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Tax Revenue

3. Mr. Simon Hughes (Southwark, North and Bermondsey): What his forecast is of the revenue from (a) personal taxation, (b) corporate taxation and (c) VAT for each of the next seven years. [150137]

The Chief Secretary to the Treasury (Mr. Andrew Smith): Forecasts of tax revenues were published in tables B8 and B11 of the pre-Budget report. Updated forecasts will be published in the "Financial Statement and Budget Report" next week.

Mr. Hughes: I predicted that reply. The projections show that the tax take over the next five years will be constant as a proportion of national income. However,

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investment in health over the term of this Government is on average lower than it was under the term of the Major Administration, the previous Tory Government. Average investment in education over the Government's term of office is less than it was on average under the Tory Government. On the same basis, investment in pensions is less than it was.

Have Treasury Ministers got the message from the public that they have no desire next week to be bribed with their own money, following a tax-cutting agenda that the Tories are suggesting? The public want real extra investment in public services such as education and health and for groups in the community who need it and deserve it, such as pensioners throughout the United Kingdom?

Mr. Smith: It is because we made tough choices, which the hon. Gentleman's party opposed, that we have been able to get the national debt down from 44 per cent. of gross domestic product to 33 per cent., and it is due to fall to 30 per cent. That is establishing the strong foundation for the investment that is under way--a doubling of investment across the spending review period, with record increases in health, education, transport and fighting crime, the people's priorities. We can deliver because we took tough choices and built a strong economy, which the hon. Gentleman's party would never do.

Mr. Christopher Leslie (Shipley): Does my right hon. Friend agree that it is important to continue the sensible and prudent planning and forecasting of revenue and expenditure? I urge the Government to ignore and not be tempted by the advice of either the Liberal Democrats, who seem to think that money grows on trees, or the Conservatives, whose sums never seem to add up.

Mr. Smith: Yes, indeed. I shall take my hon. Friend's comments as a Budget representation. I can assure him that we have no intention of being drawn down the path of irresponsibility proffered by either the Conservative party or the Liberal Democrats.

Mr. Michael Fallon (Sevenoaks): If everything is so rosy, why is the European Union worried about the Government's future taxation and spending plans, and why did the International Monetary Fund warn yesterday of

How can the Government describe that as vindication?

Mr. Smith: That is a total misreading of what the IMF said. Let me give the hon. Gentleman the quotes. The directors stated that

They said:

The acting chairman, summing up, commended the authorities for the continued strong performance of the United Kingdom economy.

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Education Investment

4. Mr. Bill Rammell (Harlow): What his assessment is of the impact on Government finances of his plans for future investment in education. [150138]

The Chief Secretary to the Treasury (Mr. Andrew Smith): As I said, because we took tough choices, stuck to prudent fiscal rules and built strong public finances, we are able to raise capital investment in education from £2.4 billion in the current year to £3.8 billion by 2004, a real-terms increase of 48 per cent. Total education spending will rise by £11.7 billion over the same period, an increase of 16 per cent. in real terms.

Mr. Rammell: I thank my right hon. Friend for that response. When I recently visited the Water Lane primary school in my constituency, the head teacher told me that in 25 years of teaching, she had never known so much extra money going into schools. Given that capital spending on Essex schools has more than doubled in the past year, that is hardly surprising. Does my right hon. Friend agree that that investment needs to increase in future years, as set out in the three-year comprehensive spending review, and does he share my concern that were any party to come to power committed to cut that investment by £16 billion, that would be entirely the wrong way forward?

Mr. Smith: I share my hon. Friend's concerns. I am grateful for his remarks and those of his constituent. Those remarks reflect the Government's record in already increasing average spending per pupil by £300 in real terms. That will be a £450 real increase next year. As for the future, by 2004 we will increase real-terms education spending by one third--a bigger real increase in the early years of this Government than in the entire period of office of our predecessors.

Mr. Oliver Letwin (West Dorset): As the Chief Secretary and the Chancellor are so keen to take comments as Budget representations, will they take the remarks of Mr. Chris Woodhead, the former chief inspector of schools, as a Budget representation, when he states:

Do they agree with Mr. Woodhead that the Chancellor and the Prime Minister have

Do they agree that the Government have not delivered, and that

Mr. Smith: Education has suffered in the past from being turned into an ideological battleground. I would caution the hon. Gentleman and his colleagues against trying to do the same on the basis of those comments. The truth is that under Chris Woodhead's leadership, Ofsted made a distinguished contribution to raising standards, worked closely with us on the literacy and numeracy

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strategy, praised what we did in respect of cutting class sizes for infants--a policy opposed by the Opposition--[Interruption.]

Mr. Speaker: Order. The hon. Member for West Dorset (Mr. Letwin) asked a question. He must show some courtesy when the reply is delivered.

Mr. Smith: What the hon. Member for West Dorset (Mr. Letwin) should do is praise the accomplishment of this Government, which is based on their work on raising literacy and numeracy standards from the disgraceful level to which they fell under the previous Government, raising the proportion of pupils who achieve top GCSE grades and turning around 650 failing schools that would have continued to suffer under the Conservative Administration.

Employment Statistics

5. Gillian Merron (Lincoln): If he will make a statement on changes in employment and unemployment over the past 12 months. [150139]

The Paymaster General (Dawn Primarolo): Since the Government were elected, employment has risen by more than 1 million. Over the past year, it has risen by 225,000 and International Labour Organisation unemployment has fallen by 169,000. The claimant count now stands at just 5,000 above 1 million.

Gillian Merron: My hon. Friend will be aware that unemployment in Lincoln has almost halved since the general election, while long-term youth unemployment has decreased by 86 per cent. However, that positive picture is not exactly uniform across the city, as people in wards such as Park and Abbey remain more likely to be out of work. Will my hon. Friend step up the application of targeted measures to areas such as Abbey and Park, to ensure that all my constituents can benefit equally from the stable economy created by the Government?

Dawn Primarolo: My hon. Friend correctly identifies that there are particular areas where it is necessary for the Government to concentrate our effort, perhaps through the expansion of new deal opportunities to help people into work. We must continue to remove the barriers to ensure that people can move from welfare into work and be financially secure. Of course, we must also continue to ensure that that work pays and that people can progress through work using lifelong learning. It is through all those measures, including expansion of the new deal, that we intend to continue to drive down unemployment, to move to full employment and to ensure that all the talents of all the people in this country can be used.

Mr. John Bercow (Buckingham): In reflecting on employment policy, does the Paymaster General, as a former member of the Bennite left-wing Campaign group of Labour MPs, now accept that that free-market capitalist the United States of America has been dramatically more successful than most countries in creating and retaining jobs? To that end, has she made any assessment of the

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efficacy of the Regulatory Flexibility Act 1980 and the Small Business Regulatory Enforcement Fairness Act 1996? If not, why not?

Dawn Primarolo: I should like to remind the hon. Gentleman of a couple of facts. First, the United States has the welfare-to-work partnership, which includes 10,000 firms. Secondly, it was the Conservative party that said in government that unemployment was a "price worth paying", following which it rose to the record level of 2.9 million. It is under this Government that 1 million jobs have been created and that long-term and youth unemployment are down. There are 1.1 million vacancies in the economy and the challenge is to match them with the people who are seeking jobs. The hon. Gentleman has no answers to that proposition.

Ms Rosie Winterton (Doncaster, Central): In my constituency, we have a new deal for communities area, which means that about £50 million will be invested in the next 10 years to help people back into work, among other things. Thanks to this Government, big capital projects are also starting, such as the North Bridge road and the transport interchange. In the light of my right hon. Friend the Chancellor's earlier statement about community investment, will my hon. Friend consider what incentives can be given to big companies to ensure that they employ local people in areas of high deprivation?

Dawn Primarolo: I reassure my hon. Friend that that is precisely why my right hon. Friend the Chancellor has emphasised the importance of investment in our communities and, in particular, the use of tax credits in that work to build on the new deal for communities. I shall certainly bear her comments in mind.

Mr. Crispin Blunt (Reigate): Given that the word "employment" appears in the title of another Department, is not the fact that this question was not transferred an example of the Treasury's astonishing contempt for other Departments in Whitehall?

Dawn Primarolo: If the hon. Gentleman does not understand that employment is part of the economy, I cannot help him further.

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