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Mr. Deputy Speaker (Sir Alan Haselhurst): Order. In a spirit of seasonal goodwill, may I appeal to hon. Members to show some generosity to each other in the time remaining? Otherwise many will be disappointed.
5.40 pm
Mr. David Kidney (Stafford): The right hon. Member for Wells (Mr. Heathcoat-Amory), who spoke for the Opposition, asked a valid question about the Labour party's contribution to the century. The Labour party has served the country in government for 23 years out of 100. Although I am proud enough that we founded the welfare state, set up the NHS and established comprehensive education, I would be pleased to assure him, if he were in his seat, that the best is yet to come.
Of course, if hon. Members were judging us by the record of previous Labour Governments, we would be waiting for the mid-term economic crisis, but it has not occurred. In an independent article VI assessment of the British economy published on 24 November, the International Monetary Fund describes the "remarkable" performance of the British economy. It says:
- "The public finances, in particular, have clearly shifted into the 'sound' range, from significant deficits to a small surplus".
What delights me especially is that this is the Labour Government who have learned that economic competence and social justice can go hand in hand. It is odd that, in a debate on public spending, no hon. Member has mentioned today's tremendous announcement about the Government's extra contribution to relief of debt for
the world's poorest countries--a very creditable announcement at this time of the year and a great tribute to the Jubilee 2000 coalition that has fought with such honour and decency for debt relief.
Mr. Letwin: I hope that the hon. Gentleman will acknowledge that Conservative Members thoroughly support that proposal, unlike many others.
Mr. Kidney: I am also happy to acknowledge the contribution of the right hon. and learned Member for Rushcliffe (Mr. Clarke) when he was the Chancellor of the Exchequer.
As ever, my right hon. Friend the Chancellor is not short of advice; it does not come just from those in the House. The IMF tells him that there is
- "no case for relaxing fiscal policy".
- "only a small fiscal loosening is compatible with the Chancellor meeting his rules for public borrowing".
- "we support the prudence the Chancellor has consistently advocated".
It is forecast that there will be budget surpluses over the coming two or three years. I accept the IMF's assessment that that is largely a cyclical phenomenon. The article VI assessment describes it as transient in nature, so an important note of caution needs to be sounded when all of us present our shopping lists to the Chancellor.
Another reason why caution is needed is the fact that there are upward pressures on inflation, to which several hon. Members have referred. As I said to the hon. Member for Kingston and Surbiton (Mr. Davey), if the Chancellor makes decisions about public spending or tax cuts that the Monetary Policy Committee judges to be unwarranted, its response will be to tighten monetary policy. Any gains that we feel would arise from that fiscal stimulus might be taken away with an increase in interest rates.
There are many reasons for the Chancellor to continue his famed prudence. However, there is scope for some clever spending, as I shall show in my advice to the Chancellor. To support my first piece of advice, I refer to the report in The Guardian on the Chancellor's performance before the Select Committee on the Treasury last week--although not to the point chosen by the hon. Member for Bury St. Edmunds (Mr. Ruffley). I refer to the mention in the report of broad hints from the Chancellor that there might be more money for health and education in the comprehensive spending review next year. I applaud that. I hope that it is true, although my right hon. Friend will realise that any spending increases must be prudent and sustainable.
My second piece of Christmas advice to the Chancellor is to urge him to continue to put as much distance as possible between himself and the ball and chain of the public sector borrowing requirement. Unlike some Conservative Members, I am pleased by the introduction of more realistic measures, such as the net cash
requirement, instead of the old and restrictive PSBR--a measure which positively discriminates against proper capital investment in our infrastructure. I hope that the Chancellor continues to make those moves and that eventually he adopts the general Government financial deficit measure which is used elsewhere in Europe.I am not only making a plea for the use of different accounting; we need different thinking in the public sector, so that it is free to be innovative. There have been some small examples of that: the armed forces have been given some leeway to attract commercial uses for their surplus resources. I have seen that at RAF Stafford, where the RAF has been innovative in trying to make the best use of its storage space, and in using the strong security of its premises.
I applaud such initiatives and hope that there will be more of them. Under the Local Government Act 1999, local authorities have been given a little more freedom to form trading companies and joint ventures.
My final pieces of advice are on education and productivity--two matters to which the Chancellor will be glad to turn his attention, as education is one of the Government's top priorities and the improvement of productivity is one of the Chancellor's favoured aims. I hope that I shall not bore those on the Treasury Bench if I make a plea to end the unfairness in Government education funding for local authorities. The present system of distributing that money is extremely unfair. The Government accept that and a working party is currently studying the matter. The Chancellor has announced that one of the 13 interdepartmental committees will consider local government finance. I hope that there will be some one-off spending that does not disadvantage authorities that feel threatened when authorities such as Staffordshire ask for more money for education. Authorities at the bottom of the spending league table should be brought higher up without affecting those at the top. That will require one-off, ambitious spending from the Treasury.
As I pointed out in a previous debate, we underinvest in our capital infrastructure. We need investment in order to achieve the highest productivity in UK plc. Through the Treasury task force, we have come a long way in improving performance on private finance initiatives--now public-private partnerships--attracting private investment for capital projects. The Chancellor has reversed the long-term decline in public investment in capital projects under the previous Government. He has done a good job. However, if there is capacity for further public spending, it would be excellent to use that money for public projects--capital spending to improve our infrastructure and productivity.
5.49 pm
Mr. Nick St. Aubyn (Guildford): We have had an interesting debate, even if it has been somewhat arcane and specialised at times. It has concentrated on the Government's spending inputs, rather than on the results that have been achieved for the people whom we represent.
Let me begin by telling the story of one of my constituents, who wrote to me recently about her mother, a lifelong member of the Guildford Labour party, who, sadly, died recently of a heart condition which until 1997 would have been diagnosed and treated in time. My constituent and her family feel betrayed by the Government and their health policies, and by Health Ministers.
The treatment did not arrive in time because the waiting time for the diagnosis of heart conditions in West Surrey has gone up from three to nine months, and it is now rising to a year. That is the result of a 20 per cent. cut imposed on the hospital service by the health authority as a result of the changes introduced by the Government, who took authority for the budget away from local doctors and gave it to the health authority. That is a classic example of how changes in the way in which that the service is delivered--it is now more bureaucratic and less sensitive--have directly led to the tragic loss of the lives of my constituent's mother and others in my area.
Only last week, the Daily Mail reported the case of a 29-year-old man who was in the prime of life. He had a huge amount to offer and an immense number of friends and he was earning his way in the world. The leading heart specialist at the Royal Surrey County hospital told me that he was convinced that that man would have been alive today if the quality of care had remained at the level available in 1997. The specialist had the terrible task of explaining to that man's family that he had not been able to give him the treatment that he knew was needed and that he would have been able to give him in the past.
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