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However, it is impossible to disengage the Government's failure from other difficulties. We know that the truth has not been told on debt, where the problems accumulated as a result of massive, irresponsible and extravagant
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public expenditure by the previous Chancellor, who is now the Prime Minister, when times looked good. He and his Government now face ruin for the mistakes that they made, but the difficulties go beyond what has been going on in the UK.

We had a debate on the Lisbon agenda in European Committee B only a few days ago. The hon. Member for Luton, North was also there, as was the Economic Secretary. I have attended many similar debates since that agenda was devised in 2000. Because of the European Communities Act 1972 and the slavish manner in which we fall in with most of the policies emerging from Europe, it is impossible to disentangle our policy making here from what goes on in Europe.

I think that the hon. Member for Luton, North will recognise that many of the problems also stem from the Maastricht treaty. He and I were the only two people in the House when section 5 of the European Communities (Amendment) Act 1993 was debated. We referred to article 2 and the aspirations embedded in the European treaties to produce high employment and prosperity for the people of Europe. It has all come to nothing: it is a total failure, and it has led to the rise of the far right and high unemployment. We are not immune, because we are seeing that even in this country.

Why have the British Airways people been on strike, and why are we seeing the beginnings of similar action in the railway industry as well? Those events are just indications of how the failure of the economy, connected with what is going on in Europe, is producing the tensions and uncertainty that are already undermining the people of this country.

Kelvin Hopkins: The hon. Gentleman flatters me when he speaks of my knowledge of the EU. I assure the House that his is much greater than mine, but does he agree that what is happening in Greece and some other countries-and Germany's insistence that they must deflate their economies-will damage the European economy? Does he also agree that if it is driven down, we could be dragged down with it unless we are very careful?

Mr. Cash: Indeed. The first moment I saw what was happening on the Greek front-it must be two months ago-I said in this Chamber that the Germans would not be able to meet the challenge that that presented, because the German people do not want to. We are talking about human nature and people, not just technical bits of accounting rules; one cannot fiddle with people. The Germans will not pay up, and if they do, there will be big trouble in Europe, because the problem will go from Greece to Spain, Portugal, Italy, Ireland and so on. The problem is inherent in the failure of the economic system of the European Union-a failure that those of us who fought the Maastricht treaty in the 1990s predicted. We were right then, and we are right now. The proof is before us. The proof of the pudding is in the eating and, my goodness, it is bitter eating.

There are serious problems, including immigration and the costs of the welfare system that arise from excessive immigration. The right hon. Member for Birkenhead (Mr. Field) and I, and many others, have got together to explain that over the years. The fact is that there are problems that can be solved only by
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cutting immigration. I shall not go into that in depth, but the matter is so important that it ought to be mentioned in this debate.

I mentioned the question of what the European Union is achieving, or failing to achieve, and the disaster that it is causing to the people of this country. I want to quote from a European Commission document, "Europe 2020 Strategy":

that is, the European gross domestic product-

It goes on:

It continues:

It says:

That does not include immigration. The European Union is taking over common immigration policy, so we will be bound into the legal framework even more than we are already. According to the European Commission, there are already 7 million illegal immigrants in Europe alone, and they are coming over here as well.

Then there is the question of over-regulation. Even the Secretary of State for Business, Innovation and Skills said, when he was a Commissioner, that 4 per cent. of GDP was taken up by over-regulation in Europe. I have not heard him say that with regard to what has been going on in this country since then. Over-regulation is a massive burden on small businesses, and the pathetic way in which small businesses are being treated was illustrated by the comments made by the Federation of Small Businesses yesterday or today.

There is a need for truth, and we are not being told the truth. The truth is emerging in the bursting of the dam. We see it in the case of Greece, in the high unemployment figures in this country, and even in the rise of the British National party. We see it in the fact that the people of this country are deeply disturbed by the way in which they have been governed over the past 13 years. The answer lies in good government, but it has to be government based on the truth. The truth that I have described, regarding levels of debt, and the fundamental weakness in our integration in the European Union when we could instead be an association of member states working effectively, cannot be denied.

Britain needs to wake up, and it will wake up during the election. When we get past that election and, I hope,
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have a Conservative Government with sound principles, including dealing effectively with the European Union in line with my United Kingdom Parliamentary Sovereignty Bill, which I hope will one day be enacted, it is essential that we restore to this House the power to decide what is necessary in the interests of our electors, and do not have it dictated to us by misleading statistics from the Government and misleading policies that have failed in the European Union.

4.55 pm

Mr. Tobias Ellwood (Bournemouth, East) (Con): It is a pleasure to contribute towards the end of this important debate about the Budget. I pay tribute to my hon. Friend the Member for Stone (Mr. Cash), who made an important point about the Government needing to wake up. This is an interesting Budget, but we needed to wake up during the statement itself, because the Chancellor's performance was so lacklustre. My hon. Friend also paid tribute to our hon. Friend the Member for Broxbourne (Mr. Walker), who began his speech by saying that he was not a nice person. I shall not comment on that, because he is a thoroughly delightful person now and a credit to his constituents, who I hope will see the light and ensure that he is back here in his place on the other side of the election.

My hon. Friend the Member for Leominster (Bill Wiggin) made an important contribution about apples and the taxation now hitting cider. I visited his constituency and saw how important that industry is. I represent Bournemouth in the county of Dorset and I know that, likewise, the industry is important there. I am sorry that the Treasury deems it appropriate to introduce taxation or changes to legislation without discussing them or properly thinking them through with other Departments, and that is a theme to which I shall return. I am sure that if the Treasury had engaged with the Department for Culture, Media and Sport, it would be aware of how wrong it is to tax all ciders, rather than those that contribute to binge drinking.

My hon. Friend the Member for Uxbridge (Mr. Randall) made one of the most succinct points of the entire debate. If the Economic Secretary to the Treasury is listening I shall repeat what my hon. Friend said, because he pointed to the Minister and asked, if an election had not been coming up in the next two weeks, would we have seen this particular Budget? [ Interruption. ] I shall repeat what my hon. Friend said, because the Minister is still talking. My hon. Friend asked, if the election had not been coming up in two weeks' time, would we have seen this particular Budget? The honest answer is absolutely not.

It has been interesting to experience this Budget debate far more closely than I have any other. The start of this ritual that we go through is a bit of a farce, partly because the Opposition and, indeed, the nation are denied the details until the debate gets going. That is a strange position to be in, considering that we, as Her Majesty's Opposition, are here to challenge and scrutinise what is going on. We then have to play catch-up during the debate in order to work out what the Chancellor is saying.

Because of the Chancellor and the absence of substance, spark and detail, the Budget statement was a painful experience, as I have said. I think that Members from all
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parts struggled to stay awake. It was certainly painful for me, because, with the Chamber being crowded, I had to sit on the steps of the Gangway, so I ended up getting sore buttocks halfway through. However, that is a separate, personal issue on which I shall not dwell.

This ritual borders on the ridiculous when we are denied access to the full report, and when the Leader of the Opposition has to react to what is leaked to the papers in the lead-up to the Budget statement and what the Chancellor has just said. Those are hardly the conditions for open and fair debate about the state of the nation's finances. It is like being given a jigsaw with some of the pieces missing and the picture on the box having been removed.

Simon Hughes: The hon. Gentleman makes an interesting and good point about the presentation of the Budget. Does he agree that the other great failure of our system is that we still have no chance to consider properly, debate routinely or vote on the Government's expenditure plans during the course of each financial year?

Mr. Ellwood: The hon. Gentleman makes a further point, suggesting, as we go through this year of more openness and scrutiny, that the Leader of the House might wish to pay further attention to the Budget as part of that process.

My hon. Friend the Member for Tatton (Mr. Osborne) has made a similar point. Twenty-four hours later, we are armed with the necessary information to be able to digest exactly what has happened in this Budget statement in a way that we were unable to do during the hour of the speech itself. Having been able to take stock and read the small print, we can make a full assessment of this Budget. Considering the state of the nation's finances and the urgency of getting public spending under control and assisting businesses that are still not getting support from the banks, there was very little to write home about. As the headline in the Financial Times, which is pretty much a neutral newspaper, put it: "Darling ducks deficit challenge".

This Budget has really been more about election tactics-the survival of Labour rather than what is good for Britain. I can imagine the discussions that took place in the last couple of weeks, in the lead-up to this, with people saying, "How do we manage this exercise for the benefit of our party in surviving through the next election?" I am guessing that it came down to three principal tactics. First, with borrowing at £11 billion less than predicted, how can that be spun in a way to suggest that there is a successful story and fine stewardship in navigating the troubled waters of the recession? Of course, that tactic has to be employed without mentioning the fact that we were the first country in the G8 to enter recession and the last country to come out of it. It must also be spun in such a way that we are borrowing £163 billion, of which it costs £43 billion a year simply to do the borrowing. From an international credit rating perspective, that borrowing continues to be under threat.

The second tactic that I think was adopted was the idea of stealing some headline-grabbing measures from the Tories and taking credit for them in order to close off potential lines of attack during the election. That is why we saw the abolition of stamp duty for homes under £250,000, the inheritance tax threshold frozen, and more university places offered. Of course, that
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tactic works only when one does not mention that it was a Tory proposal to abolish stamp duty in that way, that it was the Conservatives who decided to raise the inheritance tax threshold to over £1 million, and that it was the Tories who put forward the idea of more university places. What has also now been exposed, thanks to my hon. Friend the Member for Tatton, is that the university places funding scheme is available only for one year, yet the average university course takes up to three years.

The third tactic that I think has been employed is to rally the Labour party with eye-catching headlines on measures such as tax information-sharing with that good old country, Belize. Well, of course that got a big laugh-the biggest laugh of the day-but the enormous build-up to the big hoo-hah when this announcement was made suggests that the Budget is not being taken too seriously. Why not get to the core of the issue by doing what the Conservatives have been proposing-capping the level of contributions made to party funding? That is something that the Government could have done in any one of the 13 years in which they have been in power. Instead, they decided to go for gimmicky headline-grabbing measures.

The same applies to the amount of money for repairing potholes-£100 million. Anyone who was listening to the "Today" programme this morning would be aware that repairing the roads to the necessary standards that we expect would cost £9 billion, so £100 million will not go very far, and it will probably cause arguments as to how and where it is spent, with possibly more going to Labour seats than Tory ones.

Mr. Christopher Chope (Christchurch) (Con): My hon. Friend makes a very powerful point. Does he agree that it is ironic that the Government are threatening to withdraw the funding for the A338 from the A31 into Bournemouth, which has been part of a Government-funded programme, and yet at the same time they are boasting about increasing expenditure on highway maintenance?

Mr. Ellwood: My hon. Friend and neighbour makes an absolutely valid point. That is the trouble with this Government. They see these schemes, they get put in place, and then, as we approach the election, things are moved around for electoral gain.

The tactics of yesterday were all about attempts to overshadow key aspects of the Budget. We heard nothing about allowances being frozen, despite inflation running at 3 per cent., which effectively introduces another form of stealth tax. We heard nothing about the fact that national insurance is on its way up-not necessarily the best thing to do when one is trying to find support for businesses up and down the country.

Of course, there was no mention of delaying the spending review, which is so critical from now until October. I ask the Economic Secretary: what is the difference between conducting the next three-year spending round now and doing it in October, apart from the fact that there happens to be a general election in May?

A £24 billion hole remains in the Budget, which is supposed to be filled from savings in public services. The Government have identified and even ring-fenced the money, but they have not said where it will come from. I am afraid that that will be an election issue. People will ask where Labour intends to make the cuts.
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Of course, we will not know until after the election, if at all. There are no details in the Budget, which is a "Don't rock the boat" Budget. It is the bluffers' Budget, which leaves the economy and the country guessing Labour's true intentions.

As my hon. Friend the Member for Broxbourne said, we often come into the Chamber and experience exchanges of pleasantries or otherwise; we chew over the issues and say things to each other. Yet the opinion that actually matters as much as anyone's is that of the investors, who examine the Budget speech and the details of the Red Book and decide whether to invest and support the Government. Hon. Members should consider the gilt markets and what happened during the Budget speech yesterday. Investors around the world started to sell Government bonds, pulling their money out of the UK. They did not like what they saw. The Economic Secretary shakes his head, but they did not like it.

Mr. Cash: I am fascinated because I did not know that what my hon. Friend described had happened. Does he agree that it happened because investors know the true bottom line on debt and they are not taken in by the accounting rules, which are governed by EUROSTAT and so on? Investors look at the bottom line, which is much worse than the Government admit.

Mr. Ellwood: Again, my hon. Friend makes a powerful point. The Government must listen because people deciding to shift their money outside the country is likely to threaten our credit rating. The Government need to raise £158 billion of bonds annually in the next five years. That is a tall order with such a shadow hanging over our credit rating. I do not think that it can be achieved without better leadership and drastic action by the Government. Such action seems currently to elude them.

In the few minutes that I have left, I want to consider an aspect of the economy that is close to my heart as Front-Bench spokesman on the subject-tourism and its contribution to the economy. It may seem an odd subject on which to focus, but it is the fifth largest sector in the economy. It is worth £114 billion and I understand that approximately a quarter of those in employment are somehow connected-directly or indirectly-with tourism. We do not do it justice or discuss sufficiently its contribution to the economy. The British tourism industry comprises 200,000 small and medium-sized businesses. It deserves our support, recognition and help. It is therefore not such an unusual sector to consider in a debate about the economy.

What exactly is tourism? It links our seaside towns to our city centres, our country clubs to our town squares, the Lake district to the theatre district, the Ferris wheel to the roulette wheel and the museums in Kensington to the Munros in Scotland. The unique offering of all those things makes Britain exceptional. One cannot replicate that in other countries and that is why we are the sixth most attractive place in the world to visit. That accolade is not trumpeted enough.


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