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Mr. Jack: The hon. Gentleman may not yet have received the letter that I wrote to him in the spirit in which he put his arguments on self-assessment. I invited him to clarify any practical ideas he has. Will he give me an undertaking today to publish his ideas, if any, so that we might learn his policy, once and for all, on an issue that the Labour party has welcomed on principle in the two previous Finance Bills?
Mr. Smith: I am not sure whether the Financial Secretary means a separate letter from the one he sent to The Independent. In any event, I will read his letter when I receive it, and I am more than happy to set out our proposals. The Financial Secretary will find plenty of proposals in the amendments that we will table to the Finance Bill. The proposals will be on record in Hansard for him to read and thereby profit from. Let us hope that small businesses and the self-employed will benefit from our debate because the Government take notice of what we have said.
I shall now deal with the proposals in the Bill on housing investment. We welcome the principle of attracting private investment in housing, and we will explore how effective the proposals are likely to prove in practice. We will want to be assured that there are safeguards against abuse. We are concerned that the scheme is open-ended, because there appears to be no requirement that properties are held for any length of time. The implications for rent levels and the housing benefit subsidy are not clear.
How far might the investment trusts provide a shelter for former business expansion scheme properties? Do the proposals provide a double tax subsidy? Time and time again, we have seen tax breaks for property schemes in which costly concessions have been given for low-risk investment in properties with little or no housing, economic or social value. We need to be sure that the
proposals will not prove to be a repeat performance. We want to see a genuine partnership between the private and public sectors in the provision of affordable, good-quality housing, but housing companies must be a means of increasing supply and extending choice, not a vehicle for restricting them by privatising council housing.
There is nothing in the Bill to address effectively the problems of insecurity, negative equity and still high levels of mortgage repossessions. Conservative Members may be inclined to point to changes in personal taxation, but people have got back but a small fraction of the extra taxation that the Government have imposed since 1992. Typical families are still paying some £600 more a year in taxes than at the time of the general election, when the Prime Minister promised tax cuts year on year.
We welcome the fact that fear of an electorate that has been hit with 21 tax increases since the general election has forced the Government to give a little back. However, even that little is being eaten away by extra demands for everything from the council tax to rail fares.
The lower tax rate on savings and the exemption of insurance benefits arising from long-term care will provide modest help. However, those proposals do not begin to address the real challenge of reforming the welfare and pensions systems to ensure that everyone has the chance of a rewarding working life, and dignity and security in retirement.
The mere fact that the Government have made it clear in the Bill that compensation for mis-sold personal pensions should be exempt from tax--a scandal for which the Conservative Government must accept their share of responsibility--is a reminder that people cannot place their trust for the future in a party that has got it so wrong in the past.
The Finance Bill is profoundly disappointing, even if the sins of omission are greater than those of commission. It has all the hallmarks of a tired, frightened Government, who have no new ideas to revitalise a sluggish economy. They have no vision to bring together a divided society or to embark on the training and investment revolution that Britain needs.
Mr. David Hunt (Wirral, West):
I find it difficult to follow the first two speeches because they appear to have been delivered by people living on different planets.
The first speech delivered by the Chief Secretary to the Treasury was based in the real world--a world in which the Prime Minister, the Chancellor of the Exchequer and the Chief Secretary to the Treasury have regaled for us economic statistics better than I can ever remember in my political lifetime. Indeed, the Opposition had no real answer to my hon. Friend the Member for Colchester,
North (Mr. Jenkin), who pointed out not only that the statistics are put forward by the Government but corroborated by the OECD. I cannot recall a time when we had better conditions for sustaining a period of non-inflationary growth.
We then had the speech from the hon. Member for Oxford, East (Mr. Smith). I believed that his amendment promised much, but delivered very little in his speech. Many of us waited with some expectation for the details of the welfare to work initiative to be given in the debate. Perhaps they may be published during the proceedings on the Finance Bill--I very much hope so. We have heard reference again to a one-off tax, but, by definition, one cannot build an alternative economic strategy on a windfall tax. The Opposition, however, seem once again just to have taken refuge in a series of soundbites.
The Leader of the Opposition has become a master of the double entendre. He is a leading politician who needs spin doctors to explain everything he says. As my right hon. Friend the Chief Secretary pointed out clearly, the stakeholder economy can mean two different things at least. Therefore we need explanations, but today there came none. I greatly regret that.
I just want to make two points. First, I congratulate the Chancellor on what I believe to be a one-nation Budget. I challenge what the hon. Member for Oxford, East said about the Conservatives allegedly having deserted one-nation Toryism. That could not be further from the truth.
As I said, the first two speeches in the debate appeared to have been delivered by people living on different planets. That very phrase was used by Benjamin Disraeli in "Sybil", chapter five, book II, when he wrote:
In chapter eight, book I, Disraeli wrote:
The desire to overcome that difference has been the theme running through my strong belief in Conservatism and Christian democracy. I see it very much in the Budget. I recall on a previous occasion when my right hon. and learned Friend the Chancellor said that one of his clear objectives was to ensure that we did not have developing within the United Kingdom the sort of underclass that we have seen develop in the United States. The Budget and the Finance Bill do much to ensure that that will never happen here.
Just after the war a group of eminent Conservatives published a pamphlet entitled "One Nation". In the subtitle it described itself as
That group of Conservative members included the former Prime Minister, my right hon. Friend the Member for Old Bexley and Sidcup (Sir E. Heath) and Enoch Powell, Iain Macleod, Angus Maude and others. One-nation Toryism is not the possession of the left, the centre or the right. It is fundamental to Conservatism. I wanted to echo that message in the debate and put the record straight.
Members of the Opposition have used the phrase "one nation" as though it was the latest thing in soundbites without realising that it is fundamental to many of our beliefs in politics.
Secondly, I also believe that this is a Budget for jobs. I come from an area where we have had a high level of unemployment for far too long, going back beyond when I first came into the House 20 years ago. That high rate of average unemployment has also contained pockets of extremely high levels of unemployment, which have done a great deal to undermine the social fabric of society. It is the Tory approach to those problems that provides the answer.
In his Budget, the Chancellor clearly defined the social market. Of course we must allow the market to produce the wealth so that we can then afford the social policies that enable us to ensure fundamentally that we are one nation.
Mr. Hugh Bayley (York):
I wonder how the right hon. Gentleman squares his belief in one-nation Toryism with the findings of the Rowntree Trust's commission on wealth? That revealed that during the period in which he sat in Cabinet for many years the gulf between rich and poor throughout Britain, including Wales, was substantial.
Mr. Hunt:
Different interpretations have been put on that Rowntree report, but it demonstrated clearly, as John Rawls has always said about the social market justifying the market, that the poor are now better off than they have been before. It may be that in certain circumstances the gap between rich and poor has increased, but the justification for the market is that it ensures that people are better off, and in particular that the greatest help is concentrated on those in the greatest need.
I just wanted to make clear that for me the spirit of one-nation Toryism is as strong in the Tory party today as it has ever been. The centre ground is our territory-- it is the territory where we have won successive general elections under Lady Thatcher and the Prime Minister. We must never surrender our election-winning strategy. Siren voices from the extreme left, and indeed from the right, may urge us to sidetrack, to move away from one nation policies, but we must remain true to our long-standing beliefs.
That is why I wanted to stress that, certainly in my parliamentary career, I want to devote myself to ensuring that in my area we do not allow high levels of unemployment to undermine our social fabric. We must ensure that in the Wirral, Liverpool and Merseyside we get more jobs, and better ones. We will do that only if we espouse the economic policies that have brought us the success that we are now seeing. It must be part of our objective to ensure that that success is spread to all parts of the United Kingdom. That is the only way in which we can sustain those policies that were the fundamental bedrock of that group of Conservatives in 1950 who produced "One Nation". We must continue to ensure that we capture the electorate's imagination with the new ideas that lie within the one-nation policies of the future. That is why I strongly support the Prime Minister in his belief that we must lay the foundation for sustained, non-inflationary growth in the 21st century too.
"Two nations between whom there is no intercourse and no sympathy; who are as ignorant of each other's habits, thoughts and feelings, as if they were dwellers in different zones or inhabitants of different planets . . . the rich and the poor."
"I was told that the Privileged and the People formed two nations."
"a Tory approach to social problems."
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