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6.20 pm
Mr. Edward Leigh (Gainsborough): I speak on behalf of my rural constituents in Lincolnshire for whom car ownership is not a luxury, but an absolute necessity. Some 80 per cent. of householders in rural Lincolnshire need to own a car. My constituency, at 700 sq miles, is the same size as Greater London, which comprises some 70 constituencies. What are those people supposed to do? Many of them are self-employed or pensioners, who will now have to pay £3.13 for a gallon of petrol. They have been hit by the Budget.
I have sat in the Chamber and listened to 15 or 16 Budgets and I have become rather cynical about them. The general rule of thumb is that Budgets tend to increase public spending or the money available to consumers by about 1 per cent. in the two years running up to a general election. In the first two years of a Parliament, they tend to take 1 per cent. from consumers and give it to the Treasury. What the Chancellor gives with one hand he takes back with the other. We live in the real world and we all understand that. However, this year, we have to be aware of the particular hit that has been made against rural people who are utterly reliant on their cars. It is quite disgraceful for the Government to suggest that, in pursuit of some general environmental aim which may or may not be worth while, they can load escalators on to fuel and hit rural people so very hard.
Mr. Caplin:
Will the hon. Gentleman give way?
Mr. Leigh:
No. I have only five minutes, and I know that others wish to speak.
The next category of person to be affected by the Budget, apart from pensioners, farmers and people who live in rural areas, is the self-employed, who will be hit very hard indeed by the increase in class 4 national insurance contributions. As the Federation of Small Businesses says, this is hitting the
Mr. Andrew Tyrie (Chichester):
One of the most important things to remember about the Labour Government's handling of the economy is that they were elected not to run an alternative economic strategy, but to continue with the one that they inherited. If they had proposed an alternative strategy, as they did in the 1980s, it would again have been rejected by the electorate. A key reason why Labour is in power is that it committed itself lock, stock and barrel to carrying on with almost every aspect of Conservative economic policy, including, for the first two years, sticking to Conservative spending plans.
Mr. Caplin:
I realise that the hon. Gentleman has not been in the Chamber all afternoon, but I can inform him that Conservative Members have been complaining about our windfall levy. They cannot have it both ways.
Mr. Tyrie:
I am sorry, but I missed part of that point because one or two other people were talking to me at the same time, so I cannot answer it as thoroughly as I would like.
The hon. Member for Harrow, East (Mr. McNulty) suggested that the Government had somehow miraculously brought down the huge debt that they inherited from the Conservative Government. The truth is that Britain is the only major country to have reduced the overall burden of debt as a proportion of gross domestic product in the period from 1979 to 1997. Other countries' debts have risen substantially.
Mr. Gardiner:
Will the hon. Gentleman give way?
Mr. Tyrie:
I am terribly sorry, but I cannot take any more interventions, as I am told that I have only three minutes left.
That debt reduction was a dramatic and remarkable performance by the Conservative Government over those 18 years.
When the Labour Government came in, they were given the task by the electorate of continuing broadly with the policies that they inherited. Initially, to their credit, they did so. I supported their decision to make the Bank of England independent, although they did not do it in the manner that I would want. They made a bit of a botched job of it, although it seems that they are getting away with it. Further reforms may well be needed to make independence work properly.
The Budget represents some first steps away from the Conservative inheritance and towards picking away at what has made Britain outstandingly successful in the 1980s and 1990s. In the 1960s and 1970s, the United Kingdom economy grew at about two thirds of the
European Union average; in the 1980s and 1990s--on any reasonable projection for the remainder of this decade--it grew at slightly more than the EU average. That dramatic transformation in the performance of our economy took place because we got taxes down, deregulated, freed up the economy and brought in a culture of free enterprise.
I am worried that the first salami tactics on those policies are being undertaken by the Labour Government in the Budget. There are large rises in taxation by stealth. If taxes go up, there will be a reduction in our enterprise culture. If regulations are imposed, businesses will be less profitable and less successful.
The Government have introduced a raft of schemes in the Budget, allegedly to improve supply-side performance, that will simply clog up the system with distortions and excessive regulation. The spending on research and development is very hard to justify from the perspective of the economy as a whole.
Mr. John Whittingdale (Maldon and East Chelmsford):
This has been an excellent debate. One of the reasons for that is that 48 hours have passed since the Chancellor delivered his Budget and we have all had the chance to see past the gloss of his speech and have a look at the small print. That has been obvious from the quality of the speeches today, especially from Conservative Members. It has been noticeable that there have been more speeches from Opposition Members than from Labour Members. That point was made by my hon. Friend the Member for Aldershot (Mr. Howarth), but it was questioned by the Whip. Therefore, I wish to place on record the fact that we have heard 18 speeches from Opposition Members compared with 12 speeches from Labour Members. I understand that this is the second day running on which the Government have been unable to find sufficient numbers of supporters to defend the Budget. That is extraordinary when one considers that there are 417 Labour Members of Parliament. Only 12 could be bothered to come to the Chamber today to defend the Chancellor's proposals.
Mr. Gardiner:
Does the hon. Gentleman accept that while Conservative Members wish to attack the Budget, my hon. Friends are more concerned about basking in its glory with their constituents?
Mr. Whittingdale:
I would have hoped that Labour Members would have Parliament as their first priority, but recent experience shows that that is no longer the case.
"real entrepreneurs and risk takers".
Road hauliers are also heavily represented in rural areas. We have all received a large number of letters from them, but the Government have ignored their representations. There is a real danger that the flagging-out process will continue apace. It has happened in the past when Britain lost its Merchant Navy. I know of a business that was based in Lincolnshire and has now moved to France because of the far lower costs there. The Road Haulage Association has calculated that, on average, the Budget will cost its members £20,000 extra a year. As fuel accounts for some 36 per cent. of a haulier's budget, one can appreciate the devastating effect of an increase of this magnitude in fuel duty. It is no surprise that the Road Haulage Association referred to the "anger and disbelief" among its membership and the death knell for some 56,000 jobs.
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