House of Commons Hansard Debates for 1 Dec 1993

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£23 billion will be taken out of circulation. That is an enormous tax hike--the biggest in British fiscal history. No one can predict its effect on consumer confidence.

My hon. Friend the Member for Dunfermline, East (Mr. Brown) has already starkly drawn attention to the details of those figures. A typical family will be £16 a week worse off as a result. That is bound to have an effect on consumer confidence and consumer spending. If we are talking about growth in the economy, it is difficult to see where else that growth is likely to come from in future.

It certainly will not come from public spending on vital new capital investment projects, because we are witnessing an overall reduction in public spending. That economic growth is not likely to come from an export- led regeneration of British manufacturing, given the problems of the wider European economy. The Government are proposing, therefore, effectively to take £23 billion-worth of consumer spending out of the economy. I would like to hear some assessment from Treasury Ministers of the impact on consumer confidence of such a measure.

While we are discussing export-led growth, it has struck me, and, I am sure, many of my hon. and right hon. Friends on the Opposition Benches, that, throughout the Chancellor's lengthy Budget speech, we did not hear a reference to the trade deficit. We did not hear anything from the Chancellor of the Exchequer about the appalling imbalance of trade that has grown up, not just between Britain and the European Community but between Britain and the rest of the world.

Those are serious economic issues, and the problem with the Budget is that, instead of the serious analysis of them which we were led to believe that the Government would give us, we have had a ritual chanting of mantras that ultimately mean nothing. When we consider the evidence--the experience of 14 years of Conservative government--we are entitled to say that those mantras mean nothing.

Now I shall mention one aspect of the Government's public expenditure round which has not been mentioned so far in the debate--the reduction in defence spending. Once again, I have to say that that issue is of direct relevance to my constituents. In Barrow-in-Furness we have the highest dependency on defence-related contracting of any travel-to-work area in the United Kingdom. The announcement of a further £800 million-worth of defence cuts was received, and is being received, by my constituents very badly. We have already suffered a loss of 8,000 jobs in the shipyard in less than three years. That is an unsustainable loss of skills and jobs--and employment opportunities--for any single community to expect to deal with on its own. There is no end in sight to that. We need some information--and we need it quickly--from the Secretary of State about what the Government are now planning in terms of future procurement decisions. I fully support the idea, and the proposal, that the Government should conduct a review of the country's defence policies. That is long overdue.

I am also interested to hear the Secretary of State say, as I understand that he did to the Defence Select Committee today, that the bulk of that £800 million can be saved by means of efficiency measures. If that is the case, why were not those defence cuts proposed before? Are the Government simply saying that they have been overspending in terms of the running costs of that Department to the tune of £800 million? What a scandalous waste of taxpayers' money that would be.

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I think that the reality is that there will be significant procurement cuts, especially in the budgets of the armed services. I very much hope that that is not the case, and I hope especially that the Government will announce that they still intend to procure replacements for HMS Fearless and HMS Intrepid in the very near future. We need those ships, not just to maintain the ability to deploy the armed forces safely and securely around the world, but to secure vital employment in the shipbuilding industry.

When all the hype and froth is stripped away, the Budget will be seen for what it is--a giant confidence trick. We are all being asked to pay more for less. The fundamental weaknesses of the British economy have not been tackled by this, or any other Tory Budget for the past 14 years. The sick and the unemployed are being hit once more.

Perhaps the right hon. Member for Shropshire, North (Mr. Biffen) had it about right when he commented in the Evening Standard today :

"It could be cheers today, but tears tomorrow"

for the Tories. I agree with that assessment.

6.58 pm

Mr. Richard Spring (Bury St. Edmunds) : I listened with interest to the speech of the hon. Member for Barrow and Furness (Mr. Hutton). He talked about the need to stimulate growth, but the fact is that growth is in revival in the country, and it is in revival because we have a combination of low corporation tax, low inflation and low interest rates. That sets our record apart from those of the other countries of Europe, and the economy is certainly in revival. I also listened with interest to the speech of the hon. Member for Newbury (Mr. Rendel). Coming from the county of Suffolk, which is now experiencing a combination of the Liberals and Labour in government at a county level, I can see the wish list of goodies very much in evidence.

Mr. David Porter (Waveney) indicated assent.

Mr. Spring : I see that my hon. Friend agrees with me.

Sometimes, those who are practitioners of economics or politics can lose sight of what economic policy is all about. It is, of course, to provide a framework in which sustained economic growth can lead to decent living standards and secure employment prospects for our people.

As always, every Budget is a balancing act, but this historic Budget has succeeded very well in bringing together all the disparate elements which make up a coherent budgetary package. The result yesterday, for the whole House to see, was the floundering performance of the Leader of the Opposition. I have to say that the hon. Member for Dunfermline, East (Mr. Brown) did not even reach the beach.

The hon. Member for Dagenham (Mr. Gould) summed up the predicament of both the Leader of the Opposition and the Labour party in a press release some months ago :

"We have nothing to say across the whole range of macro-economic policy, on exchange rates, on interest rates, fiscal policy, demand management and public spending".

As one looks back at the long history of the House, there can be no time in history when the Government have been

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faced with an Opposition more ineffective and economically illiterate. Yesterday and today, they had nothing to say. They know it, and we know it too.

During the summer, I visited Japan and Taiwan with the Employment Select Committee. Japan may have its difficulties, but Taiwan regards itself as in recession with a growth rate of some 6 per cent. Our much-improved export performance is due to the substantial increase in exports to the Pacific rim countries. All that is good for jobs and economic growth.

We have been the major beneficiary of Japanese and other foreign investments in Europe. The effect has been profound. Rover now outsells Mercedes Benz in Europe ; Toyota is moving its local content in the United Kingdom from 60 to 80 per cent. ; the productivity of the work force in Britain is identical to that of Japan ; the days of Friday afternoon cars and Monday morning cars are clearly in the past.

When we visited the Ex-Im bank in Tokyo, which monitors investment flows, it was disappointing to hear that investments from Japan into Europe are very small compared with those to other parts of the globe. Why is that so? Time and again, we heard about the adverse cost structures in Europe and of employment costs that are simply pricing Europe's goods and services out of the world's markets. There is no point in talking about education, NHS, transport or defence spending if we cannot produce what the world wants. The consequence is that Europe is paying a bitter price. There are 17 million people unemployed in the European Union, potentially rising further in the years to come.

In that gloomy European picture, Britain stands out, with falling unemployment, low inflation and low interest rates. Each and every other EU country has a minimum wage policy--either statutory or collective--and it is no coincidence that, where there is a statutory wage provision in the larger EU countries, there is chronic unemployment, among young people in particular. In France, it is 23 per cent. and rising ; in Spain, it is 33 per cent. and also rising. The inflexibility of their labour markets has caused real economic destruction and personal misery.

Britain, like other industrialised countries, has to grapple with a sizeable budget deficit. I am glad that my right hon. and learned Friend has not shied away from it, and I applaud him for tackling it with his characteristic panache. I believe that the unified Budget will be seen to be as important as the Budget of 1979, which brought down confiscatory taxation and abolished foreign exchange controls ; and the tough 1981 Budget, which set the scene for a sustained period of economic growth unparalleled since the war.

One reason why the Budget is so important is that it addresses important aspects of welfare spending. It is not a party political issue--nor, indeed, is it confined only to this country. Some 25 million Britons out of 55 million are in receipt of benefit. In each of my surgeries, I try to help people, often with limited resources, because, all too frequently, the system benefits those who do not need it.

The Budget is especially important because it has put down markers for dealing with these problems, while retaining the essential integrity of the welfare state. My right hon. Friend the Secretary of State for Social Security took the matter up so well this afternoon. I was in my twenties in 1976, when the country went bankrupt. I remember feeling anger that I was going to be

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bequeathed a country which had become a byword for industrial anarchy, and the laughing stock of the world. Today, I have children of my own. It would be fundamentally wrong to bequeath them an economy laden down with a debt which would be difficult for them to service and pay off, and we should never be forgiven if we did not rise to the challenge.

The key element of the Budget is the disappearance of the budget deficit by the end of the decade. It is the most critical component of macro-economic policy.

During the boom years of the late 1980s, the vast majority of new jobs came from small businesses. It is important to remember that 96 per cent. of our enterprises in Britain employ 20 people or fewer. I therefore greatly welcome my right hon. and learned Friend's measures to help small businesses.

In rural communities such as my constituency, dozens of businesses exist which are the lifeblood of the west Suffolk economy. Many have been hard hit during the recession, but there are now clear signs of recovery. My right hon. and learned Friend's announcements will be a considerable boost to them. Only yesterday, I was talking to a number of my constituents involved in small businesses, and how pleased they were that they would now no longer have to register for VAT due to the increase in the threshold.

Businesses in that category will no longer suffer the costs and irritation of a statutory audit. Many of my constituents will benefit from a welcome measure for which the Small Business Bureau has been campaigning for many years. We should look carefully at what the attempts will be to cut red tape and help small business. The audit requirement for small businesses has been significantly relaxed. The requirement will be abolished for most companies with a turnover of below £90,000. For companies with a turnover of between that figure and £350,000, the audit will be replaced with a simplified process which will help some 500,000 businesses, all potentially involved in job creation.

I greatly welcome the immediate lifting of the VAT registration threshold to £45,000. Some 70,000 traders will be able to opt out of VAT-- greatly to their benefit. The Budget is of great help to the small business community and therefore to job creation.

There are many reasons why we seem since the war to have been bedevilled by a rollercoaster ride of interest rates. One has been the distortions flowing from our national propensity to put money into bricks and mortar rather than other economic activities. The restriction in mortgage tax relief is welcome, and I personaly hope that, over a period, my right hon. and learned Friend will consider phasing out altogether that distorting relief.

In particular, I applaud my right hon. and learned Friend for initiating the new enterprise investment scheme and a new venture capital trust, and I am personally gratified that any investments potentially will not be property-related. In looking at measures for enterprise, and therefore job creation, the enterprise investment scheme will provide income tax for individual investors of 20 per cent. on up to £100,000 of qualifying investment per year. Companies will be able to raise up to £1 million per year under the scheme. That is greatly to the advantage of entrepreneurial activity in our country.

The new venture capital trusts will pool savings for investment. That means that investors will receive dividends and capital gains free of tax. That is a useful way

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of spreading risk and encouraging entrepreneurial revival and activity, and therefore further job creation. In that context, I greatly welcome my right hon. and learned Friend's efforts to reduce red tape and bureaucracy.

As our public finances get into better balance, I hope that my right hon. and learned Friend will begin to re-examine certain income tax cuts. I hope that in due course he will take more people out of taxation altogether and continue to broaden the 20p tax band. We have seen the fruits of low corporation and income taxes being good for growth and inward investment. However, too many people in Britain are still paying tax too soon--there are too many people in the grey area that overlaps with welfare payments. I urge my right hon. and learned Friend never to lose sight of the benefits of a 20p basic tax rate. I am glad that my right hon. Friend the Paymaster General is on the Front Bench this evening. In the drama of a Budget, the avalanche of figures and their enormity, the impact of it on distinct groups can be overlooked. Ten days ago, my right hon. Friend the Secretary of State for Employment visited my constituency, notably Newmarket, the racing capital of the world.

The racing industry generates considerable employment in my constituency. The industry had been in catastrophic decline. However, as a result of the spring Budget, the number of owners coming back to the industry has started substantially to increase, and the number of horses in training has increased as well.

There has been a quantum leap in confidence in Newmarket in the western part of my constituency. We are now seeking to upgrade the quality of training for young people in the industry. With the benefit of hindsight, nine months on I express the gratitude of my constituents to my right hon. Friend the Member for Kingston upon Thames (Mr. Lamont) and my right hon. Friend the Paymaster General for effecting those changes, which have dramatically changed the fortunes of many of my constituents.

Yesterday's Budget will put the seal on the recovery that is now in place-- a recovery that will ensure in due course that we will win the next general election. The winter of recession is now over--or, to use an expression that I learned at an early age :

"If winter comes, can spring be far behind?"

7.12 pm

Mrs. Audrey Wise (Preston) : I want to consider the interaction between health and the Budget. In particular, I want to look at the direct damage that is caused to people's health by the Government's deliberate actions. Earlier the Secretary of State for Social Security bewailed the doubling of the number of people on sickness benefit and invalidity benefit since 1979. He said that that had happened although "the nation is getting healthier". Clearly he accuses a large number of people of malingering.

The Secretary of State's answer is to look for devices to disallow benefits and claims. Not only does he think that people are malingering--apparently he thinks that doctors are conniving at it. On the contrary, the number of people on sickness benefit reflects a real increase in illness. The nation cannot be said to be getting healthier when the number of people claiming sickness benefit has doubled in 14 years. Certainly the nation is getting more polarised so that the rich and the fortunate become even more rich and fortunate, and the poor get poorer.

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Fourteen years of Tory government are making people sick in the literal as well as the metaphorical sense. But what if the Secretary of State were right? Why does he not ask himself why 14 years of Tory government should produce a nation of malingerers? Surely there is something wrong with that as well. Why were people not so sick or so given to malingering in 1979 as they are after 14 years of Tory government? Could it possibly have something to do with bad housing, a lack of jobs, insecurity and casualisation of work, more money worries and more stress, and a culture of cruelty deliberately induced by the Government which encourages the weak and the vulnerable to be pushed to one side and enshrines greed and selfishness? Could that have produced the situation that the Secretary of State bewails?

Government supporters sometimes say that the national health service is a sort of bottomless bucket which will require limitless resources. That will be true if we continue to have a Government who damage people's health with their savage social policies. Bad housing is a major cause of bad health, especially respiratory diseases which are increasing, stress-related illnesses and mental breakdowns. In Preston, I see many children suffering directly from inadequate housing. I see many babies and toddlers who never seem to have been properly well.

What is the Chancellor's response to the housing crisis? He has looked at housing as an area in which to make what he calls savings. He has even cut the resources that go to his chosen instrument, the housing associations. Housing associations were supposed to be able to provide social housing so much better than local authorities. The Chancellor cut local authority housing, and he has now cut resources for housing associations. He says that that will produce savings. However, it is the most crass and cruel false economy. The cut in housing finance epitomises the Budget. We will need to continue spending more on picking up the casualties which the Government have created.

What are the Government doing to the national health service? With a twin- track strategy, they are creating a situation in which there is no boundary between the public health sector and the private health sector. We have gone far beyond the simple contracting out of health jobs. Public money is being used to buy treatment in private hospitals, and people are driven to private insurance to get treatment in public hospitals. In both those cases, public health suffers, and public facilities are abused by the process. I regard it as contrary to the philosophy of the national health service. On the one hand, the Government are making people more ill by making their social conditions worse and, on the other hand, they are making it harder for people to get the treatment that they need when inevitably they become casualties. When the Government look at the number of people who are claiming benefits and the doctors who are signing the sick claims, they say, "There are too many of them." They ask not how they will correct the situation, but how they will push people to one side. What new scrap heap will be created for those people to inhabit?

The Budget, for which we are all supposed to be so grateful, is a disgrace. In 1993, it is a disgrace that the biggest boast of the Government who have been in power for 14 years is that they have not increased taxes on food

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or children's clothes. Their claim to fame is that we were all trembling that they might tax books, clothes or food. We are supposed to be overcome with gratitude that those things have not happened and that families' conditions will not be worsened in that way. I noticed today that one tabloid even spoke of "Santa Clarke". Santa Claus's mantle sits ill on the figure of the Chancellor of the Exchequer.

Mr. Tony Banks (Newham, North-West) : He has the girth.

Mrs. Wise : Yes, he has the girth, but no other attribute. It is a redefinition of "gratitude" to suggest that we should be grateful for the Budget. I am amazed that pensioners are supposed to be overcome with glee that they will be given back half the loaf that is being stolen from them through the imposition of VAT on fuel. People will not be overcome with glee. They can recognise when they are being robbed, even if the thief gives back to them some of the proceeds. Their gratitude will be distinctly limited.

Although I despair of the problems that the Budget will continue to cause people, the only silver lining or hope that I can derive from it is that it will further expose the hollowness of the Government's claim to have a right to govern the country.

7.20 pm

Mrs. Angela Knight (Erewash) : The hon. Member for Preston (Mrs. Wise) obviously feels strongly about her constituency. She advocated spending but did not say how she would raise the money. I disagreed strongly with her remarks about the health service, which is doing an excellent job. Her description sounded like the decay that existed in the 1970s rather than the vibrant country that we have now. I welcome the Budget. It is tough but fair and it shows a genuine commitment to the welfare state. I listened with interest to the wholly negative speech of the hon. Member for Dunfermline, East (Mr. Brown). Opposition Members are evidently not prepared to take tough decisions. The sum total of their policies can be described as a decision to defer a decision, in a Micawber- like hope that something will turn up, and a policy to hunt for the phantom loophole. It would be pleasant if difficult choices never had to be made. It would be pleasant if the sun shone all day and it rained at night. But that is the stuff that fairy tales are made of, and this is reality. My right hon. Friend the Chief Secretary reminded the House that sound finance was the Budget's underlying theme, and the continuing recovery is already helping to reduce the deficit. But I welcome his decision to tackle expenditure and the deficit so positively. If left unchecked, they would result in an increasing debt burden in future years for the next generation to pay. I believe in passing on to the next generation not liabilities but sound finances and a strong economy.

The hon. Member for Barrow and Furness (Mr. Hutton) said that the combination of this Budget and the last one was detrimental and would affect confidence. I remind him that the United Kingdom is the only European country with falling unemployment and rising output. We are moving steadily out of recession, unlike our European partners. A recent survey of 1,000 companies in the east midlands, published at the beginning of this month, showed that more

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than two thirds were expecting sales to increase, and strong signs were reported of improving trends in employment, profitability and confidence.

In the past few days I received a letter from the managing director of a company, Guy Birkin, in my constituency, which is the oldest registered lace company in the world. He wrote :

"During the last five years the company has more than doubled in size ; a strong sales drive into Europe has been highly successful A major investment programme has been undertaken with over £20m spent on the latest technology The push forward by the company has been supported by a very flexible and enthusiastic staff All this has led to international recognition of the company, increased employment, improved opportunities and working conditions for our employees, a good return for our investors, and increased business for the companies who supply us with goods and services."

That is one of many examples of a highly competitive British company that is succeeding in world markets. It is prospering because of low interest rates, low inflation and the economic conditions in this country.

The Budget will be judged not just by the specific measures that it contains, or by the instant comment that has resulted, but by the contribution that it makes to keeping the economy moving out of recession, reducing unemployment, which is still too high, and reducing the deficit.

The Budget is a strategy for long-term growth and it helps business, jobs and recovery in a number of ways that are widely supported by the business community. In my constituency of Erewash, nearly 45 per cent. of the work force is employed in industry, which outstrips the average for the country, the east midlands and the county of Derbyshire. The measures relating to industry are therefore particularly relevant to my constituency. After all, it is industry which creates wealth and jobs. Big companies are the engine of the economy and small companies are the spark plugs. Some 35 per cent. of all jobs are in small companies, and growth in employment comes from them.

The past two Budgets have held the increase in business rates to the rate of inflation, which has been widely supported by business in my constituency. This year, the maximum increase in business rates will be halved and my hon. Friend the Member for Stratford-on-Avon (Mr. Howarth) referred to some of the benefits of that. Coupled with that are the changes to corporation tax. These measures will assist successful companies that are contributing to the growth of the economy.

The reduction in audit requirements has been mentioned. Small companies have wanted such a measure for some time. Audit requirements have often been out of proportion with the size and profit of the business and there is a heart-felt welcome for this deregulation.

Raising the VAT threshold benefits sole traders in particular and will drop many out of the VAT requirement altogether. But late payment of debt is a significant problem that adversely affects small companies and I have had most complaints about this problem. It has often been highlighted in the House and, in his speech yesterday, my right hon. and learned Friend the Chancellor proposed two options : either a payment performance standard or a statutory right of interest. I urge the latter course, with responsibility to a high level in the company, and continuing measures to strengthen the small claims court.

Finance for small companies is yet another continuing problem. Although I appreciate that the banks have been looking more favourably at ways of financing small

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businesses, based on their prospects and business plans rather than simply on the amount of collateral that the owner can put up, it is still common for a small company to operate with its cash flow financed by an overdraft and its expansion by a second mortgage on the home. That is not a long-term way for small businesses to operate.

I therefore welcome the venture capital trust and the enterprise investment scheme proposals. I trust that attention will be paid to detail, to ensure that small businesses, which often seek modest loans, are helped by these two proposals.

Assistance to business and the need for good infrastructure go hand in hand. The public-private sector partnership that the Treasury is promoting will bring forward schemes that otherwise might not have been introduced so quickly. It was extraordinary that Opposition Members appeared to shrug off the proposals when the Chief Secretary mentioned them today.

Many of my hon. Friends were delighted yesterday at the announcement of the improvement to the west coast line and I look forward to the day when my right hon. and learned Friend can announce a partnership that will bring about the electrification of the midland main line, which is another important railway link that connects the manufacturing heartlands of Leicester, Nottingham, Derby and Sheffield. Like other hon. Members, I have a further list of projects which I look forward to seeing come to fruition as a consequence of that partnership.

Let me turn to some of the other issues in the Budget and to the concerns that have been expressed about the continuing rise in the social security budget and the need to control it. Currently that budget is spending £13 per person for every working day, which is an extraordinary amount.

There is clearly a pressing requirement to prevent fraud and to spend where spending is necessary, but not indiscriminately. Realistic changes have to be made to ensure that we have a system that is affordable, that helps people to find work, and that properly helps people in need.

I join with my hon. Friends in welcoming the measures to assist those on low incomes and pensions in paying the increases in their bills when VAT is added to domestic heating. I am surprised that those proposals have not been welcomed by the Opposition. A few days ago the Opposition's social security spokesman said that the Government must add some something to pensions to take account of VAT, and that they should add an extra 50p to pensions. Not only have the Government proposed an extra 50p ; they have proposed more for future years. It is an excellent measure.

The hon. Member for Newbury (Mr. Rendel) poured scorn on the proposal to put VAT on fuel and power, but the Liberal Democrats' document entitled "Costing the Earth", advocated as a first priority the imposition of a tax on energy. It continued :

"for example, by ending the anomalous zero ratners. I welcome their proposals.

The addition to social security will be of considerable assistance. Gas and electricity prices have been falling--down by 3.5 per cent. in the east midlands this year--and that will also have an important impact.

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I expect that the granny bond will have a widespread appeal. I also welcome the extension of the home energy efficiency scheme, particularly to pensioners. It is a low profile scheme, somewhat unsung, but it gives grants to insulate homes, which results in lower fuel bills. This Friday, I am helping to publicise the scheme by helping a pensioner in my constituency who has received a grant and is insulating the property accordingly.

Mr. Tony Banks : I see a press release coming on.

Madam Deputy Speaker (Dame Janet Fookes) : Order. I am getting a little tired of seated interventions. The rule of the House is quite clear : if Members wish to intervene, they must seek to do so. Muttered commentaries are not acceptable.

Mrs. Knight : Yesterday my right hon. and learned Friend the Chancellor of the Exchequer announced that the pension age for men and women will be equalised at 65 by the year 2020, but that it would affect only women under the age of 44. Further details were given by my right ho:n. Friend the Secretary of State for Social Security this afternoon. I must declare an interest in this matter because I am not yet 44. I suspect that I am one of an exceedingly small minority of hon. Members who will be affected by this measure.

The demographic changes in the country are well known, and by the year 2020 there will be many more people than now who are over retirement age, and far fewer of employment age. If no change is made, the financial burden on those in work would substantially increase. Just as I believe that it is not right to pass on a deficit to the next generation, so it is not right to pass on a heavy financial burden to my children.

The measure will have a long phasing-in period--and rightly so--and changes are proposed to the state pension scheme which will particularly help women. I hope that further attention will be paid to occupational pensions, particularly for women, who go in and out of work more regularly than men as a consequence of their family commitments. Occupational pensions provide not only additional financial security but give individuals a flexible choice of when to retire.

The announcement on the retirement age reflects the changes in our society. More women now choose to work, and with the encouragement given by the child care proposal in the Budget, even more women will come into the work force.

The Budget has put the Government's finances on a sound footing and clearly helps both businesses and jobs. It decisively tackles head on the difficult economic problems that must be solved in order to ensure a long-lasting recovery.

7.34 pm

Mrs. Helen Jackson (Sheffield, Hillsborough) : As the Chancellor was making his speech yesterday, I was looking for two things in the Budget. First, I was looking for a commitment to help the major manufacturing plants in my constituency to maintain employment in the steel industry. Secondly, I was looking to see exactly how the Government were going to translate their oft-quoted phrase "traditional family values" into the preparation and presentation of their Budget.

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I came straight to the debate from a meeting with the Sheffield branch of the Engineering Employers Federation, where, as a South Yorkshire Member of Parliament, I heard a very worrying description from the major employers in our region about the extreme fragility of the recovery in their economic fortunes, if any.

When I talk about the steel industry, I am not talking about a frothy, "easy come, easy go" manufacturing sector, but about a core industry of special steel manufacture. The representatives were complaining about their competitiveness with other European steel industries. They said that they were at a disadvantage--that there was an uneven playing field--because they had evidence that other European Governments were giving their steel industries incentives and assistance in the form of help for capital investment, for environmental issues, for training, for easy finance and for land deals.

It is more sensible for us to say to our Government, "It is not fair that you are not helping our basic industry to compete in a very competitive world," than to say to a European Community country, "It is not fair that you are helping your basic industries to compete." One issue that members of that federation feared, when the Chancellor presented his Budget, was that they would have to carry extra costs such as sick pay. So I was very disappointed that sick pay was included as an extra cost for these core industries. That is not to say that the federation does not welcome many of the incentives and issues that the Budget gives for small business investment and expansion, but we cannot use that expansion to invest in a basic steel industry, as that does not come within the scope of a small business. Some 75 per cent. of the Sheffield engineering employers would be outwith that kind of help.

While I fully support many of the proposals to assist small businesses, I have a nagging worry, which the Government should address urgently. They make great play of having closed a couple of tax avoidance loopholes, but I fear that in doing so they may have opened the door to 22 more. I believe that they have done that in a range of ways, when relaxing requirements for accounting and auditing procedures in smaller unquoted companies.

I was particularly interested to learn how the Government intended to translate their oft-quoted insistence on traditional family values into the Budget. Over the past few weeks, I have observed an underlying assumption every time that phrase has been used--the assumption that such values include a substantial amount of unpaid work on the part of women at home. When the phrase "traditional family values" is linked with the phrase "back to basics", there is a specific reference to the role of women 40 years ago.

The hon. Member for Erewash (Mrs. Knight) mentioned one obvious implication of the Budget in that regard : the equalisation of pension ages at 65. It should be admitted that the £5 billion that that will save is £5 billion taken out of women's benefit. That will not be very popular among women of 40, 44 or, indeed, any other age, who will lose their entitlement to many other benefits at the age of 60, as well as their pensions.

I should have preferred the Government to make really significant strides by extending equalisation of pension entitlement to part-timers and short- term contract workers. That is crucial to giving women real equality with men when they reach retirement age. At present, female pensioners are substantially less well-off than men in terms of income.

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I welcome the Government's admission in the Budget that it is very difficult for a single parent to become involved in the job market without easier access to child care. The provision of a child care allowance for single parents was certainly a start. However, another oft-quoted phrase was fundamental to traditional family values in the context of the Budget--the Government's frequently stated intention of moving from a system in which income is taxed to one in which spending is taxed.

I believe that the real burden of the Budget will be experienced sharply at the household spending level. Who takes the responsibility for such spending? The figures are interesting. In households in which the men work, who does the household shopping? Four per cent. of men do it ; in 42 per cent., it is done mainly by the women. In households in which women are not in paid work, the shopping is done by 57 per cent. of women and only 5 per cent. of men. In households as a whole, only 8 per cent. of the men do most of the household shopping, which is done by 45 per cent. of the women.

The role of women, however, is not simply to go out with the shopping basket. Who organises the household money and bills? That is a more significant question. Again, it is mainly women who take on the responsibility : in 45 per cent. of households, they are chiefly responsible for such organisation. The effects of the Budget will be felt most markedly in that regard. The imposition of VAT on heating bills, for instance, will affect a central aspect of household budgeting.

Although welcome help has been given to households receiving income support, the Government should not imagine that that will be sufficient, given that the imposition of an 8 per cent. and then a 15 per cent. levy on heating--a crucial household commodity--will be felt next year and the year after. They will have to think again, as the spending power of households is increasingly eaten away.

Insurance of homes and household goods represents another crucial spending element, especially--as has been pointed out--during the current period of rising crime. The cut in Housing Corporation grant will result not only in fewer houses being built for rent, but, inevitably, in substantial rent increases, which will have a major effect on household bills. Those moves follow other increases--for instance, the 26 per cent. increase in water costs over and above inflation since privatisation in 1985, and the extra cost of car licences and insurance.

Yesterday, the Chancellor said :

"people should be allowed to keep as much of their own money as possible."- -[ Official Report, 30 November 1993 ; Vol. 233, c. 936.].

That, it seems, is the reason for shifting the burden of taxation from income to spending. I do not believe that households with tight budgets will have the freedom to spend their own money in the way they want ; the basic household bills will have removed all their spending power.

In the past few weeks, we have heard a good deal about another element of "traditional family values" ; the importance of the head of the family in spending terms--usually the woman--in taking in single parents or students back home. Increasingly, they are young people studying at university, who have been caught by the massive cuts imposed on students in yesterday's Budget.

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