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7.39 pm

Mr. Iain Luke (Dundee, East): Over the long years of parliamentary history, the raising of taxes, the setting out of spending plans based on Government priorities and people's needs, and finding the financial means to tackle issues of public policy have provided many of the major issues of debate and controversy heard in the Chamber. It might be worth while saying that the onset of my contribution stems from the way in which the introduction of national insurance was fought tooth and nail by the Conservative party in 1909. It is not surprising that we find Conservative Members still battling against any increases in national insurance contributions, even if there is to be spend on the national health.

The Budget, the financial focus of the nation's public life, means many different things to different constituencies, communities, businesses and interest groups throughout the United Kingdom. We as Members all come to the debate with different demands and agendas. However, at the end of the day, if the many appetites seeking succour at this supper are to be satisfied, one underlying premise has to be met.

The overall health of the economy must be sound and capable of sustaining and satisfying the many credible claims made on the Treasury's chests. Whatever one's political persuasion, it is mischievous and misleading to

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argue that the United Kingdom's economy is not sound at present or that the Government's economic management has not been a major factor in creating the unparalleled economic stability that we now enjoy.

All the economic indicators put the sophistry of the Conservative party to the sword—be they interest rates, inflation, employment, house prices, job creation or Britain's ability to cope with the global economic downturn. The Government and my right hon. Friend the Chancellor of the Exchequer have set a standard that has rarely been met by previous Governments in creating a macro-economic climate. It is one that has seldom been enjoyed by the inhabitants of these islands. This achievement has put in place the foundations that will enable Parliament to work with other organisations in civil society, including the trade unions, to build a society that will aim to achieve social justice and a better life for the many, rather than the privileged few.

Like many Labour Members, I have at the top of my agenda the need to ensure a more prosperous country for my constituents to share in. The mainstay of the prosperity enjoyed by so many so far during the Government's first term has been the creation of 1.5 million new jobs, and that job creation must be maintained. We must ensure that that prosperity is sustained. Job creation must bring a better future for many more citizens.

In the run-up to 17 April, I was looking for a better and more conducive tax regime to allow the smaller to medium-sized enterprises in my constituency to flourish, to create more growth and therefore, as a consequence, to create more employment. I believe that my right hon. Friend the Chancellor is doing that through his Budget.

Employment issues and the creation of jobs are an area of prime concern to the area that I serve, with its unemployment rate standing at 7.2 per cent., which is significantly higher than the national average. It is therefore vital that we create a financial structure that enables entrepreneurs and enterprise to establish themselves and to create new forms of economic activity. Given the measures that the Treasury are introducing, it is clear that for economic growth to mean anything it must be shared equally throughout the country.

I am happy to acknowledge the real economic benefits that will accrue to Dundee with the location of the new Department for Work and Pensions offices and the Inland Revenue's new call centre, which will bring in total 1,000 new jobs to the city. That will be much welcomed.

I hope that the Budget will help Dundee build on its considerable success in promoting itself and on its continuing efforts to capitalise on the academic endeavours of its two universities to bring new jobs into the market, especially biomedical research technology and computer games.

Only recently, my right hon. Friend the Prime Minister visited Glycocel Ltd. in Dundee, a new concern which is a good example of the fruits of a biomedical research programme that has flourished at Dundee university. Indeed, it has been encouraged to grow through a joint university/city council-promoted incubator project. It is providing a crucible for the promotion of economic production based on successful academic research.

The restructuring of the business incubation fund announced in the Budget should, I hope, enable further success in the vital restructuring of Dundee's economic base. I am glad that my right hon. Friend the Chancellor has introduced measures to assist manufacturing in general.

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At a positive meeting in February, which I think the hon. Member for Galloway and Upper Nithsdale (Mr. Duncan) missed, the Scottish chamber of commerce at Dover house presented statistics that showed an encouraging snapshot of the Scottish economy during the last quarter of 2001. The statistics produced by the Fraser of Alexander institute clearly underlined the success of the Government's management of the economy, with the figures showing encouraging levels of consumer spending, increasing house prices and improving tourism figures.

There have always been the problems clearly identified in manufacturing—in Scotland, Wales and the United Kingdom generally. I welcome the proposal contained in my right hon. Friend's pre-Budget statement last year, and I applaud the steps that he has taken in the Budget to help British industry to become more competitive and more productive by reducing the tax burden, by promoting research and development and by encouraging training and a greater ability to invest in people. With the additional funding of £30 million being made available to small firms to help them in gaining Investors in People awards, this will be extremely helpful.

I hope that this will help British business to become more competitive and more productive, and as a result safeguard jobs.

I congratulate my right hon. Friend on the freezing of petrol and diesel duties. When the hon. Member for Poole (Mr. Syms) asked why we had not replaced the levy on oil in the North sea by increasing the tax on diesel and petrol he was being disingenuous in relation to the facts that pertained last year.

I argue that the freezing of petrol and diesel duties is welcome, not because it placates motorists in general but because fuel prices play a significant role in the cost of commodities produced at a distance from the market. Given the shambles of the rail freight industry, with the Railtrack debacle and the virtual blockade of the channel tunnel, which has seriously restricted Scotland's rail haulage contacts with the continent—in some instances it has been cut by 80 per cent. owing to the inactivity of the French authorities to police asylum seekers trying to gain access to the UK—road connections and transport costs are doubly important.

Given the proximity of the new ferry terminal at Rosyth to both our constituencies, I am sure that my right hon. Friend the Chancellor and I will welcome the beginning of the new direct ferry services from Scotland to the continent next month, and the benefits that that will bring to hauliers and other businesses throughout Scotland.

I am confident that the steps taken by my right hon. Friend are the right ones, and the ones that will continue to promote the economic health and growth of the UK. They will continue the Government's great record of creating new jobs. The steps outlined in my right hon. Friend's Budget last week will provide the conditions and stimulants that many were seeking to ensure that the problems facing manufacturing were tackled. Small to medium-sized businesses will be encouraged to grow, and the opportunity for new start-ups will be enhanced.

I especially welcome the proposals for the new community investment tax credit, and the £40 million of community development venture funding that will be put aside and launched in May. This is a treasure chest that I and those involved in the promotion of economic activity in Dundee will be seeking to raid before too long.

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Certainly the national focus on strategy for new start-ups is long overdue, especially in the area that I represent. The Department of Trade and Industry should be encouraged to become more engaged in such areas to help growth and to provide advice and support for new and aspiring entrepreneurs. The new helpline proposals and starting packs will certainly aid in the process. I hope that the telephone numbers will be widely advertised and that the packs will be heavily promoted.

In presenting the Budget, my right hon. Friend the Chancellor of the Exchequer aptly referred to a discussion on the health service. He said that what we decide in this debate

I strongly believe that the essence of this country's character should be a responsible and responsive nature, caring and providing compassionately for those in need—a nation with a shared and collective sense of duty and service, striving to recreate an enterprising and creative country in which access to economic and social opportunity and welfare is based on equality for all.

I believe that my right hon. Friend the Chancellor has taken the necessary measures in the Budget to ensure that the citizens of Dundee and the people of Britain will share both in that analysis and in the prosperity and economic well-being that they deserve, which will be produced by the Budget.

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