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Mr. Harvey: It does show; it shows in all the public services. I have already discussed health at length, and mentioned the problems in education. Other Liberal Democrat Members talked about transport, which is another issue on which the public--in opinion polling and, as all hon. Members will know, based on anecdotal evidence--are grossly dissatisfied. The public believe that transport has become appreciably worse since the general election. Although they are disappointed that there has not been more progress in many other spheres, they believe that transport has become worse.
The Financial Secretary to the Treasury (Mr. Stephen Timms): The Government's vision for the public services rests on the new foundation that we have built--the new platform of stability in our economy that is almost without precedent in our history. What a contrast that is with the position that we inherited after the general election. The Tory legacy was £28 billion of debt after 18 years of boom and bust. We have turned that round. The Conservatives said that we could not do it, but we have. The Tories tried and failed, but we have succeeded. Our challenge now is to lock in that new stability for good so that we can build on it for the long term. We are determined to do that.
That is why my right hon. Friend the Chancellor was able to set out with optimism in November's pre-Budget report our new ambitions for the coming decade. We should be catching up on productivity with our major competitors after decades of slipping behind under the Tories. We should have a higher proportion of people in work than ever before. After less than three years of this Government, we have more people in work in Britain than we have ever had, but we are aiming even higher to achieve the highest proportion ever, and to do so on a durable basis.
We want to halve the number of children in poverty in the next decade, on the way to achieving my right hon. Friend the Prime Minister's target of the abolition of child poverty within 20 years. Another aim is that, for the first time, more than half of our school leavers should go on to study for a degree.
All those ambitions are achievable if we lock in the new-found stability and build on it for the long term, as we are determined to do. We cannot afford to abandon swathes of our people, as the previous Government did. Younger people and older people were dumped on the scrap heap when they could have been providing for themselves and contributing to the economy. We are building a fair society with employment opportunity for all, where everybody has the chance to develop to their full potential and nobody is left out.
Mr. Letwin:
The hon. Gentleman is customarily courteous in giving way. On a matter of genuine interest, will he tell me whether he believes that he and his colleagues have abolished the economic cycle?
Mr. Timms:
I am glad that the hon. Gentleman has asked me that, because I wanted to ask him about the economic cycle. We have had an interesting debate--
That brings us to the point that the hon. Gentleman has just put to me. What about the cycle? The right hon. Member for Huntingdon (Mr. Major), the former Prime Minister, will have made the calculation that the hon. Gentleman put to the House during the debate. It may have been made with the advice of the hon. Gentleman--I do not know what his role was in the 1992 election campaign. On that basis, the former Prime Minister promised that there would be no tax increases under his Government. That is the same basis that the hon. Gentleman has spelled out in the debate. Within a few months of that promise being made, we had 22 Tory tax rises. The failure to achieve stability in the economy caused a huge problem for the previous Government. Our success in securing stability over the past three years has made all the difference and allows us to plan for the future with confidence.
Mr. Timms:
I shall not give way again, because I want to make progress. I am encouraged by the article in The Times on 10 February about the Tory tax guarantee, which said:
My hon. Friend the Member for Reading, West (Mr. Salter) made a telling contribution, for which we were grateful. He pointed out the reality of what often happens with Liberal Democrat administrations. My hon. Friend the Member for Reading, West, along with other hon. Friends who spoke in the debate, pointed out that Liberal Democrat representatives take entirely contradictory positions in different parts of the country. Their sums frequently do not add up--my hon. Friend is absolutely right on that score.
The hon. Member for Portsmouth, South (Mr. Hancock) also made an interesting contribution. He said that people cannot wait for doctors to be trained. Well, new doctors have to be trained, and that is what we are doing. It is a necessity when it comes to improving the health service. The hon. Gentleman was right to say that it takes time. There is no short cut, however--we want high-quality staff in the health service and we are taking steps to ensure that we get them.
The hon. Gentleman also criticised the Government's programme of hospital building. I do not agree one jot, and I do not believe that the country does. We have the biggest hospital-building programme in the history of the national health service, and that is what the people of this country want.
The hon. Gentleman made a very interesting point--one of the most telling contributions to the debate, in fact--when he told us that his party had moved on since its manifesto. We will deliver on all the commitments in our election manifesto, and that is what we are doing.
Mr. Hancock:
The Minister is extremely courteous in giving way, despite being on dodgy ground. I am not
Mr. Timms:
I am glad that the hon. Gentleman is hedging on what he said before. The PFI is a very successful mechanism, which is why we have secured the biggest hospital-building programme in the history of the health service.
Our commitments are to economic stability and sustainable public finances. That is what has provided us with a foundation for two hugely significant programmes, modernising our public services and integrating tax and benefits. On public services, which we have said a lot about in the debate, the new stability has allowed us to make record extra investments in our public services, including the additional £40 billion for improvements in health and education provision. That is new investment for the future, reflecting our priorities and the nation's priorities, to build a modern Britain and a decent society. It is far in excess of anything that was promised by the Liberal Democrats' manifesto, even though they have since moved on from it.
Health spending is improving every year. There are real-terms increases of 5 per cent. every year of the comprehensive spending review. Spending on health is now 10 per cent. higher in real terms than it was in 1997. We are building more than 30 new hospitals, the biggest hospital-building programme ever. We have introduced modern delivery channels, such as NHS Direct and walk-in clinics, and we have set up the National Institute for Clinical Excellence to take the lottery element out of health care. Every accident and emergency unit in the country that needs it is being upgraded. We are employing more nurses and doctors. There is an immense programme of investment and improvement in the health service. People using the health service and working in it would not recognise the grim picture painted by the hon. Member for North Devon (Mr. Harvey).
On schools, with our 16 per cent. real-terms increase over three years, we are getting 6,000 more teachers into schools and 800,000 more students into further and higher education. We are modernising 15,000 schools with extra money from the new deal and connecting every primary and secondary school to the internet. This is very telling: in 1997, barely one school in 10 was connected to the internet. Now two thirds of them are, the highest figure in any G7 country. The number of primary schools connected has increased fourfold just in the past year. By 2002, every school in the country will be connected to the internet. That is the scale of our commitment, and we are delivering on public services.
On tax and benefit reforms, we are cutting the taxes of hard-working families across the country and making work pay so that it pays to do the right thing and get a job. Too often in the past, people have faced unemployment traps and poverty traps. The Tories built them into the system; we are designing them out. Our policies are tackling those problems; we are raising the incentives to do the right thing and building a fairer society, with employment opportunity for all.
The national minimum wage--the first in our history--was opposed by the Liberal Democrats. It is boosting the hourly wage of 1.7 million low-paid workers and helping to ensure that it is worth their while to be in work.
We have introduced income tax reforms; the 10p starting rate and the cut in the basic rate increase the rewards for work, especially for the low-paid. That is our priority and it is right. We are improving incentives for work.
National insurance contributions are being reformed to lift the burden on the low-paid and on employers. The working families tax credit is helping to make work pay for about 1.4 million working families--giving them, on average, £24 a week more than they would have received under family credit.
Together, those reforms are guaranteeing a minimum income of £200 a week for families with a full-time earner. No family earning less than £235 a week--that is about £12,000 a year--will pay net income tax.
That is why the unemployment total has been falling month after month. The claimant count is down 30 per cent. The employment rate in the UK is now higher than in almost any other OECD country. We have a strong economy and there are vacancies in every region of the country. Work incentives are being sorted out. People are able at last to move off welfare and into work.
The new deal was opposed by the Tories; the financing mechanism for it was opposed by the Liberal Democrats, as they confirmed today. The new deal focuses on helping our youngsters to build the future that the Tories always denied them. Long-term youth unemployment--of more than six months' duration--has fallen by a staggering 70 per cent. since the election. It is lower now than it was at any time under the Tories. If any Tories were in the Chamber, they should be listening--as should the Liberal Democrats--because they opposed the policies which made that fall possible. Of course, youth unemployment is lower than it was during the Tory busts, but it is also lower than it was in any of their booms--lower than at any point during the 18 years of Tory government.
Tens of thousands of young people who, in the past, would have been dumped on the dole for years--quite often for ever--have now been given a hope for the future. They are able to get used to the idea of going out to work every day, and have been given the chance to build a decent life for themselves and for their families.
Julie Haydock is from my area in East London, which my right hon. Friend the Chancellor visited yesterday. After 15 years of unemployment, she is now in a job thanks to the Government's initiatives. She was quoted in a newspaper today. She said that she has a
We have not finished yet. There is more to do. As my hon. Friend the Paymaster General said, there is more help to come for unemployed people so that they can make the most of the opportunities that our economy is creating. About 1.25 million people are being lifted out of poverty by our reforms--800,000 of them children. We are building the fairer and more modern society that we all want to see.
Nearly three years ago, we inherited a pattern of large budget deficits, a steeply rising burden of public debt and massive neglect of public services and public investment. At present, we are delivering what Britain has been crying out for years. After the cynicism of the past, there is a new conviction that we can change things for the better in our nation and in our time. Our ambitions--the nation's
ambitions--are for enterprise and fairness and for a decent and modern Britain. Those are no longer hopeless pipe dreams; they are being delivered in every part of the country.
Of course, there is more to be done, and in the coming weeks, in visits to every region of the country and then in the Budget, we shall be setting out the next steps in our programme. There will be more jobs; more opportunities; better services and a better future. That is our pledge and we are going to keep on delivering it.
Question put, That the original words stand part of the Question:--
Mr. Portillo's economic team is working on proposals to make the guarantee more believable.
We look forward to hearing those proposals. No doubt we shall return to the subject before too long.
new sense of self esteem.
She is speaking for thousands.
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