House of Commons Hansard Debates for 6 May 1993

Mr. Thomason : Does my right hon. Friend agree that, while that is extremely good news for the British economy and very bad news for the Labour party, it is important that British industry now takes the opportunity to expand its export trade, backed by a stable pound?

Sir John Cope : I entirely agree about the importance of exports. Clearly retail sales figures show the opportunities at home, but a good home market is the foundation for exports and that also should be pursued.

Mr. Bennett : Given that the Government are now claiming that the recession is over, when will they apologise to all the victims of it? What specific help can they give my constituents, particularly engineers who lost their jobs in their late 50s and still see no prospect of ever getting another job, people who have had their homes repossessed and see no chance of ever being able to buy another home, and young couples who are stuck in high-rise flats with small children and with little or no prospect of getting a home away from those flats?

Sir John Cope : My right hon. Friend has already made it clear this afternoon, as well as on previous occasions, that the depth of the recession here has not been nearly as bad as in other countries. I am not quite sure whether the hon. Gentleman expects me or any other Conservative Member to apologise for the performance in other countries as well as in Britain. Of course, a recession is very difficult for a lot of people and that is why it is important that we are now moving out of it. All the figures that we have been discussing this afternoon are positive and encouraging for all of us.

Stamp Duty

10. Mrs. Ann Winterton : To ask the Chancellor of the Exchequer what recent representations he has received from the Manufacturing and Construction Industry Alliance, the Building Employers Confederation and the Housebuilders Federation about stamp duty.

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Mr. Nelson : We have received representations only from the Housebuilders Federation. It welcomed the doubling of the stamp duty threshold.

Mrs. Winterton : Does my hon. Friend agree that stamp duty is an archaic tax which suffocates the housing market? Will he respond positively to the representations from the Construction Industry Employers Council and the Manufacturing and Construction Industry Alliance by restricting the tax payable to a percentage of the amount by which a property's value exceeds £60,000 ; or, better still, will he announce that the tax will be abolished altogether?

Mr. Nelson : I should like to be able to announce that. I know that stamp duty is not a much loved tax, but it will bring in this year on land and buildings £570 million, and on shares it will bring in more than £1 billion next year, so it is a very significant source of income. As for making a tax-exempt band as opposed to a threshold, the cost of doing that would be very significant ; it would amount to £270 million. We have already gone a long way. In the Budget, my right hon. Friend the Chancellor made a significant, welcome and important increase in the stamp duty threshold.

Mr. Gunnell : Could the Economic Secretary tell me the percentage drop in the number of transactions involving stamp duty as a result of the Budget changes? Is he using that as an argument to close the Leeds stamp duty office? Is he aware that there is great concern in the Leeds financial community about the closure of that office? Does the hon. Gentleman realise that, in closing the office, he is going against the trend of other financial institutions, all of which regard Leeds as a growing and strengthening centre for financial services?

Mr. Nelson : As for the number of transactions, that has been picking up recently. I acknowledge immediately the hon. Gentleman's concern. I know that he has represented the interests of that office in his constituency on this matter. He will know that I have written to him. Some regional stamp duty offices have been changed largely because of advances in technology as well as the need to save costs. Although a relatively small number of people are involved, I acknowledge the importance of that local service to many businesses. I am sorry that I am not able to give the hon. Gentleman a more favourable reply today than I have done in my letters, but I am always prepared to hear his representations.

Profit-related Pay

11. Mr. Ian Taylor : To ask the Chancellor of the Exchequer what was the latest available number of live profit-related pay schemes ; and what the numbers were a year ago.

Mr. Portillo : There were 4,615 active profit-related pay schemes at the end of March 1993--getting on for double the number a year ago. The number of active schemes has more than trebled since my right hon. Friend the Chancellor of the Exchequer increased the tax relief in his 1991 Budget.

Mr. Taylor : The figures that were given by my right hon. Friend are extremely good news for workers in those

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companies. Also, given the extension of employee shareholding organised by the Government, does that not show that we can extend co-operation and consultation with workers and enable them to share in the benefits of their companies much more effectively on the basis of participation in profits than the collectivist-imposed solutions favoured by the Labour party and by the social protocol? Does it not prove that we put up and that they should shut up?

Mr. Portillo : My hon. Friend is absolutely right. There are now 1.2 million employees participating in profit-related pay schemes. There are 2.9 million employees participating in all-employee share schemes. Both those schemes are highly commendable. They have attracted the approval and support of the Trades Union Congress. My hon. Friend is absolutely right to say that such schemes is the way to get employees involved. It means that all employees have a vested interest in the success and profitability of companies. That must be the right way to handle it.

Mr. Battle : Can the Minister explain why the Government are spending British taxpayers' money on advertisements placed in the German press to tell Europe that Britain now has the lowest wages in the whole of Europe? Is that something of which the Government want to be proud?

Mr. Portillo : We are enormously proud that the United Kingdom has become a haven for inward investment. We are the envy of Europe. We are attracting 40 per cent. of Japanese investment into the European Community and about the same proportion of investment from the United States. Is the hon. Gentleman so xenophobic that he wishes to turn away that investment?

PRIME MINISTER

Engagements

Q1. Mr. Fabricant : To ask the Prime Minister if he will list his official engagements for Thursday 6 May.

The Prime Minister (Mr. John Major) : This morning, I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.

Mr. Fabricant : Does my right hon. Friend agree that the quantity of advertising spend is a sensitive barometer of the state of the economy? Is he aware that the amount of advertising for retail sales is up 4 per cent. on the first quarter this year and the amount of advertising on television is up 7 per cent. on the first quarter of this year? Does he think that that is an excellent advertisement for not only the Conservative party but its economic policy?

The Prime Minister : My hon. Friend is correct about advertising being an indicator of activity in the economy. It has been increasing. I was not precisely aware of the figures that my hon. Friend has set out but I have no doubt-- [Interruption.] I must have missed them in the welter of other encouraging economic news that I have seen.

Mr. John Smith : Yesterday the Prime Minister boasted to the Newspaper Society about the number of manifesto

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pledges he claimed to have carried out during the year. Why was there no reference whatever to taxation in that speech?

The Prime Minister : The right hon. and learned Gentleman is in no position to talk to anyone about taxation. I recall that it was his talking about taxation that played a significant part in the fact that we are sitting here and he is sitting there.

Mr. John Smith : The House will have noticed that the Prime Minister studiously avoided answering the question. Is not the real reason why he forgot to mention taxation that he wants the voters in the elections today to forget that his Government's VAT and national insurance increases will cost the typical family in the United Kingdom another £8.50 every week?

The Prime Minister : How interesting that the right hon. and learned Gentleman should say that because I have in front of me a quote that I shall read :

"I favour the higher band income tax and the removal of the ceiling on national insurance contributions that Labour's 1992 Shadow budget proposed. Failing that, I would remove zero rating for VAT on all items."

That is the noble Lord Desai, an Opposition spokesman on economic matters in the House of Lords.

Mr. John Smith : The Prime Minister knows well--because Lord Desai has written to him--that the noble Lord was on the Back Benches when he said what he said-- [Interruption.] He also knows--

Madam Speaker : Order. The House must come to order.

Mr. John Smith : Is it not the case that--let the Prime Minister understand that he cannot run away from this--in the general election he made clear and specific promises not to increase VAT and national insurance contributions? Surely the last thing that he wants people to remember today is that his promises and Tory promises are worthless.

The Prime Minister : Clearly the right hon. and learned Gentleman has lost touch with his own party. The quote that I used, far from being elderly, is in Tribune today.

Sir John Wheeler : Will my right hon. Friend find time to examine the growth of bureaucracy which is seriously impeding the work of the police and the criminal justice system? Is my right hon. Friend aware that even the simplest case these days requires a trail of paperwork and that the more serious cases are such that the expensive time of detectives is now more likely to be spent on paperwork than on the investigation and detection of crime?

The Prime Minister : I agree with my right hon. Friend about that. My right hon. and learned Friend the Home Secretary, like me, wants to see police officers solving crime, not pushing paper. That is why he is setting out proposals to see how much paperwork can be cut. The more we can free our police from that work, the better they can do the work that I and every other hon. Member of this House would like to see them carrying out.

Q2. Mrs. Roche : To ask the Prime Minister if he will list his official engagements for Thursday 6 May.

The Prime Minister : I refer the hon. Member to the answer I gave some moments ago.

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Mrs. Roche : In view of Asil Nadir's breach of bail, should not the Prime Minister come clean about Nadir's contribution of £1.5 million to Tory party funds?

Madam Speaker : Order. May I make it clear to the House that, while that matter may be of some interest, there is no Government responsibility- - [Hon. Members :-- "Yes, there is."] Order. There can be no Government responsibility for finance given to a political party.

The Prime Minister : Well, Madam Speaker, you are of course entirely right about that. I notice that the hon. Lady does not mention the remarkable sums that the Labour party received from the late Robert Maxwell. I cannot, of course, comment on the details of Mr. Nadir's case, which is currently before the courts.

Mr. Waller : Because the Bosnian Serbs possibly doubt the resolve of the United Nations to act forcefully against the atrocities that we have seen in recent weeks and months perpetrated by the Bosnian Serbs against the relatively defenceless Bosnian Muslims, will my right hon. Friend make it clear to the House that we and our allies will not abnegate our responsibilities to take any action that may be deemed necessary to bring those atrocities to an end?

The Prime Minister : Our highest priorities have to be to secure implementation of the settlement plan, to deter further Serbian offences and to sustain humanitarian relief. In one important aspect, things have changed in recent days. President Milosevic of Serbia has committed himself to the Athens agreement. Whatever views may emerge from the self-appointed Bosnian Serb assembly, the international community expects President Milosevic to make good that commitment. He should do so, in our judgment, by closing Serbia's borders with Bosnia, cutting the supply of weapons and other goods and exerting all other possible pressure on the Bosnian Serbs. The Serbian people must realise that they will come under mounting pressure from throughout the international community until there is a peaceful settlement. That is the essence of the common approach that we have agreed with our allies.

Q3. Mr. Worthington : To ask the Prime Minister if he will list his official engagements for Thursday 6 May.

The Prime Minister : I refer the hon. Member to the answer I gave some moments ago.

Mr. Worthington : Could the Prime Minister devote some time to the appalling situation in Sudan, from which the hon. Member for Harrogate (Mr. Banks) and I have recently returned? There is mass starvation, the interruption of food supplies, the harassment of the Christian churches and the prevention of the international aid agencies from doing their work. Will the Prime Minister take up the matter with the Security Council to bring an end to the appalling 10-year civil war and allow uninterrupted work by the Christian churches and the international aid agencies, which are doing valuable work there?

The Prime Minister : The hon. Gentleman raises a serious matter. I fully share his concern and that of my hon. Friend the Member for Harrogate (Mr. Banks) about the distressing situation in Sudan. As the hon. Gentleman will know, we took a lead in the United Nations General Assembly last December when it adopted a resolution condemning the Sudanese Government's human rights

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record. Also, of course, the United Nations Commission on Human Rights has decided to appoint a special rapporteur. We are looking at the moment to the negotiations under Nigerian auspices. We hope that they will succeed in ending the civil war. I certainly would not rule out a future role for the Security Council. It would be helpful if the hon. Gentleman and my hon. Friend could perhaps let me have a more detailed report of what they saw in Sudan. I would welcome that as I should like to discuss it with my right hon. Friend the Foreign Secretary.

Dr. Michael Clark : Is my right hon. Friend receiving letters, as I am, from pensioners and others receiving benefit who are concerned in case that benefit should be paid exclusively into banks and building societies? Will he confirm that benefit will continue to be available from post offices and sub-post offices, thus giving the customers a choice, in line with Conservative policy?

The Prime Minister : This is a matter on which concern is raised from time to time. We have made no proposals to make those changes. If we had any firm proposals to make those changes we would bring them before the House.

Q4. Mr. Martyn Jones : To ask the Prime Minister if he will list his official engagements for Thursday 6 May.

The Prime Minister : I refer the hon. Member to the answer I gave some moments ago.

Mr. Jones : Will the Prime Minister find time during a busy and probably worrying day for him to reflect that when he and I were leaving school student grants were adequate and most discretionary awards were paid for higher degrees? Does he not think that the present situation, where higher degrees are not awarded grants by local authorities, is a deterrent to less-well-off students and the nation will lose their skills? Is it just that he is unconcerned because he got where he is with three O-levels?

The Prime Minister : The hon. Gentleman is inaccurate in most of the things he says. His essential mistake about the future is that he entirely overlooks the vast increase in the numbers of young people going into higher education. Virtually one in three young people now goes on to further education. Those are wholly different circumstances from when the hon. Gentleman and I left school.

Mr. Congdon : Is it not good news that British Telecom is to reduce the cost of connection charges by £40? Does this not show the benefits of privatisation combined with a tough regulatory regime?

The Prime Minister : It certainly does and it certainly would not have been so efficient without privatisation. Privatisation has brought better service and lower charges for gas, electricity and telecommunications and that is why we continue to support it, unlike the Opposition who have supported no new idea of any sort for years.

Q5. Mr. Parry : To ask the Prime Minister if he will list his official engagements for Thursday 6 May.

The Prime Minister : I refer the hon. Member to the answer I gave some moments ago.

Mr. Parry : The Prime Minister will be aware of the meeting last night in the Grand Committee Room where Mr. Nelson Mandela met Members of all parties and both

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Houses. The meeting was well attended and Mr. Mandela got a standing ovation on both entering and leaving the room. What help can the Government give to South African in the forthcoming general election, particularly in investment from Britain?

The Prime Minister : My right hon. Friends the Foreign Secretary and the Minister of State, Foreign and Commonwealth Office and I separately met Mr. Mandela during his visit to the United Kingdom. We had the opportunity of discussing a whole range of issues : the difficulties with violence, the progress with the talks and the prospects for transition to a peaceful, multiracial democracy in South Africa. We discussed the range of ways in which we could help, both personally and publicly.

One area that would be of immense help when the transitional Government is formed would be the immediate removal of sanctions and that is now of great importance to Mr. Mandela, as he probably mentioned last evening. The underlying concern that exists there is extremely serious. South Africa has nil economic growth, 7 million people unemployed, a 3 per cent. annual growth in the birth rate and badly needs international investment and the removal of sanctions. The sooner that can be agreed by all parties in this House, the better it will be for South Africa.

Mr. Alexander : Will my right hon. Friend hesitate a little before deciding to abolish the May day bank holiday? Ideological considerations apart, is it not a fact that more people enjoy having an early summer day's break than would enjoy a break at the beginning of winter? Is it not further the case that the May day bank holiday gives a welcome and much- needed kick-start to the leisure industry which a holiday at the end of October could never begin to do?

The Prime Minister : I am grateful for my hon. Friend's advice on that important matter. When we have an announcement to make, we will bring it to the House.

Mr. Shore : The Prime Minister will recall that yesterday the European Communities (Amendment) Bill was debated and that in the course of the debate an amendment was passed, as a result of which the House has unanimously agreed to strike out the protocol that the Government had previously negotiated for an opt-out from the social chapter.

Can the Prime Minister now tell us whether his respect for the views of the House of Commons is sufficient for him not now to pursue his previous goal of completing the ratification of the treaty? If he is not prepared to give that guarantee to the House, will he at least now let the people of this country have a chance to vote on their future, when the House of Commons is unable to influence the Government even by a majority vote?

The Prime Minister : The right hon. Gentleman knows as well as any hon. Member the implications of being a parliamentary democracy. We are a parliamentary democracy, and I am not in favour of referendums. The sole effect of the amendment to which the right hon. Gentleman referred is to remove the social protocol from being incorporated into United Kingdom law, but the opt-out remains part of the treaty. So let me repeat very clearly that we will ratify the treaty which I signed at Maastricht : no change, no social chapter, no back-door socialism.

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