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Mr. Hayes: Will the hon. Gentleman give way?
The final value by which we should judge the Budget is that of community. How does the Budget strengthen our sense that we depend, quite properly, on one another and that we are not individuals pitted against one another in the colosseum of the economic market. We are co-contributors to building a society in whose prosperity we all share.
The Institute for Fiscal Studies response to the Budget shows that every decile of the population gains from the Budget, but, critically, the richest decile benefits least and the poorest deciles benefit most. That means that the Budget has begun to reverse the widening gap between the rich and poor. The Rowntree Foundation report on inequality showed that that gap was growing faster in this country than in any other country during the 18 years of Conservative rule. The £430 million extra put into our health service accident and emergency departments, the extra £170 million to combat crime and the doubling of child support since May 1997 are all part of--
Mr. Deputy Speaker:
Order. The hon. Gentleman may not quite have won his race against time.
Mr. Nick Hawkins (Surrey Heath):
I must tell the hon. Member for Brent, North (Mr. Gardiner) that there is nothing synthetic about the anger felt by Conservative Members on behalf of their constituents. My constituents are well aware of the Government's propaganda, although some hon. Members may not have realised that the
The BBC had been investigating what was being provided as a commentary on the Budget; apparently, it has been written by civil servants. That commentary was described as deliberately misleading. The hon. Member for Bolton, West (Ms Kelly) had been put up by the Government to try to defend the indefensible on "The World at One" today. She is Member for whom I have great respect; she is well known in the House for having come from a serious position in financial matters with, I think, the Bank of England. Nevertheless, she found it difficult to deny the suggestion by the BBC journalist that misleading information had been provided by the Government on the internet. It was apparent from this lengthy interview that the BBC recognised the position. Not only was all the bad news being edited out; not only were all the figures on the Government's website misleading; there was a whole page of Labour party political propaganda which had no relevance to the Budget.
I may be the first to break the news of that particular discovery, but I have no doubt that considerable concern will be expressed during the remainder of our debate on the Budget--and, perhaps, in points of order next week--about the scandalous misuse of taxpayers' money that has been involved in the Government's presentation of misleading propaganda. Even worse, the Government got civil servants to write the propaganda for them, pretending that it was in some way a factual analysis of the Budget.
As several of my hon. Friends have pointed out, this Budget is, in fact, nothing better than a scandalous conjuring trick. Misinformation has been deliberately given. As recently as yesterday, at Question Time, the Prime Minister deliberately failed to respond to my right hon. Friend the Leader of the Opposition, who repeatedly pointed out that, over the three Budgets delivered by the present Government, there had been a huge increase in the tax burden. On each occasion, the Prime Minister deliberately failed to answer the question: he tried to talk only about this Budget.
We are becoming aware of one aspect of even this Budget, as it unravels. It involves a further tax hike. In his attempt at a music hall act--his attempt to turn Question Time into a pantomime, which he does so often--the Prime Minister did not make any effort to answer my right hon. Friend's real question, which concerned the tax hike that had taken place in the three Budgets added together.
In fact, that came as no surprise. When the Prime Minister appears on Wednesday afternoons--he is now prepared to face questioning only once a week, rather than twice a week as before--he never answers a question. He reminds me of the late Lord Olivier in his great performance as Archie Rice in "The Entertainer", portraying a down-at-heel, sad, failing music hall artiste. That is how the British people will see our current Prime Minister. He never answers a question, he betrays parliamentary democracy, and he has no interest in telling the British people the truth.
Some in the business world, however, have already seen through the Budget. Ian Peters, deputy director of the British Chambers of Commerce--quoted in The Times yesterday--says:
Quoted in The Daily Telegraph yesterday, Patrick Stephens, a partner in Ernst and Young, said that the Budget was
Mr. Hayes:
Will my hon. Friend give way?
Mr. Hawkins:
I hope that my hon. Friend will forgive me if I do not. Time is limited.
Before coming to the House, most Labour Members have never had to worry about the bottom line. Hardly any have had to run a work force, or look at a balance sheet. Most have come from the public sector. A number of other sectors have been hard hit. I used to work in the insurance and financial services industry, and I should have thought that a Government who claim to be caring would recognise that it is a good idea for people to take out insurance. Not a bit of it. Not for the first time, the Chancellor of the Exchequer regards insurance as a cash cow to be milked whenever he wishes, so that he can balance the books in a particular Budget. This year,
he has hit insurance premium tax; in the past, he has regarded travel, holiday and tourism businesses as a cash cow, and has raised airport passenger duty.
Mark Boleat, director-general of the Association of British Insurers, says:
The Budget has a nice, easy, soft target. The increase in insurance premium tax is rather like the Chancellor's earlier raids on pension funds. This is a soft target, and a stealth tax. As my right hon. Friend the Leader of the Opposition has said, this is a pick-pocket Chancellor, who proves time after time that he believes in stealth taxes.
Even some Labour Back Benchers have referred this afternoon to the difficulties in controlling smuggling to which the Budget will lead. Certainly, the Budget has done nothing to reduce smuggling; in fact, the incidence of smuggling will increase. The hon. Member for Hove (Mr. Caplin) referred to the "white van trade"--a black economy in white vans. That is the black and white truth of this Labour Government.
4.29 pm
"The sting in the tail may be that the Bank"--
the Bank of England, that is--
"may have less room to reduce interest rates than we would have wished."
Ruth Lea, head of policy at the Institute of Directors and one of our most informed economic commentators, was quoted in the same edition of The Times as saying:
"We wanted to see looser monetary policy and tighter fiscal policy and it looks as though we're getting the opposite."
My main concern, however, lies with small business. My constituency contains many thriving small and medium-sized businesses, and I am one of the vice-chairmen of the Small Business Bureau. All the small business organisations have seen through the Budget. Brian Prime, chairman of the policy unit of another small business organisation, the Federation of Small Businesses, estimates that the increased contribution rates for class 4 national insurance from 6 per cent. to 7 per cent. will hurt about 500,000--half a million--self-employed people. He says:
"The real entrepreneurs and risk takers--the sole traders--will miss out on the corporation tax changes, but will be hit by increases to national insurance contribution."
Ian Hanford, chairman of the federation, says that the Budget
"completely missed the target where the majority of small firms were concerned."
The gloss has already come off this Budget, and the truth behind the Chancellor's attempted conjuring trick has emerged.
"not going to make a difference where people are looking at starting a business or not."
We realise that Labour Members have little understanding of small business. The hon. Member for Brent, North said that he used to run an international business, but he is a rare figure on the Government Benches. Most Labour Members have never had to work in a business.
"The increase in insurance premium tax is regretted. It will result in higher premiums and could further encourage some people not to insure. It will hit people on the lowest incomes hardest and those starting up new businesses."
So much for this caring, family-friendly Budget. This Budget makes it more difficult for people to take out insurance. It means that more people will not take out insurance, and will not protect their families, homes and businesses.
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