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11.11 am
Mr. Ben Bradshaw (Exeter): I congratulate the hon. Member for Bromsgrove (Miss Kirkbride) on her excellent maiden speech. Speaking for so long without notes is a great achievement and I want that to go on record, as she was far too bashful to do so herself. I will not try to emulate that record. We share a common profession, and perhaps that is a sign that my background is in radio, where one would never go into a studio and try to speak for more than 20 seconds without a script--I shall be more or less following one this morning.
The hon. Lady spoke a great deal of sense on many issues. I have not had the pleasure of visiting Bromsgrove, but it sounds delightful. I am sorry about the trouble that she is having with the new recreation centre. She said a lot of good things about green taxes, with which I am sure all hon. Members would concur.
Many new Members are hoping to speak this morning and, as I have experienced being squeezed out, my speech will be scripted but brief. I have the great honour and
privilege of representing the people of Exeter here at Westminster--a privilege that has been enjoyed, sadly, only once by a Labour Member, who is now myhon. Friend the Member for Crewe and Nantwich(Mrs. Dunwoody). For the past 27 years, Exeter was served by a one-nation Conservative of the finest sort, Sir John Hannam. He was a conscientious constituency Member and contributed a great deal to a number of areas of our public life. As hon. Members will be aware, he worked particularly hard in the area of disability, for which I am sure that we would all want to pay him a warm tribute. Sir John was no less active within his party and was, until his retirement, secretary of the 1922 Committee--a somewhat less onerous task now, I fear.
I have another rather more personal reason to be grateful to Sir John. He played no part in--indeed, he was completely absent from--the campaign of my Conservative opponent in the recent general election. I wish Sir John and his wife Vanessa a long and happy retirement on the Isle of Wight.
Exeter, as I am sure you were aware, Mr. Deputy Speaker, is one of Britain's finest cathedral cities. At the risk of being controversial, it is also the county town of England's most beautiful county, Devon. Despite the worst efforts of the Victorians, the Luftwaffe and post-war planners, Exeter remains one of the most attractive cities in Britain in which to live. We have a popular city centre, a large and successful university and a very high number of sunshine hours--second, I believe, only to Eastbourne.
Taken together, Exeter's many assets mean that we usually come top or near the top of those regular quality-of-life surveys. We are also blessed--unlike the hon. Member for Bromsgrove, by the sound of it--with a model Labour council, which has just kept its council tax pegged to a zero increase for the third year running.
Despite Exeter's many perfections, we share with other towns and cities throughout the country some of the social and economic problems that make the quality of life for those who suffer them anything but perfect. This Budget is an important first step towards combating those problems. The release of capital receipts to spend on social housing will be welcomed by the more than 1,600 families in my constituency who are on Exeter city council's housing waiting list.
The allocation of £2.3 billion extra for schools will be welcomed by Exeter parents, who are fed up with their children being taught in dilapidated classrooms, without the books and resources that they need and facing cuts in teaching staff. The extra money will give new hope to parents in areas such as Topsham, who have been waiting for two generations for a new school. Together with the fulfilment of our pledge to cut class sizes, that will make a real difference to the education of our children.
My local health authority, North and East Devon, is one of the many that are in financial crisis. It is proposing severe cuts in front-line services, particularly those for people with learning disabilities. The £1.2 billion extra pledged for the health service should at least help to ease that crisis.
Hundreds of my younger constituents--many of whom have not had a proper job or training since leaving school--will benefit from the welfare-to-work programme. Single parents who are caught in the poverty trap, as we heard, will have the chance to get back into the labour market.
Exeter businesses remember well the boom and bust of the 1980s and early 1990s. They welcome the long-termism enshrined in this Budget. They are grateful that under a Labour Government they will be paying the lowest corporation tax of any of our major competitors.
My constituents, along with most economists, the Confederation of British Industry and others, recognise that, at this stage of the economic cycle, revenue-raising measures are essential if we are to avoid the busts of the Conservative years.
Given the Government's commitment to the environment and to improving the nation's health, higher levies on petrol and tobacco are both fair and sensible. My constituents, who suffer the pollution and congestion caused by the large number of private cars carrying commuters into Exeter every day, might have welcomed more green measures, but they will be reassured by the Chancellor's pledge to consider those further before the next Budget.
Exeter drinkers, who are celebrating my city's excellent annual festival, will be toasting the Chancellor for avoiding slapping extra duty on alcohol. They and my superb local cider and real ale producers will await the outcome of his review of alcohol duties with great expectation.
Householders, particularly pensioners and others on fixed incomes, will welcome our fulfilment of the election pledge to cut value added tax on fuel and my gas users will look forward to substantial falls in their bills, thanks to the abolition of the gas levy.
No one, not least my constituents, likes to feel that he or she is living on the backs of his or her children or grandchildren. The last Government's public sector borrowing requirement was unacceptably high for this stage of the economic cycle. On top of everything else that the Chancellor achieved in this Budget, he will have slashed the public sector borrowing requirement from £23 billion in the last financial year to £5.4 billion in the next. That is a tremendous achievement.
Mr. Julian Brazier (Canterbury):
I congratulate the hon. Member for Exeter (Mr. Bradshaw) on his fluent maiden speech and join him in the generous tributes that he paid both to his predecessor and to the excellent speech of my hon. Friend the Member for Bromsgrove (Miss Kirkbride). I must chide him for introducing a controversial note into his speech. I know Devon to be a most attractive county, but Kent is the garden of England. Over the next few years, he and I will, I suspect, exchange some political blows on matters on which we have already corresponded, but I take this opportunity to welcome him on a personal level to the House.
The Minister for Welfare Reform has clearly set out the agenda in relation to his benefit system review. His aim is to reward hard work, honesty and responsible behaviour.
Those are aims that I know he honestly holds, and I suspect that most hon. Members support him. During the term of the previous Government, from time to time, in writings and in speeches, I supported some of the specific issues that he raised, sometimes against the actions of that Government. That makes it all the sadder to say that I firmly believe that his programme will fail, and for reasons that are grounded in three different strands of Government policy: tax policy, housing policy and the wider benefit system.
First, we must be clear what it is we are addressing when we talk about the growth in dependency. Opening the debate, the Secretary of State for Social Security made a point that has often been repeated by Labour Members: that one household in five in Britain do not have a breadwinner. That is not a record of which I am proud. As someone who is very proud of most of the previous Government's record, I believe that that was our greatest single failing.
However, we have to find out exactly what that statistic means, because it contrasts curiously with another set of statistics, which show that, on internationally agreed measures of unemployment, we have one of the lowest unemployment levels in Europe. Indeed, it has been dropping for a long time.
The solution to that contrast lies in two words: family breakdown. I am not referring here to any global generalisation about single parents. I am not talking about widows--my grandfather was brought up from babyhood by his widowed mother--or about divorce. I am talking about the rapid growth in one category of single-parent families--those headed by a single woman who has never been married and who depends on the state from the arrival of the first baby. Two thirds of all families that fall into that category are now wholly or mainly dependent on the state.
I suggest, therefore, a benchmark for the review that the Minister for Welfare Reform is carrying out throughout the social security system, excluding the pensioner sector, where the issues are different. The benchmark is this: will each measure in each area of policy tend, among low-income groups--those groups at the margin--to promote or to retard the breakdown of the traditional family?
Of the three strands, I want to consider taxation policy first. I was one of the few Conservative Members to chide the previous Government for increasing taxation on the working poor, particularly the cuts in the married couple's allowance, which we had steadily expanded during the years of the Thatcher Government, but which, over the past five or six years, we steadily eroded, resulting in a heavy penalty on poorer working families. Hence, after the outcry from Labour Members on that issue, I find it particularly disappointing that the Chancellor of the Exchequer has done nothing in the Budget on the taxation side for those families.
A vague generalisation about introducing a 10 per cent. starting rate of income tax when funds allow does nothing now for those poorer working families, who are supporting themselves, struggling to be self-reliant and paying too much tax. The 10 per cent. tax rate is a gimmick, anyway. It would be far more efficient--not least in relation to administrative costs--simply to raise basic tax allowances, to get people out of the tax system and to stop the nonsense of people paying tax and receiving means-tested benefits at the same time.
I also want us to return to a system of child tax allowances, side by side with child benefit--most continental countries have both--and to introduce the programme for transferable allowances, for which the Conservative Family Campaign fought for a decade, and which was adopted in the Conservative manifesto.
The second side of the triangle is housing policy. This is the worst aspect. There are two dimensions to it: allocation, and the way in which the housing benefit system works. Housing allocation is critical.
Let us be realistic. As we consider the other two sides of the triangle, we are continually in the business of trying to pick up the pieces and identifying how to get people at the margins back into work and so on. However, the main reason--I disagree strongly with an hon. Member who spoke earlier--that the problem arose in the first place lies in the allocation of housing. It is no good people saying that it is cynical to believe that women become pregnant to achieve the allocation of a council house. The reality is that, for families on low income, the greatest single economic watershed in their lives is the allocation of a house.
Let us take a simple, notional example, which is repeated throughout the country thousands of times every year. Two young ladies of exactly the same age and socio-economic background become pregnant. One either decides to marry her boy friend or is already married to him, and is offered accommodation at home by one or the other set of parents. The other young lady decides to strike out on her own, perhaps simply having agreed with her parents that they write out a slip to say that they are evicting her, which she takes to the council's housing office.
Under the workings of the old Housing (Homeless Persons) Act 1977, which we finally repealed only last year, that second young woman takes priority, perhaps for several years, not just for a place to stay, but for permanent accommodation--usually the most valuable capital asset she will ever control--over the other lady, who is part of a couple trying to set up an ordinary traditional family and who might have to wait years on a housing list. To return to those legal arrangements, as this Government are committed to do, will undo much that people such as the Minister for Welfare Reform wish to achieve.
The other side of housing policy is the way in which the housing benefit system works. This is one of the most complicated benefits in the whole system. I do not want to go into a lot of detail, except to say that, by focusing a higher proportion of the resources within the existing budget on what she calls the most needy, the Secretary of State will only sharpen the taper. The people who will lose are those at the top of the taper, who are nearest to breaking out of the poverty trap. Through housing allocation, more people will enter the trap, and through housing benefit it will become harder for people to break out of it.
The third side of the triangle is the workings of the wider benefit system. I remind the House of those criteria stated by the Minister: honesty, encouragement of thrift and responsible behaviour. I look with despair at the proposed benefit changes as they affect families. I shall focus on what has been said on child care.
We have before us two important proposals--or allegedly important: to expand the benefit disregard from £60 to £100, and to create 50,000 child care trainees as part of a national child care strategy.
I worked for some years for a Swedish company and saw the way in which Sweden moved from being the world's most prosperous country in the post-war years to destroying its family structure and a large part of its business structure. That was caused by a series of social mistakes, of which the worst was Sweden's approach to child care.
Sweden had exactly the same elements in place as those towards which the Government are moving--an emphasis on so-called higher standards, which in practice means more expense, and encouragement through the tax and benefits system for more and more people to go for child care. Those factors inflated demand. Sweden also provided state training for people who wished to enter child care, and state places were provided.
By the mid-1980s, Sweden had reached the absurd state where the highest single aspect of municipal budgets was for child care. However, the municipalities were picking up only 45 per cent. of the bill. The Government paid another 45 per cent., and there was a payment by families.
By the time the system reached its peak, the all-in cost of a place in a pre-school creche had reached 60 per cent. of the Swedish average wage. No wonder the country was able to provide places for only one third of its pre-school children. The whole system came unstuck. That is the sort of nonsense upon which the Government are setting their sights.
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