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7.46 pm
Mrs. Anne Campbell (Cambridge): As I listened to the Chancellor of the Exchequer this afternoon, I asked myself the questions: what does this Budget do for Britain and what does it do for my constituency? To try to visualise what effect this Budget will have, I tried to picture groups of my constituents and to assess their reaction to what the Chancellor said.
I think first about parents in my constituency who are extremely angry about local government funding and about the enormous cuts that took place last year. I think not only about their anger, but of their concern for educational standards, the level of cuts that schools have experienced, local library closures, cuts in community education and all the things that we care desperately about in our communities. I also think about parents who are dependent on child care, about the real lack of child care that we experience in this country, and about the difficulty that parents have in finding work that allows them to take proper care of their children because of the lack of public child care facilities.
I think about council tenants and housing association tenants because in Cambridge more than 4,000 families are on the waiting list for public housing. Nothing in what the Chancellor of the Exchequer announced today will help those people or give them hope for the future. That relates not only to people who are homeless, but to people who are inadequately housed.
During my advice surgeries, often, families with two or three children come to see me. They occupy two-bedroom flats, often they live on the second or third floor, where there is nowhere for the children to play. We should be doing something about the pressure and stress that those parents feel when they look after children in such conditions. We should be trying to help.
I know that many people are employed in temporary work. They are concerned about job insecurity. Nothing has been done in the Budget to help them. We have seen some measures to help small businesses, which certainly need more Government help. I want to describe a business that belonged to two of my constituents. The measures announced today would have done nothing to help them.
Yes, there are tax cuts and I believe that they will be welcomed by those on low pay who are finding life a struggle. However, that must be measured against the background of the 7p that has been put on taxes since the last election. The Budget has reversed just 1p of that. We have a 7p up and a 1p down Budget. I believe that taxes should not have been reversed in that way. I would have liked to see a reduction in VAT on fuel. That would have helped more people who are struggling now to make ends meet.
A short time ago I was visited by two of my constituents who ran a transport business. It was a very successful business which was expanding rapidly. It was the sort of company that the Government would feel was a shining light and an example to others of how to conduct a business.
Two or three years ago, the Bonfields found it necessary to buy new lorries, which were purchased on credit agreements. I understand from different manufacturers that the lorries proved to be of unmerchantable quality. They suffered multiple mechanical breakdowns, not so much in this country as in eastern Europe and elsewhere. My constituents found that, despite promises that had been given at the time, there were totally inadequate servicing arrangements, and the business rapidly began to lose money. It lost money to such an extent that the Bonfields went out of business.
When my constituents set about trying to sue the finance companies which had supplied the money to pay for the trucks, they found that, because of an exclusion clause in the contract--it was a completely standard contract between a finance company and a small business--they were prevented from taking any legal action.
My constituents were so concerned about that that they came to me to see whether I would lobby the Department of Trade and Industry about trying to improve the regulations applying to contracts between the larger finance companies and small businesses. I received an answer from the Department which told me that the Government, far from trying to tighten the regulations, were thinking of abolishing them completely. That illustrates well that the Government's attitude towards small businesses consists of just warm words. Describing small businesses as the engine of the economy is fine, and I believe they are, but we are not giving them the help they need if they are to conduct their business successfully.
So often we find that the stakes are raised in favour of large businesses and large finance companies and the small businesses have no teeth in the face of that. Small businesses could be given more help and, although I welcome what is in the Budget, we could be doing far more to ensure the survival of those important companies.
Mr. Nicholas Winterton:
Will the hon. Lady tell us what she would do for small businesses?
Mrs. Campbell:
I just described a situation which arose because of a lack of regulation. Nobody wants red
Today we have seen a small amount of help given to families with the child care allowance for those on family credit. I welcome that, but it does not go far enough and is not sufficient to help many of those families get out of the poverty trap. The child care allowance for those on family credit was introduced in a previous Budget and I believe that a pathetically small number of parents have been able to take advantage of it so far. The problem is not with the allowance but with the fundamental changes that are needed in the social security system which will allow people to climb out of the poverty trap.
The real problem is that, because of the way in which the tax and benefits system works, parents often find it more beneficial to be on benefit than to go out to work, even if that work is not particularly low-paid. This is some attempt by the Government to try to reverse that, but it does not go far enough and I do not believe that it will help many parents.
Over the past few years, we have seen a real rise in the number of single-parent families. Often that is not because parents choose to live as single-parent families. It has been found that 60 per cent. of single-parent families have been through divorce, separation or bereavement. Only 4 per cent. of those families are women under the age of 20 who have had babies out of wedlock. We should be giving families more help to climb out of the poverty trap.
I was struck by the case of another of my constituents who came to see me. It was a woman with two children who believed that she was in a stable relationship. She had a part-time job. Unfortunately, because of a breakdown in the relationship with her boyfriend, he threw her out of the property in which they were both living. She found that she was unable to continue working because of the way in which the tax and benefits system operated. It was a crazy situation. She found that the Government were paying her £600 a month in benefit, whereas, if they had instead been prepared to pay her £200 towards the cost of child care, she would have been able to continue working. That is the sort of absurdity that creates real difficulties for people.
Many such families are living in dire poverty. They do not have enough to eat and cannot buy proper clothes and shoes for their children. Surveys have shown that 90 per cent. of single parents wish to return to work. Cambridge has a high number of lone-parent families and, at the same time, the city has a skills shortage. It seems absurd that we cannot marry up the women, many of whom have high skills levels, with the jobs that need to be filled, because of the way in which the tax and benefits system works.
We want to see not just straightforward cuts in benefits and the fiddling around the edges that have been announced in today's Budget, but a real restructuring of the social security system, which will alleviate the poverty trap and allow parents to return to work without being worse off.
In Cambridge, we are taking an innovative approach by setting up a series of one-stop shops to give parents the advice they need when they are trying to get back to work. Such parents need advice on benefits child care, jobs and training. That information is usually scattered, and it is difficult for parents to travel around the city or to make telephone calls to obtain advice from different places. We are hoping that putting all that advice in one place will prove to be a real boost to parents who want to return to employment.
As I said earlier, there is major concern about the effect of the Budget on education. I have been doing a little arithmetic while hon. Members have been speaking, trying to work out what the local government settlement will mean for education in my county. Last year, it meant that Cambridgeshire county council had to cut its spending by £17 million. In fact, it took £10 million from its reserves, so the cut in expenditure was only £7 million. I say "only £7 million", but that still meant huge cuts in school budgets, with the loss of more than 100 teaching posts and many auxiliary posts. Some schools escaped the consequences by taking money from their reserves. However, unless there is a huge injection of money, there will have to be further cuts in the coming year.
There have also been huge cuts in the library service. Opening hours have been reduced and there have even been some full-scale library closures. My local library, which is celebrating its 100th anniversary, will, I am sad to say, close next year. It is well used by elderly people and those with young families. Indeed, from an early age all my children borrowed books from the library when learning to read. There have been huge cuts in community education. Youth Action, a club in the Cambridge area which teaches young people socially useful skills, has suffered huge cuts and there is now a danger that it will have to close.
What does the Budget mean for Cambridge and Cambridgeshire? The usual calculation is that the county gets about 1 per cent. of the money that goes into the general budget, so 1 per cent. of the £780 million that the Chancellor announced today will mean, if my calculation is correct, that Cambridgeshire will get about £8 million. However, we must remember that last year we had to cut expenditure by £17 million, so we are still short of
£9 million on our 1994-95 settlement--and that is in cash terms, without taking account of inflation.
Many of the parents who have worked so hard writing to the Secretary of State for Education and Employment, the Chancellor of the Exchequer, the Chief Secretary to the Treasury, the Secretary of State for the Environment and everybody else they could think of, will be bitterly disappointed. When today's announcement is translated into the effect on their schools, libraries and community groups, I fear that the cuts will be as bad as we had all imagined they would be. Although the
£8 million will make up for some of last year's cuts, it is not anything like enough to reverse their effects completely. There will be a real reduction in the standard of education in Cambridgeshire as a direct result of the cuts that today's Budget has not reversed.
I want to raise two other matters. First, I welcome the additional help for elderly people who have to pay for residential care--although again I have to say that it is too little, too late. It will do nothing to help those who have to
sell their homes to pay for private residential care, because the amount by which they have to reduce their income to prevent them from having to contribute is too small.
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