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Mr. Campbell-Savours: Say that again.
Mr. Nicholls: I might do so one day.
When the hon. Gentleman tries to pretend that everyone accepted--
Mr. Nicholls:
The hon. Gentleman feels an intervention coming over him.
Mr. Campbell-Savours:
I am the last person on earth who would either be offered or would accept a job.
Mr. Nicholls:
It has been my experience that one can never make that assumption with complete confidence.
The hon. Gentleman might say that everyone knew that taxes would go up, but that view was not universally shared. It was not shared by the Prime Minister. In an article in the Financial Times on 21 September 1996 he said:
It was not just the Prime Minister who said that. As recently as 8 April 1997, at the beginning of the election campaign, the Chancellor said:
It is worth placing MIRAS in the context of 17 tax rises from people who were saying days before the general election that there would be no increase in taxation. I will not go through all of them, but there are some that might be thought to be directly relevant.
By my rough and ready calculations, the Budget raised tax by £13 billion. Only a few short days before the election, the Government said that there would be no need to increase taxation. The hon. Member for Workington argued with a straight face--he cannot keep a straight face now--that everyone knew that taxes would increase and that it is only £13 billion, so who cares. That will not wash. If he wants to know a little more about it, he should ask the Prime Minister and the Chancellor why they said that there would be no need to increase taxation when, according to his analysis, they knew that that was not true.
In the event, the Labour party, which came to power saying that it would not increase taxation, has increased it by £13 billion. This is one of the biggest tax-raising
Budgets in history. I shall give credit where it is due. It is remarkable that the party that managed to produce that huge tax-raising Budget has not yet been rumbled by the electorate.
There are two points to make about MIRAS. Labour Members have said that we started it. It is curious that they justify this change by saying that we did it, so it must be right, even though we are now opposing it. As my hon. Friend the Member for Daventry (Mr. Boswell) explained, when we adjusted MIRAS it was in the context of a downward trend in interest rates.
Mr. Nicholls:
The hon. Gentleman can pick out particular months, but if he sits down later in a reflective mood he will see that when we adjusted MIRAS there was a downward trend in interest rates.[Interruption.] The hon. Gentleman can wave his document in the air as much as he wants, but he should read it quietly, and hopefully he will be able to understand it.
When we adjusted MIRAS, we were heavily criticised by Labour Members. They had a principled objection to doing anything about MIRAS, but in today's Labour party the presence of principle is no obstacle to action and change.
To highlight their embarrassment, it is worth reminding Labour Members of what their leaders were saying about our attempts to adjust MIRAS. As recently as March 1996, in a speech to the Labour housing conference, the present Prime Minister "had to say"--because he talks like that--this:
The then shadow Chief Secretary to the Treasury, the right hon. Member for Oxford, East (Mr. Smith), attacked the changes to MIRAS. In a press release in March 1995, he said:
Changes to MIRAS do not hit the very rich. Those who recently made a windfall gain of £300,000 or £400,000 by selling their house in London will not be affected by this change. It does not affect people wealthy enough to travel all over the world with their own personal crimper. Alterations to MIRAS have no effect on them whatsoever: to them it is a matter of pence. But such changes affect the people who are just about able to claw their way into the housing market at the very lowest level.
I remember a speech made by the right hon. Member for Chesterfield (Mr. Benn) in which he spoke wistfully of the time when one could go into a council estate and feel at home. He said, "Now you walk down the streets of a council estate and all you see are fake Georgian front doors." That said it all. It showed contempt for the efforts of the very poor to raise themselves above the level of municipal serfdom and get into the property market.
What is so awful about the changes to MIRAS is not the £10 a month that it will cost people--because that is eminently affordable by Prime Ministers, Chancellors of the Exchequer and hon. Members such as the hon. Member for Workington and me--it is the effect that such a sum has on the working poor. [Interruption.] It is all very well for the hon. Gentleman to mock. It is a long time since Labour Members, most of whose salaries have doubled, were in the ranks of the working poor.
Such people will have to find another £10 a month because of the change to MIRAS, and a further £20 a month because of the interest rate rises that have already been announced, let alone those that are in the pipeline. For those people, whose plight makes Labour Members giggle, an extra £30 is real money. It is immensely sad that such changes are being proposed by a party that was once the genuine champion of the working poor, but it no longer has any acquaintance with those people: the principles, rhetoric and concerns that used to matter to the Labour party have been Follettised and Mandelsonised out of existence.
I can imagine what is said in Cabinet: "Let's do a bit of tinkering on MIRAS--it won't matter very much because it's only a tenner here and there." That is what happens when a party cannot even fall back on the paternalism that it has disliked over the years, and has deprived itself of its principles.
"I have to say"--
that is how he puts it--
"that we have no plans to increase tax at all."
He actually used the phrase "at all" to reassure people.
"There is no black hole for the Labour party because we have got no public spending commitments that require extra taxes."
One man's black hole leads to someone else's black death, because it is pretty obvious now that there has been a huge amount of extra taxes. It is clear that some people knew that taxes would go up, and those people were the Opposition if they came into government.
"The first blow the government dealt to homeowners was to cut MIRAS in the 1993 Budget. First to 20 per cent., then a year later to 15 per cent.. . . the effect of all these measures was to add to insecurity, to destroy confidence in the housing market and to make people much more wary of buying and selling homes."
The hon. Gentleman may raise his eyebrows, and I understand how he feels, but that is what the Prime Minister said.
"Many people's living standards will suffer a severe knock when the latest two Tory tax increases take effect in a few weeks' time. These latest tax hikes hit as the Tories continue to argue amongst themselves over the absence of a supposed 'feel good' factor."
We are criticised for suggesting that it is inappropriate for the Labour party to make these changes to MIRAS, but when we made adjustments to MIRAS, we were roundly attacked. Adjustments to MIRAS may or may not be appropriate, but it is clear that Labour Members cannot say that our attack on the Government is inconsistent or intellectually unsatisfying.
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