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Mr. Edward Davey: Will the Paymaster General give way?
Dawn Primarolo: I shall in a minute, so that the hon. Gentleman can respond to the following statements. In their 1997 manifesto, the Liberal Democrats promised to spend £9.5 billion over five years on education. The Labour Government, over three years, are spending £19 billion. In their 1997 manifesto, the Liberal Democrats said that they would spend £3.5 billion over five years on health. The Labour Government are spending £21 billion.
Mr. Davey: I am grateful to the Paymaster General for giving way during her recital of funny-money figures. Will she tell the House how much more would be freed for investment in public services if, in April, the Chancellor did not go ahead with a penny cut in income tax?
Dawn Primarolo: The hon. Gentleman does not appear to understand, which surprises me. The Government do not take a pick-and-mix approach to policy. We have a co-ordinated strategy, consisting of stability in public finances, tax and benefits reforms to make work pay, and investment in public services. We have a poverty strategy, an economic strategy and a strategy of investment in public services. They go together, but the Liberal Democrats do not appear to understand that.
In the last three years of the previous Government, growth in education spending was £7 billion. We have committed additional education spending of £19 billion, which demonstrates our commitment to education as our number one priority. We are delivering a cash injection in health service funding of £21 billion pounds. That is more than double the cash put into the NHS by the previous Government in three years. Contrast that with the Liberal Democrats' manifesto commitment--it promised nowhere near the sums we are spending.
Mr. John Burnett (Torridge and West Devon):
Will the Paymaster General give way?
Dawn Primarolo:
No. I have been generous in giving way, but I must make progress. I am sure that the hon. Gentleman wants to participate in the debate.
Mr. Matthew Taylor:
Will the Paymaster General give way to me? I did give way to her.
Dawn Primarolo:
No, the hon. Gentleman did not. I have not intervened on the hon. Gentleman, unless it was in some other place at some time that I do not now remember. I should make progress, because I am taking up valuable time in the debate.
The extra investment the Government are making in the NHS will help to deliver our 10-year modernisation programme for the NHS, so that there is equal access to high standards everywhere, and faster and more convenient services. Sixty-five per cent. of the population of England already have access to NHS Direct and more than 1 million calls have been received. We have also set up walk-in centres: there have been 36 successful bids, covering approximately 10 million people. The centres are due to open during the first half of this year.
In addition, the Government have committed £115 million to modernise every accident and emergency department that needs it; and we have introduced the NHS modernisation fund of £5 billion or more over the three years of the comprehensive spending review. In addition to that, new money is coming in under the private finance initiative. We have already signed £5 billion worth of PFI deals--that is more in two years than was achieved in the five years of the last Tory Administration.
After many years of neglect, the comprehensive spending review will provide new resources for the renewal and modernisation of the UK's infrastructure. After a 1½ per cent. fall during the last Conservative Parliament, gross investment will total nearly £30 billion pounds a year by 2001-02. For transport, the comprehensive spending review committed £1.1 billion in extra resources to modernise local and public transport, providing more than 150 new integrated transport schemes in towns, cities and rural areas. To make sure that taxpayers get value for money, our public service agreements are a contract with the people--a promise of lasting improvements in public services. In this year's spending review, we shall continue to match investment with reform, increasing the resources available for the NHS, education and our public services.
The Liberal Democrats continually criticise the Government for not spending enough on public services, but the truth is that their figures do not add up--their figures never add up, although they always make interesting statements about their 1p. For example, for the 1992 election, the basic rate of tax was 25p in the pound. Guess what the Liberals promised to do? They promised to put 1p on the basic rate of tax. Before the 1996 Budget, when the basic rate was 24p, the Liberals again promised to put 1p on the basic rate of tax. After the 1997 election, the basic rate was 23p, and the Liberals promised to put 1p on the basic rate of tax. What is the purpose of tonight's debate? It is to discuss 1p on the basic rate of tax.
The Liberal Democrats do not tell us whether they are still committed to raising tax, or whether they now recognise that a necessary part of an anti-poverty strategy
is ensuring that people who are trapped in poverty are guaranteed an income that will lift them out of poverty. The Liberal Democrats have opposed every measure that the Government have proposed to ensure long-term sustainable funding of our public services. The House should compare their hype with our proven commitment to macroeconomic stability for the long term, with our commitment to tackle the causes of family and child poverty, and with the way in which we have steadfastly invested £40 billion in our priorities--the nation's priorities--of health and education.
Mr. Oliver Letwin (West Dorset):
Tonight, unusually, I feel a certain fellow feeling with you, Mr. Deputy Speaker, and the other occupants of your Chair, in that you share with me, the Financial Secretary, the hon. Member for Kingston and Surbiton (Mr. Davey) and my hon. Friend the Member for Arundel and South Downs (Mr. Flight) a certain jadedness. I last arose from my bed 37 and a half hours ago and it might be because of that that I found myself less than entranced by the example of joined-up arithmetic--which, in the hands of the Paymaster General, becomes double-jointed--that was offered by the hon. Lady in her splendid, but entirely unilluminating tirade. She informed us that the Government have done nothing but good for everybody in all circumstances and with the greatest possible prudence.
Dawn Primarolo:
He has got the message.
Mr. Letwin:
I have indeed got the message--I could hardly fail to do so, seeing as it was repeated at roughly two-second intervals throughout the hon. Lady's speech. However, she could have saved her breath--not because anything she said was less than lovely and elegant, but because, like the nation, we in Parliament have become accustomed to such pronouncements and we no longer need them. I adjure the Paymaster General to ask her speech writer to write a different speech next time, or to get a different speech writer next time, so that her speech addresses the issues.
The hon. Member for Truro and St. Austell (Mr. Taylor) raised an interesting and profound question. I am not sure that I believe that he is able to provide the correct answer; nevertheless, it is to his credit that he asked a good question. What is the Labour Government's policy on tax and spending and what ought to be our policy on tax and spending as a nation? That needs to be addressed and, if the hon. Lady will forgive me, I propose to do so, notwithstanding the fact that it has nothing to do with whether the Government are all things to all men or the miracle cure for life.
As I understand it, the underlying thesis of the hon. Member for Truro and St. Austell, which, oddly enough, is broadly the same as that in the Government's amendment, is that there is a choice between public spending going up in real terms along with the tax burden
as a percentage of GDP, or the reverse of that. The hon. Gentleman broadly asserts that the Government claim to be raising the two but are really not doing much in either direction and that we should be raising the two.
Mr. Matthew Taylor:
I think that I see where the hon. Gentleman is going, but we are talking about the Chancellor's choices in the short term--what he does about this year's spending. I suspect that the hon. Gentleman will talk about a successfully managed economy delivering extra funding, perhaps allowing us in the long run to cut the tax burden at the same time, with which I would not disagree. The issue at the moment is whether the Chancellor should deliver a tax cut now when that would necessarily mean the sacrifice of extra Government investment in public services.
Mr. Letwin:
The hon. Gentleman is right in anticipating part of the burden of my remarks. I still want to dwell on them because it is of the utmost importance that we understand the facts before we discuss the value that we place on them. It is also true that we must address what is to be done this year, or, more particularly, the Chancellor must address that question. I am not convinced that the hon. Gentleman's logic quite works at that point. However, let me pursue precisely the point that the hon. Gentleman traversed.
The Chancellor has been preoccupied with prudence. He could be called "Mr. Gordon Prudence Brown". Prudence is broadly his motto. He is different from all previous Labour Chancellors because he is determined to ensure that his miraculous golden rule and all his other possible rules will be satisfied under all possible circumstances so that no one could anyone possibly accuse him of being anything other than prudent.
I can quite see why a Labour Chancellor wants to do that, but he ignores the deepest truths of economics. It is not just the case that, in the long run, one can reduce the tax burden on the economy as a proportion of GDP and increase public spending in real terms, particularly on essential services; it is also and much more importantly the case that the one cannot be sustained without the other. That is the point on which we have a genuine difference of view with the Liberal Democrats and which I want to address.
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