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Mr. Brooke: Is my right hon. Friend aware that the fastest-growing sport in the state of California is cricket, which is played in silicon valley?

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Mr. MacGregor: As always, my right hon. Friend, through an illustration or an anecdote, makes the point extremely well.

I understand that the Chancellor has a passion for and obsession with detail, and that certainly shows in the complexity of so many of the new measures. As with education and getting budgets into schools, I believe that it is much more sensible to reduce taxation on families generally than to introduce a series of directed schemes that appear to be favourable and attractive to families. It is much better to leave families to make their own choices.

The complexity that we are beginning to detect on the tax credit front is frightening. Following the working families tax credit, a series of extremely complicated tax credits has been introduced. I must tell the Chief Secretary that I hope that that is not another way to fiddle the figures by reducing the public expenditure totals, as was done by the working families tax credit. The first of the two more serious consequences of such an approach is complexity for the recipients, and I am not surprised that there is not a big take-up.

Coming to the House in the car the day after the Budget, I listened to "Money Box Live". All the questions were about tax credits and the experts had great difficulty in explaining them. A lot of people outside the House simply will not comprehend them and I understand that the form is 40 pages long. That is not the way to set about establishing new systems, nor is it the way to encourage take-up.

Anyone who has tried to complete a self-assessment tax form this year, as I have, will have discovered that, because of a number of minor changes that the Chancellor has introduced to the tax system, that form is also 40 pages long and extremely complex. I happened to fill in my own, but it represents a bonanza for accountants, who will have to spend much longer on it. Introducing schemes of such complexity is not the right way to proceed and, of course, the burden on employers will be substantial too.

In the light of what is undoubtedly a Budget that will greatly exacerbate the complexity of our systems, I await the Chancellor's proposals on simplifying tax. It is perhaps significant that the press release on that subject comes last of all the Budget press releases. What is being simplified this year? The measures, which are the most minor that one could imagine, conclude with

Big deal, when so many complexities are being introduced.

On savings, I have to declare an interest. As stated in the Register of Members' Interests, I am a non-executive director of a life assurance company. However, my remarks are geared not to that, but to pensioners. The hon. Member for Lewisham, East (Ms Prentice) said that the Chancellor wears a hair shirt and is greatly interested in thrift. She might be right about the hair shirt, but he shows his interest in thrift in funny ways. We know how much the savings ratio has dropped--it has more than halved and is down to 3.75 per cent. this year from about 11 per cent. when the Government took office.

I regard that as serious, but I am not at all surprised when I consider ISAs--which replaced PEPs and TESSAs and are nothing like as good by any measure--and the

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changes to pension fund income in relation to advance corporation tax. I predict that the stakeholder pension scheme will not do for the Government what they hope it will. It certainly will not achieve substantial take-up among the targeted income group--those who earn between £9,000 and £18,000. Indeed, the scheme is likely to proceed in such a way that there will probably be many fewer providers and much larger ones than in the past. That, too, will not produce the results that the Government seek, although I am certainly with them in wishing to encourage much more take-up of pension contributions at a much earlier age from all employees.

Mr. Geraint Davies: Does the right hon. Gentleman accept that savings ratios tend to go down at a time of consumer confidence and economic stability? The majority of people's savings these days is in their houses, not in conventional savings accounts, and the savings ratio does not take on board wealth accumulated in housing.

Mr. MacGregor: When providing for old age or saving for other reasons, it is not helpful to put all one's money into a house.

Mr. Davies rose--

Mr. MacGregor: Let me finish. I was a great supporter of the original Conservative concept of the property- owning democracy and supported all the way through every measure that we took to achieve it, but it has been achieved. The next stage is the share-owning democracy and the vast majority of the population providing for their own pensions. We all know, and the public widely recognise, that the state system will not do that, which is why I want to encourage those other measures and why it is worrying that the savings ratio has gone down.

There was speculation before the Budget that the Chancellor would introduce a measure to deal with the fact that people with personal pensions have to purchase an annuity by the age of 75. The concerns about the current system have been well documented, not least in a report by a retirement income working party headed by Oonagh McDonald, a former colleague in the House who participated in debates on the Finance Bill. I shall not go into those concerns because of the shortage of time, but they are well understood.

My hon. Friend the Member for Bournemouth, West (Mr. Butterfill) has introduced a private Member's Bill to address the matter, but as far as I can see the Government took every step to talk it out last Friday. Why is not such a measure in the Budget? Why are not the Government removing the deadline age limit of 75, by which one must have turned to a retirement annuity? If we are in a low-inflation environment, annuities will pay much less so it would be much better for individuals--certainly with their personal pensions--to subscribe enough to what the McDonald working party report describes as an index- linked annuity to meet a minimum retirement income. That would cover the possibility that individuals may squander their money, not have enough and, in due course, rely on a minimum income guarantee from the state.

I agree that it is right to protect that, and people have been working out ways to do so, but, beyond it, there is no reason why people who have been encouraged to build

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up personal or money-purchase pensions should be encumbered with such a restrictive regime, which, in my view, is out of date, not least because they would have nothing to pass on to their families. Therefore, it is sensible to introduce a measure to remove the deadline age limit, and the absence of that represents a great gap in the Budget. I hope that it will be addressed and I am interested to know why the Government have set their face against such a measure.

This may be the last time that I speak in the Chamber and I echo all the comments made by my right hon. Friend the Member for Huntingdon. Participating in so many Budget and Finance Bill debates has been a tremendous experience, but, above all, it has been a privilege and a thrill to be a Member of the House.

7.19 pm

Mr. Colin Burgon (Elmet): As a relatively humble Back-Bencher, I am proud to take part in a debate with the former Prime Minister, the right hon. Member for Huntingdon (Mr. Major), and the right hon. Member for South Norfolk (Mr. MacGregor). I hope that they will still have further contributions to make. The right hon. Member for Huntingdon is a straight man whom I respect. I also respect his experience, but I think that it was Frederick the Great who said:

Perhaps we will have to debate these issues further.

After the Budget, like all good constituency MPs, I went out and about trying to judge people's mood and find out what they thought about the proposals. I should like to cover three subjects that have been drawn to my attention: education, the environment and pensioners.

On education, I did not recognise the picture painted by the hon. Member for Maidenhead (Mrs. May). On Thursday, I went to West Garforth primary school to meet the head teacher, Ann Oxley, and open a computer suite, thanks to Government funding. The head was pleasantly surprised to hear that the amount of money she was expecting to receive for her small primary school had leapt from £10,000 to £13,000. Similarly, down the road in Allerton Bywater primary school, a larger school in my home village, Gill Weatherhead, the head teacher was delighted to hear that her expected sum of £50,000 had leapt to £63,000. Likewise, the amount for the two large comprehensives in my constituency, at Boston Spa and Garforth, leapt from £92,000 to £115,000. That is money well spent and well received.

We must be honest. I wish that the hon. Member for Harrogate and Knaresborough (Mr. Willis) was still present. I used to be a neighbour of his in more ways than one: I am a neighbour as an MP and he taught just up the road from where I taught. He got a lot more money than I did, and I was in a tougher school--but then again, he was a head teacher, so he can speak with authority. Any MP who goes round schools and talks to teachers must accept that they recognise that more money is coming in, but that is not the full picture.

We must address two problems. First, I hope that when we are re-elected at the general election, whenever that may be, we will do something about teachers' pay structure. Secondly, we must deal with an area that will otherwise give us problems by supporting teachers in the most difficult aspect of their job, which is maintaining discipline. There is no doubt that it is impossible to

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contain some pupils in an ordinary school setting, so we must consider pupil referral units. Such units are costly, but they are productive. If the element that is difficult to control were removed, teachers could get on with the job of teaching.

I do not think that I am so aggressive or imposing that head teachers cannot speak to me frankly, and not one of them has ever told me that they want a full, 100 per cent. devolved budget. If the argument is that head teachers are already disappearing under a sea of bureaucracy and paperwork, such a move would involve them in even more bureaucracy, whether it be on school dinners, school transport or special needs. I did not recognise the picture painted by the hon. Member for Maidenhead.

I listened carefully to my right hon. Friend the Secretary of State's comments on the big issue of recruitment and retention. It is no good trying to shy away from this problem. I welcome the £35 million to be invested in the new management information system. It is our job as MPs--certainly on the Labour Benches--to ensure that the claim that the new system will lighten the load of data collection is delivered. Teachers tell me that the amount of paperwork they receive is extremely time consuming. I regularly receive a lecture from my brother, who is a head teacher and who tells me how much time he has to spend dealing with forms.

In the discussions I have with teachers, I encourage them to speak their minds, and in response I am allowed to speak mine. After having a face-to-face, full and frank discussion with staff of a large comprehensive in my constituency, I asked the head teacher--I shall not say who--"Don't they realise the amount of money that is going in? I can't believe their reaction." He said that, at the end of the day, they will vote Labour, because they know that a Labour Government will deliver the resources they need. We may have an argument with teachers, but it is within the family, and I feel confident that they will support us.

We need to get a grip on the lack of cover in schools. In my city of Leeds, several schools are balloting on strike action. If a pool of people is not available now--to be blunt, supply teachers are of variable quality--I am not sure what strike action will achieve.

I am also interested in the Chancellor's proposals on the environment and how they affect my city of Leeds. Leeds takes a dual approach to many matters. It has an affluent outer core, and an inner-city core where the business sector has developed. It also has areas of devastating poverty. The steps that the Chancellor has taken to regenerate Britain's towns and cities, such as Leeds, are excellent. I want to highlight three or four key proposals.

The stamp duty exemption for property transactions in the most disadvantaged areas is an excellent measure. My right hon. Friend has cut VAT to 5 per cent. to encourage renovation and conversion of existing property, and he has proposed 100 per cent. capital allowances for creating flats over shops. I hope that people will support all those ideas.

I am particularly interested in the 150 per cent. accelerated tax credits to help to clean up contaminated land. That is good news for the industrial and old mining areas of Leeds that I represent. The only bad news is that that was not done a few years ago. In my home village of

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Allerton Bywater, the colliery site has just been reclaimed. I wish that the tax incentives had been available at that time.

Those measures taken in conjunction with the various planning legislation that the Government have introduced--I am thinking principally of planning policy guidance note 3--provide a package of measures that show the interrelation between the inner city and the suburbs, whose fates are inextricably linked. In Leeds, we are developing housing in the city centre. We must ensure that it is not only flats for wealthy people. If we use our derelict land effectively, it will help us to protect our greenfield sites. I hope that Conservative Members agree with us on that issue.

The proposals in the Budget that have preoccupied me most are those relating to pensioners. Like all MPs, if I had a pound for every time a pensioner chewed my ear, I would not be here--I would be sunning myself somewhere. Pensioners are great people, because they speak their minds. As long as I can speak my mind back to them, I welcome that. I welcome the priorities in the Budget that will improve pensioners' incomes. It is important to consider the strategy that the Labour Government have developed over the years. It represents a giant step forward, but we have a few more to take.

In an overall strategy of ending pensioner poverty by 2010, the Government have taken the initial steps of increasing the basic state pension by more than the rate of inflation to £72.50 for a single pensioner and to £115.90 for a pensioner couple; increasing the amount of income that is taxed at the low rate of 10 per cent., which will help an estimated 3 million pensioners; and increasing the minimum income guarantee to £92.15 for a single person and £140.55 for a pensioner couple.

When the MIG was introduced, like most other MPs, I ran campaigns up and down my constituency to raise awareness of the guarantee and to encourage people to take it up. In such wonderful-sounding places as Swillington, Allerton Bywater and Swarcliffe, we engaged in vigorous discussions about the Government's policy on pensioners and the minimum income guarantee.

An important aspect of the Budget for pensioners, and for me--after all, I may well be a pensioner soon--is the announcement of the start in 2003 of the pension credit scheme, which will reward the 5.5 million pensioners who have made the sacrifice of contributing to modest works pensions, and/or saving for their later years. I encountered many households with very small tailors' or miners' pensions, for instance--they were usually the husbands' pensions; for some strange reason women tend to outlive men, and research will doubtless explain why--which prevented them from claiming other benefits. That rankled with them. I wrote to the Prime Minister and the Chancellor of the Exchequer, and I should like to claim that they have listened to me, although greater forces were probably at work. In any event, the proof of the pudding is in the eating.

During that first half of 2000, I went out of my way to meet as many of my pensioner constituents as possible to promote the minimum income guarantee. They raised a question which I hope the pension credit scheme has at last begun to answer. Under the scheme the sacrifices that they made while in work will be recognised, and credit will be given for modest pensions and savings. I am gratified to note that pension credit will be linked

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to earnings, thus giving pensioners more than they would have received through the restoration of the link between the basic state pension and earnings.

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