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12 Feb 2003 : Column 902—continued

Several hon. Members rose—

Mr. Redwood: I shall give way to the hon. Member for Preston (Mr. Hendrick) because he has not intervened.

Mr. Mark Hendrick (Preston): Does the right hon. Gentleman agree that consumers, and not the

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Chancellor, purchase manufactured goods? In fact, the Chancellor has done a great deal to stabilise the economy.

Mr. Redwood: That was incredibly lame. The hon. Gentleman could not name a single thing that the Chancellor has done. I am glad that consumers are still allowed to make their own choices on some issues in this country, but I am sure that Labour is working on stopping that. When the Chancellor was in opposition, he said that he had all the answers. However, in government, he has adopted all the wrong policies. He is the man of taxation and regulation, so he is destroying jobs by his deeds. Lift the regulation, reduce the taxes and the situation would improve for many manufacturers.

The next issue on which the Chancellor has fallen down is the euro. Does he not realise by now that joining a Germany mired in recession, joining a large area where one interest rate certainly does not fit all and hitching our fortunes to the continent of Europe where growth rates and productivity growth rates are far worse even than in Brown's Britain would be the last thing that we need to do? Should he not now lift the burden and uncertainty from business?

One thing that the Chancellor could do today to make business a little happier would be to come to the House and say that he has decided that it would be quite wrong to destroy the pound and the separate controls over our economic life. He could say that business need not waste its time and money worrying about preparations and about whether the Government will hold a referendum. He could remove that uncertainty if nothing else.

The next thing that the Chancellor has done that shows how disastrous he has been was his pathetic sale of gold reserves. It was a signal to the market. If one had been looking for a contrarian view, one should have immediately moved in and bought however much gold off the Chancellor that one could afford to buy. He managed to find and create the deep bottom of the gold market. He sold this country out; he sold it short; he got it wrong; and he has never apologised for the losses that he has chalked up.

The losses to date are a mind-boggling £750 million. What could manufacturers have done with that sum if it had been given back to them as a tax reduction? What could my hospital and hospitals around the country have done with that money if it had been available to purchase enough nurses and doctors to get ahead of the productivity problem that the Government have created in the health service? This Chancellor decides that he can outwit the fund managers of the world. He sold the gold at the wrong price and, of course, he does not apologise. Britain is poorer as a direct result.

The next issue is the telecoms industry. The Government inherited a marvellous telecoms industry that had been created by the previous Conservative Administration's privatisation, liberalisation and deregulation. Their policies spawned thousands of new jobs, many new products, a great increase in exports, a huge improvement in service and an extension of telephony services to many people who simply could not afford them under a Labour Government with a monopoly public enterprise system. This sector of the market was leading the growth and the boom that

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Labour inherited. What did the Chancellor do? He imposed a swingeing telecoms tax on the industry, charging them £22 billion simply to stay in business.

I agree that that was very clever. The Chancellor wanted to maximise the take and he worked out exactly how to do that. He did that very well. However, he did not seem to realise that that would bankrupt half the industry, turn the other half into walking wounded, lead directly to huge job losses, slow down investment in new technology and extend the damage being done by the dotcom bubble bursting in the States. He made the problem more severe and more difficult in the United Kingdom. He decided to burst his own boom in the leading sector, and he did so dramatically with terrible results.

Mr. Ivan Henderson rose—

Mr. Redwood: No, I wish to conclude, because many other Members wish to speak.

Mr. Henderson: What about rail privatisation?

Mr. Redwood: The hon. Gentleman will be delighted to know that the next issue to which I shall turn is the railways.

This Chancellor took a private sector company that needed a modest amount of Government assistance to deal with the very large requirements that the Government were heaping on it to improve safety and standards on the railways and, through bankruptcy and the development of a new type of company—a third-way company, as they like to call it—he decided to waste billions of pounds of taxpayers' money that would not have been wasted if the Government had soldiered on with the system that they had inherited.

Kali Mountford: At the time of privatisation—which was clearly a privatisation too far—why did the right hon. Gentleman's Government not think more carefully about how it should be conducted? Why did they split the industry? Why did they make it unsafe? Why did they make it uneconomic?

Mr. Redwood: We did not make it less safe than the nationalised industry that it replaced. Privatisation led to the great increase in ridership and usage of the railways to which Ministers often refer. They do not realise that they are contradicting themselves when they point out that element of success in the system that they inherited and that they then enjoyed in the good times. This Government bankrupted the private sector company; they decided to impose such strong requirements on the railway that it was not possible to finance it at the then rate; and they decided to tip at least £14 billion into an organisation only to discover that railway services are now worse than they were when they started the dreadful odyssey on which they embarked.

The Government are wasting billions on the railways but commuters from my constituency of Wokingham still cannot get to work on time on a reliable service. The Government's rail regulator is saying that it will now have to cut services because, despite all the money, there is not enough to spend on the things that need doing. Despite all the money, the service is going backwards

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rather than forwards. The Government will rue the day when they bankrupted that company; they will rue the amount of money that is gobbled up by their new creature without it achieving good results.

Mr. Bercow: Is not the ultimate evidence of the Government's chronic policy failures on Railtrack and of the disinformation provided to the House about such matters the reality that the right hon. Member for Tyneside, North (Mr. Byers), who was the Secretary of State responsible, scuttled off and resigned from office?

Mr. Redwood: Indeed, the right hon. Gentleman had to do that. His policy was disastrous and, at times, incorrectly presented to the House and to those outside.

That brings me to the Chancellor's and the Government's ninth catastrophic failure. If he wants to have a fast growing, modern and successful economy, he will have to learn that the first thing that he needs is a good transport system. Yet this Government have managed to combine big increases in public spending on transport with a massive failure of performance.

This is the Government who now nervously await the introduction of the congestion charge in London, knowing that London has been brought to a halt by a combination of central Government misdirectives and a Labour Mayor whose one purpose in life is to stop anyone driving anywhere, whatever the hour, however much it might be necessary to take their tools to work or to travel at times when public transport is not available.

Until this Government understand that a modern economy needs to let vehicle traffic get around as well as railways, until they understand that we need a massive increase in capacity of all types of transport, there is little hope of restoring the levels of growth that the economy once enjoyed, which are now slipping because of the dreadful policies of the present regime.

That brings me to the tenth of my 10 points [Interruption.] Labour Members must be very relieved to know that I have limited my speech to 10. I could have done another 10.

The tenth point I have chosen is the Government's strange view that third-way finance will ride to their rescue, that there is magic money in the private sector that can be attracted into public service without a cost to taxpayers. Again, they will rue the day. They will discover that many of the half-baked schemes they have constructed, starting with the London Underground, are badly thought through and will end up with enormous risk to the taxpayer.

My right hon. and learned Friend the Shadow Chancellor is right. The £100 billion-odd of liabilities that are potentially already out there should be on the Government's balance sheet and should be clearly understood by the Government. Next time the Government should pause before signing some of these contracts, because there must be honest finance for these projects. If they are public projects, they will end up with higher taxes, and higher taxes mean a weaker economy.

We desperately need a Government who will lift the burden of regulation, will start to concentrate expenditure on the people and things that are necessary and will hack away at the overgrowth and undergrowth

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of the political classes and the spin doctors, the administrators, the consultation experts and the great raft of colour brochures that this Government now churn out to substitute for proper policy and managing services on the ground.

There is massive waste in this Government. I say to them: start to chop it out. Give the money back to the people, give the money back to business, and then things could start to grow again.

The Chancellor has let the country down. He has robbed and pillaged the private sector. He has driven people out of work in manufacturing. He should be ashamed. He should apologise to the House.

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