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Mr. Jeremy Hunt (South-West Surrey) (Con): Does my hon. Friend think that there is a contradiction between the Chancellor's emphasis on stability and prudence and the way in which money was showered on the NHS a few years ago? That money was taken out of the service as quickly as it went in, with the result that many hospitals have had to close.

Andrew Selous: My hon. Friend is correct—there is no point in making money available and then taking it back. A smooth transition is the only fair way to treat people working in the NHS.

I come now to pensioners. I agree with the comments made earlier that it is scandalous that the ombudsman's report into the 85,000 people whose pension schemes have collapsed has not been honoured. Some of my constituents worked for Dexion in Hemel Hempstead and so fall into that category. The Chancellor was happy to talk about the unclaimed assets going into youth services. We all support those services, but the 85,000 people who were forced to save for pensions as a condition of employment, and who now find that the money has gone, should have first claim on those funds. It is reprehensible that they do not and I hope that the Paymaster General, who is sitting on the Front Bench listening to the debate, will urge the Chancellor to reconsider the use of those unclaimed assets. As I said, the 85,000 people who have lost their pensions should have first call on them.

What of the £200 payment for pensioners to help with their council tax? We had it last year, but not this year. We will all have constituents who are counting down the number of years that they can stay in their own homes. They run down their savings every year just to pay their council tax. That is simply not acceptable. Had we had a Conservative Government there would have been a halving of the rate of council tax for people over 65, up to a maximum of £500. It is deeply regrettable that the Chancellor has not given that £200 rebate this year and that we have not had a proper reform of council tax, which is long overdue.

I welcome the emphasis on shared ownership in housing. Like synthetic phonics, that is another Conservative idea that the Chancellor is bringing in. In 1995, only 10 per cent. of young people buying their first home needed help from their parents—now 46 per cent. of them do, if they are lucky enough to have parents who are able to help them financially in the first place. Looking at my constituency, we need the right homes in the right places. The Government's approach to the
 
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housing needs of London and the south-east is to ram all the housing into five areas around London. Housing should be spread across London and the greater south-east, and across the country as a whole. Two days ago, the Financial Times contained damning evidence about the fact that regional disparities in the UK have got worse. If that situation was slightly better, it would relieve the housing pressures on London and the south-east. The infrastructure for that housing is not there either, which leads to great worries.

6.41 pm

Chris Huhne (Eastleigh) (LD): I may forgo a lifetime's obsession with macro-economics and look at some of the micro-economic aspects of the Budget, focusing on the environmental impact. I welcome the fact that the Chancellor has announced that he will index fuel duty in September and that he is indexing the climate change levy, but we have to put that in the context that was admirably spelled out in the Environmental Audit Committee report, "Pre-Budget 2005: Tax, economic analysis, and climate change", which came out yesterday. If we update for today's announcement, figure 6 in that report makes it clear that, on fuel duty, there has been a revalorisation in only two and a half of the past seven years—if we count the current period as a half year. On vehicle excise duty, we are looking at one increase in revenue over the past seven years. On the climate change levy, we are looking at one year out of the past seven years. On air passenger duty, we have had a freeze over all the seven years, with a steady decline in yields.

If we look at the detail of what the Chancellor announced today, we can see, for example, that it is extremely unlikely that we are even going to see an increase in yields from the green taxes overall, given that he admitted that vehicle excise duty, although restructured, would raise less. The restructuring is actually extremely mild. On the increase for those at the top end, in terms of emissions, we are looking at a cost that will be less than the cost of filling a full tank of the average 4x4 gas-guzzler that he says that he is aiming at. The Energy Saving Trust recently came up with research that suggested that, if there is to be a genuine shift in the pattern of car-buying behaviour, there could be a need for a tax at the top end of more like £2,000 a year than £200.

Lest there be any doubt among Treasury Ministers—as there seems to be among Department for Environment, Food and Rural Affairs Ministers—that
 
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taxation through the price mechanism has an effect on behaviour, it is worth pointing out an extremely useful article in the latest Fiscal Studies from the Institute for Fiscal Studies, which cites a number of academic research studies, from Finland, Denmark, Sweden, Austria and Belgium, all of which clearly suggest that increased taxes and prices have positive impacts on behaviour when it comes to dealing with climate change. However, the Chancellor's record since 1997 shows a peak in green taxes of 3.6 per cent. of GDP in 1999, but that has fallen steadily so that the latest figure is only 3 per cent. of GDP, or a lower share than in the last year of the Conservative Government. Given the policy announcements today, there is no prospect of a rise either.

The result is clear. The Government constantly remind us that they are set to meet our Kyoto target, but that is an exceptionally complacent spin on the reality, which is that the only reason we are meeting our Kyoto obligations is the felicitous shift from coal-generated electricity to gas-generated electricity, which had a sharp impact on the reduction of greenhouse gas emissions. The Chancellor has included a chart in the Red Book, chart 7.1, which usefully shows that carbon dioxide emissions have risen by 2.9 per cent. since 1997. The Government cannot be confident that they will continue to meet our Kyoto obligations or their target for carbon dioxide emissions unless they take a much more radical view of the need to change behaviour.

The issue is a test of seriousness for the Government and for the Opposition, who are strangely silent whenever anybody mentions the possibility of using the price mechanism or taxation to direct behaviour towards a more sustainable pattern for the future of the planet, our children and our grandchildren. It is a basic economic point that such a change does not necessarily involve any overall increase in taxation. If £10 more is taken in green taxes, it can be handed back to the same people through a reduction in taxes elsewhere, thus leaving incomes unchanged but ensuring that the price incentive bears down on people's behaviour.

I hope that Ministers will consider the policies that they have announced in the context of the longer run since 1997 and see how weak a reed the Chancellor has produced in this Budget. I hope that that spurs them to greater radicalism in dealing with what is, after all, the pre-eminent policy challenge of our time.

Debate adjourned.—[Tony Cunningham.]

Debate to be resumed tomorrow.
 
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36 Engineer Regiment (Maidstone)

Motion made, and Question proposed, That this House do now adjourn.—[Tony Cunningham.]

6.47 pm

Miss Ann Widdecombe (Maidstone and The Weald) (Con): I am grateful for the opportunity to have this Adjournment debate tonight and I also wish to record my gratitude to the usual channels on the Government side who ensured that I knew that I had to be here somewhat earlier than I might have predicted.

I am raising this matter tonight because it is an extremely grave one for the 36 Engineer Regiment and for the town that I represent. It is an irony that 19 years ago I had to fight exactly the same battle when it was proposed to move the regiment from Invicta barracks in Maidstone to, at that time, Thorney Island. It was a bleak prospect and the town and regiment rebelled. I am pleased to say that we secured a reversal of the policy.

It would seem that yet again we are threatened with the removal of the 36 Engineers from Maidstone. I am sure that the Minister will accept that it is very important that morale is kept as high as possible in an Army that is stretched as badly as it is at the moment. Part of the maintenance of good morale is ensuring that families are happy, especially when the forces have to serve overseas for any length of time.

The 36 Engineers is a sapper regiment, so almost by definition it spends a large amount of time abroad and has one of the highest rates of separation from spouses and families in the entire Army. It is thus essential for recruitment and retention that the soldiers can go away feeling that their wives and families are happily integrated in the local community. In turn, the wives have considerable influence over whether their husbands decide to stay in the Army. It follows that if there is general unhappiness with the serving conditions, the soldiers will not give a particularly happy account to potential recruits.

In Maidstone, the 36 Engineer Regiment is based near the centre of a large town, which offers not only good shops but extremely good schools, including the envied grammar schools, and many opportunities for wives to work. The Gaffney report described the regiment's relationship with the town as "ideal" for a major unit. It is. Super-barracks are no substitute. They would need to be built and maintained, and would be costly. The regiment currently enjoys the freedom of the town, and the citizens of Maidstone and the surrounding areas regard the Army with immense gratitude following its intervention, first, after the 1987 wind storm when we had to clear roads urgently and, secondly, during the floods which, the Minister may recall, devastated parts of my constituency a few years ago.

The Minister appears remarkably unmoved by all that, however. I shall quote from a recent letter from the Secretary of State for Defence. He said:


 
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We should look at the context for that proposal to dispose of sites. On 21 July 2004, the then Secretary of State for Defence announced to Parliament what he described as a "radical change" in the future force structure. Since 1997, the trained establishment has actually declined by about 6 per cent. at a time when the reserve has fallen by nearly 68,000, including a fall of 20,000 in the Territorials.

The cuts make no sense at all, given what we require our armed services to do. We should have taken notice of the recent situation when we wanted both to deploy troops in Iraq and to keep them on standby during a firemen's strike. From talking to members of the 36 Engineer Regiment, I know that that placed considerable strain not only on their resources but on the ingenuity necessary to manage both operations.

The cuts should be reversed. We should be making sure that we have a properly manned force rather than a reduced one that is operating with a reduced reserve. In the last 12 months, the outflow from the Army has exceeded the inflow by about 3,500, which led my right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard) to tell the Prime Minister that as our forces were so overstretched it was hardly the time to cut four battalions from the Army.

Since the last time we went round this course, that proud regiment has fought in both Gulf wars and has been involved in every other conflict. The Secretary of State for Defence has said that there is no specific time scale, but I think that he means by 2012, which is the time to which the Army is operating in considering the creation of super-barracks and the disposal of sites. Of course, 2012 is a mere six years away. The loss of the regiment would be a severe loss to Maidstone. Although I appreciate that this is not the Minister's direct worry and that it is more properly the concern of the Deputy Prime Minister, it would be a very great worry to Maidstone if that site were replaced by development.

Our infrastructure is already extremely pressured. We do not have enough water. We do not have sufficient roads. Our schools and certainly our health services are stretched and, of course, we have to face up to the huge extra developments being foisted on us by the Deputy Prime Minister. If we were also confronted by a major site, such as Invicta barracks, being covered by housing development, it would be a great deal more than Maidstone could stand.

Quite apart from those worries, we want to keep the regiment in Maidstone, as we wanted to do in the late 1980s, when we faced the same threat of removal but for different reasons. We want to keep it because we are proud of it. We are particularly proud of the Gurkhas. We want to keep it, because it makes a major economic contribution to Maidstone and because we believe that we, in turn, provide the Army with a very good background against which troops can go abroad satisfied that their families are fully integrated into the local community. Our schools would be regretful if those children were suddenly to disappear to super-barracks somewhere else.

The creation of vast Army sites is not a substitute for a major unit in close association with the town in which it is stationed. I ask the Minister to think again. It would be very optimistic of me to think that he would give me every reassurance that I have sought tonight, because
 
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that is rather unlikely, but I hope nevertheless that he will, at the very minimum, agree to visit the 36 barracks at Invicta and talk to the officers and men and, of course, the Gurkhas who are involved there. I hope that he will also consent to hold conversations with Maidstone borough council about the impact on the town if that Army site is disposed of and the force sent elsewhere.

The 36 Engineers have been associated with Maidstone for more than 60 years—a long association that has been fruitful both for the regiment and, indeed, for the town. I therefore very much hope that some singleton sites will not be disposed of—a few must survive—and I should be grateful to the Government if Invicta barracks were among the few that survive.

6.58 pm


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