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Mr. Ingram: I thank the hon. Gentleman for his welcome. This is an unusual occasion, as I do not think anyone failed to welcome the statement either wholly in part. We must wait and see whether there are any exceptions, but hon. Members realise that there is sense in the proposals. The hon. Gentleman is right that we will establish a new medical squadron—the designation is still to be confirmed—of the 254 Divisional Medical General Support Regiment. I will write to him with more details about that and the new military provost service. According to my figures, there are no cuts or reductions in his area, which does exceptionally well out of the Ministry of Defence, and serves us extremely well in return.

Mr. Mark Francois (Rayleigh) (Con): So as not to disappoint the Minister, may I express concern about
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further reductions in the TA infantry, not least given the problem of overstretch in the regular infantry of which the Minister is well aware? However, in the interests of balance, I welcome the decision to rename TA infantry battalions according to the regiments in which their regular counterparts serve. On that point, can the Minister assure me on the record that the so-called east of England regiment will be renamed the Royal Anglian Regiment TA? That is what it has been all along, but we would like the cap badge and the name to be fully established.

Mr. Ingram: I am sure that the hon. Gentleman will appreciate the fact that I have written to 92 Members, and that point has simply slipped my mind. Nothing has come through the ether to assist me, but I will write to him. He may be able to find the information in the detailed charts that we have provided. [Interruption.] If I may be allowed to respond to all the hon. Gentleman's questions, I might be able to remember the position. I appreciate his partial welcome, and I noted his concern about—[Interruption.] As ever, the one person whom one does not expect not to write properly is the one who passes the note, but my office will write to the hon. Gentleman.

The infantry reduction is consistent with what we are seeking to achieve in the future Army structure. It is about rebalancing and re-roling. We want to look at critical pinch points for logisticians, engineers, and the intelligence and provost corps so that our future structure can meet future threats. The TA rebalancing is compatible with that exercise. Recognising that recruitment has increased slightly, we must all work to make sure that that increase is maintained in our own areas. That will help everyone, not least the TA, to be more confident about how they can assist the regulars.
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Orders of the Day


Order read for resuming adjourned debate on Question [22 March].


Motion made, and Question proposed,

(a) for zero-rating or exempting a supply, acquisition or importation;

(b) for refunding an amount of tax;

(c) for any relief, other than a relief that—

(i) so far as it is applicable to goods, applies to goods of every description, and

(ii) so far as it is applicable to services, applies to services of every description—[Mr. Gordon Brown.]

Question again proposed.

Budget Resolutions and Economic Situation

1.5 pm

Mr. Oliver Letwin (West Dorset) (Con): I draw attention to my interests in the register. I draw attention, too, to my interests as a taxpayer and as a user of public services. We have had just under 24 hours to consider the Chancellor's budget. In the calm of reflection, two things are clear—£5.5 billion has been added to the tax bill over three years by the Chancellor and there will be £175 billion of net borrowing over six years. The most telling fact, however, is that the immediate crisis facing Britain is in the health service—a crisis that is captured by the evocative but surprising title of "Brown's cuts in the NHS"—but he remained entirely silent about that. In the past 20 or so hours, that fact has become more and more salient.

I never wish to impute to an opponent something that they do not sponsor. The Chancellor, however, has sponsored a vast increase in spending on the health service, as is clear in the Budget and is well known to the entire House. Bizarrely, however, the great increase in expenditure on the NHS goes hand in hand with the Chancellor's cuts. For example, 480 people were sacked in the last 24 hours, and 2,000 were sacked in the last week. Every hon. Member will have experience of what is happening on the ground in the NHS.

Ed Balls (Normanton) (Lab) rose—

Mr. Letwin: I will give way to the hon. Gentleman, but I will not do so on every occasion on which he seeks to intervene, as I suspect that he would wish to do so approximately once a minute.

Ed Balls: The right hon. Gentleman had a fine and distinguished career in the shadow Treasury, first as
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shadow Chief Secretary then as shadow Chancellor. He is now head of policy, and today he is probably shadow shadow Chief Secretary. Can he confirm that in all those jobs, it was Conservative policy to achieve falling public spending as a percentage of gross domestic product, and that the proceeds of growth of rule has consistently been applied in the past six years? Can he confirm that that is why the hon. Member for Chipping Barnet (Mrs. Villiers), who is shadow Chief Secretary, confirmed that the Conservative party would not match our commitment to increase state school spending to the level of private school spending? Is that why the hon. Lady is not on the shadow Front Bench today?

Mr. Letwin: I will pass over the absurd question about my hon. Friend the Member for Chipping Barnet (Mrs. Villiers). When I was shadow Chief Secretary I never fulfilled that role in Budget debates, and neither has my hon. Friend the Member for Tatton (Mr. Osborne) fulfilled his role as shadow Chancellor in such debates. However, I will respond—[Interruption.]

Madam Deputy Speaker (Sylvia Heal): Order.

Mr. Letwin: I will respond specifically to the point that the hon. Member for Normanton (Ed Balls) made, quite reasonably, about sharing the proceeds of growth. The Chancellor has relied on his wise advice for many years, so I welcome them both to the fold. We are delighted that they are our comrades in arms, as they believe in sharing the proceeds of growth. Page 259 of the Red Book deals with the proportion of GDP to expenditure in successive years. I was not surprised to learn, given the buffers into which the Chancellor's fiscal policies have run, that he intends that the proportion of spending compared with GDP should fall in successive years. That is called the "sharing the proceeds of growth" thesis. I am delighted that the hon. Gentleman and the Chancellor now agree with us that that is a necessity. Having established that base, we come back to the extremely important question: where is the money going and is it being properly used?

David Wright (Telford) (Lab): Will the right hon. Gentleman give way?

Mr. Letwin: No, I shall make a little progress. The hon. Gentleman will want to hear the next part, before he intervenes.

The Chancellor said in July 1997:

Those are fine sentiments, which I echo. The right hon. Gentleman continued:

That is what he said—

How has he managed to do what he signalled in the first sentence, and so abundantly failed to do what he signalled in the second sentence? How can one spend £5 billion extra on the NHS in the current year and £6 billion extra in the succeeding year and nevertheless end up with Brown's cuts on the coalface of the NHS? That is a remarkable phenomenon.

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