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Mr. Darling : Given that an increasing amount of take-home pay is being eaten up by value added tax, is the Chancellor aware that in 1979 the typical family paid £2.50 a week in VAT, whereas in 1994 the same family will pay £20 a week in VAT ? Why should we believe a single word that he says when he promises not to increase the rate or scope of VAT again ?
Mr. Clarke : First, as I have already said, the average net take- home pay is up by £83 since 1978-79 and, as a lot of this bandying of figures tends to demonstrate, if real incomes go up people pay more tax. That is undoubtedly the case. The taxation that we are now imposing, however, is necessary in order to bring our borrowing under control and it will not affect the rising prosperity and continued growth of the economy in the medium term. As regards what we may impose VAT on in the future, that silly game is starting rather early before a November Budget and no doubt it will be played again between now and then, and I shall continue to say that I never give any advance undertakings on what may be in the Budget. As my hon. Friend the Paymaster General said, the biggest threat to zero rates, whatever anybody decides to do here, would come if the Labour party had its way, as set out in its European manifesto, and a majority vote in the European Parliament would decide whether we have zero rates.
Mr. Nelson : I am delighted to report that more than 125,000 pensioners have bought the new guaranteed income bond, to a value of more than £1 billion. That is an excellent result for the initiative that my right hon. and learned Friend the Chancellor announced in the November Budget.
Mr. Nicholls : I welcome that reply, but can my hon. Friend confirm that the introduction of that measure was prompted by the realisation that although falling interest rates were good for business and people at work, they could be very bad indeed for pensioners on fixed incomes ? Does not that show that the Government do listen to the concerns of the pensioner community, and will my hon. Friend confirm that they will continue to do so ?
Mr. Nelson : Yes, I can so confirm on both accounts. For a long time, many of our elderly constituents had asked for a bond that would give them a guaranteed long-term fixed assured rate of return. We have delivered that and it has been extremely popular, as shown by the figures that I have given today. I am sure that its popularity will be maintained in the future.
11. Mr. John Evans : To ask the Chancellor of the Exchequer how many representations he has received concerning the impact that Government tax policies will have from the beginning of April on the economic well- being of the average family, with two children and one spouse on average male earnings.
Mr. Evans : Is the Chancellor of the Exchequer aware that millions of weekly-paid workers on average earnings will today receive their first wage packet containing the delayed Budget tax increases, and that all of them will be able to see the sheer magnitude of the lies and deception that were fed to them by the Tory leadership at the last election ? Does the Chancellor agree that no one with any intelligence will believe the word of a Treasury Minister on taxation, or anything else, in future ?
Mr. Clarke : At the last election we committed ourselves to sound economic policies producing growth, prosperity and more jobs, and we will deliver that. We committed ourselves to reducing taxes when it was "prudent" to do so, in the words of our manifesto. We have a tax-cutting record over our period of office compared with our predecessors and we have a tax-cutting destiny before us as the recovery strengthens, as and when it is sensible to resume our agenda. People know that we tax less than the Labour party because they know that the Labour party spends more than the Conservative party. Any objective consideration of the course of the present Government is wholly consistent with the successful delivery of our policies ever since 1979.
Mr. Tracey : Does my right hon. and learned Friend agree that far more households will be heavily burdened by the excessive council tax bills from Labour and Liberal councils than they are from anything that the Government and the Treasury will deliver through income tax bills ?
Mr. Clarke : Certainly, and when it comes to the credibility of the political parties, it is bizarre for the Opposition parties to go on as though they have suddenly discovered that they are tax-cutting parties after all, when they are about to defend the record of councils that, throughout the country, consistently produce greater expenditure and greater council tax bills for the equivalent properties in the councils that they control.
Mr. Gordon Brown : Will the Chancellor now answer the question that my colleagues have asked about the extension of VAT beyond fuel ? Will he confirm that he has personally voted for VAT on children's clothes ? Will he confirm also that he has said that it is anomalous not to have VAT on food, on books and newspapers, on rail and bus fares ? In the light of those statements, will he now give the House an unconditional assurance-- [Interruption.] Given the contradiction in Government statements on VAT, will he now give the House an unconditional assurance that he will not extend VAT to other basic essentials ?
Mr. Clarke : I am glad that the hon. Gentleman is so stuck for damaging quotations against me that he goes back to my voting record 21 or 22 years ago to cite a vote against me when I was on the losing side of the House and we
Column 414sought to impose VAT on children's shoes and children's clothing. Returning to more up-to-date material, I shall continue to say that I will give no advance hint one way or the other about my tax intentions at the Budget.
If the hon. Gentleman already, in April, has to rely for a summer's campaigning on scares about VAT next November, he is in a desperate state. Why does not he say something about his tax and spending and borrowing plans--perhaps even something in defence of those high-spending local authorities putting everyone's council taxes up--rather than trying to raise those ridiculous scares ?
Mrs. Gorman : Does my right hon. and learned Friend agree that the average family these days has two, not one, wage earners because of the growth in the economy under Conservative management over the past decade, so that most families are miles better off than they were ? Should not any increase in taxes be seen against the general growth in prosperity as a result of our policies ?
Mr. Clarke : My hon. Friend is right. She has seen through the talk of the typical family, which Labour Members portray as a working man with a non-working wife and two children, with other circumstances that happen to suit the purpose of the questioner. That describes a tiny section of the population. A higher proportion of the population is in work than in any other major European economy. Average incomes are, in real terms, £83 more than they were when we came to power. My hon. Friend is right to put the present situation and future prospects in their right perspective.
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. Duncan Smith : Is my right hon. Friend aware that my socialist- controlled council of Waltham Forest, which is now being investigated by the ombudsman for malpractice, set a council tax for band D of £587, supported by the Liberal party, whereas the Conservative group would have set one of more than £100 less ? Does not that demonstrate clearly, first, that people pay in bands, not averages, secondly, that Conservative councils would cost people less and
The Prime Minister : Well, my hon. Friend is quite right. Whatever bands they may be concerned with, council tax payers will pay more under Labour and Liberal authorities than they would under any Conservative authority. I am sure that voters will note that on 5 May.
Mrs. Beckett : Is not it a scandal that, because of the changes that the Government have made in the health service, elderly people are being denied the right to hospital treatment on the ground of their age ?
The Prime Minister : The right hon. Lady is either ill-informed or scaremongering. As my right hon. Friend the Minister for Health said this morning, the reports to which the right hon. Lady refers, no doubt from this morning's "Today" programme, are wholly irresponsible. Neither patient in the BBC report had been refused treatment ; both had been offered better options. It is utterly wrong of the right hon. Lady to raise the matter in that manner and to continue to cause needless anxiety to millions of people.
Mrs. Beckett : What is scaring people is not what we are saying but what the Government are doing with the health service. The Prime Minister should know that people are being refused treatment because of what the British Medical Association calls the "undeniable fact" that there is now a two-tier health service. The GP of one of the people to whom the Prime Minister referred said :
"Since contracts were introduced, this kind of predicament arises all the time."
What is that but a two-tier health service ?
Madam Speaker : Order. I do wish that the House would listen to the comments that are being made and not make such a row. I have asked the Prime Minister politely to reflect and I hope that he will withdraw what he said. [Interruption.] Order. I am sure that if the House were to listen, it would hear him do that.
The Prime Minister : The right hon. Lady is aware, from what I said a few moments ago, that in both cases she has misled the House. [Hon. Members :-- "Withdraw."] In neither instance was treatment withheld from those patients. In both instances, they were offered better treatment. I hope that the right hon. Lady will now withdraw the imputation of a few moments ago.
Mrs. Beckett : I am not aware that I have misled the House. Indeed, there is a letter from one of the hospitals concerned apologising for the way in which the patient in question was treated. That does not sound to me like something which did not happen.
I ask the Prime Minister : why will he and his colleagues not recognise reality ? Elderly people are being clobbered
Column 416by VAT on their gas and electricity and when they are ill they are being refused treatment in hospital. What has the Prime Minister got against the elderly ?
The Prime Minister : The fact that the right hon. Lady changed tack shows most clearly that she knows that she is wrong. Once again, the Labour party is needlessly alarming people, precisely as it did before the election by claiming that we would privatise the national health service. The Labour party will use any scare, at any time, for any reason, providing it believes that it will help its own party-political ambitions.
Mr. Robathan : What action will my right hon. Friend take to ensure that taxpayers' money is not wasted on ludicrous pay-outs to former service women who joined the armed forces on the understanding that they would be obliged to leave should they become pregnant ?
The Prime Minister : I am not aware of the particular case to which my hon. Friend refers, but, as he has raised the matter, I will ask my right and learned hon. Friend the Secretary of State for Defence to examine it and report to me about it.
Mr. Turner : Does the Prime Minister have any plans to visit Wolverhampton in the near future ? If he has, I am sad to have to tell him that the good folk of Wolverhampton are completely brassed off with his Government's policies and, I am sad to say, with him. I have to ask the Prime Minister whether, if the local elections go badly for him, he will do the noble thing with his Government and resign.
The Prime Minister : I know that the hon. Gentleman would want his constituents to know the truth about matters, so perhaps he might mention to them that, under this Government and the last few years of my predecessor's Government, unemployment in his constituency fell by 23 per cent. Perhaps he could tell his constituents that. Perhaps he could tell them that there is now no one waiting for more than two years for health service treatment as there once was. Perhaps he could tell them about the extra millions of pounds allocated to the health authority to help reduce waiting lists. Perhaps if the hon. Gentleman carried some of those messages to his constituents in Wolverhampton at the next election he would no longer be here.
Mr. Hawkins : Does my right hon. Friend agree with me that the Labour party, where it is in office in local government, is to be judged on its record ? Will he also agree with me that Manchester, under socialism, now owes nearly as much as El Salvador--a country which has been ravaged by 10 years of civil war ?
Mr. Keen : Is the Prime Minister not ashamed to appear to take so lightly the accusations that, in this year when we are specially remembering those who gave so much 50 years ago in the last war, because of the Government health reforms the people who made those sacrifices are now being denied the treatment that they so desperately need ?
The Prime Minister : What the hon. Gentleman says is wrong. Perhaps he might reflect that, although the elderly population has risen in numbers in England and Wales by about 9 per cent. since 1979, expenditure on elderly people has risen by approximately 40 per cent. over the same period. That is to accommodate the fact that more treatments are now available, better treatments are now available, waiting times are shorter and no one is denied proper treatment at any stage in the national health service.
Mr. Evans : Is my right hon. Friend aware that Janice takes quite a lot of interest in this place and she would like to know whether it was a Conservative party that won the last four general elections, with a record 14 million votes in the last election ? Could he also tell Janice whether it was a Conservative Government who imposed a higher rate of tax in 1978 ? Was it 40p ? [Hon. Members :-- "No."] Was it 60p ? [Hon. Members :-- "No."] Was it 70p ? [Hon. Members :-- "No."] Was it 90p ? [Hon. Members :-- "No."] Was it 98p ? [Hon. Members :-- "Yes."] And if it was not a Conservative Government, was it that lot opposite ?
Ms Glenda Jackson : Is the Prime Minister aware that the chief executive of the Royal Free hospital trust in my constituency today issued a statement apologising for the fact that, as a result of the Government's obscene internal market policies, a 70-year-old man was denied treatment at that hospital ? Is he inferring that the chief executive of the Royal Free is attempting to mislead the House and the country and is scaremongering ?
The Prime Minister : Perhaps the hon. Lady would like to tell the House how many more patients the Royal Free has treated since the health service reforms. Perhaps she would like to do that and stop mis-stating matters.
Mr. Gallie : Does my right hon. Friend recall the words of doom, gloom and condemnation--the words of the right hon. and learned Member for Monklands, East (Mr. Smith)--at the time of the Leyland DAF collapse a year or two ago ? Is my right hon. Friend aware of the successful rebirth of the activities previously undertaken by that company ? Is he aware of the considerable increase in axle sales from Scottish Stampings in my constituency of Ayr as a consequence ?
The Prime Minister : I am aware of that and I think that it is extremely encouraging. It is part of what I believe to be a bright future for the Scottish economy. Equally, it shows how right we were to resist the demands from all the Opposition parties to spend extra money on Leyland DAF. They still have the same old interventionist, corporatist, 1960s policies. Leyland DAF has done far better without the sort of help that they would have forced down its throat.
Mr. Mullin : Has the Prime Minister had a chance to read yesterday's report of the Select Committee on Home Affairs on the funding of political parties, particularly the minority report that starts on page 38 ? Is No. 10 Downing street still being used for Tory party fund-raising dinners ? If so, is not that a misuse of public property ?
Mr. Heald : Will my right hon. Friend join me in congratulating Letchworth Garden City on its 90th anniversary, which is currently being celebrated with a musical extravaganza called "Why Aren't We All Dancing ?" ? Does he agree that, with unemployment down by 13 per cent. in the last year, with house prices up by 4 per cent. and with a council tax half that of the neighbouring Labour-controlled Stevenage borough council, people in Letchworth and north Hertfordshire have every reason to be dancing--dancing on the Labour party in May and June ?
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