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Mr. Bob Russell (Colchester): A millennium contract.
Mr. Ashdown: A millennium tax contract. I am delighted; I will send the Chancellor our manifesto for the next election so that it is not applied beforehand.
We should like an independent audit on taxation to be carried out, setting out how many new tax rates have been introduced or abolished, what measures have been taken to promote simplification and what extra administrative cost burden will arise for businesses as a result. That is being honest with the public about taxation.
The two other big issues that I want to deal with briefly are the environment and public spending. Today, some significant and welcome steps in the right direction have been taken on the environment. Lower car tax on small-engined cars is good--we have been proposing it for 10 years--but the Chancellor has not gone as far as he could have done. There is a perfect case for abolishing tax--vehicle excise duty--on cars of less than 1,600 cc altogether. There is no earthly reason why that should not be done, and I suspect that that will happen; that will be the Chancellor's destination in due course.
I commend the Chancellor on his commitment to an industrial energy tax. That is undoubtedly good news for our environment, and we warmly welcome it. I do not want to sound churlish--the devil will be in the detail, as the old cliche has it--but at what level will the tax be set, and, crucially, is this a stand-alone policy or part of a serious strategy to fulfil the Government's commitment to cutting carbon dioxide emissions by 2010?
Finally, let me ask about public spending. Of course we understand that no Budget statement from this Chancellor would be complete without the regular announcement of a little more money--or, more often, the regular recycling of money already committed--for education and health. Given that that has become so regular, one wonders why the amounts cannot be allocated in the first place, allowing time for planning, rather than being drip fed into the system.
I am ready to be disabused if I am wrong, but is it not a fact that today's extra money for health, education and the police is not actually new, but has been taken from the capital modernisation fund that was announced last year? Is it not also a fact that the sums announced by the Chancellor are sums for not one but three years?
I seem to recall that, when the capital modernisation fund was announced last year, the Government proudly told us that it would be
This, surely, is the important and serious point. We need to get away from short-term crisis management of the funding of our schools and hospitals, and into adequate long-term investment. Incidentally, I am afraid that the extra money for schools and hospitals, although welcome, is rather small beer. While I was listening to the Chancellor's statement, I turned to one of my colleagues and said, "My God! are they going to hold an election this year?" Of course, they are: they will hold elections on 6 May and 10 June. No doubt, Labour Members are smiling because they think that the Budget will help them in those elections. They should speak to the 29 out of 32 Scottish councils that have been forced to cut their education budgets for the past two years, and see whether they are equally pleased about an amount that will provide cold comfort after those two years of cuts.
The Budget money will also be cold comfort for a national health service that can stem the rise in official waiting lists only by doubling the number of people who
are waiting to see a consultant. It will be cold comfort for police forces that have had to cut police numbers for the past two years. And I fear that, although it will be some comfort--quite a lot, in fact--to some pensioners, it will be cold comfort for the millions of poor and elderly pensioners over 80 who continue to receive a supplement of just 25p to their weekly pensions. That is less than the cost of a first-class stamp, but the amount has been set at that level for 30 years. Surely it is time to increase it.
We believe that, even in a neutral Budget such as this, the Chancellor could have found the money needed to increase the pension top-up from 25p to £5 a week for pensioners over the age of 80, and to £3 a week for those over 75. Instead, he chose to focus on headline-grabbing gimmicks, which I do not think will be very effective in the long term, such as the 10p tax rate.
Mr. Derek Foster (Bishop Auckland):
We have just heard three very good speeches and probably parliamentary democracy at its best. I am sorry that the House now has to come down to reality. I could not possibly match the eloquence and command of detail of the previous three right hon. Members who spoke. I am just an old party hack, but I will do my best.
The Chancellor's speech was the usual tour de force. When he sat down, I thought that the new Jerusalem had already arrived. When the Leader of the Opposition sat down, I thought that things were as bad as they were under the Tories, but the right hon. Gentleman did a remarkably fine job in what is the worst possible speaking engagement in the whole year; he also has the worst job in British politics.
I know something about that because, for 10 years, I did the second worst job in British politics. On 18 occasions, I sat listening to my leader trying to make a speech in response to a Chancellor who had command of all the detail and the vast Treasury at his disposal, while he himself had limited facilities.
The Leader of the Opposition is my neighbour. I have the strange experience of being sandwiched between the Prime Minister and the Leader of the Opposition. They are people for whom I have enormous respect and regard, particularly the Leader of the Opposition. He has the worst of the two jobs, of course: whatever he does and says will be dismissed because no one that thinks that he will win the next election.
That happened to Neil Kinnock, now Commissioner Kinnock, during my many years of working with him. No one really believed that he was going to win the next general election until 1992, when we all believed that we might do extremely well. Of course, in the end, we did not.
The Chancellor said so many good things in his speech that it is difficult not to make a speech entirely in praise of his policies and what he said, but I have no ambitions to be sycophantic; colleagues may have noticed that from time to time. That is not what being a Member of Parliament is all about. We are here to bring the
Government to account, to tell them where we think that they may be right and to mention those things about which we may be worried.
I would have wanted the Chancellor to say that he recognised that deflation, rather than inflation, was the problem facing the economy. Indeed, the international economy faces deflation, not inflation. The Economist has woken up to that. Its leader column last week gave great coverage to an exposition of why deflation is now the problem, not inflation.
My old friend Keynes was a great Liberal. I have ambitions for my Chancellor to be as radical as Lloyd George. He is coming along; he is doing pretty well. Once he has had a bit more experience and we have been able to kick him up the backside occasionally, he may attain that radicalism. If we can do that, perhaps he will adopt Keynesian policies.
Those policies were always deeply respectable within the Labour party, although it was Lloyd George in 1929 who was the first to espouse them. In 1935, President Roosevelt espoused them and transformed the United States economy. In 1945, of course, the Labour party also espoused Keynesian policies, giving us full employment. Keynesianism was so successful that it informed the consensus until about 1970. In the 1970s, we had the two oil hikes, which most people believe blew Keynesian policies out of the water.
If Keynes had a weakness, it was that he did not address the issue of inflation. For him, inflation was not a problem. During the 1920s and 1930s, deflation was the problem. Keynes had a brilliantly successful strategy for dealing with deflation, for which we all owe him a great debt of gratitude. In my book, he is far and away the greatest economist of the 20th century. Without him, we should not have had the Bretton Woods agreement, which ushered in a period of tremendous prosperity for the whole of the western world. That seems to have been forgotten by Labour politicians.
The Deputy Prime Minister managed to use the word Keynes only at Christmas, when the Prime Minister was away. So courageous are we now in our political beliefs in the Labour party that we can whisper the word Keynes only when the Prime Minister is out of the country.
Keynes gave us full employment. The reason why I came into politics was to get rid of unemployment and to get rid of poverty. Only when we get back to the type of policy advocated by Keynes will we make the maximum impact on those two problems.
Why do I say that? In my region--the northern region--many of the Chancellor's policies are not working. We have the new deal--I am an enthusiastic supporter of all the new deals in all their aspects--but, without jobs, all that improved employability is dissipated all too quickly.
"allocated to Departments on a competitive basis assessed in part by the merit and quality of Departmental Investment Strategies."
All that sounds jolly reassuring, doesn't it? But the press tell us that, in fact, the extra money was agreed at midnight on Friday after what they euphemistically call an "eleventh-hour dispute"--for which we should read "late-night punch-up, involving Cabinet heavyweights and a personal intervention from the Prime Minister". I suppose that could be described as competition of a sort, but I had not expected "three falls and a submission".
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