Previous SectionIndexHome Page


9.30 pm

The Opposition's talk of a hidden agenda is a lot of nonsense. I suppose that they have nothing better to say, but we could have predicted that the right hon. Member for Wells (Mr. Heathcoat-Amory), along with the hon. Members for Guildford (Mr. St. Aubyn) and for Runnymede and Weybridge (Mr. Hammond) and others, would mention the European situation.

In anticipation, I took the trouble of getting some figures on Europe, which I am sure will interest or even intrigue the right hon. Member for Wells. He was pretty right on Belgium; wrong on France and on Germany; and right on the Netherlands. I have the figures here, and I will make them available to him afterwards. Overall, stamp duty and its equivalents in the Community stand at between 6 and 10 per cent. on average, which still puts us at a considerable advantage.

I believe that I am correct in saying that there is no intention that the business properties taxation should bring us in line with the code of conduct of business taxation. We have looked at the market--

Mr. St. Aubyn rose--

Mr. Robinson: If the hon. Gentleman can contain himself for a moment, I am dealing with a coherent point raised by other Conservative Members in the debate.I agree with the Budget judgment that we have a level of taxation that even he would accept is assimilable in the present market and does not pose a problem.

Mr. St. Aubyn: In the light of the Paymaster General's assertion that to refer to a hidden agenda is nonsense, and of the comments that he has just made, can he confirm that the Government have no intention of raising stamp duty yet further?

Mr. Robinson: The question of a hidden agenda was raised in relation to Europe and to some harmonisation proposals concerning a code of conduct for business taxation. I repeat that that is nonsense. There is no hidden agenda in that respect.

Mr. Hammond: The point was also raised in respect of how the housing market would be regulated under a single currency and of comments made by the Chancellor himself suggesting that a prime motive for the move was a further damping of the housing market.

Mr. Robinson: The hon. Gentleman says that the Chancellor made that remark, and I look forward to receiving a copy of it, if he can produce it.

27 Apr 1998 : Column 111

The issue is not whether the United Kingdom's housing market is out of phase with the European Union's, although that could well happen; the issue is whether there is genuine convergence between our economy and the European economies. That is why the policy that we cannot contemplate entry to the single currency until there is established convergence is so right. Convergence means a general harmonisation of the economies in terms of inflation, growth and other factors, one of which, but only one, is the housing market. We cannot pick out housing and try to deal with it as a separate issue; nor would we attempt to do so.

All the amendments have been odd, as if the Opposition had trouble getting them down or making up their minds what they wanted to do. The odd thing about this amendment is that it would give relief for businesses of over £250,000, but nothing for those under that figure. I do not resent Opposition Members speaking to the amendment. For the most part, their concern seems to have been the effect on the housing market, but the amendment would do nothing about the problems that they consider the increase in stamp duty might pose for that market and we do not accept that it will pose a problem.

The hon. Members for Runnymede and Weybridge and for Guildford are concerned about the housing market and the possible effects of the tax on house building, house prices and land prices, but surely they must have learnt from the 1980s, the Lawson boom and the mishandling of the economy by the Conservative Government that the one thing the property market does not want is the politics of boom and bust. The politics of envy has nothing to do with it--it is the politics of boom and bust. That is what brought the housing market to its knees and what plunged millions into negative equity from which, as I heard today from someone who works in the Treasury, people are still not escaping, in spite of the improvement in the economy.

The whole point about everything that the Government are doing, as I explained during the debate on clause 75, is that stability and long-termism have to be the name of the game. There is no point in going back to boom and bust or trying to regulate one aspect to distort another. We have to have a coherent set of policies that keep the economy on a steady course. That is what the Budget is about and the increase in stamp duty is one part of it.

Mr. St. Aubyn: I am afraid that the hon. Gentleman condemns himself with his own words. On the one hand, he tells us that there is no hidden agenda and that raising stamp duty is not part of regulating the economy, but, on the other, he talks about preventing boom and bust. In the context of house building, surely he realises that it is the transaction costs that are the concern. Increasing transaction costs will deter the development and provision of brown-field sites for residential development.

Mr. Robinson: The hon. Gentleman may continue to make that point, but we believe that we have taken a balanced view. Indeed, a Conservative Member agreed--I cannot remember whether it was the hon. Member for Bognor Regis and Littlehampton or the hon. Member for Runnymede and Weybridge--that, at the present level, the increase will not markedly affect the market. We agree with that judgment and it is the one which we have taken.

27 Apr 1998 : Column 112

The point that I was trying to make about stability, which the hon. Member for Guildford seems to be too dense to understand, is that we are trying to achieve it not through one measure alone, but through a set of measures. The one thing that will kill the housing market again is to get away from stability and go for boom and bust. We must not do that. That is why the whole of the Budget fits together as a coherent set of measures to keep the economy on a steady course, with steady growth, to the benefit of all sectors.

I hope that the right hon. Member for Wells is reassured about the European fund. He also mentioned welfare to work and its having some effect on those companies that we will be looking to to provide considerable effort in that respect. I am pleased to be able to tell him that my right hon. Friend the Chancellor and I met representatives of some big companies in the hotel industry--this is not unrelated to commercial property values--and, while they could give us a tremendous commitment to welfare to work and the developments that they have in hand are extremely encouraging, none of them raised the increases in stamp duty with us. They were committed to welfare to work and very committed to the Government's policy of stability and long-termism.

We are in the right ball park as far as the increase is concerned. Indeed, that is confirmed in the monthly index of Richard Ellis, which shows that the impact is pretty marginal, if there is any at all, and that we are not greatly affecting the market. It also seems that Richard Ellis reviews its Budget judgment as well.

Mr. Hammond: I listened carefully to what the Paymaster General said about long-term stability. Can he explain how two separate stamp duty increases in less than 12 months convey an impression of stability? Either we have to assume that there will be a steady progress and further increases, or those are discrete and disruptive movements.

Mr. Robinson: There has been nothing of significance in the market and no boom such as that which the Conservative party managed to contrive. There is every indication that the economy is on a steady course. We believe that our Budget judgment was right and everything we have done was committed to stability. We shall stick with our policies.

There is no merit in the amendment, which would do nothing to improve the housing market in a way that would have any effect on commercial property. We believe that our judgment is correct and we will make decisions as and when it is proper to do so in the context of the Budget.

If a fit of misguided "Oppositionism" leads the Conservatives to force the amendment to a vote, we shall resist it.

Mr. Heathcoat-Amory: I do not think that the Paymaster General has done justice to the many excellent points raised by my hon. Friends the Members for Bognor Regis and Littlehampton (Mr. Gibb), for Runnymede and Weybridge (Mr. Hammond) and for Guildford (Mr. St. Aubyn), all of whom spoke with considerable theoretical or practical knowledge. The Minister has once or twice completely overlooked their questions.

27 Apr 1998 : Column 113

The Paymaster General did pass the comment that our amendments were confused and asserted that we had had trouble in getting them down. I do not know what he means by that, or how on earth he can know the circumstances in which our amendments were tabled. In fact, we had no difficulty. Our only problem was to try to restrain ourselves from flooding the amendment paper with necessary amendments and to try to concentrate on those that would be constructive and would improve the Bill.

The amendment is crystal clear. We tabled it to try to take out commercial property because we thought that the Government intended that.

Mr. John Swinney (North Tayside): I take it from what the right hon. Gentleman has said that the Opposition amendments will be the pinnacle of their contribution to the debate and that we can expect no better from the other amendments that we will debate over the next two days.


Next Section

IndexHome Page