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European Single Currency
9. Mr. Reed: What representations he has received on the consequences of British entry into the European single currency after 1999. [16593]
Mr. Gordon Brown: My statement of 27 October on economic and monetary union was widely welcomed in this country. Representations are still being received.
Mr. Reed: I thank my right hon. Friend. Will he comment on the contrast between the Government's policies in Europe, which have given us a leading voice with business in Europe, and the Conservative party's policies? The right hon. Member for Henley (Mr. Heseltine) has said that the Tories are leading the fight against British companies, and we have heard some examples of that today; does my right hon. Friend agree that their increasing isolationism in Europe is leading to increasing isolation in the opinion polls?
Mr. Brown: I am grateful to my hon. Friend. We have declared for the principle of monetary union: we have not yet had an answer from the Conservative party. We have said that there is no constitutional bar to entry: we have not yet had an answer from the Conservatives. We have said that the economic tests will be decisive, and if entry is in the national interest, that is what we shall do: we have not yet received Conservative party policy.
It is small wonder that the former Deputy Prime Minister has said that the Conservative party has fallen out with Britain's leading companies.
Sir Peter Tapsell: Has it occurred to the Chancellor of the Exchequer that by 1999 the danger of inflation may be rather less than the danger of deflation? If that should come about, the economic criteria for the establishment of a single currency laid down in the Maastricht treaty will be not only irrelevant but exceedingly damaging for the people of this country.
Mr. Brown: That was exactly the proposition that was put forward in 1987, and it led the Conservative Government to cut interest rates, cut taxes and cause boom and bust conditions, as a result of which 1.5 million people lost their jobs and businesses were destroyed. We shall have stability in our economy, and we shall not return to the stop-go days of the Conservative party in government. Even now, they should apologise to the British electorate for what they did.
Economic Growth (North-East)
10. Mr. Cousins: When he next plans to meet the north-east regional Chamber of Commerce to discuss economic growth. [16594]
The Financial Secretary to the Treasury (Dawn Primarolo) rose--
Dawn Primarolo: I am touched by the support shown by Opposition Members.
My right hon. Friend the Chief Secretary was recently in the north-east to give the Darlington economics lecture to the local employers forum. Although there are no immediate plans for a meeting with the regional chamber, Treasury Ministers regularly meet business representatives, and pay careful attention to what they have to say.
Mr. Cousins:
I thank my hon. Friend for her reply. Does she accept that we have very few fat cats in the north-east? With our colleagues in Wales and Northern Ireland, we are last in and first out of any recovery. We understand that the Government have had to make tough choices to secure stability, but does she accept that high interest rates, the strong pound and our exposure due to links with south-east Asia have given us special and particular problems? Is she willing to meet some of us involved in business and some of my hon. Friends from the north-east to work out how we could match the tough patience that we shall need with the tough choices that the Government have had to make?
Dawn Primarolo:
Recent business surveys indicate that the north-east economy is performing well. In particular, north-east manufacturing industry is growing at a reasonable pace. My hon. Friend has made important points. The Government's policies on regional development agencies and the consultation document that will be released shortly reinforce our determination to
Miss McIntosh:
Has the Financial Secretary had the opportunity to consider the impact on the local economy in North Yorkshire of the collapse of the Samsung plant at Flaxby moor? Will the Government review the effect that the collapse of south-east Asian economies may have on job prospects and economic development in north Yorkshire generally?
Dawn Primarolo:
The Government are vigilant on all matters, especially jobs. We need to ensure that the economic framework is sound, so that business can invest, grow and survive in our communities.
11. Mr. Burns:
If he will estimate at what level of national minimum wage the current departmental spending limits would be breached. [16595]
Mr. Darling:
The level of the minimum wage has not yet, of course, been set. The hon. Gentleman will be aware that the National Minimum Wage Bill received its First Reading today. The level of the national minimum wage will not be decided until the Government have the benefit of advice from the Low Pay Commission, which has already started work.
Mr. Burns:
I am grateful to the Chief Secretary for that answer. I am slightly surprised, however, that his officials have not been carrying out any studies of the impact of a minimum wage at different levels on the Government's spending targets. Will the right hon. Gentleman give a categorical assurance to the House that, if the level of a minimum wage, when it is set, has any impact on the wages bill of the national health service, patient care will not suffer and the Government will make up any shortfall?
Mr. Darling:
It is a bit rich for Opposition Members to lecture us on patient care after their record for 18 years--[Interruption.] The hon. Gentleman does not like being reminded of what the Tories did to the NHS. The minimum wage will be set at a sensible level that is manageable, and we shall keep the promises to the health service that we made during the general election campaign. We are ready to be judged by that at the next election.
Ms Abbott:
Are not the arguments against a minimum wage at a decent level, as put by Tories in business, exactly the same as the arguments advanced by the same people in the 1970s against equal pay for women, being based on the premise that a minimum wage will lose jobs? Just as equal pay for women did not lose jobs but did more to raise the living standards of working-class women than any other act of the Labour Government, will not the minimum wage have the same effect?
Mr. Darling:
My hon. Friend is right. The Conservative party has always been against any economic or social progress. We were told that equal pay would spell the end of British industry, and the Tories say
Mr. Forth:
Is the Chief Secretary suggesting that it is possible that a minimum wage level, when set, will be at such a low level that it can have no impact on budgets or cash limits in the health service and other public services?
Mr. Darling:
As I told the hon. Member for West Chelmsford (Mr. Burns), the Government will decide the level at which the national minimum wage will be set when they receive the benefit of the advice and evidence of the Low Pay Commission.
Mr. Pike:
Is it not increasingly obvious that the public support the policy of a national minimum wage and oppose poverty pay, whether in the public or the private sector? They believe that the implementation of such a policy is long overdue. They obviously welcome the policy announced earlier this week by my right hon. Friend the Chancellor of the Exchequer, and believe that it will prevent those who go into work from losing out as a result of the present conflict between benefits and tax. It is a good policy, and it is overwhelmingly welcomed by the people.
Mr. Darling:
I am grateful to my hon. Friend for his support. He is right to say that it is the Government's strategy to ensure that as many people as possible are encouraged to go into work. To that end, we want to remove some of the barriers that face people coming off benefit and going into work. Our strategy is geared to achieve that. As for the minimum wage, many people will wonder why the previous Government put up with a situation in which some employers paid wages so low that their employees were being subsidised by decent employers and by the public purse. That is an intolerable situation and one that we are determined to end.
13. Mr. Gibb:
If he will make a statement on his Department's policy towards the European Union paper "Towards Tax Co-ordination in the European Union". [16597]
Dawn Primarolo:
The Government deposited an explanatory memorandum on 17 November on the Commission communication of 5 November 1997, "A Package to Tackle Harmful Tax Competition in The European Union." The issue was debated yesterday in European Standing Committee B.
Mr. Gibb:
This European Union proposal, which the Chancellor of the Exchequer intends to agree to at Brussels on Monday, breaches the principle that the EU does not involve itself in direct tax policies of member states. Why do the Government think that it is necessary to do this?
Dawn Primarolo:
As I explained repeatedly to the hon. Gentleman yesterday in Committee, the code is a voluntary agreement. There are no sanctions and it is not legally binding. It specifically recognises national
Mr. Derek Twigg:
Does my hon. Friend agree with the Leader of the Opposition when he says that we should realise a single currency for the next Parliament, or does she think that the shadow Chancellor is right when he says that we should not bind future Parliaments?
Dawn Primarolo:
It will not surprise my hon. Friend to hear that I agree with my right hon. Friend the Chancellor and with the Government's policy on that issue.
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