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Mr. Patrick McLoughlin (West Derbyshire): Some time ago, the Government announced that they would give the fuel duty rebate to community transport. Is there anything in the Bill that advances that commitment? When will we get the proposals that the Government promised they would make on that measure?
Mr. Smith: I understand that no such commitment was made, but as the hon. Gentleman has raised the matter, I will check it carefully and get back to him.
On waste disposal, we want to encourage the sustainable treatment of waste. As was expected, clause 119 increases the standard rate of landfill tax from £12 to £13. The Bill also includes important amendments to the operation of the aggregates levy and provides for the scheme's operation in Northern Ireland. Clauses 126 to 130 set out the details.
The goals of economic growth and environmental protection are intertwined in the policies of this Government. That was true of the Budget, it is true of the Bill and it will be true of the forthcoming spending review.
David Taylor (North-West Leicestershire): I was pleased to hear of the planned increase in landfill charges, but does not the Minister recognise that associated with
that steady increase in charges is a steady increase in fly-tipping of the type that my hon. Friend the Member for Lewisham, Deptford (Joan Ruddock) seeks to address in the private Member's Bill on waste that she introduced a moment ago? The problem exists in the constituencies of many hon. Members. Do the Government intend to tackle fly-tipping at the same time as making it more expensive to use our existing landfill sites?
Mr. Smith: My hon. Friend makes an important point, as did my hon. Friend the Member for Lewisham, Deptford in introducing her ten-minute Bill. That is partly why we have been reviewing and consulting on reform of the use of the fund that the levy makes possible to ensure that it is properly aligned both with our priorities and with those of the public for better recycling and clearing up mess wherever it is—as well as taking vigorous action against those who are responsible for fly-tipping.
Mr. Jack: When the landfill tax was introduced, there was a corresponding reduction in employers' national insurance contributions. Can the Chief Secretary explain why, for the second time under this Government's responsibility for that tax, no corresponding reduction has been made, although the landfill tax rate has been increased?
Mr. Smith: We have made a judgment on the overall balance between the reduction of 0.3 per cent. in employers' national insurance contributions and the establishment of the fund. As I said, we have been reviewing the fund's operation. In making that overall judgment, the effects must be considered together.
Mr. David Laws (Yeovil): Will the Chief Secretary give way?
Mr. Smith: I should like to make a little more progress, if I may. I have been very generous in giving way.
To ensure fairness for taxpayers and businesses, we must act swiftly to close tax loopholes and be vigilant against tax avoidance. The Chancellor has therefore decided to act with immediate effect on the avoidance of stamp duty on property, to put an end to three artificial schemes for VAT avoidance and to review the complex rules of residence and domicile.
The heart of the Budget, as we debated last week, is to secure the long-term future of the national health service—a key priority for the Government. Tomorrow, we will have the opportunity to discuss the measures in the national insurance resolutions. The Bill freezes personal allowances for the under-65s in 2003–04, contributing to further investment and reform in public services and the NHS, which were starved of resources for 18 years under Conservative Governments, but will be renewed for generations to come by this Government.
We believe in a Britain where fairness and enterprise reinforce one another, where, on the platform of stability and tough fiscal rules that we have put in place, we can invest the resources needed for quality public services and make work pay, so that everyone is enabled to make the most of their potential. A strong and growing economy is crucial for a fairer Britain. The Bill, like the Budget, advances both, and I commend it to the House.
4.8 pm
Mr. John Bercow (Buckingham): I beg to move, To leave out from 'That' to the end of the Question, and to add instead thereof:
- 'this House declines to give a Second Reading to the Finance Bill because the provisions contained in its two volumes and 488 pages increase the burden of taxation on important sectors of the economy; fail to make adequate commitments about taxation and personal allowances in future years; and will have a negative impact on competitiveness and the attractiveness of the UK as a location for investment.'
I can say without exaggeration, and with the assent of my right hon. and hon. Friends, that the Chief Secretary's speech in winding up the Budget debate last Tuesday was widely viewed as the most peculiar parliamentary performance of this Parliament, and probably of the past five years. The right hon. Gentleman was overcome with hysteria and propelled into such flights of uncontrolled fury that many Conservative Members feared that Vesuvius had exploded all over again. I am an observant as well as a compassionate chap and I therefore recognise that it was a terrifying experience for the Chief Secretary to try to cope with the forensic dissection of the Budget that my right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard) unleashed. Nevertheless, let me say with all due courtesy that it is reassuring to observe that this afternoon he has returned to some semblance of normality.
Let me continue as I have begun, in a generous spirit and with some words of welcome for specific measures in the Finance Bill. We welcome the tax credit for research and development by large companies, even though it has been announced for the third time. We welcome the cut in corporation tax for small firms and the modest reform of the basis for the payment by companies of VAT. However, they and other not unwelcome features of the Budget must be viewed in the wider context of other, damaging imposts.
I refer specifically to an impost of which business is painfully aware: the £6 billion a year extra taxation with which it has been encumbered in the past five years and the additional burden of £5 billion a year in regulatory costs. Those burdens impede companies' ability to win orders and create jobs.
The Bill must be viewed in the light of the fact that new regulation that affects business has been introduced and continues to be introduced every 26 minutes of the working day. It must be viewed in the light of the fact that since the Government took office, Britain has plunged from ninth to 19th on the world competitiveness scoreboard. It must also be considered in the light of the fact that productivity growth is below that of the United States of America, under the Labour Government, when it was consistently above it under the previous, Conservative Government.
Kevin Brennan (Cardiff, West): Will the hon. Gentleman give way?
Mr. Bercow: In a moment. The hon. Gentleman tempts me; he will have to wait only a few minutes.
The measure must be examined in the light of the fact that this country's share of world exports has fallen since the Chancellor took office. The balance of trade deficit is there for all to see—it has damaged the country every month for the past four years. Indeed, the British Chambers of Commerce estimate that rail failures alone have cost the average company in this country no less than £21,000. The Chancellor is wont to speak in terms of telephone numbers and that figure might therefore be writ small in his thinking. However, as my hon. Friends know, it is significant to the companies that are damaged as a result. That is the crucial point.
Kevin Brennan: Will the hon. Gentleman give way?
Mr. Bercow: I can no longer resist the hon. Gentleman's soothing bromides.
Kevin Brennan: The hon. Gentleman is an expert on peculiar parliamentary performances, but is not it peculiar to cite so many statistics without reminding us of this country's record on growth compared with that of the other G7 nations?
Mr. Bercow: The hon. Gentleman tempts me. I shall comment on growth and the recent forecasts later. He might wish to advance his cause by making a speech or indulging in an intervention, but it is extremely foolish of him to assist me in mine. That is precisely what his ill-advised intervention has done.
The Bill is massive and its size continues and exacerbates a trend that we have witnessed in the past five years. The first Finance Bill of Margaret Thatcher's Government, which was commended to the House of Commons by the then Sir Geoffrey Howe, now my noble Friend Lord Howe of Aberavon, ran to 22 pages. For the elucidation of Labour Members, it was published on 18 June 1979. This Bill is the third largest that the Chancellor has introduced and the third largest of all time—it has 488 pages and is published in two volumes. As if that were not a grievous enough affliction, this 488-page, two-volume Bill is accompanied by a further two volumes of explanatory notes, which in total amount to no fewer than 604 extra pages.
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