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Dr. Evan Harris (Oxford, West and Abingdon): The right hon. Gentleman says that this is the fairest way, but would he concede that some forms of taxation, particularly some forms of income taxation, would be even fairer, to use his terms, than the rise in national insurance contributions, which does not, for example, tax very wealthy people who have unearned income and are not in work?
Mr. Smith: It is perhaps a consequence of debating these matters four times in two weeks that no points have so far been raised that have not already been exhaustively explored. The answer to that question is that because we are raising the money through national insurance contributions, many pensioners on fixed incomes will not have to make the additional contribution. Equally, raising the money through income tax would have hit and penalised savers. The hon. Gentleman points to rich people, and a very complex system might have exempted the other groups, but we decided that this measure was a fair, efficient, widely and appropriately based means of raising the money. My experience, my hon. Friends' experience in their constituencies and the evidence of the polls show that the public overwhelmingly understand and support what we are doing.
These measures, along with the Budget, have enabled the Government to announce the largest ever increase in investment in the NHS, raising spending on average by 7.4 per cent. in real terms each year. That is an annual cash increase of 10 per cent, and it is not just for three years but for five years, creating the stable platform necessary for long-term investment. With the year-on-year rises, UK health spending will grow from £65.4 billion this year to £105.6 billion in 2007–08. Even allowing for inflation, that is a rise of 43 per cent. over five years. Since 1997 there has been a real-terms doubling in health service investment. UK health spending will rise from 6.7 per cent. of national income in 1997, and 7.7 per cent. of national income this year, to 9.4 per cent. by 2007-08, and that investment is being matched by reform.
First, on accountability, there will be independent audit, inspection and scrutiny of patient complaints, with a duty to account for money spent and standards achieved, and report to the public. In future, an annual report to Parliament will be prepared by the new independent auditor, accounting for the money allocated to the NHS, where it has been spent and the results that have been achieved. That will be matched by a local report from
every primary care trust that will spell out to each household in its locality the services available and the value for money that is being achieved.The second principle of reform is devolution. As the Secretary of State for Health has already announced, there will be vital new reforms. They will include new financial incentives for hospital performance, greater freedoms for high-performing hospitals and trusts, powers and resources that are devolved to front-line staff and primary care trusts, reform of social services care for the elderly, and a series of measures increasing choice for patients.
Patient choice will help to drive the reformed system. Money will follow the patient, so resources will be tied to performance. The NHS will treat more patients more quickly and to a higher standard.
Let me give some examples of what the extra investment will mean in constituencies throughout the country. There will be 35,000 more nurses, midwives and health visitors, 15,000 more doctors and consultants, and 42 major hospital schemes. That is the difference: more nurses, more doctors, more hospitals, more care centres and better treatment. That is what the Bill is about—investment in the nation's health and investment in the future.
Throughout the whole debate, the dividing line has not just been between those who support raising national insurance and those who do not. It is between those who support an NHS comprehensively available and free at the point of need and those who would abandon it. There is a very clear choice before us all. Do we want a high quality national health service to meet the needs of the British people and funded through general taxation, or a system in which families are forced to take out private insurance and have to pay more for their treatment through charges? That is the real choice. We choose the NHS, whereas the Conservative party chooses charges.
We are providing record new investment combined with reform. Money and change together will deliver results as we reaffirm the basic principle of the NHS—that health care should be available on the basis of need, not of ability to pay. To vote for the Bill is to back the NHS that the British people want and deserve. I commend the Bill to the House.
5.38 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 National Insurance Contributions Bill because its provisions fail to reflect the need for change and improvement in the NHS to match additional resources, will hamper job creation and further increase the burdens on business, and will impose additional taxes on employees, including those on whom the public services rely."
If Ministers' statements were to be believed—a mighty if, it has to be acknowledged—this is the Bill that was
never to be. During the election campaign, the Prime Minister told the Daily Express—I quote for the delectation of the House—
- "We are not going to clobber people on higher incomes. We are not going back to 1992 and the shadow Budget. We have not the slightest intention of hammering people on £30,000 and £35,000 and the higher income brackets."
- "We've got no plans to raise the ceiling on national insurance contributions",
- "It is not going to happen."
- "Gordon Brown has made it perfectly clear that we have absolutely no plans to raise the ceiling on national insurance".
"To Byers" could be the new verb that describes the contagious disease of misinformation that rampages through the Government.
Phil Hope: Will the hon. Gentleman give way?
Mr. Bercow: In a moment. I will not accuse Ministers of lying. Suffice it to say that they are in a class of their own in giving credence to untruths.
The changes outlined in the Bill that the Chief Secretary to the Treasury has commended to the House today will help to raise £8.6 billion in 2003–04 and similar sums in years thereafter. It is notable, although the right hon. Gentleman did not mention it, that the 1 per cent. increase in the rate of primary class 1 national insurance contributions represents a proportionately bigger increase to those married women who took up the option—prior to its withdrawal—to pay national insurance contributions at a reduced rate, earning no entitlement to contributory national insurance benefits as a result of those contributions. That reduced rate is currently 3.85 per cent; it will rise to 4.85 per cent. in April 2003.
Phil Hope: Will the hon. Gentleman give way?
Mr. Bercow: I can resist the hon. Gentleman's soothing bromides not a moment longer. I give way.
Phil Hope: The hon. Gentleman is practising his communication skills most eloquently this evening. I have a couple of questions for him. Given that they are to vote against the Bill tonight, have the Opposition given up on the NHS and its principle of treatment according to need, not ability to pay? If they intend to match the spending on the NHS that we have pledged, how will they pay for it? Will they make the sick pay for being sick?
Mr. Bercow: No, we are certainly not going to do that. I am indebted to the hon. Gentleman for giving me the
opportunity to confirm that we believe passionately in the ideals of the national health service. However, we believe that after five years of mismanagement and ineptitude under a benighted Labour Administration we are now further away than ever before from those cherished ideals. The Opposition are committed to reform—
Mr. Bill Rammell (Harlow): Will the hon. Gentleman give way?
Mr. Bercow: In a moment—the hon. Gentleman must contain himself with what resilience he can muster.
The Conservatives are committed to reform. We will look at the options. We want a service that is better. Next week the hon. Member for Corby (Phil Hope) and I are to play alongside each other in a tennis match on behalf of the House. Let me say, in all charity, that it is to be hoped that his excellence at tennis is rather greater than his capacity to make incisive interventions in debate.
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