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The Prime Minister (Mr. Tony Blair): As tradition has it, I shall begin by performing two duties, one of which is the sad duty of paying tribute to Gordon McMaster. He was a valued Member of the House, and, for those who knew him, could justly be described as one of the nicest and kindest people anyone could ever meet. He was a thoroughly decent man, and is sadly missed in the House. I also join the right hon. Member for Richmond, Yorks (Mr. Hague) in his tribute to Michael Shersby.

It is my more pleasant duty to pay tribute to the proposer and seconder of the Loyal Address. My hon. Friend the Member for Bassetlaw (Mr. Ashton) made a brilliant and scintillating speech, and we all enjoyed it immensely. The similarities between 1968 and now were interesting, but the differences were even better. Apart from politics, my hon. Friend's other lifelong passion is football. Whatever excitement he felt in proposing the Loyal Address, I am sure that it was as nothing compared with Sheffield Wednesday's 3-1 defeat of Manchester United last Saturday.

My hon. Friend was a Whip during the previous Labour Government--he was known as a strong Whip. He was also a whip on Sheffield city council. He was known as something of a control freak in his time. He sounds like my type of politician! I pay tribute to his speech, and to the wonderful way in which he put across his case on behalf of his constituents.

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I also thank my hon. and learned Friend the Member for Edinburgh, Pentlands (Dr. Clark), who entered the House last year in the most dramatic way by defeating the former Foreign Secretary. As she showed today, she brings formidable skills to the House, having been a distinguished Queen's counsel. She always contributes well to our debates. I should tell her, in case she is worried that anything that she said sounded rebellious, that I do not carry a pager either. It is always better to write the messages than to receive them.

The right hon. Member for Richmond, Yorks made a speech that was full of great jokes--I will give him that--but it was a speech devoid of any serious content. The right hon. Gentleman said nothing of any interest about any major subject that concerns the country. As a sixth-form debating speech, it was fine; but, for a speech that was supposed to address the big issues of the day, it was full of diddling and tiddling but nothing much else. I believe that the right hon. Gentleman spent more time on the Paymaster General than on education. And what was the one policy? We heard no policy in the entire speech, save one. The right hon. Gentleman would scrap Bank of England independence; he would scrap the £40 billion investment in our schools and hospitals; he would scrap the working families tax credit revenue deal; but he will die in the ditch to save the hereditary peers.

I gather that the right hon. Gentleman has hired an image consultant. I would go back and hire another, because that was the response of a Conservative party that is moving ever further rightwards and backwards. Its programme has nothing to do with the interests of the country.

The right hon. Gentleman said that we had not legislated. In the last Session, we proposed 22 Bills and delivered 52 Acts, including four education Acts. Now, in a much shorter Session, nearly 20 Bills are promised, covering a range of issues barely any of which the right hon. Gentleman mentioned. Yes, there are other draft Bills, and yes, they do deal with issues such as freedom of information, the food standards agency and the funding of political parties. The right hon. Gentleman seemed to criticise us for not doing those things more quickly. Well, that lot had 18 years in power, and they did not do any of them. They never introduced any legislation relating to the funding of political parties: indeed, they refused to let the then Nolan committee even look at the issue. On food standards, they opposed every move that we made in opposition, and they never did anything about freedom of information.

We have had a big legislative programme, last year and this year. This will be a year of challenge. The key themes of the Queen's Speech are modernisation and fairness, so that we can create a Britain that is strong, modern and fair. In the Queen's Speech, we set out how we can do that. The Tories messed the job up; Labour is getting the job done. That is the difference.

Of course it comes as a shock to the Tories to see a Government deliver on their manifesto. After two decades of Tory government, it probably comes as a shock to the public as well, but the fact is that we are delivering. If ever we want a metaphor for recent times, we need look no further than another subject that the right hon. Gentleman did not mention: BSE. The Tories messed

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it up; Labour sorted it out. The Tories made threats; Labour made progress. The Tories gave us the beef ban; yesterday, a new Labour Government lifted it. That is the difference.

Let us leave aside the fact that the right hon. Gentleman did not mention a single policy area of any serious nature, and examine the legacy that we inherited and what we did. We had boom-and-bust economics and a doubled national debt. We had rising class sizes and waiting lists. In one in five non-pensioner households, no one was working. Britain was utterly marginalised in Europe and the rest of the world. This year, last year's work is paying dividends: the lowest long-term interest rates for more than 30 years; the inflation target now met; the lowest ever corporation tax; unemployment down, employment up; waiting lists and infant class sizes coming down; the biggest ever increase in child benefit; new rules to tackle anti-social neighbours and to cut crime; a special bonus for pensioners with winter fuel; free eye tests; and discount fares on public transport. [Interruption.] Conservative Members talk among themselves. They are not interested. When we get on to serious policy, they start muttering among themselves; they do not want to hear it.

As for the cheek of the right hon. Member for Richmond, Yorks about the countryside and about building on brown-field sites, he was attacking us, saying that we were not doing enough. When his Government were in power, 46 per cent. of the building was on brown-field sites; we have raised it to 60 per cent., and we are the party that has invested in rural transport--opposed by his party.

In addition, we have the young people on the new deal: 160,000 of them have passed through it; 30,000 are already in work, as promised. Those are great achievements that we will take forward in this year's Queen's Speech. [Interruption.]

Madam Speaker: Order. I can hear too many conversations: I can hear every conversation on my left.

The Prime Minister: Let me see whether I can liven Conservative Members up. Is any one of them prepared to tell us what the Tory position now is on Bank of England independence? Is any one of them prepared to tell us whether they oppose the new deal? Is any one of them prepared to tell us which part of social security spending--apart from the working families tax credit, to which I will come in a moment--they oppose? It is no wonder they are talking among themselves.

Let me deal with the issues that were raised on the economy. The Government are delivering long-term strength. Let us not forget that we inherited a situation where inflation was predicted by the Bank of England to rise above 4 per cent., and where the budget deficit under the Conservatives was £28 billion. We therefore introduced Bank of England independence, followed by new fiscal rules to control and to cut borrowing. We put through the two toughest financial years that any Government have done for a long time, and we did that precisely so that we could sort out the public finances and get the investment into our public services that we need. As a result, even in a downturn, current budget surpluses will be run every year and the golden rule met in full. We will have, even with the additional spending, the lowest borrowing as a percentage of national income of any major European Union country.

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There is no doubt that there will be difficult times for business and jobs in the forecast slowdown. We do not hide from that, but we should never tire of drawing the contrast between now and the early 1990s, when interest rates were not, as now, coming down from 7.5 per cent., but were 15 per cent. for a year or more, and 10 per cent. for four years or more; manufacturing output fell by 7 per cent.--over 1 million jobs went in that Tory recession in manufacturing; and unemployment topped 3.5 million.

The reason for drawing attention to the Conservatives' record in the early 1990s is that their policies, in so far as there are any--the right hon. Member for Richmond, Yorks did not give us any, but in so far as one can divine the policies from the shadow Secretary of State for Trade and Industry and the shadow Chancellor of the Exchequer--are precisely to repeat those mistakes: cancelling Bank of England independence, so returning interest rates to short-term political considerations; cancelling the additional spending; and opposing every measure that we took to cut the budget deficit. Every one was opposed by the Conservatives.

Mr. Kenneth Clarke (Rushcliffe): It is very good of the Prime Minister to seek to re-attract the interest of the House.

Every time the Prime Minister seeks to justify having taken measures appropriate to the late 1980s, he cites a Bank of England forecast about the danger of inflation rising to 4 per cent. if these measures had not been taken. Does he not recall that Bank of England inflation forecasts have always been wrong? Does he regard the 4 per cent. as representing a risk of an inflationary boom? Is that the justification for raising interest rates to the highest level in the developed world, causing near recession in manufacturing, agricultural ruin and a slowdown to 1 per cent. next year, on the optimistic forecasts of the Chancellor of the Exchequer?


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