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Orders of the Day
WAYS AND MEANS
Order read for resuming debate on Question [29 November].
Motion made, and Question proposed,
Madam Speaker:
I must tell the House that I have selected the amendment in the name of the Leader of the Opposition to the first Ways and Means motion. It may be convenient if at this stage I also announce that I have selected the amendment in the name of the Leader of the Opposition to the motion on public expenditure which is being debated together with the Budget resolutions.
That it is expedient to amend the law with respect to the National Debt and the public revenue and to make further provision in connection with finance; but this Resolution does not extend to the making of any amendment with respect to value added tax so as to provide--
(a) for zero-rating or exempting any supply, acquisition or importation otherwise than by--
Question again proposed.
(i) zero-rating or exempting supplies of goods which are, or are to be, subjected to a fiscal or other warehousing regime; or
(ii) zero-rating or exempting supplies of services on or in relation to such goods;
(b) for refunding any amount of tax otherwise than to persons constructing or converting buildings in cases where the construction or conversion is not in the course or furtherance of a business;
(c) for varying any rate at which that tax is at any time chargeable; or
(d) for relief other than relief applying to goods of whatever description or services of whatever description--[Mr. Kenneth Clarke.]
3.35 pm
The Deputy Prime Minister (Mr. Michael Heseltine): My right hon. and learned Friend the Chancellor of the Exchequer had three principal objectives in his Budget: first, to maintain the Government's determination to make this country the enterprise centre of Europe; secondly, to enhance still further the priority that we give to three vital public services--education, the health service and the battle against crime--while reducing overall public expenditure as a percentage of gross domestic product; and, thirdly, to pursue the Government's objective to allow people to keep more of their own money through a programme of significant tax cuts. I pay tribute to my right hon. and learned Friend for producing a Budget that achieved all three of those objectives. He has delivered a Budget that will get borrowing down, secure our reputation for governing responsibly and in the national interest, and continue to promote a sustainable, lasting recovery.
I referred to our determination to build in this country the enterprise centre of Europe. We have recognised as a Government--perhaps more frankly than any other Government--that over the past 100 years, our position as a trading nation, from about 1860 onwards, has been one of relative decline. As a Government, we inherited in 1979 an economy heading for still more serious decline-- structurally unsound, grossly overmanned, seriously unproductive and ridden with industrial disputes. It was widely acknowledged that in 1979 this country was the sick man of Europe.
Today, we are among Europe's fastest growing economies. The United Kingdom grew faster than G7 average growth in 1993 and 1994, and we are set to do so again this year. The International Monetary Fund expects us to join Germany at the top of the G7 growth league in 1996. The Organisation for Economic Co-operation and Development has praised the change. Its survey of the UK noted:
Mr. D. N. Campbell-Savours (Workington):
The Minister refers to sweeping structural reforms. Has he noted the sweeping structural reform in my constituency, where an American company, Campbell Soups--60 per cent. of its share capital is owned by one family--was able to take a decision which closed one of the most advanced food-producing plants in the country, owned by Home Pride, effectively wiping out 123 jobs at a stroke? Home Pride was profitable last year; it made £4 million. The entire food industry is outraged, and my constituency is outraged, yet the Government stand back and do nothing. Who is going to step in to stop such companies wrecking the local economy in my constituency? If the right hon. Gentleman has any honour, will he stand at the
Mr. Dennis Skinner (Bolsover):
So much for inward investment!
The Deputy Prime Minister:
Of course I do not like unemployment being created in any constituency in any circumstance. I take the point made by the hon. Member for Workington (Mr. Campbell-Savours) seriously. Was he saying that a future Labour Government would become involved in preventing companies from closing down? Would a future Labour Government be prepared to offer subsidies to such a company? Is that one more--
The Deputy Prime Minister:
No, I will not give way. This is a question not for the hon. Gentleman, but for Front-Bench Members of his party. What faces us today is old Labour anticipating old demands that it will make to a future Labour Government. Perhaps the deputy leader of the Labour party will tell us how much money is tucked away in the coffers of a potential Labour Budget to save jobs in the circumstances that the hon. Gentleman has described.
I noticed another characteristic of old Labour when the hon. Member for Bolsover (Mr. Skinner) spoke against inward investment, cynically attacking one of the most successful aspects of the British economy.
Mr. Skinner:
Why does the right hon. Gentleman not carry out his promise of a short time ago, when he talked at the Tory party conference about intervening before breakfast, before dinner and before tea? Why, in this respect, does he not intervene before the soup?
The Deputy Prime Minister:
As the hon. Gentleman knows, I and my right hon. Friends have intervened time and again and the result has been that there have been more than 4,700 inward investments into this country which are creating or safeguarding 700,000 jobs. That is the sort of intervention in which we believe, creating an enterprise economy which is making us the most successful enterprise centre of Europe.
It is interesting that this is the new Labour party. At any sign of success, any inward investment by overseas companies or any decision to cause a redundancy, the Labour party is up in arms with indignation. There is nothing new about the Labour party. Labour Members are the oldest men and women, psychologically, in British politics.
Several hon. Members rose--
The Deputy Prime Minister:
There is no point in my giving way when the Labour party has given way to every intellectual argument that this party has paraded over the past 16 years. Labour Members--the whole lot of them-- do not realise that they are intellectually flat on their backs.
The people of this country must make a decision. Do they want this country's economy to be judged by the standards of the Labour party, or by the standards of the men and women running the world's most successful international companies who, in the freedom they enjoy, are choosing to invest in this country--a country that the
Tories have made the most successful in Europe? Which is the right judgment? Should people choose Labour's restrictionism, which harks back to yesterday, or the Tory party's bringing the investment that will create prosperity and jobs tomorrow?
Mr. Ronnie Campbell (Blyth Valley):
The Deputy Prime Minister closed the pits and put 30,000 miners out of a job. Why are new mines now being opened in the north-east of England? Why are companies opencasting half my county? Why is that happening when the right hon. Gentleman put 30,000 miners on the dole?
The deputy Prime minister:
I took that most uncomfortable decision for the same reason as Labour Ministers took exactly the same decisions year after year after year, in the unhappy circumstances when they sat temporarily on the Treasury Bench. They took that decision--as I did--because the industry was uncompetitive. The reason why the hon. Member for Blyth Valley (Mr. Campbell) can point to the fact that new mines are being opened, new opportunities are being created and coal is being exported is that under the private sector, the coal industry is competitive. That is the transformation which has come about.
Mr. William Cash (Stafford):
Bearing in mind the fact that I voted against the coal proposals to which my right hon. Friend has referred, but moving further forward, does my right hon. Friend accept that the Labour party demonstrates its utter hypocrisy by continuing to cavil and complain about how we are running the economy, when the Labour party was behind the exchange rate mechanism and is in favour of further integration into monetary union? Will my right hon. Friend say here and now that the United Kingdom will never go back into an exchange rate mechanism? It is precisely because we are outside that system that we are now competitive and have all the growth to which my right hon. Friend has rightly referred.
"the UK's sweeping structural reforms are yielding dividends in a more flexible, competitive, and less inflation prone economy."
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