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Mr. Nicholas Soames (Mid-Sussex) (Con): The hon. Member for Leicester, East (Keith Vaz) is a fluent and capable speaker, but the collective memory of the House knows that that there is something wrong with his memory. To describe the period that Nigel Lawson was Chancellor as being a background of solid crisis is to show that the hon. Gentleman wasted the first few years that he was a Member. I remember very well the time that he was talking about. Indeed, the time of the Lawson reforms was the beginning of the settling of the economy's strength, which has given the extraordinary inheritance that the Chancellor benefited from when the Labour Government came to power. I imagine that, otherwise, his constituents will be much gratified by his speech and look forward to him exerting his authority to bring the mini-Olympics to Leicester, in which we look forward to seeing him perform in white shorts.
Hearing the Secretary of State for Transport speak is, on many occasions, like a near-death experience, and today was no exception. Even by his undemanding standards, it was an absolute corker of a speech. Given the huge transport issues that effect this country—many hon. Members face serious infrastructure problems in our constituencies—it was a very mere and disappointing speech indeed.
I congratulate the Chancellor on his 10th Budget—a record achieved only by one other Chancellor, Sir Nicholas Vansittart. I do not know what the Chancellor
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has got to swank about—this is the 21st Budget that I have sat through in the House—but achieving his 10th Budget is a notable milestone. I am prepared to congratulate him, as long as he is prepared to remember that in his time—it has not been a wholly unsuccessful time—he has been able to build on the golden inheritance that he inherited from my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke).
I congratulate the Chancellor, as I have done every year since he has been Chancellor, on his decision to grant independence to the Bank of England. This time, I applaud very much the steps that the Government have taken, although belatedly, to assign more independence to the Office for National Statistics. I hope that that will enable us to bring greater integrity and accuracy to our statistics, which are so important for the assessment and forming of Government policy.
The Budget settles for the record the fact that the Chancellor is indeed a leading exponent of the old-fashioned tax-and-spend school. My right hon. Friend the Leader of the Opposition, in his admirable and energetic response yesterday, was certainly right: the Chancellor has indeed raised billions, he has spent billions and he has very little idea of where the money has gone or how effectively hard-working people's tax funds have been spent and to what ends.
Listening to the Chancellor, he rather reminded me of Christopher Columbus in that when he set off he did not know where he was going, when he got there he did not know where he was, when he came back he did not know where he had been, and he did it all on borrowed money. Listening to his rather manic presentation, one was very conscious of the fact that, as my right hon. Friend the Member for West Dorset (Mr. Letwin) pointed out, it is not necessarily how much money is spent, but the way in which it is spent that counts. Any number of taskforces and goodness knows what else will not be able to close that gap.
Whether it can be considered a triumph to achieve what the Chancellor calls sound public finances when taxation is nearing 39 per cent. of gross domestic product is in itself a question. What we do know is that his key policy mistake has been a massive transfer of resources into a largely unreformed public sector. His announcement of even larger spending increases on education and child care will, in my view, only make the situation worse. The long-term effect of the Budget will be a significantly higher tax burden, lower productivity and thus depressed growth, living standards and competitiveness, to our domestic and our international disadvantage. It is a huge disappointment that the Chancellor simply does not understand that while, of course, increased resources matter, so does a disciplined programme of expenditure matched with real reform and thus with better results. All the lessons of the past show that to be the case.
Let us take education. The decision to increase spending by £19 billion a year in real terms from taxpayer funds is extraordinary, given the record of recent years. The Government have already increased schools spending by 66 per cent. in real terms since 1999 with no discernable change whatever in the trend in examination results and the quality of the finished article leaving schools. Extra spending might be justifiable if it were preceded by a major programme of reform, but reform—that is to say, management
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autonomy and parental choice—has proceeded most slowly in education out of all the public services. The truth is that the source of the problem is the failure to deliver, even now, with all this money, a good education. That is what parents want to see and it is what the country wants to see. That needs to be tackled with real and energetic reform and not just large amounts of low-flying cash.
I was truly shocked that, as my hon. Friend the Member for West Chelmsford (Mr. Burns) pointed out, in the whole of the Chancellor's one hour and one minute speech, conducted at a decent gallop, he never even mentioned the national health service—almost the most important of all the Government programmes in terms of expenditure. I suppose that that is not really surprising given that he knows what he spends, but because the Government have totally failed to grip reform in the national health service, they have no idea what it really costs. The health service in my constituency and all over Sussex and elsewhere is struggling to cope with unfunded cost pressures, inherited debts and not enough time or support to help it through. With the greatest anxiety, I await the inevitable outcome of the cuts in services that must follow on from the situation of those health authorities. The excellent think-tank Reform estimates that, at the present rate of growth in the NHS, there will be a resource gap of £7 billion in 2010. That is an enormous sum of money and I would be grateful if the Paymaster General would tell me how she thinks that the Government intend to deal with that.
After the expenditure of all this money, hard-pressed taxpayers are entitled to ask, "Where are these world-beating public services?" The Chancellor has indeed taxed too much and borrowed too much. Old Labour has got its way under this Chancellor, which is, of course, why the Labour party cannot wait, by and large, to get rid of the Prime Minister and to put in his place a more user-friendly animal. Let us face it: under the Chancellor, the pips really are squeaking. He has saddled the taxpayer with the highest tax burden in history. Families are literally groaning under the impact of the amount of money that the state takes from them.
The Chancellor has imposed on commerce records levels of bureaucracy and red tape and he has blocked vital reforms in the public service. Even with some of the reforms that he has brought in, the valuable concept of a low-regulation, low-tax and competitive economy, which came to fruition in the later years of Baroness Thatcher and under John Major, is being rapidly eroded as business men and women sink every day into a bog of regulation and higher taxes. Had the Chancellor himself had the guts, will and determination truly to set about reforming the public sector by dealing with the vast array of old Spanish practices and the like that still remain, by increasing investment and by substantially extending choice in real terms, high-quality public services would today be available to everyone.
Where exactly is this modern and efficient transport system or even its beginnings? Where is the infrastructure expenditure that is glibly promised every year? I urge the Chancellor to consider carefully a message that came from a seminar that I held in my constituency last weekend ahead of the wholly unsustainable programme of house building that is wished on Mid-Sussex and the surrounding area by the
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Deputy Prime Minister: there should be a far more even distribution of infrastructure expenditure across the growth areas. Let me give the Paymaster General an example. The Government are spending enormous sums of infrastructure money around Ashford and in Milton Keynes. Mid-Sussex, and north-west Sussex generally, are going to have willed on them by the Deputy Prime Minister an enormous number of houses—not significantly fewer than Ashford—yet there is no commensurate Government spending on public infrastructure. The Government need to acknowledge the firm feeling that they should honour their obligations for infrastructure expenditure, rather than simply passing them incontinently across to the developers who rightly already make a major contribution.
I want to consider three areas on which the Chancellor and his people have done badly. I preface that by saying that I do not pretend that everything is bad. Many of the things that have been done are good. There are bits of our economy that are doing well, although, as I said, they should be doing well because of the Chancellor's remarkable inheritance.
I will quote from a speech made in the House by the Chancellor in 1989, when he was shadow Trade and Industry Secretary, on a pensions scandal when, again, the ombudsman blamed the Government of the day for bust pension schemes. The then shadow Trade and Industry Secretary railed against the
"fecklessness, gullibility and incompetence of the Government who, for months and years, ignored all the warnings"—[Official Report, 19 December 1989; Vol. 164, c. 204–05.]
Today, the Chancellor who said that presents himself as the future leader of our country, but, frankly, he and the then Work and Pensions Secretary, who is now the Transport Secretary—I am sorry that he is not in the Chamber—debauched the public pensions system in this country.
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