some of my right hon. and hon. Friends who rather timidly accepted that fiction in the early part of this Parliament can now feel comforted that it was not true and refute it. They need not concede, but may safely move on and reassert our traditional tax credentials. Taxes were not unduly increased, despite the pressures of a recession that began in the 1980s and cast its shadow into the 1990s—although not, from the point of view of the health of the economy, much beyond 1992.

The Chancellor is ever ready to gloss over the excellent parts of his inheritance. He cherry-picks the bits on which he can make party political capital, and I do not blame him for that: most politicians do. However, he misses other bits. He is, after all, a very political Chancellor who wishes to be Prime Minister, and he is doing a bit of image building.

We need more facts and less of the fiction that we so often hear. The economy has been growing steadily since 1992, before—some hon. Members may not wish to hear this next point—sterling left the exchange rate mechanism. Unemployment has also been falling since that economic recovery began, and the very welcome job growth across the country—in both the number and the variety of jobs—has been consistent throughout the previous Parliament and this one.

Inflation, too, began to decline in the early 1990s and has remained low. It looks set to fluctuate only within historically narrow parameters.

The Chancellor has been skilled, but I put that in perspective. Other factors have contributed, such as the ebb and flow of the economy, and I accept, to an extent, that employment growth was under way during the right hon. Gentleman's stewardship. I have intervened only because of his breathtaking assertion that people are somehow worse off than in 1996, which defies both belief and the litmus test of what one sees and feels. There was extensive unemployment, particularly among poor and unskilled people, during the period to which he refers, and although I do not apportion credit or blame in respect of employment, people are now in jobs. Demonstrably, they are better off.

Demonstrably, the people in jobs are better off. That is undeniably so, but I was referring to the scale of tax increases. If the hon. Gentleman reads some of the independent research, he will see precisely why I made that comment.

As it happens, I was about to give credit to the Chancellor. The economy is in good shape and he can take a great deal of satisfaction from that. I shall not be mealy-mouthed: he can take a good bit of credit for it as well. Were he to be similarly candid, he too would offer credit to his predecessors, because he has built on what they did and on a trend that was established five years before he went to the Exchequer.

For example, some hon. Members, but perhaps not all, believe that an economic miracle began on 2 May 1997. Let us take a date at random—1 May 1997. Growth was set to be 3.5 per cent. for the next year. Inflation was 2.6 per cent. and stable. Unemployment was falling rapidly and, although still high, was down to just over 1.5 million. The fiscal deficit was falling sharply—a point that the Chancellor invariably overlooks because it embarrasses his campaign to discredit his predecessors. The trend of a falling fiscal deficit was clear, and it was falling sharply. The right hon. Gentleman can take credit for not wrecking the trend, but he cannot take credit for beginning it, for it preceded him by four years.

I thoroughly welcome the fact that economic management has reached a maturity whereby the two major parties do not feel it necessary to reverse all the actions of their predecessor. That is beneficial to the British economy, and it will remain so for as long as that is the case. I may be wrong, but I think that the Chancellor took that too far in his first two years by adopting the previous Government's expenditure plans in toto. I can tell the House, and I hope that it is not a great shock, that we certainly would not have done that. We would have increased them in the two public expenditure rounds that followed, as we had in every public expenditure round since 1979.

Stakhanovite is one word; masochistic is another, which might perhaps describe more plainly the Chancellor's disposition. He has been an economic masochist over public spending. We hear a huge amount about public spending, and the Secretary of State for Education and Employment was at it as well this afternoon, but despite the hype about the unprecedented sums for health and education, the fact is that the Chancellor has raised taxes by far more than he has increased expenditure. The public have not noticed because one skill that the right hon. Gentleman has perfected is that of counting, and that includes the capacity to double count, overcount and miscount, which he has done repeatedly.

Again, I am indebted to the Institute for Fiscal Studies: total Government spending in this Parliament has risen at 1.2 per cent. a year in real terms. That is not only less than tax increases, but less than economic growth. It compares with public spending of 2.6 per cent. in the previous Parliament, which is a point that Liberal spokesmen have often made, although they are not often nice about the Conservative party. I am glad to see a nod of agreement, rather than a shake of the head, from the hon. Member for Sheffield, Hallam (Mr. Allan), because that is undoubtedly the case.

I concede that much of that expenditure was not discretionary: it resulted from the unavoidable impact of the recession. However, it puts in a better context that hoary old myth about Tory cuts, which the Prime Minister is trying to recycle with his current spate of posters about potential future Tory cuts. Either he is ill-informed or scaremongering—probthly the latter.

The Government's publicity on cuts is familiar: it is an echo from the past. It was an odd experience in the last Parliament to be taunted by the Labour party over so-called cuts while hostile monetarists attacked us for spending far too much money.

Nothing has changed.

The lion. Gentleman may be right.

The health of the economy in 1997 and subsequently suggests that we may have got that balance about right.

During this Parliament, the Chancellor has benefited from the supply side reforms of the 1980s and the disinflation brought about by the policies of the 1990s. When he chants his mantra of boom and bust—I lost count of the number of times that he and the Prime Minister uttered such drivel last week—he should remember that the last unsustainable boom was well over a decade ago. That h is not stopped the Prime Minister depicting my right hon. Friend the Leader of the Opposition and my right hon. Friend the shadow Chancellor as Mr. Boom and Mr. Bust. [Interruption.] The Financial Secretary to the Treasury sniggers, but that is the politics of sneer and jeer. Neither of my right hon. Friends were policy makers at the time of the last boom, and one of them had barely been in the House of Commons.

There is a boom and bust today: a boom in tax raising and a bust in the competitiveness of manufacturing industry. Perhaps the Chancellor and the Prime Minister should concentrate on that boom and bust.

Will the right hon. Gentleman give way?

I shall make a little progress, if the hon. Gentleman does not mind.

The Chancellor of the Exchequer is a redistributive Chancellor. He tries to hide that fact, but it is evident, and from his perspective he should not hide it. He aims to redistribute to the less well-off, but in general he redistributes to the Inland Revenue. Even his well-intentioned schemes are not wholly successful. I do not disagree with all of them. Bits of what the Chancellor has done have been good social justice, and if I had been in government with the economy that he now has, I would certainly have taken some of the measures that he has taken, and I am not remotely shy about saying so. However, some of those schemes have not been successful.

The Chancellor abolished the married couples allowance last year, and this year—after a helpful 12-month gap for the Treasury and the Inland Revenue—he has introduced a children's tax credit to replace it. However, many people will not receive that credit, because it is means-tested and millions will lose either some or all of it on the means-tested taper.

The organisation of that tax credit is a shambles. As it is based on the highest-earning member of the household, it throws up huge and unacceptable anomalies. If one parent works and earns £42,000 a year, no payment of the child tax credit is made, whereas if both parents are at work, with no one at home with the child, and earn £35,000 each, the full credit is payable. As a means of social justice, attacking poverty and helping low-income families with children, this scheme is nonsense on stilts. If the Chancellor were serious, he would have examined those problems and sought to correct them before introducing the tax credit in its present form.

The minimum income guarantee is the Chancellor's safety net against poverty, but it is so complex that more than one third of eligible pensioner s do not claim it. The form is so complex and absurd that a large percentage of graduates might not claim it.

The 10p band extension is right in principle. I do not disapprove of minimising tax on lower income groups. However, the proposal is so niggardly and mean as to be almost pointless. The maximum gain from the Chancellor's measures in the Budget is 75p a week—that figure should strike a chord with Labour Members. Given pensioners' response to that amount previously, surely he should have done it differently.

Many of the main effects of all economic management, by every Chancellor of the Exchequer, become apparent some years after the announcement of the original tax and spending decisions. This Chancellor was lucky. He was lucky in his predecessors—lucky, notably, that my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) and my right hon. and noble Friend Lord Lamont made the painful and unpopular decisions that contributed so much to the subsequent benign situation of which the present Chancellor has made such use in this Parliament. And—unless my memory is failing—I seem to recall that they made those decisions in the teeth of unrelenting opposition, not least from the present Chancellor and the Prime Minister.

I will not be in the House to see the Chancellor's legacy at first hand, but much of it is now predetermined. He inherited an economy of falling unemployment and low inflation, and he has maintained it. That was well done; but under his stewardship also, taxes have risen too much. The tax system has become far more complex. Manufacturing industry has declined further. Regulations have soared. Increases in business taxes are undermining competitiveness, and so in due course will the social charter, whose economic folly is not yet fully apparent but will become so.

It is, in truth, a mixed record—some good, some bad—for this luckiest and most fortunate of modern Chancellors of the Exchequer.

I cannot be certain, but this may well be the last occasion on which I shall speak in the House. Let me say that it has been a privilege beyond measure to be here, in this mother of Parliaments. I hope that the next generation of hon. Members, whichever of our peat parties they may represent, will feel as I did when I first came to the House; I hope that they will feel that way in future, and I hope that we shall be able to end the miserable political climate of spin and counterspin that has grown up in recent years.

We need to separate fact from fiction, substance from soundbite, information from innuendo. The public—the electorate—the people who sent us here—deserve more than to be spoon-fed a cocktail of headline-grabbing feel-good stories. They deserve the truth, unvarnished sometimes, but the truth, and every Member of this House, whether Minister or Back Bencher, has the obligation—the duty—to provide it.

I hope that that was not the last speech that the right hon. Member for Huntingdon (Mr. Major) will make in the Chamber. We can agree with some of what he says from time to time and disagree with other things he says, but we must all recognise that he has made interesting contributions to the House over the years—and, indeed, ended up being Prime Minister as a result. I hope that we shall hear from him one last time: he may say things that Labour Members do not like sometimes, but that is the nature of politics and the nature of debate.

I welcome some of the initiatives announced by my right hon. Friend the Secretary of State. I appreciate the £8.5 billion capital investment in education, as I am sure will many local authorities, and the capital investment in the new transfer of information scheme from primary to secondary schools. If that will reduce the amount of paperwork, it must be worth while. As I said earlier, some of us—sadly—remember the years when the present Opposition were in government. They may talk of red tape, but I remember teachers showing me cupboards full of paperwork that they were expected to go through. It is not all Labour's fault; there is much for which to blame the other side. The Opposition talk of freedom, and money going directly to schools. Who introduced local management of schools—again, the forerunner of bureaucracy?

Opposition Members talk about teachers being demoralised, but who was it who took away teachers' bargaining rights? I seem to remember that it was Conservative Members—although they seem to have changed coats now. I also remember, some years ago, a Conservative Secretary of State receiving a very rough ride at a teachers' conference. Although I agree with Opposition Members that there are some cases of low teacher morale—no one would deny that—the Government are making various attempts to raise it.

I welcome some of today's announcements by my right hon. Friend the Secretary of State for Education and Employment, as they should help to lift teachers' morale. Training bursaries must be welcomed, because anything that encourages more people to enter the teaching profession must be good. I also welcome the increase in teacher training places to 2,250 as part of the direct funding package for education, which should commence in June. It is a good development which should also help to lift teachers' morale.

In many ways, the teaching profession was devalued by some of the measures implemented by the previous Administration in their 18 years in office. It is therefore perhaps not difficult to see why it is so difficult to persuade the profession to trust the current Government's efforts to help it.

Opposition Members have mentioned the Government's schemes to retrain young people and to get them into work. I remember three or four of the previous Government's youth schemes, some of which only served to disillusion young people. Indeed, those schemes may be part of the reason why we have a lost generation of young people. Regardless of what caused that disillusionment, it is indisputable that, because of this Government's action, 270,000 young people now have prospects that they never had before and 1.1 million adults have been able to take up full-time employment.

Such progress was never made under the previous Government. I remember when, under that Administration, there were between 3 million and 4 million unemployed. That is quite a contrast with the current situation. Conservative Members accuse others of cherry-picking issues, but they, too, address them selectively. They take credit for the improvements, but blame everything else on the Government.

A few weeks ago, I raised the general issue of education standard spending assessments. Often when Governments of whatever complexion say that they are providing money in the SSA, it turns out that that money is not available. I am not accusing my colleagues of doing that, but simply telling them that that means of funding is well worth examining. The sooner we do that, the better.

Reorganisations—school amalgamations and closures—are under way both in my constituency and in other parts of Coventry. I am not so sure that the way in which we are dealing with those reorganisations is always right. A consultation exercise is being conducted and the public are essentially being told that alternative proposals will be considered. However, it is not always appreciated that the public may need assistance in developing and proposing such alternatives. Some members of the public have never before dealt with public authorities such as big education departments, which have great resources, or tried to persuade them to change policy. Although drastically declining school rolls sometimes require the amalgamation or closure of schools, I believe that that policy, and SSA funding, should be revisited.

Other matters, such as further education, were not dealt with in the Budget, but we cannot have an education debate without considering them. The Government have made some progress on further education, but it is still sometimes treated like a Cinderella eduction sector, squeezed between secondary and higher education. I ask my hon. Friends on the Front Bench to think about that. Very often, people who have not had the benefit of a university education find their niche in further education. I see the Under-Secretary of State, my hon. Friend the Member for Croydon, North (Mr. Wicks), nodding his head.

I hope that in the next Parliament the Government will not be in favour of top-up fees. Universities are looking for a variety of means by which to raise resources. Only a couple of weeks ago, one of the universities in my constituency tried to introduce a system whereby students who did not have laptop computers would find it difficult to get into that university. I hope that the Secretary of State is looking out for such schemes and gimmicks.

We cannot have disparity between north and south of the border, and it is about time that we looked at the Cubie report.

The long-term care of elderly people will not go away and I hope that Ministers will consider it after the election, if not before.

It has been said that our manufacturing base has been threatened. We have a well-known problem with Rolls-Royce in Coventry. People have heard me ask my right hon. Friend the Prime Minister to look at that, and my right hon. Friend the Secretary of State for Trade and Industry has agreed to do so. An important lesson has come out of discussions with Rolls-Royce.

The decisions that resulted in the lack of money invested in research and development were made in about 1992, and earlier. I remember saying on many occasions that the money saved by people losing their jobs should be used for research and development. A colleague of mine, a prominent shop steward, once told a Minister, "You're going to have some expensive shelf-stackers at Sainsbury's." That gives an idea of what people feel about a lack of research and development and the consequences that that can have in Coventry, particularly for companies like Rolls-Royce.

We welcome the increases for pensioners. Whatever the merits or demerits of the link to earnings, we have to convince pensioners about our policy. I readily acknowledge that Ministers have some valid reasons for not going down the road to re-establish the earnings link. For example, the £200 winter fuel allowance would be taxed. Nevertheless, at many of the meetings that I attend, pensioner constituents voice a lot of concerns about their incomes and it would be remiss of me not to repeat them. I hope that the Government will take note of that.

Low interest rates mean that the economy expands, and that assists manufacturing industry, certainly in the midlands. That has to be welcomed. Interest rates are probably the lowest they have been for about 35 years, and low inflation—the lowest for about 30 years—plays a significant part in the economy. Short-term interest rates from 1997 have averaged about 6 per cent., while longer term interest rates should average about 5 per cent.

People will remember the problems of negative equity. Mortgage interest rates have dropped—they have stabilised, from an average of 11 per cent. between 1979 to 1997 to about 6 per cent. at present. That gives comfort to small businesses, and to anyone buying a house, particularly young people. Low mortgage interest rates allow young people to plan ahead, which most of them want to do.

Manufacturing has started to rise—to about 1.6 per cent. That must be vitally important to the economy—especially in the west midlands. Productivity has been a subject for debate for 35 years or longer—certainly, during all my time in public life and in industry. It has grown by 4.4 per cent. That has got to be good, when we consider the years when it did not grow. I am sure that most people welcome that growth. We can all remember the days of boom and bust when exports were down and imports were up, creating balance of payments problems. Exports have risen by about 7.4 per cent. That has to be welcome—as is this year's surplus of £23 billion.

One of the things that the Conservatives lectured previous Labour Governments about was borrowing. The debt repayment is about £34 billion, so that is surely welcome.

The hon. Gentleman talks of the importance of debt reduction, although he does so very much at national rather than local level. If the issue is of importance to him—it is right that it should be—will he tell the House what assessment he has made of the impact on the size of interest repayments on local authority debt of the change in the rules on the use of capital receipts from the sale of council houses?

The hon. Gentleman should not throw that red herring into the debate. The issue of capital receipts was always mixed, depending on which local authority one spoke to. It was a Conservative Government who told local authorities that they could keep all their capital receipts only to start to plunder them. The hon. Gentleman should do his homework.

Lower unemployment means lower social security costs. In the past, the Opposition have criticised social security; they talk about cutting the budget and introducing swingeing measures that would make it almost impossible for people to claim social security. In fact, the cost of social security under my right hon. Friends, is down by about £4 billion—that must be welcome. In effect, it means that in order to achieve our other targets we do not have to make it more and more difficult for people who need social security to claim it.

During the period from 1979 to 1997, 42p in every pound was being used to pay off debt. That is down to about 16p at present. All in all, we must congratulate my right hon. Friends—especially on the reductions in corporation tax and capital gains tax and, more important, the assistance to be given, through reduced VAT, to small businesses with turnover of up to £54,000, and £100,000 for larger businesses. Those reductions should certainly be helpful.

Inner-city regeneration has caused much consternation and debate over the years. Under previous Governments, improvement grants were available, but people in inner-cities would now find it extremely difficult to obtain them because the Conservative Government cut them. I welcome the new initiatives to reduce VAT, to encourage inner-city regeneration—whether of property or by setting up small businesses.

Once again, I congratulate my right hon. and hon. Friends on an imaginative Budget, which gives something to everybody. I hope that they have noted the concerns that I highlighted and that, at some point in the future, they will revisit them.

It was a pleasure to be in the House to listen to the speech of the right hon. Member for Huntingdon (Mr. Major). It was a pleasure to listen to a speech that was part of the debate, that entered into it and offered information and informed opinion. The right hon. Gentleman's speech was in stark contrast to the comments of the Leader of the Opposition—especially the speech about "a foreign land" that he made in Harrogate two weeks ago. The right hon. Member for Huntingdon did not give the House that impression today. It was delightful to hear the right hon. Gentleman forgive his former friend, Lord Lamont—although I suspect that Lord Lamont has never forgiven me for defeating him at the general election.

I want to quote a wonderful remark made by the right hon. Member for Huntingdon—he may intervene if I do not get it right. In 1997, when the right hon. Gentleman was asked to comment on the Labour Government's policy of "education, education, education", he replied that he thought it was a good policy but that he would have put it in a different order. That brings me to a critical comment on the right hon. Gentleman's Government.

Although I would not challenge the right hon. Gentleman's knowledge and understanding of economics, I would certainly challenge the fact that successive Conservative Governments, one of which he presided over as Prime Minister, left 7 million adults functionally illiterate and only one in four adults functionally numerate. That legacy was unacceptable, and it behoves all of us, irrespective of political party, to address that huge deficit and to ensure that future generations do not face the world without the basic skills that they need to operate successfully.

I, too, welcome this debate and echo the comments made at the beginning of the Budget debate by my right hon. Friend the Member for Ross, Skye and Inverness, West (Mr. Kennedy), who said:

"the mark of a society is what sense of opportunity it gives its youngsters and how much security it offers the most elderly and vulnerable."—[0fficial Report, 7 March 2001; Vol. 364, c. 318.]

The hon. Member for Lewisham, East (Ms Prentice), who is no longer in her place, hit the nail on the head. The one thing that I took from the Budget, and the one thing that the House should praise, was the concentration on removing child poverty. Without ending child poverty and ensuring that fewer of our young people begin life and spend their early years in poverty, much of the rest of what we do is reactive rather than proactive; it is a sticking plaster.

In terms of my right hon. Friend's comments on 7 March, two main issues were not dealt with in the Budget, and they have been addressed by Labour Members during the debate. First, there was nothing in the Budget on the care of the elderly. That was a huge omission; it is one of the most pressing issues that we face. It is not simply a pensions issue—clearly, we have had many debates about pensions—but one of how we care for our elderly. The way in which the long-term residential care needs of our population are looked after distinguishes a caring from an uncaring Government, an idea to which the hon. Member for Coventry, South (Mr. Cunningham) alluded in his speech.

There was nothing in the Budget to support local authority social service departments, which are desperately struggling with the costs of residential and nursing-care placements. It was rather sad that there was nothing to support the cross-over between health authorities, health care trusts and social services in trying to meet those needs. The Chancellor, who had the resources available, could more wisely have used his money in that way.

The hon. Gentleman may want to consider the fact that Library figures show that, in the first two years of this Government, the Chancellor reduced personal social services expenditure to the detriment of the very vulnerable groups that he describes.

I accept the hon. Gentleman's comments, but he must accept that, certainly in each of the five years before the new Labour Government's election on 1 May 1997, the resources given to local authorities for social care use were reduced, year on year; and that, more perversely, capping arrangements meant that council tax rises could not compensate for those reductions, so I would say, "A plague on both your houses!"

This debate is primarily on education, so I shall return to education as soon as possible. It was rather sad that the hon. Member for Maidenhead (Mrs. May) spent virtually all her contribution offering a diatribe without ideas, regurgitating the same old accusations, mostly on behalf of The Guardian and Nick Davies, about the Government's spending plans.

The hon. Lady and the Tory party offer one specific response to our schools' needs—free schools. The response that she gave to my question about funding was appropriate, because it goes to the heart of the debate on the Tories' proposals for free schools. They seem to be suggesting that every school will be funded centrally, so I asked whether every child would receive the same level of funding. Interestingly, the answer was no. There would have to be a formula to distribute resources and that is one of the issues that has bedevilled Governments in their attempts to provide equitable resources to individual schools.

I have often discussed the issue with the hon. Member for South Holland and The Deepings (Mr. Hayes). The tragedy of the Tories' proposal becomes clear when one considers which of the services that are currently offered by local authorities to schools would have to be offered by the schools themselves as part of the package. The costs for special educational needs for schools in an inclusive education system can be horrendous if they are not largely picked up by the central administration. The idea that each school would have to meet the requirement does not bear the critical examination that such a policy should receive. The idea that head teachers want to be responsible for school transport and want to organise buses and taxis is beyond belief. Again, the suggestion that the service could be provided more cheaply if it were run by each individual school rather than by a local authority does not bear critical examination.

One of the key suggestions that the hon. Member for Maidenhead constantly makes to head teachers relates to disruptive pupils. Under a Tory Government—God forbid—schools would be able to kick such pupils out, but where would they go and how much would it cost to look after them? All the evidence shows that it costs at least five times more to educate a pupil in a pupil exclusion unit than it does in school. Where would that money come from, and what would happen if the number of units were expanded? My authority does not have such a unit. It would have to build one, and that would have to be resourced centrally.

In my role as education spokesman for the Liberal Democrats, for the past two years I have had spats with the Secretary of State and accused him of all sorts of things. However, I would never accuse him of not being interested in, or committed to, education. From the age of four, I have spent my whole life involved with various Secretaries of State in one guise or another. In 1944, my father was presumed killed in the war and that was the year I attended my first nursery school. Since then, I have been involved, in one way or another, with every Secretary of State. Perhaps Butler to Blunkett does not sound as good as Huxley's cradle to the grave, but the Secretary of State will be right to be proud of many achievements if he leaves the Department for Education and Employment and goes to the Home Office.

Sadly, however, the Secretary of State's legacy will not be as good as it should have been. In 1997, the whole education world welcomed a change and expected that things would be different. I was a head teacher in 1997 and I know that schools were demoralised then. The whole education system was demoralised and underfunded and there was a 20-year backlog of repairs to school buildings. The situation was dire. So it is rather sad that the Government have abandoned the proud ambitions with which they came into office. They have squandered them on spin, triple accounting and knee-jerk reactions. Above all, the Government have put their faith in the likes of the former chief inspector of schools, Chris Woodhead, who betrayed not only the Secretary of State, but the education system.

The Budget was announced as we look forward to a general election and I support much of what the Chancellor said last week. I welcome the fact that much additional money will go to head teachers to spend on books and equipment. When I was a head teacher, I would have welcomed greater flexibility in the spending of part of my resources, and I am sure that most heads welcome the proposal.

However, the Government should not be able to claim that a huge sum of extra money was announced in last week's Budget. The £1 billion was an underspend from previous years. It was not new money, but money that had been regurgitated. If we take account of the Barnett formula and subtract the money for Scotland, we are talking about £800 million over three years, of which £200 million will go towards earmarked recruitment and retention packages. The money for each school will thus be about £10,000 to £11,000 a year, and a school's future cannot be planned on the basis of such funding. That is the huge mistake that the Government continually make. Year after year, they drip-feed money into our schools and they attract major headlines, but they do not attack the root cause of the major underfunding in the resource budgets of all our schools.

Let me give some examples. A head teacher in the royal borough of Kingston upon Thames has written to the chairman of the Conservative-led council. Kingston is reducing school budgets, because it is anticipating the money that the Chancellor will give directly to schools. Exactly the same thing, is happening in North Yorkshire—again a Conservative-controlled authority—which is top-slicing its school budgets by £2 million. Although Harrogate grammar school—which, by the way, is a top-class comprehensive school—will receive an extra £12,000 from the Budget settlement, it will lose £40,000 because of the reduction in funding from the county council. I recall what the hon. Member for Coventry, South said, and point to the nonsense of the current funding arrangements and to their lack of transparency.

I know that the hon. Gentleman shares my concern that the problem with the drip-feed approach that he describes is that, although it may attract headlines, it is unrelated to need. It is a crude instrument. He criticised my hon. Friend the Member for Maidenhead (Mrs. May) because she said that the formula would have to take account of need, but surely he would acknowledge that the Government's approach of handing out money in lump sums does not address the core issue of need.

I think that I have already said that. I have never met an hon. Member who supports the current system. I asked for an explanation of the current standard spending assessment system and, because I knew that it would be a leisurely debate, I have the answer with me. I shall describe to the House how primary schools get their money. Under the fairer funding scheme, the Government's SSA for primary pupils for 1999–2000 contains the following formula:

"(a) Pupils aged 5-10 multiplied by the result of: £1,722.06; plus £206.93 multiplied by Additional Needs index; plus £94.75 multiplied by Ward sparsity index; plus £200.94 multiplied by free school meals;

(b) The result of (a) is multiplied by the Area Cost Adjustment for education;

(c) The result of (b) is then multiplied by a scaling factor (1.00000461765064)."

It is plainly nonsense to have such a lack of transparency in our funding system, and the Government promised to change it.

First, it ill behoves the Opposition's Front-Bench spokesman to talk about SSAs when no one manipulated them more than the Conservative Government. Secondly, every year they were in government we had the hardy annual of finding out whether an area would retain its cost adjustment. We cannot know where we stand when we relate cost adjustments to SSAs.

Again, I agree with the hon. Gentleman. However, while the Labour party was still in opposition, it promised that the system would be made fair and transparent. The Secretary of State should give a commitment to that effect.

Another myth needs to be exposed. It was mentioned by the right hon. Member for Huntingdon and relates to the amount that the Government are spending on education services. It is thought that such spending is increasing dramatically. However, according to Library figures, the proportion of gross domestic product that is spent on education during this Parliament will be 4.6 per cent., compared with 4.9 per cent. under the Government of the right hon. Member for Huntingdon. We can argue about GDP until the cows come home, but the Government said that they would spend a greater percentage of the country's wealth on education. That is clearly not happening.

Liberal Democrats welcome the £200 million for recruitment and retention which the Secretary of State announced. We also welcome the fact that the Government have understood that there is a problem. However, we want to dissociate ourselves from the right hon. Gentleman's disgraceful attack on dedicated professionals which appeared in the Daily Mail today. When we are in the middle of a sensitive dispute, it does no good whatever to launch a wholesale attack on the teaching unions. The Under-Secretary of State for Education and Employment, the hon. Member for Croydon, North (Mr. Wicks), is in the Chamber and I have a challenge for the Government: rather than bandy words with trade unions about teacher shortages and, in particular, the strike action, they should immediately organise an emergency summit with trade union leaders, local authorities and the Department to set a timetable and resolve the crisis.

Last year, we established the General Teaching Council, one of whose key tasks should be to operate as a standing committee on teacher supply. I hope that I receive a response to that idea. We have all continually warned the Government about the problem of teacher recruitment. In last year's debate on the Budget, I said:

"It is surprising … that there is nothing in the Budget to assist with teacher recruitment … despite the worrying trend."—[Official Report, 23 March 2000; Vol. 346, c. 1150.]

This year, we have received £200 million over three years. That is an improvement, but it is clearly not enough.

According to last week's survey by The Times Educational Supplement and the Secondary Heads Association, there are 10,000 vacancies in our secondary schools, and some 10,000 vacancies in our teacher training colleges have gone unfilled since 1997. That cannot go unchallenged. Indeed, Ministers have acted. They have introduced "golden hellos" and have tried to introduce a grant, which has become a training salary. Baroness Blackstone has said:

"The Government have introduced training salaries".—[Official Report, House of Lords, 21 February 2001; Vol. 622, c. 861.]

Hon. Members should note the term "training salaries". Paragraph 5.17 on page 68 of the Green Paper, which was published two weeks ago, said:

"We have introduced a new £6,000 training salary".

However, it is not a training salary and, if it is, it breaks all the Government's rules on salaries. A £6,000 salary works out at £3.95 an hour, based on a 40-hour week, but last week they told the House that we must have a £4.10 minimum wage from October. There is a real conflict here. Perhaps the Government will admit that the new training salary—if it is to be a salary—will have pension rights attached to it and that national insurance contributions will be paid on it. Without those, people will be disadvantaged.

The hon. Member for Maidenhead said that there was a problem with the Government's figures on applications for teacher training. I do not want to repeat those. Last week, we had a major spat with the Graduate Teacher Training Registry because it published figures a day early for the Government. It said that the Government asked for their early release so that they would not conflict with the good news in the Budget. It cannot be right that an independent organisation should leak information to the Government ahead of time, but not give it to Conservative Front Benchers, Liberal Democrat Front Benchers or anyone else. The Government so often get it wrong by attempting to manipulate information rather than giving everyone access to it.

There has been a 13 per cent. drop in secondary course applications, despite all the Government's belated actions since 1997. That is having an effect on our schools because of the related shortages. Rather than criticising the teaching unions, we should work with them to redress that balance.

Higher education was—conveniently—almost totally absent from the Budget statement and the Secretary of State's statement today. The Chancellor recognised that we need 2.5 million more employees who are educated to degree level. However, he offered nothing to ease the growing burden of student debt. There is an aversion to mentioning that problem. Indeed, the Select Committee on Education and Employment avoids recognising that debt aversion is relevant. It puts people off going into, and staying in, higher education. The Liberal Democrats are the only party to guarantee students reduced debt and the abolition of tuition fees. I was delighted to hear the hon. Member for Coventry, South mention the Cubie report. Ultimately, we will return to that and have similar arrangements for students in this country.

Last Friday's editorial in The Times Educational Supplement said:

"The Liberal Democrats' proposals to restore means-tested grants are the most coherent solution to student poverty and are a prerequisite to expansion. Labour should steal them."

That is a good message for the Minister.

My hon. Friend will know that many of my constituents are academics who work in Sheffield's two universities—the university of Sheffield, and Sheffield Hallam university. He should also be aware that many of them are writing to me to tell me how poor morale is within the higher education sector. Does he share my concern that the Government's policy is about cramming more bodies into the higher education institutions without dealing with the fundamental pay problems in higher education? The product that they provide will inevitably suffer as more industrial disputes take place and other problems of morale arise.

My hon. Friend makes two excellent points. Expansion is pointless without sufficient investment to ensure quality. After the Robbins report in 1963, the sector expanded year after year, but in the 1990s, under the previous Government, there was a year-on-year reduction in real terms in the amount available for each student in higher education. The sad fact is that every year since 1997 there has been a reduction per student in the amount of money for their education.

The Prime Minister recently announced that his ambition was to have 50 per cent. of young people going into higher education. That is meaningless unless we are told where all those people are to come from. At the moment, the demand simply does not exist. Last year, 53 higher education institutions were unable to fill their student places. There were 40,000 unfilled places in our universities. The Government are planning unbridled expansion simply to grab headlines.

I agree with the earlier comments about further education. There was not a word about that sector in the Chancellor's statement. It is as if the Learning and Skills Council has wiped away all further education worries and resolved all the problems. There is a massive problem of recruitment and retention in FE, just as there is in our schools. There is a huge issue surrounding pay, just as there is in higher education, as the Bett committee reported. An even bigger issue in FE is the professionalisation of lecturers. If we do not grapple with those problems, we will see the same sordid results as have occurred in many of our schools, such as young people being sent away and teachers being pulled in from wherever possible to fill staff places.

The Government's policy on lifelong learning began with a huge agenda and was going to revolutionise the world. Under the policy, "learning works", no child, young person or adult who was failing would be allowed to continue to do so. Sadly, the joined-up thinking has not taken place. The schools taskforce said that we desperately needed people to have access to level 2 and 3 qualifications throughout their lives. The Chancellor says that he wants to underpin level 2 training, but that is all. There will be access to training at level 2, but not beyond, even though, apart from Mexico and Greece, we have the lowest number of people in level 3 training anywhere in the developed world. That is the challenge that the Government have not met. Hopefully, a Liberal Democrat Government will meet it in the next Parliament.

We have heard perhaps the final contribution of the former Prime Minister, the right hon. Member for Huntingdon (Mr. Major), so it is appropriate for me to say a few words in response. If we put politics to one side, most of us would accept that he is basically a decent man, but he found himself leading a political party that was unleadable. Indeed, much of his time was spent standing up to the right-wing, extreme elements that now control the modern Conservative party, so it must be difficult for him to make speeches from the Opposition Benches these days.

It was, however, curious to listen to the right hon. Gentleman's analysis of the economic situation in Britain. He was clearly anxious to rewrite the legacy of his stewardship of the economy. Listening to him, one would have thought that his Governrnent had a reputation for economic competence and that he had led them to a barnstorming victory on 1 May 1997, but history records something very different. It shows that Black Wednesday was the beginning of the end of the Tories' claim to be the party of competent management, economically and more generally. That Government left the country with national debt that had doubled. They left the country extremely insecure, socially divided and very unhappy, and that is why the right hon. Gentleman led his party to the worst election defeat in living memory. That is no reflection on him as an individual or on his decency; it is a reflection on the record of the Government whom he led, and more specifically on their economic incompetence and the social division that they created.

The right hon. Gentleman made one useful contribution to the debate of which the Government should take note. In his condemnation of the use of the terms "Mr. Boom" and "Mr. Bust" to describe the Leader of the Opposition and the shadow Chancellor, he spoke of "sneer and jeer" politics. I am sure that Labour Members would regard "Mr. Sneer" and "Mr. Jeer" as equally appropriate descriptions of the Leader of the Opposition and the shadow Chancellor, so I thank the right hon. Gentleman for that idea.

Labour Members would agree with much of what the hon. Member for Harrogate and Knaresborough (Mr. Willis) said, although, like every Liberal Democrat Member, he asked for more and more public spending. There is never any reckoning of how that is to be paid for, and account is never taken of the need for a stable economy and for economic prudence as the foundation of public spending.

I shall give an example of Liberal Democrat contradiction from my area. The right hon. Member for Ross, Skye and Inverness, West (Mr. Kennedy) recently said that we cannot have high levels of public spending and low levels of taxation, and that it is important that politicians are honest about the fact that they must put up taxes if they want to increase spending. Last week, the Liberal Democrat group on Bury council proposed an amendment to the Labour-controlled council's budget to reduce council tax. They displayed none of the honesty recommended by their national leader; they did not say that reasonable, fair taxation is necessary to pay for decent services. They made a nakedly political move to pander to an audience.

Throughout the country, Liberal Democrats at a local level are inconsistent with their national leadership. They do not merely have different policies in different towns—sometimes they have different policies in different streets. Is it not about time that they were honest with the British people about how they would pay for the increased public expenditure for which they continually ask?

Before the hon. Gentleman awards us the monopoly on complaints about local taxation, I hope that he will refer to Labour opposition groups, such as the one in Sheffield, who attack Liberal Democrat-controlled councils for their council tax rises. Does he not accept that it seems to be a traditional role of the opposition in local government, whatever party they represent, to attack the ruling group for its council tax rise? Will he pay attention to the proposals published in the Liberal Democrats' alternative Budget, which clearly point out where additional funding at a national level would come from?

The hon. Gentleman's party says that it is different; that is the whole point of the remarks of the right hon. Member for Ross, Skye and Inverness, West. He tries to pretend that the Liberal Democrats are somehow separate from politicians in other parties, and that they are more honest, straighter and tell the truth. Yet in Bury, the Liberal Democrats did exactly what their national leader tells us is unacceptable and misleading—they called for a council tax reduction purely to pander to local opinion at the time and without any regard for the consequences for local services. The Liberal Democrats cannot continue to have it all ways.

The Budget has been warmly welcomed by my constituents. It demonstrates that the Government have honoured their pre-election promises to the British people. To be specific about the fundamental pre-election promise, the Budget continued the rebuilding of the country on the foundations of economic stability and social justice. The Government have always aimed to combine encouragement of individual ambition and aspiration for families who want a decent life and to do well for themselves with a commitment to community solidarity, to public services and to the idea that we achieve far more together than we ever do alone. The Budget is responsible and it ensures that we are able significantly to invest in the people's priorities. It would never have been possible without the tough choices made by this Government early on in our Administration.

The Conservative party seeks to pretend that we have continued its economic policies and that, had it continued in government in 1997, the economy would have been as strong as it is now and the fundamentals would have been in place. I shall give three specific examples of why that is arrant nonsense and of where this Government had to make distinctive and difficult choices.

The first decision was to give responsibility for the setting of interest rates to the Bank of England's Monetary Policy Committee. That option was available to Tory Chancellors for many years, but they declined to take it. This Government took the decision to prioritise paying off the national debt. That is a distinctive choice, which Governments do not have to make. In fact, the Conservative party doubled national debt while in office.

Will the hon. Gentleman give way?

I shall give way in a minute.

This Government chose to make the payment of national debt central to their economic strategy. Yes, we chose to stay within tight spending limits, but that did not mean that we did not spend considerably more in the first two years of the Parliament on health and education—we did. [HON. MEMBERS: "No you did not."] Yes we did. However, the overall Government spend stayed within previous limits. It is interesting that the Conservative party says that that is the best example of our continuing its economic policies, yet the right hon. Member for Huntingdon said that the Conservatives would not have done so had they been in government post 1997.

I feared that the hon. Gentleman would get to a point where my intervention would be irrelevant. As he has said that the previous Government doubled the national debt, will he remind the House of the national debt in 1979 and of that in 1997? I think that he will find that it did not double during that period.

I thank the right hon. Gentleman for his intervention. I was referring specifically to the period between 1992 and 1997, when he was a leading and respected member of the Government. It is important that people who served in that Government take responsibility for their record and legacy, and do not seem to have a collective fit of amnesia.

This Government made distinctive and difficult decisions in their early days that led to today's economic stability. It is wrong to pretend that the economic strength of our country, which the right hon. Member for Huntingdon was honourable enough to acknowledge, was created by accident or chance. We, as a Government, recognise that it is also due to the enterprise of the British people and their contribution to that economic growth and success. If this Government had not laid such foundations, we would not now be able to use that economic stability to invest in our country's future.

Let us consider the outcome of those policies of economic stability and competence. One difficulty for Conservatives is that they cannot cope with the fact that the British people now see the Labour party as the party of economic competence. The Conservative party finds it difficult to stomach the fact that the British people recognise that the Labour party has travelled a tremendous distance and demonstrated—not just promised—in four years that it can be trusted to manage the economy. The outcome of the policies is clear. We have the lowest inflation for 30 years and we have low interest rates. The average family now pays £1,200 per household a year less for their mortgage than they did in 1997. That is a significant contribution to household income. The Government have created 1 million new jobs, and we have the lowest unemployment for 26 years.

We should remember that it was not so long ago that we were being told that mass unemployment was a price worth paying for low inflation. For a long period during the reign of the Conservative party, the British people were told that they could not have low unemployment and low inflation at the same time because it was managerially impossible. In fact, I think that it was Lord Lamont who said that unemployment was a price worth paying. That was an insensitive and disgraceful comment, and this Government have demonstrated that unemployment is not a necessary price to pay for the creation of a low-inflation Britain. It is a Labour Government who have delivered low interest rates, low inflation and low unemployment.

All that does not mean that there are not job losses—of course there continue to be people who lose their jobs. In recent weeks in my constituency, I have seen the sad loss of the East Lancs paper mill, which had offered a number of very important jobs and played an integral part in the community of Radcliffe, which is an important part of my constituency. What is important now to those who have lost their jobs is an opportunity to get another one, and that there will be investment in their area and community to give them hope, so that they are not consigned to long-term unemployment.

In the 1980s and 1990s, far too many people were consigned to the scrap heap of unemployment. In some families, three generations of people were never given the opportunity of a job and of engaging positively in society and in the community in which they lived. There continue to be job losses in certain sectors, but if one maps what happens one sees that the majority of people who find themselves out of work are very quickly able to reskill, retrain and find alternative employment opportunities.

Indeed, one of this Government's great successes has been the incentivisation of work through the new deal, which gets young and long-term unemployed people off benefit and into work. There has been a cultural shift in the social security system and economic strategy. Many people used to be better off not working. Low-paid jobs were available, but people were not able to secure work that provided a decent income for themselves and their families. This Government have created an environment that incentivises work and makes it pay. That in itself constructively engages many people in the community, so that they can make a positive contribution to the economy.

It is essential that our economic and social policy is relevant to all parts of the country. That is why the establishment of the regional development agencies was so important. They look at the strengths and needs of each region and ensure that we invest according to their sensitivity, history and future needs. Of course, the Conservative party is committed to abolishing RDAs, which would be disastrous in areas such as the north-west, where we are beginning to see the coming together of a local strategy between the public and private sectors, working with central Government to lay the foundations for continued economic growth and prosperity while at the same time tackling the fundamental social exclusion that has built up over many years. To ditch regional policy and, more specifically, to abolish RDAs, as the Conservatives would if they had their way, would be a lost opportunity.

One of the most incredible facts revealed in the Budget is the statistic on national debt: in one year, this Government have paid off more debt than was paid off in the preceding 50 years added together. That is a major achievement. I say that not because it is a good soundbite or because it sounds good politically but because I believe that we should analyse the way in which the state spends its money and how it prioritises that spend.

Under the Conservative Government, in 1997, 42p in every pound of taxpayers' money was spent on paying either unemployment benefit or debt interest repayments. Only 58p in every pound remained to be spent on front-line services such as education, health and the fight against crime. Now, only 16p in every pound is spent on debt repayment and unemployment benefit and 84p in every pound of taxpayers' money is available to be spent on services that matter to people. There has been a massive change and a fundamental shift in the management of the economy since the 1997 election.

Why have the Government not considered local authority debt, especially that of hospitals and health care trusts? The local health care trust in my constituency spends about £900,000 a year on servicing debt. Why is it only Government debt that is written down? Why is there not support for local authorities and health authorities?

The Government's responsibility is to lay foundations at a national level and to set parameters for the way in which local agencies work and for the choices that they make. The Liberal Democrats would be the first to criticise us for over-centralisation if we decided to dictate priorities for health care trusts and other local agencies in terms of the balance between debt repayment and investment in services. We have set parameters and taken a lead but, ultimately, given the massive extra moneys that are being made available by the Government to local health care trusts and LEAs, it is for those organisations to make choices and judgments on priorities locally.

We in Bury were pleased to receive my right hon. Friend the Secretary of State to open the Third Millennium building at the college of further education last week. It was a successfull visit, and my right hon. Friend was warmly received by all those who were fortunate enough to attend the opening. We are generally proud of our education system in Bury. We have excellent levels of performance. We have a family of schools working together in partnership with the LEA, which is recognised nationally; Ofsted acknowledges that it is one of the best in the country.

All those educational achievements—among the best performances in the country—must be set in the context of our having probably one of the worst levels of funding per pupil in England. That is why the public, and especially head teachers, teachers and governors, welcome the fact that the Government have produced a Green Paper on the reform of local government finance which for the first time identifies the distribution of education standard spending assessments as a difficulty and commits the Government to taking action to ensure that there is a far fairer distribution of education resources. I am told that a White Paper will follow after the election.

It is important that we tackle the issue of SSAs and have a more equitable system. Wherever a child is educated, a minimum sum should be agreed. No education authority should be expected to receive less than that sum.

I agree with what my hon. Friend says, but does he agree with me that we also need to take into account issues such as ethnicity, multicultural education, mobility and other costs that certain urban centres face and certain rural areas do not?

Of course I agree that those factors must be taken into account in creating a new and fairer system. The Government are not seeking to justify the funding gap that exists as between some LEAs. Indeed, they are seeking in their Green Paper to redress the balance. The factors to which my hon. Friend has referred matter, but they do not in themselves explain the gap between funding per pupil that exists as between some areas. That is why we welcome the Green Paper.

There are some political parties who say that the Government should have revamped local government finance in their first three or four years—that we should have got to grips with extremely complex and difficult problems that the Conservative Government did not tackle in 18 years. The Liberal Democrats know that, realistically, they will not have the opportunity to tackle them in the near future. We all know that local government finance is amazingly complex and that it is not easy to reform. However, the Government are committed to reform. In the Green Paper, they have specifically acknowledged the inequity of education SSAs as one of the issues that must be put right. Bury regards that as an extremely important commitment.

Those who imply that, because the SSA system has not been radically reformed, massive amounts of money have not gone into schools in places such as Bury and the other LEAs, are deceiving and misleading the public. Investment in the standards fund in Bury has risen from £27 per pupil in 1997–98 to £151 in 1999–00. We have seen £240,000 allocated to school security. Access initiatives have received £133,000. To recruit additional teachers to reduce class sizes, there has been funding of £2,082,000. Various capital projects have been allocated £1,448,000. There has been spending of £1.5 million on new classrooms to reduce class sizes, and £1.9 million has been made available for the new deal for schools. Given what was happening in the education system in the lead-up to the 1997 election, there has been a massive shift.

The right hon. Member for Huntingdon accuses us of scaremongering about the threat posed to communities by Tory cuts. Our argument is based on real experience. Anyone who served on a local authority during the Tory years knew what the annual cycle meant: it meant managing cuts exercises year after year to ensure that cuts did the least damage to the most vulnerable people in our communities.

The extra money that is going into schools and other local services throughout the country is making a real difference to the quality of those services and to the quality of education available in schools. It is a pretence that there has been no difference. We remember annual cuts exercises. We remember when there was inadequate money for books and equipment. We remember when class sizes in primary schools were far too large. We remember that era.

Anyone working in education at any level would acknowledge the significant amount of extra investment that is going into schools, which is making a difference to standards, to the quality of education and the physical environment and to opportunities to learn. The assertion that the Government are not making a difference to education is false and mislading and is not borne out by the evidence that exists in every community.

The Budget will also make a difference to schools through the teacher recruitment strategy announced today, which is backed up with resources. One subject that has not been discussed so far is the reason for the crisis that we face in recruiting people to work in the public services, part of which is the way in which the public services and public servants were devalued and run down during 18 years of Tory government. Public services were portrayed as a leech on the public purse. Young people were not encouraged to go into public services if they wanted a decent standard of living or quality of life.

The status of public services and those who worked in them was undermined and demeaned over an 18-year period, yet in four years the Government are supposed miraculously to turn that culture around. Labour is responsible, allegedly, for the fact that we have thousands too few nurses, doctors, teachers and other public service professionals. In the words of a famous tennis player, "You cannot be serious." Most of the British public accept that, it takes time to make a fundamental shift in such a complex situation.

If we have thousands too few teachers, doctors, nurses and hospital beds, what was going on during the 20 years of unbroken Conservative rule, when there were periods of great prosperity and economic opportunity for the Government of the day? Where did that dividend go? Where did our money go? It went on tax cuts for a very few at the top, and the rest of it went down black holes on Black Wednesday and on debt repayment and paying the costs of mass unemployment.

It is a bit rich for the Opposition to attack the Government for the difficulties arising from the shortage of certain public sector workers. No one out there believes that. I suspect that many Opposition Members do not believe that that is a credible position. Everyone accepts that public services had to be rebuilt from the lowest level at which they have been since the war as a result of the damage that the Conservatives did to them. That will not happen overnight. Most of the British people acknowledge that, and are fair enough to accept it and to congratulate the Government on the achievement so far, even though they want more.

It is important to mention the Government's attack on child poverty, which has a direct correlation with educational performance. It is not good enough to look in isolation at test results, exam results and the resources going into schools. It is essential that we also consider the resources going to ordinary, hard-working families to tackle the problem of poverty and people living on unacceptably low incomes. The Budget introduces the children's tax credit, which will be £520 a year for ordinary families, and £1,040 in the first year after a child's birth, in recognition of the fact that that is a particularly expensive time for families bringing up children.

There will be enhanced child care allowances, which contribute towards a stable home environment, allowing children to learn and do better educationally. There will also be long-overdue improvements to maternity pay and leave, which again contribute towards stable foundations for the average family. The increase of £5 a week in the working families tax credit will incentivise work, making it worthwhile for people to make the choice to have a job.

The Government were the first Labour Government, after many promised it, to introduce the national minimum wage. That is to be increased from £3.70 an hour to £4.10 an hour—another policy of which the Government are proud, and which the Opposition said would cost millions or hundreds of thousands of jobs. Not a bit of it. The shadow Chancellor has accepted that if the Conservative party ever returned to power, the minimum wage would have to remain. Of course, that party would allow it to wither on the vine. That is the difference in approach between the Opposition and the Government. We will ensure that it increases according to the economic conditions that prevail, so that people on low pay benefit when the economy is doing well. Although the Opposition say that they would not eliminate the national minimum wage if they ever returned to government, they would certainly have a strategy of allowing it to wither on the vine.

All the Government's support for families, for children and for people who are working hard will make a substantial difference to those people's quality of life and standard of living, and ultimately to the quality of our education system. The Conservatives' comments about the Government's spending plans as set out in the Budget imply that they would make significant cuts in public expenditure. They have accused the Chancellor of having irresponsible spending plans, and they have identified the areas in which they believe those spending plans are irresponsible. If the Tories were ever re-elected, every community throughout the country would face tangible and massive cuts to local services that matter to local people.

It is about time that the Tories were honest and told us where the cuts in local public services would fall. How many teachers, doctors, nurses, police officers and transport schemes would be lost? How many essential services would be cut, and how quickly would we return to the culture of public service cuts? The Opposition also say that they would reduce taxes. We all know who would be the beneficiaries of that policy. The Conservatives would reduce taxes for the few at the top in our society, whereas our tax proposals are directed at reducing taxes in a targeted way for those who most need it.

Opposition Members look horrified at that proposition, but it has always been the way of the Tories, throughout history, to cut the taxes of the very people who least need it, and to do nothing about the hard-working majority of people, especially those on low incomes. It is not new and should not come as a shock to the Opposition that such accusations are levelled against them. It is entirely consistent with what they are promising in their election manifesto, and even more consistent with what they did when they were in government for all those years. It is often best to judge politicians by what they did when they had power, rather than by what they say they will do.

I am grateful to the hon. Gentleman for giving way. Having listened to him drone on for 40 minutes because his Whips cannot get enough speakers to fill the time allocated for the debate, we are at least entitled to an accurate representation of the Conservative party's policies. There is no question of cutting health, education, transport or police spending. We would make a darn sight better job of running those services than his party has done. Likewise, the tax cuts that we announced would be far more effectively targeted on those who genuinely need the help—the elderly and savers, in particular.

I thank the hon. Gentleman for yet another example of the Opposition denying reality. Whatever the debates and disputes about the state of the economy, when the Government came to power in 1997, we inherited hospitals in crisis, schools that were crumbling, public services that were in a dreadful state, and a transport infrastructure that was a disgrace to a modern economy. That was the legacy not of four, eight or 12 years of the Conservatives, but of 18 years of unbroken government, when they had the opportunity to run the country in whichever way they saw fit. That is the situation that people faced in their daily lives on 1 May 1997, which may provide a miraculous explanation of why the Conservative party had the worst election result ever in the history of a major British political party.

Until the next election.

I thank the hon. Gentleman for his confident prediction.

It is important to remember that, in four years, it is impossible to put right 18 years of under-investment, social division and the running-down of public services. That view prevails among Labour Members and others and explains why we were elected in such large numbers. Many people who had previously voted Conservative transferred their loyalties to the Labour party because they saw destruction on the ground and society crumbling in their communities.

The Budget redresses the belief that there is no such thing as society and that we are simply a collection of individuals. That was not just Conservative rhetoric; the previous Government tried to run this country on the basis of that belief. They divided the country from top to bottom and, having failed to deliver high-quality public services and a cohesive society, added to that between 1992 and 1997 by messing up the economy. They were deemed to be economically incompetent and unfit to govern.

Nobody believes that the Opposition have any new solutions to the country's fundamental problem. Everybody knows that, if they came back into power, it would be more of the same—cuts in public services and tax cuts for the few at the top of society at the expense of the mainstream majority. There is nothing new about that; it has been Tory philosophy throughout the ages and from one generation to the next.

I am proud to support the Budget. Having spoken to my constituents at the weekend and read newspapers that I am not normally inclined to read, I genuinely believe that it is a Budget for hard-working families and high-quality public services. It is a good Budget for pensioners and small businesses; it is a Budget of which the Government can be genuinely proud.

The hon. Member for Bury, South (Mr. Lewis) droned on for so long, with so many travesties of the truth and the facts, making so much irrelevant comment about history— rewriting it and spinning—that he will forgive me if I do not follow his example. Indeed, the longer he went on, the more I realised that it was not worth following him and responding to his comments.

I have spoken in many Budget and Finance Bill debates, both as a Minister and a Back Bencher, during my years in the House. There was a pause only when I was a Minister in a certain Department. This may well be my last opportunity to speak in a Budget debate before retiring from the House, so I am glad to have had the opportunity of catching your eye, Mr. Deputy Speaker. I do not intend to cover the entire ground, only some key points, as I very much agree with my right hon. Friend the Member for Huntingdon (Mr. Major), not least about our strong economic legacy. I shall come back to that.

My overwhelming impression, as I listened to the Chancellor and looked at the Budget over the weekend, is that this is an itsy-bitsy Budget which, as in previous years, used the smoke and mirrors of the conjuror's art—I know something of that art—to deflect attention from what was really happening. There were little bits for everyone, but they did not add up to much. Nevertheless, the Chancellor got what he wanted: media coverage that made it look like goodies all round. I shall refer to smoke and mirrors later.

It has been widely recognised—and much commented on—that the Chancellor is apparently giving away, or, more accurately, giving back, only a small proportion of what he has accumulated during the past four years. That cannot be said too often because the Chancellor, the Prime Minister and others on the Government Front Bench tried to deny for some considerable time that there had been an increase in the overall tax burden—until, of course, the facts became irrefutable. Many studies by the House of Commons Library, accountants and others demonstrated that what the Government said was untrue. Now, the Red Book demonstrates that there has been a considerable increase in the tax burden, which, as a proportion of gross domestic product, has increased from 35.3 per cent. when the Government took office to 38 per cent. in the coming year. That is a measure of the increase in the tax burden, of which a significant proportion comes from fiscal drag.

My right hon. Friend the Member for Huntingdon was right to talk about the legacy of a strong economy. When history is written, that will be seen as one of the great benefits that the Chancellor inherited. To be fair, by and large he has not gone back to the policies of past Labour Governments, which would have dissipated all the benefits of the strong legacy that came about partly through the supply side reforms undertaken by my noble Friend Baroness Thatcher in the 1980s and the many other economic reforms during that period.

Will the right hon. Gentleman give way?

No, I have listened to the debate for a long time and I know that many of my hon. Friends wish to contribute.

During that period, there were strong economic policies, low inflation, and falling unemployment. As those of us who have worked at the Treasury know, those trends continue and others benefit from them—which is what has happened to the Chancellor. As I said, to be fair, he has not returned to the policies of the last Labour Government.

One reason for the fiscal drag is that the Chancellor has indexed all the thresholds on direct tax, including inheritance tax and capital gains tax, and has not compensated for the substantial earnings increases and capital cumulation during those years. When I listened to the Chancellor, I was struck by an illustration of that. The starting point for the tax threshold for the 40 per cent. higher rate, taking into account the personal allowance, is about £34,000, which is only about £9,000 higher than average earnings. Someone earning £34,000 goes straight into the highest tax band, which is a big tax jump and particularly unfair for households with a single earner in the family. They start to pay higher rate tax at the comparatively low level of £34,000 and are particularly disadvantaged compared with two earners in the same family each earning £25,000. That is a similar point to that made by my right hon. Friend the Member for Huntingdon about the children's tax credit. That issue must be addressed. However, fiscal drag is not permanent and can soon wither—I shall return to that later.

The other reason for the big fiscal surplus is the collective stealth taxes, the bulk of which have been levied on companies and their pension funds, and also involve indirect taxes. Starting with the burden on companies and pension funds, the Chancellor has been able to give the impression that he has not increased the tax rate because the burden has been put on those who, if I may put it this way, are not ordinary voters, and on bodies where the effect of the tax increase will come much later. Some people therefore feel that because the Chancellor has not increased direct taxation, he has not increased taxes overall.

However, the disadvantageous effects of increases in stealth taxes are bound to come through, especially in relation to pension funds. In the past four years, £17 billion has been taken from pension funds and added to the Chancellor's revenue, giving him the opportunity for fiscal surplus. That £17 billion, which will continue to accumulate in coming years, will have severe effects on companies and pensioners. Speaking as the chairman of the House of Commons pension fund, I suspect that, before long, it will feel the impact; the surplus will disappear partly because of the change in advance corporation tax. There is already a severe impact on a lot of companies, which now find that they have to cut benefits, move to direct benefit pensions—rather than direct contribution pensions—and considerably increase their own contributions to pension funds. Damage is already becoming apparent, but we shall see much more.

As for indirect taxes, the one that really affected individuals was the constant increase in fuel duties. Looking at the Chancellor's environmental measures, on which I shall comment in a moment, he has now recognised that technological improvements have made a bigger contribution to our climate change targets and so on than any increase in fuel duty. In fact, the Chancellor's continued increase in the fuel duty escalator was simply for revenue-gathering purposes, not for any environmental reason. It was only because of the outcry last autumn that the Chancellor called a halt to that. The impact of indirect taxes such as those has been very severe indeed, particularly on rural areas.

It is because the collected stealth taxes do not make a direct impact on individuals that the Chancellor's figures suggesting that various households are better off are so misleading. His calculations in the Budget documents about people being better off refer only to direct tax. The situation looks very different if we take into account all the indirect taxes.

The Chancellor is at it again with the stealth taxes that were not announced in the Budget, but which leaked out later. The 7.5 per cent. increase in the upper earnings limit for national insurance contributions announced this week is an increase of three times the rate of inflation. Many individuals earning about £30,000 will be worse off as a result of the Chancellor's measures because that stealth tax was not announced in the Budget. We did not hear anything about it in the Budget for the simple reason that the Chancellor wanted to introduce it stealthily.

Another reason for the fiscal surplus has been the restraint on public expenditure in the Chancellor's first two years, to which my right hon. Friend the Member for Huntingdon correctly referred. That restraint was spun out by the treble counting that we kept hearing, year after year. Figures were repeated constantly by the spin doctors and by the Prime Minister, accumulating three years' increases in expenditure and giving the impression that they were being introduced all at once. That is one of the reasons why the public were unaware that many of the increases were nothing like as large as the Prime Minister and the Chancellor tried to pretend.

There has also been an underspend in the departmental expenditure limits, by £2 billion last year and £1 billion this year. That could be one of the reasons why a reluctant Chancellor managed eventually to allow the Minister of Agriculture, Fisheries and Food to announce changes to the amounts of agrimonetary compensation last week. The underspend no doubt made that very easy for the Chancellor. It is a pity that the announcement was linked to foot and mouth disease, because it has nothing to do with it and should have been introduced much earlier.

I also suspect that the underspend made it possible for the Chancellor to announce what I thought was going to be another smoke and mirrors announcement: the £1 billion increase in health and education. I was watching for an element of retreading or reannouncing of an announcement that had already been made. I grant that that did not happen on this occasion, but the three years' increases were rolled into one and made to look very much larger than they are. The increase in education, for example, is £290 million next year, a far cry from the impression of £1 billion that was given. I take the point made by the hon. Member for Harrogate and Knaresborough (Mr. Willis), who has just left the Chamber, that education spending as a proportion of GDP under the previous Government was higher than it has been under the Labour Government over the past four years.

I shall make one comment on part of the educational spend—the new £290 million—which is that I welcome the conversion to the way in which we approach education spending in terms of the direct payments to schools announced as part of the package. I notice that the Secretary of State for Education and Employment spoke today about greater delegation of budgets and giving more freedom to head teachers. Well, what a conversion. One of the most damaging things that he did was to abolish the grant-maintained schools approach, in which a large proportion of the spend was directly delegated to head teachers, who were given the freedom to spend it as they wished.

I agree with the comments by my hon. Friend the Member for Maidenhead (Mrs. May) about the way in which so many of the education initiatives have been ring-fenced and small, giving the impression of great initiatives and great activity, when they would have been much better directed if they had been given directly to the schools in lump sums.

On health, the reality on the ground and the spin relating to the amount of money are poles apart. A general practitioner in a small village called Brooke in my constituency is retiring. It is proving very difficult—indeed. I think that it will be almost impossible—to replace that GP. One reason is the shortage of money. When I tried to discover whether the relevant funds could be rolled forward into the next three years, I was told that the Norfolk area health authority and the primary care groups were under huge pressure in relation to their budgets. That is the reality on the ground, and the announcement made last week will not make a great deal of difference.

More smoke and mirrors, now. I noticed, when I started to read through the press releases, that many of the tax reductions and grants are, as in the previous Budget, in years two and three. The impression is given that all those goodies will be immediately available, but we shall have to wait for two or three years for them to come through.

Furthermore, press release No. 1 from the Inland Revenue is absolutely littered with proposals which, when we examine them, turn out to be proposals to consult on this, that and the next thing. They give the impression of substantial giveaways to companies—many of the proposals affect the corporate sector—while doing almost nothing at all. As a former Minister with responsibility for small businesses, I can say that the changes proposed for small and medium-sized enterprises are absolutely minimal. The spin is much greater than the reality.

Like my right hon. Friend the Member for Huntingdon, I want to give credit to the Chancellor on two counts. First, on the macro-economic front he has not, by and large, pursued old Labour policies. He has avoided the ludicrously high rates of tax and the reckless spending that we saw under previous Labour Governments. I freely acknowledge that, because of that and the continuation of many of the policies that we were pursuing, he has been able to make a significant repayment of debt. Any Chief Secretary to the Treasury—especially one of my political composition—would always wish to be in that position. In fact, I was close to getting to it myself when I was Chief Secretary, and my point about inheritance was that it was my right hon. Friend the Member for Huntingdon who inherited the opportunity to repay debt.

I acknowledge that the Chancellor has been able to repay that debt, very much for the other reasons that I have given. However, he is in serious danger of throwing away his advantage. I sometimes wonder why there are so many rumours about an imminent election. I suspect that it is because the Prime Minister and the Chancellor do not want to wait until the autumn because they are aware that, given the slowdown in the American economy, the difficulties in Japan and the possible repercussions of globalisation that we experience from time to time, the fiscal drag and the opportunity to repay debt might quickly start to move away. I suspect that that is one reason for having an early election.

However, we must also take into account the threat to the Chancellor's position on the repayment of debt. According to the Red Book—this point has now been well documented and commented on—in the next three years, the increases in public expenditure are planned at between 6 and 7 per cent. a year, with the three years growth estimated at very much less than that. Anyone who has been involved with the Treasury will know that, in terms of the surplus or the deficit—because we are talking about a small residual figure in relation to the expenditure numbers and the revenue numbers—if the economy moves into a slowdown, or if we spend much more than the growth in the economy, we can quickly experience a reverse in that repayment of debt and in the improvement that the Chancellor has been able to achieve on that front. That is the danger.

I also want to give credit to the Chancellor on the environmental front. I strongly welcome the reductions in fuel duty on ultra-low sulphur petrol, and a number of the other proposals in the Budget designed to improve the environmental aspects of transport generally. I remember clearly that I was Chief Secretary when my noble Friend Lord Lawson was Chancellor and we introduced the first reduction in duty on unleaded petrol. Although we were all in favour of that measure, we greatly underestimated the impact that that reduction would have on quickly moving everyone over to the use of unleaded petrol.

I generally welcome the Chancellor's proposals on environmental issues, but he is persisting with the climate change levy, with all the damage that it will do to the many businesses that will not be compensated by the national insurance reductions. He promises an aggregates levy next year, but that will be equally damaging to certain parts of our industry, and the threat of the pesticides tax to agriculture has still not gone away. If we read the small print, we discover that there is still the threat of a pesticides tax being introduced next year. I can think of nothing more harmful to our beleaguered agriculture industry at the present time than the continuation of that threat.

I have further detailed points to make. I believe that the climate change levy should not have been proceeded with and that the pesticides tax and the aggregates levy should not be introduced. I am sad that the Chancellor did not reverse IR35. When I was in California last September, I talked to a lot of Brits who work in the high-tech and biotech industries. Although California was the magnet that attracted British expertise from these shores, the spike of IR35 has greatly accelerated the trend and the visit to India made by the Minister for Small Business and E-Commerce provided one of the more ludicrous examples of its impact.

The Minister tried to recruit skilled consultants in the high-tech industries, for whom an accelerated immigration procedure was to be introduced, because we were losing our people. We have had to turn to others because IR35 has forced home-grown consultants from our shores.

Is my right hon. Friend aware that the fastest-growing sport in the state of California is cricket, which is played in silicon valley?

As always, my right hon. Friend, through an illustration or an anecdote, makes the point extremely well.

I understand that the Chancellor has a passion for and obsession with detail, and that certainly shows in the complexity of so many of the new measures. As with education and getting budgets into schools, I believe that it is much more sensible to reduce taxation on families generally than to introduce a series of directed schemes that appear to be favourable and attractive to families. It is much better to leave families to make their own choices.

The complexity that we are beginning to detect on the tax credit front is frightening. Following the working families tax credit, a series of extremely complicated tax credits has been introduced. I must tell the Chief Secretary that I hope that that is not another way to fiddle the figures by reducing the public expenditure totals, as was done by the working families tax credit. The first of the two more serious consequences of such an approach is complexity for the recipients, and I am not surprised that there is not a big take-up.

Coming to the House in the car the day after the Budget, I listened to "Money Box Live". All the questions were about tax credits and the experts had great difficulty in explaining them. A lot of people outside the House simply will not comprehend them and I understand that the form is 40 pages long. That is not the way to set about establishing new systems, nor is it the way to encourage take-up.

Anyone who has tried to complete a self-assessment tax form this year, as I have, will have discovered that, because of a number of minor changes that the Chancellor has introduced to the tax system, that form is also 40 pages long and extremely complex. 1 happened to fill in my own, but it represents a bonanza for accountants, who will have to spend much longer on it. Introducing schemes of such complexity is not the right way to proceed and, of course, the burden on employers will be substantial too.

In the light of what is undoubtedly a Budget that will greatly exacerbate the complexity of our systems, I await the Chancellor's proposals on simplifying tax. It is perhaps significant that the press release on that subject comes last of all the Budget press releases. What is being simplified this year? The measures, which are the most minor that one could imagine, conclude with

"increasing to £50 the de minimis limits within corporation tax, self-employed income tax and VAT for business expenditure on gifts, so that fewer minor items need to be reported and tracked by business."

Big deal, when so many complexities are being introduced.

On savings, I have to declare an interest. As stated in the Register of Members' Interests, I am a non-executive director of a life assurance company. However, my remarks are geared not to that, but to pensioners. The hon. Member for Lewisham, East (Ms Prentice) said that the Chancellor wears a hair shirt and is greatly interested in thrift. She might be right about the hair shirt, but he shows his interest in thrift in funny ways. We know how much the savings ratio has dropped—it has more than halved and is down to 3.75 per cent. this year from about 11 per cent. when the Government took office.

I regard that as serious, but I am not at all surprised when I consider ISAs—which replaced PEPs and TESSAs and are nothing like as good by any measure—and the changes to pension fund income in relation to advance corporation tax. I predict that the stakeholder pension scheme will not do for the Government what they hope it will. It certainly will not achieve substantial take-up among the targeted income group—those who earn between £9,000 and £18,000. Indeed, the scheme is likely to proceed in such a way that there will probably be many fewer providers and much larger ones than in the past. That, too, will not produce the results that the Government seek, although I am certainly with them in wishing to encourage much more take-up of pension contributions at a much earlier age from all employees.

Does the right hon. Gentleman accept that savings ratios tend to go down at a time of consumer confidence and economic stability? The majority of people's savings these days is in their houses, not in conventional savings accounts, and the savings ratio does not take on board wealth accumulated in housing.