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Mr. Browne: We are in this country increasing spending and investment, and both are generating growth in the economy. I have to say that the people of Denmark and Ireland did not have 18 years of Tory Government and a lack of investment in the infrastructure of the country to contend with.
As I said at the outset, we have had a comprehensive, informative and wide-ranging debate. It ranged from the customary prophet-of-doom contribution that Labour Members have come to expect from the right hon. and learned Member for Rushcliffe (Mr. Clarke), who has predicted imminent recession in this country yearly since we came to power, to the enlightened and positive contribution of my hon. Friend the Member for Doncaster, North (Edward Miliband), who set a series of challenges for the shadow Chancellor, all of which he signally failed to answer. My right hon. Friend the Member for Coatbridge, Chryston and Bellshill (Mr. Clarke) eloquently expressed support for disabled people and the poor of the world. He has supported those issues for many years.
The hon. Member for Shrewsbury and Atcham (Daniel Kawczynski) sought the safety of the Back Benches from which to make a significant number of calls for further public spending in his constituency. I am sure that the shadow Chancellor took note of that. However, it was not nearly as damaging a contribution from the Back Benches as that of the hon. Member for Gainsborough (Mr. Leigh), who gave the game away in a sedentary intervention. As the hon. Member for Rutland and Melton sought to set a clear dividing line on tax, the hon. Member for Gainsborough interrupted and suggested that his Front-Bench spokesman meant tax cuts.
In their individual ways, several hon. Members recorded genuine improvements in their constituencies, including my hon. Friends the Members for Hartlepool (Mr. Wright), for Bishop Auckland (Helen Goodman), for Stoke-on-Trent, North (Joan Walley) and the hon. Member for East Antrim (Sammy Wilson). They acknowledged the opportunities that my right hon. Friend's Budget gave their communities.
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Much has been said in the debate about productivity and competitiveness, not least in the contributions of the right hon. and learned Member for Rushcliffe and the hon. Member for Twickenham (Dr. Cable). Business in the UK needs stability above all. My right hon. Friend the Chancellor has delivered stability that the International Monetary Fund described as "remarkable". The Organisation for Economic Co-operation and Development has already noted that UK has the lowest barriers to entrepreneurship of any major economy. The Budget does even more to support business, not least the 575,000 more small and medium-sized enterprises that have been founded in the UK since 1997.
UK Trade & Investment will promote the United Kingdom abroad. We will establish a new business advisory council and enshrine in law the Hampton code of deregulatory practice. There will be specific budgets for Her Majesty's Revenue and Customs to reduce the burden on business. We will extend the research and development tax credits.
Mr. Browne: We have not only improved productivity but done that while creating 2.3 million new jobs. Labour Members can be rightly proud of that achievement because we have presided over the longest period of sustained employment growth since the 1950s when records began.
Mr. David Gauke (South-West Hertfordshire) (Con): The Chief Secretary says that the Government have improved productivity. Will he explain precisely how he calculates that? According to witnesses to the Treasury Committee yesterday, any attempt to describe productivity as improving is "misleading".
Mr. Browne: The only years when productivity fell in the United Kingdom were Tory years. I do not know if the hon. Gentleman was in his place at the beginning of the debate but, as my right hon. Friend the Secretary of State for Trade and Industry said when he opened it, over the economic cycle, which is the proper measure of productivity, there has been 2.3 per cent. growth compared with 2 per cent. in the previous cycle.
The hon. Member for Rutland and Melton, joined by the hon. Member for Twickenham, the right hon. Member for North-West Hampshire (Sir George Young) and the hon. Member for Cheltenham (Martin Horwood) mentioned the home computer initiative. The changes have been made to ensure better targeting of resources to meet the Government's objective of improving access to technology. The home computer initiative was never intended to subsidise those who can already afford computers. Exemptions were being used,
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contrary to the original intention, for second personal computers and, indeed, for games consoles. There has been a huge fall in computer prices since 1999, and the Government want to focus resources on those who would not otherwise be able to gain access to a computer to increase their IT literacy skills. In addition, computer ownership has risen from 28 per cent. to 60 per cent.[Interruption.]
Miss McIntosh: I am most grateful to the right hon. Gentleman for giving way. The Secretary of State for Trade and Industry prides himself on the number of new jobs that have been created. Of the 3.2 million that have been created in the public sector, how many of the women in the civil service earn exactly the same as the men? Is the right hon. Gentleman concerned that they earn 25 per cent. less than their male equivalents?
Mr. Browne: I am grateful for the opportunity to remind the House that, since 1997, women's wages have increased twice as fast as men's wages. I recognise that there is still a gap between the two, but we are narrowing that gap, and that is a record of which we can rightly be proud.
A number of Conservative Members have alleged that the tax burden is now the highest in history. That is of course dependent on the most spurious of all calculations of the tax burden, and it is completely wrong. The tax burden is actually lower now than it was for the entire period between 1981 and 1988 under Margaret Thatcher, and well below the peak tax burden in 1984. According to the experts at the Organisation for Economic Co-operation and Development, the net tax burden on the average working family is half what it was when we came to power. As a result of all the tax and benefit changes that we have introduced, the average household will, from next month, be £950 a year better off in real terms than it was in 1997. According to Ernst and Young, the effective rate of corporation tax on British businesses is well below historic highs, down from 14 per cent. in 1997 to below 10 per cent. today.
Of course, the amount of tax collected rises fastest when the economy is doing wellwhen business, the City, the housing market and retailers are doing well, and when there are more people in work, paying tax and moving up the earnings scale. The lowest tax burden of the past 30 years was in 199394, when the economy was barely growing, unemployment was above 3 million, millions of families faced negative equity and wage settlements were at a 25-year low.
This Budget illustrates the gap between the Government's responsible preparation for global change and the instincts of the Conservative party, which would leave us all woefully unprepared for the future.
Underneath it all, no matter now compassionate their rhetoric, the Conservatives still have the desire to cut. We could do that too, of course, but it would be the wrong thing to do, and the Conservatives know it. We cannot face global competition with one hand tied behind our back. Instead, we will have spent some £5.4 billion a year on science by 2008. This year alone, we have invested more than £2.6 billion to renew UK university research infrastructure. This Budget adds to that by creating a single £1 billion a year health research fund. It also simplifies research funding arrangements and expands R and D support for medium-sized companies.
Our drive is to improve the UK's position as the best location for inward investment, and that means strengthening our reputation as one of the world's finest locations for higher education. It also means promoting London as the world's leading centre for financial and business services. This is a Budget for the future, and for a strong and strengthening economy. I commend it to the House.
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