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The Parliamentary Under-Secretary of State for Trade and Industry (Mr. Alan Johnson): The poll is pretty good.

Mr. Ottaway: I suggest that the Minister looks at the figures in the poll.

There is a certain irony in the Government's stealth taxes of the past three years. We all know that the Chancellor has increased total taxes by more than £40 billion over the lifetime of the Parliament. We know that taxes have gone up on pension funds, cars, petrol, diesel, charities, mortgages, marriage, medical insurance, house buying, cigarettes, alcohol, insurance policies, savings, betting, employer benefits in kind, the self-employed and on retirement: £1,500 extra taxes per taxpayer, a rise in the overall tax burden of almost 2.5 per cent.

All that is now in the public domain, but how many people have noticed how regressive many of the taxes are for those on low incomes? Who would have thought that it would be a Labour Government who left the basic and higher rates untouched, but raised indirect taxes by such a level that they hurt most of all the people in their heartlands? The irony is that it should be a one-nation Conservative party that must articulate on behalf of and stand up for their people.

When those people realise that it is a Labour Government who are imposing those burdens on them, and that it is a one-nation Conservative party that is coming to their defence--a party that believes in one nation of rich and poor and equal and fair treatment for all--it is the sign of a Labour Government who have lost touch with their core electorate and of a Conservative party that speaks for the nation as a whole.

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Dr. Fox: On a point of order, Mr. Deputy Speaker. At the beginning of the debate, I pointed out that, in his statement, the Prime Minister had apparently unintentionally misled the House with one of the figures that he gave. Is not the convention that, when Ministers of the Crown mislead the House, they should return to the House and correct the matter as soon as possible? I have given Ministers several hours' notice of the matter, and the figure has been confirmed by the Library and by other independent sources. I am sure that it would be helpful to the House if the Paymaster General could confirm that the Prime Minister made a mistake and gave a misleading figure on the Government's health care expenditure for 2003-04.

Mr. Deputy Speaker: I was not in the Chair when those earlier exchanges occurred. However, as the hon. Gentleman is well aware, figures can sometimes be a matter for debate. I have no doubt that Ministers have heard the point of order.

Mr. Fabricant: On a point of order, Mr. Deputy Speaker. I am sorry to delay the Paymaster General's reply to the debate. You will know that a usual courtesy of the House is that Front Benchers who attend a debate's opening attend its conclusion. Have you received a message--no apology was made to the House--explaining why the Secretary of State for Health is not in the Chamber for the end of this debate?

Mr. Deputy Speaker: I have received no such notice. However, whether Ministers attend the conclusion of debates is entirely a matter for them.

9.46 pm

The Paymaster General (Dawn Primarolo): The hon. Member for Croydon, South (Mr. Ottaway) concluded his speech by saying that the Conservative party is the one-nation party. However, as we have seen in our debates in the past two days, the Conservative party is incapable of speaking with one voice even in this Chamber. We have heard from Conservative Members some very interesting and varied, but contradictory, speeches on the Budget.

In the short time that is left, I shall try to answer some of the questions that have been asked in the debate. I apologise to hon. Members who spoke in the debate, but whom I may not be able to mention because of the shortage of time.

Yesterday's Budget was about building a stronger and fairer Britain. The Budget provides significant resources to improve key priority services, particularly for our schools and hospitals. It also takes further action to tackle child poverty, to support pensioners, to promote enterprise and work, and to protect the environment.

Many of the speeches in today's debate--which has followed the statements by my right hon. Friends the Prime Minister and the Secretary of State for Health--were on the national health service. Nevertheless, it is worth reminding the House now of the reaction to the Budget.

The Trades Union Congress described it as "a good Budget". It said:

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The Confederation of British Industry said:

    This is a positive Budget

for small and medium-sized enterprises.

The Institute of Directors--that well-known socialist enclave that always supports Labour Governments--said:

Many hon. Members on both sides of the House made very thoughtful speeches today on the national health service. There was general agreement in the House in welcoming the extra resources for the NHS. Hon. Members concentrated also on the issue of improving quality, and particularly on the issue of the dramatic variations in cost and performance across the NHS. They spoke also about the action that needs to be taken, in partnership with those who plan and work in the NHS, to build success in the service. Opposition Members were surprised that my right hon. Friends the Prime Minister and the Secretary of State for Health should use the word "partnership". I remind Opposition Members that partnership is necessary because the health service over which they presided was divided through secrecy and competition, by the use of the internal market.

The right hon. and learned Member for Rushcliffe (Mr. Clarke) made an interesting speech. I was especially interested when he said that health was always his priority as Chancellor, but that real spending on health fell during that time. I was pleased to hear him welcoming the statements made today.

Mr. Kenneth Clarke: I wish to react to a somewhat startling assertion. I do not think that real spending on the national health service has fallen at any time for the past quarter of a century. The last time that spending fell was in 1976.

Dawn Primarolo: I would not wish to pick a fight directly with the right hon. and learned Gentleman, but I would ever so gently point out to him that the real terms annual growth in national health service expenditure in England in 1996-97 was minus 0.1 per cent. By 1998-99, that had risen to 2.3 per cent. He will find, on closer scrutiny of the figures, that his first assertion was right.

The right hon. Member for Fylde (Mr. Jack) and several others raised the issue of IR35 and service companies, and I shall put one or two facts clearly on the record. In the tax system, rules govern whether one may designate oneself as self-employed or whether one counts under the PAYE definitions. The category in which a worker falls dictates the reliefs and tax that need to be paid. No one--including consultants in service companies--is allowed to choose their category. People may wish to be self- employed, but that is determined by the terms and conditions of their contracts.

IR35 deals with the massive avoidance of national insurance and a considerable amount of tax in which some of those service companies have engaged. It does not impose a new tax: it merely requires them to pay tax in the same way that millions of other taxpayers--companies, the self-employed and individuals on PAYE--pay tax. It is suggested that such consultants will form a mass exodus, but that does not bear scrutiny because other countries have similar mechanisms to those

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that we are introducing to the UK system. In fact, I have been amused by the postcards that I have been sent by rather silly consultants from the countries in which they claim they have settled because the tax regime is easier. I am disappointed that they do not give me a reply address, because then I could write back to them to explain how the tax system of Germany or the USA, for example, requires people to pay their fair level of tax.

My hon. Friend the Member for Waveney (Mr. Blizzard) and several other hon. Members referred to the construction industry scheme. I think that the right hon. Member for Fylde will have some sympathy with me on that, although I do not wish to try to tie him in to any criticisms that have been made. The construction industry scheme was designed under the previous Government to deal with the specific problem of tax avoidance that was occurring in that industry. All of the consultation about what the new scheme should look like was conducted under the previous Government. Questions were raised about why the scheme did not work and some Opposition Members said that the Government had been warned. However, the Government were not warned until the scheme had been introduced. I am glad that hon. Members welcome the changes that we are making.

There was considerable discussion of our transport policies and whether the Budget was sympathetic to motorists. By chance, this morning I met representatives of the Automobile Association who told me that they very much welcomed the Budget. In fact, they told my right hon. Friend the Chief Secretary to the Treasury that it was the first Budget in nearly 10 years that the AA had welcomed. That takes the shine off some of the more unreasonable points made by Opposition Members.

The hon. Member for Esher and Walton (Mr. Taylor) made an extremely thoughtful speech--I invite him to come and join us. He was quite right to say that we need confidence in our national health service and that people are entitled to know that they can get treatment when they need it. As he said, there have been difficulties in respect of NHS care and the quality of care declined under the previous Government. He said that there was a shift towards private medical insurance at the time because people lacked confidence in the national health service. I am sure that all my right hon. and hon. Friends agree that confidence in the national health service is also about the challenge of providing better quality care. I took particular note of the hon. Gentleman's cautionary tales about the Inland Revenue, which really is quite friendly. It only requires Ministers who know what they are driving through.

In conclusion, let me turn to the points made by the hon. Member for Boston and Skegness (Sir R. Body) about smuggling. He concentrated on beer smuggling, but I am sure that he is aware that the problem is much wider. Smuggling systematically challenges our health policy and spreads criminal activity throughout our communities. Today the Government announced expenditure of an additional £209 million over three years on Customs and Excise, employing nearly 1,000 extra customs officers at ports and inland. That is in addition to our commitment to increase penalties, provide better equipment and X-ray machines and develop a strategy to disrupt inland activities. The hon. Gentleman will welcome the fact that we can now employ extra staff to deliver on that commitment.

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The Budget that my right hon. Friend the Chancellor presented to the House yesterday was based on clear visions and basic sensible principles that Conservative Members seem unable to understand. Economic efficiency and success are central to our strategy. By building a platform of stability we also build a platform for social progress, as economic efficiency and social progress go hand in hand. Conservative Members never understood that and they have demonstrated that they still do not understand it.

We continue in our aim to deal with unemployment and head towards our goal of full employment. In contrast, the Tories said that unemployment was a price worth paying. The right hon. and learned Member for Rushcliffe even said that he had had to provide figures on unemployment because of the problems that had occurred.

We are dealing with child poverty and pensioner poverty and investing in the national health service. We have presented a Budget for all the people which is based on stability, public services, enterprise and investment to make sure that our economy grows and people have secure employment.

Debate adjourned.--[Mr. Clelland.]

Debate to be resumed tomorrow.

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