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Mr. Tobias Ellwood (Bournemouth, East) (Con): I am pleased to follow my hon. Friend the Member for Wellingborough (Mr. Bone), who spoke with such passion about how the Budget will affect his constituency. He started by talking about the hype that surrounded the Budget. I agree with him—for many of us who, for the first time, were able to sit in the Chamber and listen to the Budget, there was an awful lot of hype surrounding the event. In fact, one could describe it as a non-event. We had a 61-minute speech and lots of documents—1,000 pages in all, I think—but there was very little to tackle some of the challenges that we face today. There was nothing to assist productivity growth, pensioners or the NHS. When we remove the North sea oil revenues, we find that we are being taxed more now than ever before.
Dawn Primarolo: Will the hon. Gentleman explain to the House why he wants to take North sea oil receipts out of calculations of tax?
Mr. Ellwood: It has been a common practice to be able to read the two sets of figures: one with North sea oil revenues and one without. That gives a good indication to the public. They can recognise how much contribution is made from North sea oil.
Dawn Primarolo: Will the hon. Gentleman follow through by explaining whether it is his party's policy that, whenever a sector is doing well in the economy, its contribution to tax is to be removed from the tax calculation?
Mr. Ellwood: I think that the right hon. Lady is deliberately trying to mislead me. We are trying to show that if there is a significant sector that is contributing to the revenues and that is removed, it gives a good indication of what the rest of the economy is doing. I am not saying that we should take any one sector in isolation, but North sea oil provides such a large amount of revenue for this country that it is important that we are able to see both figures. As I said, that is common practice. It is nothing new.
Mr. Ellwood: I think that I will make a little progress, otherwise there will not be an opportunity for the winding-up speech.
I am trying to convey that, because of what is happening to the economy, borrowing is not under control. This year, we are having to borrow £37 billion or, to put it another way, £175 billion over the next five
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years. That is all to do with over-regulation of our economy, and that also applies to businesses and affects growth. Productivity growth is falling from 2 per cent. to 1.75 per cent.
Of course, there were some great headlines in the Budget. One of them was about education, which we have spoken about at length. However, when we analyse that—we have had a couple of days to look at the figures—we realise that the increase is less than 1 per cent. Another headline-grabbing bit of news was that pensioners are to get free travel during off-peak times. That is wonderful, but the measure does not come in until April 2008. The Chancellor failed to mention that.
The Budget was promoted as a green Budget, but it contains very little to turn around the CO 2 figures that we face. We have heard many times the fact that, in the past five years, CO 2 emissions have increased rather than fallen. I am glad that the hon. Member for Edinburgh, North and Leith (Mark Lazarowicz) is now in his place. I hope that we will be able to meet our Kyoto targets, but I asked him whether we would meet Labour's manifesto commitments on greenhouse emissions. The answer to that is no. We will not be meeting them at all.
Sadly, we spent much of today's debate discussing not the Government's initiatives, plans for Labour, or plans for Britain, but what the Tories and the Liberal Democrats would do instead. In the remaining days of the Budget debate, I hope that we will focus on how we can improve the situation with CO 2 emissions, instead of trying to second-guess policies that are yet to mature and be announced in their fullness.
Where are the initiatives on rail transport? France is actively encouraging people to abandon their cars and use rail, but we heard nothing in the Budget about that. Indeed, there was nothing on cycling to encourage people to abandon their cars, specifically during the school run. We could easily help to tackle CO 2 emissions through VAT on aviation fuel, but again we heard nothing about that. All that we have heard is a lot of attacks on Tory policies.
Mark Lazarowicz: If all the matters that the hon. Gentleman thinks should have been covered in the Budget statement had been covered, it would have lasted a lot longer than the 61 minutes about which he is complaining. Is it now the case that the Conservative party thinks that there should be VAT on aircraft fuel, or an increase in air passenger duty? I would be interested to know—I might actually support it.
Mr. Ellwood: The hon. Gentleman falls foul of exactly the same thing that I accused him of earlier. He is trying to talk about Tory policy when we should be debating the Government's policy. There will be ample opportunity to discuss Conservative policy in due course, but today's debate is about the Government, not the Conservative party. Yes, we heard a 61-minute speech from the Chancellor, but there was not one mention of any of the initiatives that I have cited in the statement or in the 1,000 pages that were produced. [Interruption.] I will make some progress because I appreciate that we want to hear from the Front-Bench spokesmen.
At the start of the debate, we digressed by talking about the NHS. The NHS is in crisis, but there was nothing in the Budget to alleviate it. We acknowledge
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that an extra £1 billion has been put into the NHS, but today we became diverted on to a debate about whether simply to throw money at something. That debate was entirely misleading. Conservative Members do not question the fact that extra spending must be put in, but it is the way in which the money is spent that is important. Reform must accompany spending, which shows the whole point of us scrutinising the money that is spent.
Although Dorset has one of the worst-funded health authorities in the country, we are just able to make ends meet. However, as authorities in other parts of the country cannot do their sums and run their services correctly, £11 million is being removed from our health authority so that it can be given to other authorities. Dorset, which is doing well, is being made to suffer and yet another health authority will go into the red. That cannot be sensible, and it shows exactly why we need the reform about which I spoke earlier—[Interruption.] I get the message and will draw my remarks to a conclusion.
I was pleased, on a personal level, by the announcement of the introduction of a charitable fund to help British victims of terrorist attacks abroad. Such a fund was absent until now, although Spain, France, the United States and other countries had introduced one. Adequate compensation was provided after people were sadly killed or affected by the 7 July bombings because of the Criminal Injuries Compensation Authority. However, those affected by an attack on Britons abroad did not get a penny because the compensation scheme is limited to British shores and travel insurance does not cover terrorism. I am pleased that the fund has been introduced and I ask the Paymaster General to give us details on when we will have a full announcement on how the process will work.
The Budget was left wanting. An awful lot could be done and we need answers soon. We cannot wait until the comprehensive spending review to tackle problems with the NHS, the climate, the economy and, certainly, our support for pensioners.
5.24 pm
Mr. Paul Goodman (Wycombe) (Con): It is a pleasure to respond to the second day of debate on the Budget, all of which I heard bar five minutes. I also spent two hours attending yesterday's debate, which was a great pleasure to listen to.
I should like to respond to some of the points made in today's debate. The first Opposition speech was made by the hon. Member for Leicester, East (Keith Vaz)—who is not in the Chamber, but he may return. Almost the first thing he did was to make the extraordinary claim that he was inundated with telephone calls yesterday in support of the Budget. We regard that as very strange—I certainly have not been inundated with such calls, and neither have my hon. Friends. Perhaps he was making a bid to return to the Front Bench. Later, he said that the Chancellor's speech was too long at one hour and two minutes, so he may not return just yet. He made a very good point about the Olympics with which we wholeheartedly concur. He spoke, too, about the effects of terror—a point also rightly made by my hon. Friend the Member for Bournemouth, East (Mr. Ellwood).
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The hon. Member for Edinburgh, North and Leith (Mark Lazarowicz), who is in the Chamber, made a long speech—perhaps longer than he expected—on climate change, which is a subject on which he has great expertise. After 36 minutes he said, "Can I say briefly?", and he may wish to follow that advice in his next contribution. However, he made some very good and interesting points.
The hon. Member for Wirral, West (Stephen Hesford) spoke about 56 periods of continuous growth. He was right to do so, but he did not make the point fully, as he failed to mention that many of those periods were under a Conservative Government. However, he reminded the House that we left the Government a golden economic legacy which, alas, they are not handling well, as we shall see.
My hon. Friend the Member for Mid-Sussex (Mr. Soames) gave a masterly summary of the effect of government on business. My hon. Friend the Member for Beverley and Holderness (Mr. Stuart) dealt with productivity growth and cited some figures, to which I shall return. My hon. Friend the Member for South-West Hertfordshire (Mr. Gauke) made the same point and spoke, too, about the effects of regulation. My hon. Friend the Member for Wellingborough (Mr. Bone) dealt with the effect of the Budget on council tax in his constituency. He said that the Budget did not do anything for Wellingborough—he should know, as he is a fine constituency Member.
We know full well that the Chancellor's annual Budget speech does not so much reveal the Budget as conceal it. We know from experience that the full truth about the Budget is contained not in the big announcements in the Chancellor's speech—there were not many such announcements in his speech yesterday—but in the small print of the Red Book. Page 180 shows that he has revised down long-term productivity growth from 2 per cent. to 1.75 per cent. His speech yesterday certainly did not reveal that fact—it concealed it. Page 252 shows that he has revised up his current deficit from £4 billion to £7 billion. His speech yesterday did not reveal that fact—again, it concealed it.
The Chancellor claimed yesterday that it was a Budget for the environment, but page 262 reveals that he expects to take less, not more, revenue over the next two years from the climate change levy, although his speech did not mention that fact either. Above all, there is the issue of council tax. Page 186 of last year's Red Book includes the heading, "Building a Fairer Society", and lists 17 measures, the 15th of which is payment for the over-65s. An £800 million payment was to be made to help hard-pressed elderly people whose council tax bills have, in most cases, risen, and the value of whose pensions have, in many cases, fallen.
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