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9.35 pm
Mr. Peter Bottomley (Worthing, West): Although Members on both sides of the Chamber hope that the hon. Member for North-East Derbyshire (Mr. Barnes) will have many other opportunities to address the House, it is right to pay tribute to the service that he has given to his constituents over the years. If I may, I shall add to his name that of his helper, Gary Kent, who, in many of the activities in which the hon. Gentleman has been involved, has contributed much for the public service that is offered through politics, whether in a party sense or otherwise.
As on other occasions, it was interesting to hear the hon. Gentleman speak about his constituency, and the House will be sympathetic over the Biwater closure. He talked positively about the need to recognise the resources within areas, which should not be taken for granted when people are considering what can be done through partnership arrangements, lottery funding or other activities, and he will agree that what appear to be less well-regarded areas containing less well-regarded people have provided, for example, the founders of the co-operative movement, the trade unions and small businesses.
Such people also helped to create political parties and used the extension of the franchise to found mass political organisations. We ought to learn from our forefathers and, for that matter, our foremothers.
Mr. Bottomley: I am trying to be politically correct for the benefit of my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth).
On mass membership, the political parties probably have fewer members than they have had for a long time, although I suspect that the drop in membership of the new Labour party is even greater than that in the membership of the Conservative party.
I pay tribute to a point made by the hon. Member for Halton (Mr. Twigg), who was right to say that we need to bring the family perspective into our analysis of Budget measures and social and economic policy. That is the only nice thing that I shall say about the hon. Gentleman. He is not here, so I should not say that the rest of his speech was pretty snide and hardly worth listening to.
We must acknowledge the important point that, at times, people have family responsibilities, and I pay tribute to the Chancellor for recognising that. The right hon. Gentleman has been able to do so because he has taken advice, which I have offered after a number of Budget speeches over a number of years, that the Department of Social Security should not be involved in setting income support or benefit levels for children.
In the traditional system, under which the Secretary of State for Social Security is supposed to get involved in negotiations with the Chief Secretary and, thereafter, the Chancellor and probably the Prime Minister, the question can arise each year, "Do you seriously want flat rate increases in child benefit or would you prefer to get more of the available money to those below the poverty line?" The sensible answer each year is, apparently, "Help the poorest." However, if we help only the poorest, the value of child benefit may hold steady in absolute terms, one year against another, but it certainly will not rise in line with average earnings.
I am glad that the Chancellor has got rid of the fiction that the Secretary of State for Social Security in effect takes responsibility for the child benefit level. That responsibility has always, and properly, been in the hands of the Chancellor. This Chancellor has shown that to be the case and there have been significant increases, which matter. No one can claim that everyone in full-time work can earn enough to support a spouse and children. They cannot.
If ever we try to return to raising pay so that people can achieve that, we shall end up in an inflationary spiral and pensioners and those with children will be worse off. If we want to have any kind of equity in this country, we must ensure that those who look after children or who are past working age do not suffer as those of us of working age go on an illusory chase after money that is not there.
I shall refer briefly to the Chancellor giving himself a pat on the back about the level of public debt. He misleads himself, but not any Member who has bothered to study the figures, when he talks as though the previous Conservative Government did bad things with the national debt. They did not. In fact, during their 18 years in office, public debt as a proportion of gross national product roughly doubled in other European countries, rising from 37 per cent.--I think--to 74 per cent. In this country, meanwhile, it fell--depending on which years we choose as the starting and finishing points--from about 44 or 45 per cent. by about 10 per cent., to 41 per cent. or less.
The Chancellor cannot really claim credit for the first year in which he held his office, as he was carrying forward Conservative spending policies. Before his 24 stealth taxes and his 20 business stealth taxes were introduced, debt as a proportion of gross national product had dropped to 35, 36 or 37 per cent. If the right hon. Gentleman claims that national debt doubled under the Conservatives, he may be right if he is merely counting the number of pound notes, but in terms of gross national product, or gross domestic product--which is the only sensible comparison, even for someone as clever as the Chancellor--he is simply wrong, and he should stop saying things that are misleading. Indeed, I wish the whole Government would stop saying things that are misleading.
Mr. David Taylor: It is not clear to me whether the hon. Gentleman is about to commend or criticise the Chancellor's track record over the past four years, and his stated aim in relation to debt repayment over the next five years. Does he not agree that one of the strengths of the Chancellor's activities over the past four years has been his driving down of public debt, thus enabling interest payments to be diverted for more profitable and effective purposes?
Mr. Bottomley: Perhaps; but if the Chancellor continues to maintain that people must turn their pensions
savings into annuities, and if the repayment of Government debt means that their return from buying Government stock goes down, he will be kicking the pensioners yet again. We should remember that the biggest stealth tax introduced by the Chancellor was the £5,000 million--probably adding up to £20-odd billion over the lifetime of the Parliament--that he obtained by withdrawing dividend tax credit from pension funds and individuals. I do not think that the hon. Gentleman's intervention has helped him much.The hon. Gentleman should look at table C23 on page 212 of the Red Book. He will see that in the last year of the last Labour Government public sector net debt was 47.3 per cent. of GDP, and that in the first year of the present Labour Government it was 39.6 per cent. That is a significant drop.
It is also worth noting that when the Chancellor and the Prime Minister make comparisons with the last Conservative Government, they are often unclear about whether they are referring to the period from 1979 onwards, when we had to sort out Labour's mess, or to the period following 1992 when, as we all remember, Labour was fortunate enough not to be elected. That enabled Labour to go into the 1997 election saying, "We are glad that you did not vote for us in 1992: we were wrong on virtually every significant policy". Labour paid the greatest possible tribute to its Conservative predecessors by adopting their spending plans during its first two years in office.
Dr. Lynne Jones (Birmingham, Selly Oak): What does the hon. Gentleman consider to be the purpose of public debt? He will note that when a Conservative Government last had a similar debt ratio, public assets amounted to around £80 billion. They are now down to £17 billion. What is the purpose of public debt and public investment?
Mr. Bottomley: If the hon. Lady wants me to use the last 17 minutes of the debate to give a lecture in economics, I shall be happy to do so. I may be a third-rate economist, but I could certainly fill in 17 minutes. I think, however, that the Minister would prefer me not to do so.
Let me give another example of the Chancellor's not quite achieving what he was after. This is at the opposite end of the spectrum. It has been estimated that one cigarette in three smoked in this country carries no tax. The stealth tax on smoking--which does not feature much in Budgets--hurts lower socio-economic groups most, both because they tend to smoke more and because their incomes are lower: they are hit by a double whammy. The Chancellor increased the tax by £500 million a couple of times when he raised duty by more than the escalator.
I am not arguing for low taxation on tobacco. However, another consequence of very high taxation on tobacco is the type of e-mail that I saw today, which states:
- "Hi, are you interested in making a saving of nearly 66 per cent. on your next purchase of cigarettes and handrolling tobacco? From only 17.50 Pounds per carton of 10 packs of 20 cigs each . . . Minimum order 3 cartons . . . delivery is fully guaranteed."
That e-mail is a good example of how excessive taxation can be counter-productive. I strongly support the conclusion that the Centre for Policy Studies reached in a
paper which it will publish in two weeks. The centre analyses the Chancellor's tax increases, including the ones that he does not deal with in his Budget statement and--I am sorry to say this in front of the Paymaster General--those that are not dealt with in the press notices that are made available to Members of Parliament.As I said in an earlier point of order, officials serving Ministers may not have those press notices available now, but they should be available. If they are available, they should be provided to hon. Members. The Paymaster General said that, if we want them, they will be available later. I hope that, in future, everyone understands that we want them on the day of the Budget.
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