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In last year's pre-Budget Report, I set up Infrastructure UK, to advise on how our country can achieve those vital goals. Today, it published a new strategy setting
out a route map and the investment that will be needed. To deliver this ambition, which is vital for future jobs and the health of our planet, I am setting up an investment bank. It will control £2 billion-worth of equity, half of which will come from assets, including the channel tunnel rail link, and the rest will be matched by private investment.
That equity will unlock billions more of finance from the private sector. The fund will focus first on investing in green transport and sustainable energy, in particular offshore wind power, where Britain is already the world leader. To strengthen the position further, we are offering £60 million to develop ports to host manufacturers of offshore wind turbines. That will help the UK to secure new inward investment deals and support thousands of extra jobs in these sectors.
The UK has the potential to be the world leader in the digital economy. Realising this ambition would create thousands of new businesses and hundreds of thousands of new jobs. It would also open the way for public services to be delivered more effectively and at lower cost. Access to high-speed broadband is essential to deliver these goals. We have taken the decision to ensure that the benefits are spread to rural as well as urban areas and are not limited to the better-off. The 50p monthly landline duty will unlock private investment and enable 90 per cent. of the country to access the next generation of fast broadband by 2017.
I now turn to how we will give targeted help to British industry to realise its global potential. The role of modern government is to work with key sectors to help them compete and prosper. We will not go back to the interventionism of the past, but nor can we return to the hands-off approach of the free-marketeers.
It is also through partnership, not indifference, that Britain can and will succeed. It is a source of pride that 50 per cent. of all Ford diesel engines in the world are now produced in Britain's cutting-edge engineering plants. That is testament to the commitment of their staff and the high quality of their research and development, but the Government have also played a part, with financial support, in this success story.
The Government, again, cannot develop and manufacture electric cars, but we can provide the support to help these projects to take place in Britain. The announcement by Nissan last week that it is to produce in Sunderland its first mass-produced electric car was a vote of confidence in British engineering and its work force, but this ground-breaking venture would not have happened without our support to unlock this private investment. It is precisely that co-operative approach that will ensure our country competes successfully on a global scale.
The same partnership is being built in the life sciences sector, which already employs over 120,000 people. Our approach can be seen in the patent box, for example, which offers tax breaks on income from patents held in the UK. That will lead to more products being manufactured here in this country.
Our creative industries are also a huge source of jobs, wealth and pride. I will offer help to the computer games sector, similar to the steps that are helping to restore the fortunes of the British film industry. It is a highly successful and growing industry, with half its sales coming from exports, and we need to keep British talent in this country.
From advanced manufacturing to pharmaceuticals, and from digital communications to creative arts, it is the ideas that are driving their success. Building on the Hauser review, we will ensure that the UK's technology and innovation centres achieve their potential to commercialise new British discoveries. We have also strengthened the links between universities and business to ensure that ideas are harnessed for commercial success, but we need to do more, so we will set up a £35 million university enterprise capital fund to provide direct support for university innovation and spin-out companies.
Along with the impact of new ideas, it will be the ambition of young people that will carry this country to success. We need to invest in skills, education and our centres of learning. Over the past 13 years, we have increased the number of places and funding for universities by 25 per cent. Almost 400,000 more of our talented young people now go on to university than in 1997. Given this unprecedented rise in investment and the need to tighten public spending overall, universities must make efficiency savings while focusing their funds rigorously on quality teaching and research. We are determined to achieve that without damaging key skills and our economic strengths. To help them to do this, we are going to provide extra one-off funding of £270 million in 2010-11 through a modernisation fund that will help universities to create 20,000 more university places, largely in key subjects such as science, technology, engineering and maths, starting in September this year.
The extra places allow us to strengthen our offer to our young people and ease parents' concern that their child's first taste of life after school or college will be a prolonged spell on the dole queue. We have seen in past recessions what a waste of potential that was and the long-term damage that it caused. Because of the choices that we have made, every school and college leaver, as well as every recent graduate, under the age of 24 will receive personal help and new opportunities. That will be delivered by a guaranteed place in education or training for all 16 and 17-year-olds, a guaranteed job, work experience or training for every 18 to 24-year-old, supporting a higher number of apprenticeships, and more university places for those who want them.
The cost of this £2.5 billion one-off growth package to invest in Britain's future will be met partly by switching resources from existing budgets and, as I said, by the higher revenues from the tax on bankers' bonuses. I expect that cost to be repaid many times over in the coming years in new jobs, new opportunities and greater prosperity.
This recession has had an impact on people across the world. It is often the most vulnerable who are affected most-those in insecure jobs or on modest incomes. While people are suffering hardship, it is all the more unfair that some are escaping their tax obligations. I am determined to continue our successful drive to prevent avoidance and evasion.
Measures in this Budget will bring in additional tax worth £500 million each year, while protecting £4 billion-worth of revenues by 2012-13. These steps include tax agreements such as that already signed with Liechtenstein, which is expected to bring in around £1 billion of extra revenue. I can also now tell the House that we are ready to sign tax information exchange agreements with three additional countries: Dominica, Grenada and Belize. I have a further announcement to make: we expect these
deals to be signed within a few days, which is rather quicker than the 10 years it has taken Opposition Front Benchers to exchange information with the deputy chairman of their party.
We are proud of our achievements in helping families and tackling child poverty. For the new born, there is an additional element of the child tax credit, as well as the child trust fund-something which, I know, will now be even better news for certain Members of the House. Pre-school children are benefiting from a massive expansion in free child care places, and I want to do more to help the parents of one and two-year-olds by increasing by £4 a week the money paid through child tax credit from 2012. That extra money will be paid for all children who need it, whether their parents are married, living together, or living apart.
We have also tackled pensioner poverty. In 1997, hundreds of thousands of pensioners lived on a basic state pension worth about £62 a week. From next month, because of above-inflation increases in the basic state pension and the introduction of the pension credit, every pensioner will be entitled to a weekly income of £132.60. We have announced increased personal allowances for older pensioners, which will mean that, from April next year, no one over 75 will pay any tax on the first £10,000 of their income.
The cold weather conditions of the past few months have underlined the importance of the winter fuel payment for many pensioners. Over the past two years, those payments were temporarily increased to £250, and £400 for the over-80s. Without action today, the winter fuel payment would have decreased in value this coming winter, but I have decided that that would be unfair, so I will guarantee this higher winter fuel payment for another year. That means that 9 million pensioner households will receive at least £250 this winter to help with their fuel bills. In line with our values and fairness, help for
pensioners, families and homeowners over the coming year is paid for by closing down tax loopholes, as I have already announced.
I believe that the Government have made the right choices to rebuild our public services. When faced with the upheaval of the global recession, we made the right choices to support the economy, businesses and families. Because of the steps we took, opposed by the Conservatives, the recovery has begun, unemployment is falling and borrowing is better than expected. The choice before the country now is whether to support those whose policies would suffocate our recovery and put our future at risk, or to support a Government who have been right about the recession, right about the recovery, and right about supporting people and businesses in this country to build a prosperous future. I commend the Budget to the House.
Motion made, and Question put forthwith (Standing Order No. 51(2)),
That, pursuant to section 5 of the Provisional Collection of Taxes Act 1968, provisional statutory effect shall be given to the following motions:-
(a) Stamp duty land tax (relief for first-time buyers) (motion No. 5.)
(b) Alcoholic liquor duties (rates) (motion No. 8.)
(c) Tobacco products duty (rates) (motion No. 9.)
(d) Amusement machine licence duty (rates) (motion No. 17.)
(e) Insurance premium tax (separate contracts) (motion No. 42.)
(f) Stamp duty land tax (partnerships) (motion No. 45.)- (Mr. Darling.)
Mr. Deputy Speaker: I now call upon the Chancellor of the Exchequer to move the motion entitled "Amendment of the Law". It is on this motion that the debate will take place today and on the succeeding days. The remaining motions will be put at the end of the Budget debate on Tuesday 30 March.
Motion made, and Question proposed,
(1) That,-It is expedient to amend the law with respect to the National Debt and the public revenue and to make further provision in connection with finance.
(2) This Resolution does not extend to the making of any amendment with respect to value added tax so as to provide-
(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. Darling.)
Mr. David Cameron (Witney) (Con): So there we have it-Labour's big idea is a stamp duty cut on homes worth less than £250,000. Where on earth did they get that one from? That has been Tory policy for three years. The Chancellor came in copying our inheritance tax cut. He leaves as Chancellor copying our stamp duty cut.
The only new ideas in British politics are coming from the Opposition. The only things that Labour brings are debt, waste and taxes. Here is a first. The centrepiece of this Budget, the stamp duty cut, has already been torpedoed by a Treasury Minister. This is what the Economic Secretary said about the policy:
"raising...stamp duty...threshold to £250,000 would not be an effective use of public money".-[ Official Report, Finance Public Committee, 21 May 2009; c.108.]
First, the Government denounce it, then they embrace it.
That is not all. Remember our tax plan for super-strength cider? When we announced it, the Chancellor's spokesman said that that was illegal. It is now official Government policy. Remember our proposal for 10,000 extra university places? The Higher Education Minister said:
"It is clear, as has been demonstrated in the House today, that this fatuous proposal of an extra 10,000 places is elitist"-[ Official Report, 16 March 2010; Vol. 507, c. 802.]
That is what the Government said about it. Once again, they have been caught taking the public for fools. The Chancellor spoke for an hour. He could have done it all in a sentence. Labour has made a complete mess of the British economy and is doing nothing to clean it up.
One figure in the Red Book stands out above all others. They have doubled the national debt and, on these figures, they are going to double the national debt again. In this election year they are borrowing £167 billion. We are meant to be impressed that that has turned out a few billion lower than the last disastrous forecast, but it is still-hon. Members should be ashamed of this-more than every single Labour Government in history ever borrowed, added up together. That is what they have done. Like every Labour Government before them, they have run out of money, and they are leaving it to the next Conservative Government to clean up the mess.
Today the Chancellor had his last chance to do the right thing for the country. He totally failed. [ Interruption. ] Labour Members are leaving. The taxis for hire are on their way out of the Chamber. The Government are just
going to carry on spending, carry on borrowing and carry on failing. The biggest risk to our recovery is five more years of the present Prime Minister-five more years of falling confidence, five more years of bloat and debt and taxes, five more years of Britain closed for business. Most members of the Cabinet are looking at their Blackberries. They cannot think of a single reason why the country should have another five years of the Prime Minister, so I say let us have an election and put them out of their misery.
Let us have a look in detail at the appalling mess that the Prime Minister and Baldemort seem to find so funny. Here are some of the things that the Government did not tell us in the Budget. They boasted about trade. They did not tell us that page 171 of the Red Book just published says that the trade deficit has risen by £7 billion. They told us about investment. They did not tell us that page 169 of the Red Book shows that business investment is falling by 5 per cent. this year. Almost everything that they have told us about the economy has turned out not to be true.
The Government told us they would be prudent. The Chancellor has just said that they will borrow £734 billion over the next six years, giving us a national debt of £1.3 trillion. They have confirmed in the Red Book that the deficit this year at 11.8 per cent. of GDP is the worst in the OECD except for Ireland. That is what the Labour Government have left us with. They talked about education and its importance. Next year they will be spending more on debt interest than on educating our children. They told us endlessly that they had abolished boom and bust, but the figures show that they have given us the deepest recession since the war. The figures show that we lost 6.2 per cent. of our GDP in total.
The Chancellor endlessly boasted about the action that the Government had taken. We have the longest and deepest recession since the war. They should be ashamed. They speak endlessly about their brilliant judgments, yet we were the first into recession and the last out of recession. They talk endlessly about their great judgment and about how well prepared we were. We went in with the biggest Budget deficit, and we come out with the largest Budget deficit. And of course they promised us real help now, yet more businesses went bust in this recession than in any other, and more people have gone bankrupt under Labour than ever before in our history.
What about all the schemes that the Chancellor mentioned, which were launched with great fanfare? How many people did they help? Let us take the mortgage support scheme, which was announced in December 2008. The Government said:
"This is real help for homeowners".
So how many households did it help? Fifteen. That cost £66,000 per household helped; or, to put it in currency that the Cabinet can understand, that is about 13 days of Geoff Hoon's consultancy fees.
The Government told us endlessly how brilliantly they had done on unemployment and what a triumph they had achieved. One in four adults of working age in our country are not in work. They talked about European comparisons. We have more young people unemployed than anywhere else in Europe.
To be fair to the Prime Minister, there is one forecast that he got spot-on. He told an audience of bankers:
"What you as the City of London have done for financial services, we as a government intend to do for the economy as a whole".
That is a pledge he met in full.
Thirteen years on from 1997, we can now see what has happened. In 1997, debt was £350 billion. Now it is getting on for £860 billion. In 1997 the deficit was £6 billion. That is what the Labour Government inherited-a £6 billion deficit. Today it is £167 billion. In 1997 we were ranked seventh in the world for competitiveness. Now we are 13th. We were fourth in the world for tax and regulation. Does anyone want to know what we are going to do? We are going to get back to fourth in the world for tax and regulation.
Barry Gardiner (Brent, North) (Lab) rose-
Mr. Cameron: The hon. Gentleman slept through the Chancellor's statement; I am glad to see that he has woken up for my reply. Does he know where we stand today? Having been fourth in the world for tax and regulation, we are now 84th and 86th. We have gone from the top of the premier league to the bottom of the conference in 13 wasted years-and we say that it is time to sack the manager. No wonder "Match of the Day" did not want him.
So that is the mess: what about their plans to clear it up? Pitiful. The big argument in British politics today is this: they say, "Don't do anything before the election-let's just sit tight and keep our fingers crossed"; we say that we need real action to get our economy moving, and urgently. We need a credible plan to deal with Britain's record debts, starting now, and we need to show the world that we are back open for business.
Let us start with the debt. The Chancellor repeated his hope to halve the deficit by 2014. Let us be clear about what this means. It means that in four years' time we will have a deficit almost as big as when Denis Healey went to the IMF in the 1970s. We are not the only ones who think that this is completely inadequate. The CBI has said:
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