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Mr. John Bercow (Buckingham): Will the hon. Gentleman confirm that the Liberal Democrats believe that the average taxpayer pays too little and should pay more?
Mr. Taylor: The hon. Gentleman has missed the point of the motion and the debate. We are arguing that taxpayers should not pay less than now on average and that the Government should forgo tax cuts at this stage because they have not fulfilled their pledges on health, education, pensions and the rest.
Mr. Bill Rammell (Harlow) rose--
Mrs. Anne Campbell (Cambridge) rose--
Mr. Taylor: I give way to the hon. Member for Harlow (Mr. Rammell), but then I must make progress.
Mr. Rammell: I thank the hon. Gentleman for giving way. He may agree that there is a suspicion--I put it no higher than that--that the Liberal Democrats constantly commit themselves to more spending than they justify in terms of where the money would come from. When challenged, their usual defence is, "Refer to our Budget submission." Is he aware that when the Library contacted the office of the hon. Member for Gordon (Mr. Bruce) and Liberal Democrat headquarters, neither was willing or able to provide a copy? Does not that show the degree of Liberal Democrat disingenuousness on this issue, and is not it about time that they justified where the money would come from?
Mr. Taylor: I can help the hon. Gentleman. First, I am now the spokesman on the issue and, secondly, this year's Budget submission has not yet been published.
Mr. Taylor: I have given way so will the hon. Gentleman let me make progress? He should perhaps be a little more careful in making his points. I want to discuss education.
Mr. Taylor: I shall give way in a moment, but let me make a little progress.
Class sizes for the five to seven age group have fallen. The Labour pledge on that, although not yet met, is likely to be met soon--not because of extra funding, but because a transfer of resources has meant that class sizes for over-eights have risen every year since Labour came to power. The parents of five and six-year-olds who voted for lower class sizes for their children back in 1997 find that class sizes are higher. Nursery class sizes have also risen and secondary school class sizes are at their highest for 20 years. Why?
Average spending is 4.8 per cent. of GDP, which is lower than the 5 per cent. average in the last five years under the Tories. Even by the end of the comprehensive spending review period, spending, according to the pre-Budget report, will fail to meet the Government's 5 per cent. target, which was only set in 1998. That is the result of the cut in their first two years in office to 4.7 per cent. of GDP, which was lower than in any of the last five years under the Conservatives.
Mrs. Campbell:
Is not the reality of the Liberal Democrats in local government different from the scenario that the hon. Gentleman describes? Is he aware that Liberal Democrats on Cambridge city council voted to cut not only the council tax, which was at a standstill, but £170,000 from neighbourhood planning in the ward in which they had recently conned people into voting them in at a by-election? Furthermore, is not it true that Councillor David Howarth, their leader on the council, is an economic policy adviser to Liberal Democrat Front Benchers?
Mr. Taylor:
The hon. Lady may see the Liberal Democrats in control of Cambridge city council shortly, when she will learn for herself what the Liberal Democrats do to invest in education when in control. When Cornwall county council was under our control, we increased spending on schools year by year.
There is a similar problem with public transport. There are record numbers of complaints, the number of late trains has increased by 25 per cent., London Underground breakdowns are up by 30 per cent., and spending compared with that under the Tories has been cut. Indeed, on the Government's own inflated figures, they will spend £130 million less of Government funds than they did last year. Their public transport investment is simply going down.
The measly 73p increase for pensioners is outweighed just by the council tax rise, which has been predicted by the Government themselves, irrespective of any other
cost-of-living increases. The Chancellor likes to boast of the free television licence for those aged over 75, which we argued for and welcome, but it is not enough to say to a pensioner that he can watch television but cannot feed or heat himself following the 1.1 per cent. rise in the pension.
What did the Labour manifesto say? It pledged to ensure that, like those in work, pensioners would benefit from growth in the economy, yet the income of those in work has increased by four times that of pensioners--so much for sharing the growth of the economy.
In response to all that, the Chancellor comes up with the mantra "£40 billion for health and education." It is there again in the Labour amendment. I hope that the Labour Members who are here and, perhaps more significantly, the much larger number in marginal seats throughout the country, understand that it is not true. It is funny money. A Labour Member recently asked me why people do not understand that it takes time. Perhaps that is because people thought that the £40 billion was true. Certainly, Labour keeps peddling the figure; it does so again today.
The reason people are not seeing the improvements in health and education that they would have expected with such massive investment is that that massive investment is not taking place. NHS spending of £20 billion is reduced to around £12 billion simply by stripping out inflation. Once we strip out triple- counting--adding three years together--the real increase this year will be only £2.3 billion. That is not negligible but, on average over the current Parliament, it is in line only with the investment that the Conservatives managed under the previous Prime Minister. This is a funny-money Chancellor.
Waiting lists are increasing. Labour Members should not be surprised if people are disappointed by the Government's approach. If they had said that it was a hard process that would take time, that we could afford this now but that we would do more when we could, they might have carried the public with them, but the truth is--Labour Members know it--that they raised expectations beyond anything they could deliver. They had not got out of the habits of hype and exaggeration that they had displayed in opposition.
Mr. William Cash (Stone):
The hon. Gentleman may know that I share his concern about the fact that the Labour Government have broken their promises on public expenditure, but will he answer the following question on behalf of the Liberal Democrats? Does he repudiate the Treasury clamp, which in turn depends on the Maastricht criteria, which determine the 3 per cent. deficit rule? Would they refuse to accept that? Would they renegotiate it, or would they accept it, in which case they would break promises in the same way as the Labour Government?
Mr. Taylor:
I might have known that the hon. Gentleman would work Europe into the debate somehow. I congratulate him on his ability to do so in any circumstance, but we argued for that disciplined approach to economic management in advance of any European rules. We do not criticise the Government for taking that approach. It is the proper way to manage an economy.
The £19 billion for schools is reduced to £13 billion when inflation is stripped out. There is only an additional £2.1 billion this year, but even that is an exaggeration as it counts local authority money that has already been spent. Most of those local authorities have already spent over SSA, so simply raising the SSA, which allows the Chancellor to come up with the phoney figures, does not deliver a single extra penny to schools.
The real comparison is with our 1p income tax pledge, which would have put more than £2 billion into education every year. Central Government investment in education is down to only £600 million extra this year. The cumulative real total is £4 billion over three years--if they prefer to do it on that phoney three-year basis. That is less than the average under the Conservatives. By comparison, the Liberal Democrat increase would have delivered more than £15 billion extra real money over a Parliament, not the funny money that the Chancellor likes to deliver.
Mr. John Hayes (South Holland and The Deepings):
The hon. Gentleman is making untypical sense for a Liberal Democrat, and I mean that in a kind way. He almost understates the case, if anything. If we take into account the funding of the teacher pay awards in the past two years, the financing of the standards fund and other initiatives, which have been borne by local authorities, the money that is going to schools at the sharp end--at the chalk face--is even less than when we scale it down in the way that he has done.
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