House of Commons Hansard Debates for 17 Mar 1993

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Points of Order

3.30 pm

Mr. Simon Hughes (Southwark and Bermondsey) : On a point of order, Madam Speaker. If, for example, the hon. Member for Derbyshire, South (Mrs. Currie) had tabled a closed question about Derbyshire and another hon. Member had then tried to ask a question about Hertfordshire or Bedfordshire, I assume that you would have ruled that hon. Member's question out of order. In fact, the hon. Lady intervened on a question about shipbuilding to ask a question that was entirely about the aircraft industry. Will you reflect on whether such questions should be ruled out of order in future?

Madam Speaker : As far as I recall, the hon. Member for Derbyshire, South (Mrs. Currie) led on defence expenditure, but let me make my attitude to questions absolutely clear. I very much deprecate hon. Members' going very wide of the questions on the Order Paper : I regard that as an abuse of the House. If it is any comfort to hon. Members, I make a mental note of the names of those who abuse the House in that way. May I leave it at that?

Dr. Kim Howells (Pontypridd) : On a point of order, Madam Speaker. Can you tell me whether questions 5 and 12--one tabled by a Scottish nationalist, and the other by a Welsh nationalist--were withdrawn today because the hon. Members concerned did not wish to embarrass the President of the Board of Trade, and were involved in the grubby deal that the nationalists cooked up with the Government last week?

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Madam Speaker : I have no idea why the questions were withdrawn. A message simply came to my office in the normal way.

Mr. Michael Clapham (Barnsley, West and Penistone) : On a point of order, Madam Speaker. Has the President of the Board of Trade made a statement to you to correct his inaccuracies with regard to the report by the Select Committee on Trade and Industry? He said that the report made no recommendations about gas and nuclear energy, but it clearly does. Paragraph 247 states :

"In determining whether new capacity should be licensed, we recommend that the Secretary of State give priority to :

Projects with a substantial CHP"--

that is, combined heat and power--

"element and thus major environmental benefits sour gas, which is unsuitable for other purposes and thus unlikely otherwise to be developed."

The report also suggests that the right hon. Gentleman use

Madam Speaker : Order. The hon. Gentleman is now becoming involved in content. I have tried to explain to him previously that I cannot deal with content, or with what Ministers or Back Benchers say in the House. I am concerned with procedure and points of order.

Mr. Clapham rose--

Madam Speaker : May I answer the hon. Gentleman? After all, he asked the question in the first place.

The Secretary of State for Trade and Industry has made no statement to me, privately or in any other way. I understand that the hon. Gentleman is attempting to pursue the matter. I advise him to pursue it by other means ; he cannot pursue it through the Speaker.

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Hire Purchase and Conditional Sale (Prevention of Fraud) 3.33 pm

Mr. Michael Stephen (Shoreham) : I beg to move,

That leave be given to bring in a Bill to amend the law relating to the sale and leasing of goods and to vehicle registration ; to make provision for the registration of title to certain other goods ; and for connected purposes.

I am grateful for this opportunity to present the Bill this afternoon.

Hire purchase fraud is a serious form of criminal activity, which can and must be stopped. In a typical case, a criminal takes goods, usually motor vehicles, on hire purchase, lease or credit sale and sells them to an unsuspecting member of the public or a motor dealer or through an auctioneer without of course, disclosing the existence of the hire purchase company's interest. The criminal then disappears or is not worth suing.

Last year, losses to finance companies exceeded £13.5 million, and further losses exceeding £2 million were suffered by motor traders and auctioneers. Those costs are passed on to our constituents in the form of higher finance charges and higher vehicle prices. Last year, there were also more than 4,500 cases of wrongful disposition of motor vehicles, many of which resulted in prosecutions, with increased costs for the police, the courts the prison system and others, all paid for by the long-suffering taxpayer.

The remedy is not to arrest, prosecute and punish the offender but to change the system of documentation to make it virtually impossible to commit such a crime. As the law stands, if the criminal sells to a private buyer who acts in good faith and without notice of the finance company's interest, the buyer gets a good title and the loss falls on the finance company. If the criminal sells to a motor trader or through an auctioneer who does not know of the finance company's interest, the loss falls on the trader or auctioneer.

A register of hire purchase interest is maintained by a company called Hire Purchase Information, or HPI. It does an excellent job, but traders and auctioneers searching the register will often find no trace of a hire purchase or other security interest. There are two reasons

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for that. First, many hire purchase companies do not bother to register, knowing that private buyers do not search at HPI and also knowing that, if the criminal sells to a trader, the trader will have to bear the loss.

The second reason is that the criminal may have sold the vehicle very quickly, before the hire purchase interest has been registered. It is therefore necessary to change the system of vehicle registration so that the vehicle registration document sometimes known as the logbook, is endorsed with a note of the hire purchase interest. Traders and private buyers would therefore see straight away whether the car was subject to a finance company's interest and, of course, if the seller said that he could not produce the vehicle registration document, a prudent buyer would send him away until he could produce it. The present pace at which the Driver and Vehicle Licensing Agency at Swansea operates is much too slow and needs to be speeded up.

Some consequential changes to the law would be needed. The main one would be to make it clear that a finance company that fails to register its interest or allows its customer to take possession of a vehicle with an unendorsed vehicle registration document would lose its title if the criminal sold to an innocent private buyer or an innocent trader. There is no reason why a system similar to that which I have outlined should not also be introduced for boats and caravans, which are subject to the same criminal activity. It is time to take action to crack down on hire purchase fraudsters. I commend the Bill to the House.

Question put and agreed to.

Bill ordered to be brought in by Mr. Michael Stephen, Mr. Andrew Bowden, Dr. Liam Fox, Mr. Patrick Thompson, Mr. Bruce George, Mr. Tony Banks, Mrs. Angela Knight and Mr. Michael Bates.

Hire Purchase and Conditional Sale(Prevention of Fraud) Mr. Michael Stephen accordingly presented a Bill to amend the law relating to the sale and leasing of goods and to vehicle registration ; to make provision for the registration of title to certain other goods ; and for connected purposes : And the same was read the First time ; and ordered to be read a Second time upon Friday 23 April, and to be printed. [Bill 163.]

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Orders of the Day

WAYS AND MEANS

Order read for resuming adjourned debate on Question [16 March].

AMENDMENT OF THE LAW

Motion made, and Question proposed,

That it is expedient to amend the law with respect to the National Debt and the public revenue and to make further provision in connection with finance ; but this Resolution does not extend to the making of any amendment with respect to value added tax so as to provide--

(a) for zero-rating or exempting any supply, acquisition or importation ;

(b) for refunding any amount of tax ;

(d) for relief other than relief applying to goods of whatever description or services of whatever description.-- [Mr. Lamont.] Question again proposed.

Budget Resolutions and Economic Situation

[Relevant documents : European Community Document No. 4683/93, the Commission's Annual Economic Report for 1993, and the draft Decision adopting the Report.]

Madam Speaker : The Question is as on the Order Paper. I remind the House that the Budget debate continues on the motion entitled "Amendment of the law". Before I call the first speaker, may I plead for short speeches today, please? A number of Members are seeking to catch my eye and I should be much obliged if speeches could be rather shorter today.

3.39 pm

Mr. Gordon Brown (Dunfermline, East) : Two years ago, we had a "Budget for business". Since then, 100,000 businesses have gone under. Last year, we had a Budget called a "Budget for the recovery". No recovery materialised. In November, we had an autumn statement "for investment". Public investment continued to fall. Now we have what is called a Budget for jobs, and I make one Budget forecast--that, after the Budget, unemployment will rise this month, next month and for months afterwards. This "Budget for jobs" is really a Budget with only one intention, to save one job--the Chancellor's own job. It was the Chancellor's last Budget to be held in March, and it should be his last.

The Budget makes it clear that taxes will rise not only this year but next year and the year after. There will be tax rises now, tax rises later and tax rises two years later. That is not only a double whammy but a triple Conservative tax whammy.

National insurance contributions, which the Conservatives said would not be increased, have risen. VAT, which they promised would not increase, is now to be imposed on fuel. As the President of the Board of Trade would say--

Mr. Jacques Arnold (Gravesham) : Will the hon. Gentleman give way?

Mr. Brown : I shall give way later.

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As the President of the Board of Trade would say, "Taxes to the left, taxes to the right, taxes everywhere." For people paying VAT, there will be "tax rises before breakfast, before lunch and before dinner", and people will have to get up the next day and pay taxes yet again.

Before the general election, the Conservatives promised not to devalue--

Mr. Arnold rose--

Madam Speaker : Order. Is the hon. Member for Dunfermline, East (Mr. Brown) giving way?

Mr. Brown : Yes.

Mr. Arnold : Bearing in mind the statement on the Labour party's green creditials made by the hon. Member for Islington, South and Finsbury (Mr. Smith), and the commitment to reduce CO emissions by the end of the century, if the hon. Gentleman opposes the imposition of VAT on domestic energy, will he explain how the Labour party would honour the commitment?

Mr. Brown : The difference between us and the Conservative party is that we have a policy for the environment. We are not using the environment, as the Conservatives do, simply to raise taxes at the expense of the rest of the people.

At the general election, the Conservatives promised not to devalue. They did devalue. They promised a recovery that has not happened, and they promised to end repossessions, which continue at the rate of 1, 000 a week. They promised and guaranteed young people jobs or training ; hundreds still have none. They promised that they would not privatise Scottish water, and now there is a real fear that they plan to do so.

Most of all, the centrepiece of the Conservatives' election campaign was the promise that taxes would not rise--indeed, that taxes would fall. The Chancellor's Budget has been not a Budget for Britain but a betrayal of the people of Britain.

The central failure of the Budget is the failure to tackle unemployment and economic decline. The Budget deficit and the tax rise that will ensue result from the central failure to produce economic prosperity. A Government who tackle only the consequences and not the causes of economic and industrial decline will fail in the Budget, and they will fail Britain.

Reading the Budget statement, which makes it clear that unemployment will continue to rise and that little will be done about it, we realise that the only consistent view that the Chancellor has held over two years has been the view that, for him, unemployment is a price well worth paying.

I am sorry that the Chancellor is not in the Chamber. The first thing that Ministers must do is apologise to the House and to millions of people throughout the country. Two pounds a week is the price that will be paid in the fuel bills of elderly people and of many millions of others. That amounts to £100 a year and, as I noticed yesterday, there is no guarantee of full compensation in social security payments or in pensions.

Mr. David Shaw (Dover) : Is the hon. Gentleman actually denying the words that hon. Members heard the Chancellor say quite clearly, quite categorically--that those who are getting benefits through the social security

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system will have those benefits made up to take full account of what is going to happen on the additional VAT?

Mr. Brown : I am grateful to the hon. Gentleman. I shall now give way to the Chief Secretary to the Treasury so that he can confirm what his hon. Friend said.

The Chief Secretary to the Treasury (Mr. Michael Portillo) : I intend to make a speech later.

Mr. Brown : That is the Tory party at work--the Tory party that never, ever tells a truth in answer to a simple and straightforward question.

Let us consider in precise detail what the Government have said about tax rises. During the election campaign, the Chancellor said on "Channel 4 News" :

"We will not have to increase taxes. I cannot see any circumstances in which that will be necessary."

Just to be sure, Jon Snow, the interviewer, pressed him and asked :

"Does that mean direct and indirect taxes?"

"Yes," said the Chancellor. The Chancellor and the Ministers who have betrayed promises made during the election campaign can never be trusted again.

The tax promises were not casual remarks or offhand, throwaway comments. They were not a peripheral element of the Conservative campaign. The Chancellor made it the centrepiece of his whole election strategy that taxes would not just not go up, but would go down under his leadership. I repeat that he said that he could not see any circumstances in which tax rises would be necessary. Is that the same Chancellor who has raised taxes by £17 billion over two years, the same Chancellor who kept telling us during the election campaign that tax rises would destroy work incentives, the same Chancellor who has imposed tax rises amounting to £8 a week on the ordinary taxpayer from next April, and the same Chancellor who unveiled billboard poster after billboard poster saying that Labour's plans to raise taxes were a folly and a fraud on the people of this country? Is it the same Chancellor who has imposed--

Mr. John Townend (Bridlington) : Will the hon. Gentleman tell the House whether, if he is so opposed to dealing with the Budget deficit by increasing taxes, he accepts that inevitably he would have to introduce substantial cuts in public expenditure?

Mr. Brown : The hon. Gentleman fails to understand that it is the failure to solve the problems of unemployment and of economic decline that is forcing up the Budget deficit. The Budget's failure to deal with the causes of the problem and the fact that it deals only with the consequences mean that it is a Budget that fails Britain. I should have thought more of the hon. Gentleman if he had told us that he would apologise to the voters in his constituency whom he told during the general election campaign that there would be no VAT rises and no national insurance rises. If he cannot point out the section of the election manifesto which warned of increased tax rises for the ordinary voter under a Conservative Government, he should be ashamed of himself.

Mr. Townend : If the hon. Gentleman looks at my election address, he will see that I talked about no increases in direct taxation.

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Mr. Brown : The hon. Gentleman's comment is interesting. I presume that he meant that there would be no increase in national insurance. Was that the policy with which he went to the electors? Was that the policy? He cannot answer the question. National insurance is a tax that is paid by every worker, and by next year people will be paying £3 a week more.

There are only two explanations for what has happened since the election-- either Ministers are incompetent on a scale that beggers belief or, with the access that they, uniquely, had to the Treasury papers before the election, knowing of the problems that their policies and their failures had created, they set out to deceive the people of Britain on a massive and unprecedented scale.

Let us remember that this is the Chancellor who told us that he would not devalue and did ; who forecast that the recession would be shallow and short-lived ; who told us that the recession would end two years ago, then one year ago ; who told us that he had seen the green shoots of economic recovery--months before there is any sign that a recovery is happening. Can anyone ever believe anything that he says to the House or the people of this country again? During the election campaign, the Tories put up billboards throughout the country saying that the country could not trust the Labour party. Now they should put up billboards in every town and city saying that the country can never trust the Conservative party again.

Mr. D. N. Campbell-Savours (Workington) : Is there not something far more sinister about these matters? Given that the Government have a majority of only 20 and that among those 20 are a number of marginal seats, is not it quite clear that, had it not been for the tax lie, there would probably have been a minority Labour Government today? Should not the wider public be told that?

Mr. Brown : If the truth had been told, there would have been a majority Labour Government.

What did the Prime Minister say? His reputation is clearly on the line in connection with all the promises that were made. Let us be absolutely clear that it was not just the Chancellor--who is taking the lion's share of the blame--but the Prime Minister who made the promises. The Prime Minister was asked about VAT. "We have no plans," he said, "to increase VAT. There will be no VAT increase." Let me remind Conservative Members--who will have to live with this as these decisions come back to haunt them between now and the next general election--of what the Prime Minister said. Asked by The Independent on 27 March :

"Can you give the same pledge that Mrs. Thatcher gave in 1987 that you will not extend the scope of VAT to children's shoes, clothing, gas, electricity and food?",

the Prime Minister replied,

"I have made the pledge in the past. I have made it clear that we have no plans no need no plans to extend the scope of VAT." The Prime Minister was not content with that. He went further and promised tax cuts year on year :

"I have no doubt,"

he said,

"that we will be able to make further reductions in the rate of taxation."

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Those were the words of a Prime Minister who put himself at the forefront of a manifesto that said that lower taxes were necessary to encourage people--they would make for "a more productive economy" ; and would

"transfer power from the state to the people"--

and that high taxes would

"kill the goose that lays the golden eggs".

There is now no refuge for the Prime Minister in claiming that he did not know anything about the length of the recession. It was he who gave the unequivocal promise : "Vote Conservative on Thursday and the recovery will continue on Friday." They were calculated, cold-blooded and cynical statements, made simply to win the election. The result is that the Conservative party, under the Prime Minister's leadership, will never be trusted again.

Let us just remember that, to win an election, President George Bush said, "Read my lips--no more taxes," then put taxes up and lost the election. The Prime Minister said, "Read my manifesto--no more taxes." Now he has put taxes up, and he will be thrown out of office.

Dr. Liam Fox (Woodspring) : Will the hon. Gentleman take this opportunity to pledge his party to reverse the extension of VAT to fuel and power?

Mr. Brown : Perhaps the hon. Gentleman would like to join us in the Lobby on Monday, when we will be voting against the VAT increases. I will tell him something else : when we draw up our election manifesto, we will be fair to pensioners and to all those to whom fuel prices matter, and when we go to fight an election campaign, we will tell the truth.

The Chancellor has argued that the Budget will set Britain on the road to recovery. He has argued, when he has produced figures, that the balance of payments will rise to £17.5 billion, that investment will grow by only 0.5 per cent., that the trade deficit in manufacturing will double, and that the Budget is a sign of the successes of his policy. But let us consider what is happening to unemployment in Britain.

After the Budget, unemployment will still cost the country almost £30 billion a year. The cost of every unemployed person--the rising numbers--is £9,000 a year. When faced with the problems of massive unemployment in the 1930s, we had a new deal in America. After the war, we had the Marshall plan to reconstruct Europe. We need a mobilisation of resources to combat unemployment now.

What do we have instead from the Government, when more people are unemployed ; when more people are chasing jobs ; when, in some constituencies of Conservative Members, 1,000 people go for every vacancy on offer ; when we need a great national effort that would repair our roads and railways, build homes, improve our schools and hospitals and upgrade our environment?

When we look at the plans produced yesterday by the Chancellor and the Secretary of State for Employment, let us remember that there are fewer training places now than in 1990, when the Chancellor and the Prime Minister came into office. Let us remember that the amount spent on every unemployed person has not increased but has been reduced.

When talking about broken promises, let us also remember the promises that were made to the

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unemployed, which have been cynically betrayed : the promise that, by March 1992, employment action would create 30,000 places--it never did ; the promise that the Government would increase the funding available to the training and enterprise councils--the Chancellor had to admit that the funding was being cut ; the guarantee that all young people would have a job or training--thousands, and now hundreds, do not have that ; the Chancellor's promise in 1991 that the monthly rate of increase in unemployment had peaked and was likely to moderate further. All those promises were never met.

What do we have now in the Government's employment programmes? Employment action, which produced neither employment nor action, is now relaunched as training for work, to disguise a £34 million cut. The business start- up scheme mentioned by the Chancellor yesterday has been relaunched under a new name, with almost half the places that it originally had five years ago.

Certainly there are twice as many job interview guarantees from the Chancellor and the Prime Minister, but when the two main firms in the job interview guarantee scheme helping the Government are the Post Office and British Gas and between them they are laying off 26,000 people in the next few years, how can the job interview guarantee scheme generate thousands of jobs for the unemployed? After all that, we are left with the central fact that unemployment is rising and will continue to rise, and that the Government's whole approach is essentially this : that unemployment is a price well worth paying. I say that there is no recovery that we will call a recovery when it assumes that 3 million people stay out of work. There is no recovery that is worth its name which does not begin to put Britain back to work.

Will the Chancellor tell the couple who stand to lose their home as well as their jobs as a result of higher unemployment that unemployment is a price well worth paying? Will he tell the man in his 40s who knows that he will never work again once he loses his job that his unemployment is a price worth paying? We all know very well that, if the Government accepted their responsibilities for jobs, we could begin to get Britain back to work.

Will the Chancellor tell the youngster with no hope, no cash and no job that his long-term unemployment is for him a price well worth paying? The Chancellor knows that he could abolish youth unemployment if he had the will to do so.

The tragedy is that the only redundancy that really worries the Chancellor is his own, and that the repossession of No. 11 Downing street is the only repossession he cares about.

What are the Government's excuses for what has gone wrong? They started, in 1979, by blaming the trade unions. Then they blamed Labour councils, the European Economic Community, the exchange rate mechanism and Jacques Delors. When European excuses ran out, they discovered world recession. At the weekend, the Secretary of State for Trade and Industry even blamed the Labour party.

The weekend before that, as things were beginning to get desperate, they looked nearer to home and found someone else to blame--Lady Thatcher--who, in her own words, is now the "enemy within" for the Conservative party. All was explained. The Prime Minister had been terrorised into silence in her Cabinet on a subject dear to his heart--British manufacturing industry. That is the

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