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Lord Higgins: My Lords, can the Minister say whether the Bill will include housing benefit?

Lord McIntosh of Haringey: My Lords, I do not think so. That is not the way it has been described. The Bill is about the New Deal, incapacity benefit, maternity pay and a number of detailed benefits, but, as far as I know, housing benefit is not part of it.

As to the pension credit Bill, I was surprised to hear a renewed attack on the windfall tax. When we have, as a result of the New Deal, which was paid for by that tax, 293,000 young people and 50,000 older people in work who might not otherwise have been, I would have thought that was of enormous benefit to society, both economically and socially.

I turn to the enterprise Bill, which deservedly gained a lot of attention. I agree with those who started with a word of caution. I do not go quite so far as to agree with the noble Lord, Lord Blackwell, who seems to think--as he has done for a number of years--that the economy is going to hell in a handcart. He has been proved wrong so far, and there is just a chance that he might be proved wrong now. It is certainly true that the economic stability we have achieved is enormously beneficial to business. Fundamentally, that is of a

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different order of magnitude from the complaints about burdens on business that we have heard from a number of noble Lords.

It is also true that we must not relax the monetary and fiscal disciplines and rules that we have set up in the past four years. We must continue our drive towards our long-term ambition to close the historic productivity gap between the UK and its major competitors. The noble Lords, Lord Haskel and Lord Hodgson, both quoted comparative figures, with the United States in particular and with France and Germany. Yes, the platform of economic stability is the first step in the strategy to close the gap, but we need more reform and that is what the enterprise Bill will seek to tackle.

Not all of this needs to be done by legislation. I am sure it is right that some of it can be done by the relaxation of legislation or even the abolition of legislation. However, I was interested that the Opposition, when they were talking about burdens on business, particularly on small business, did not remember the attitude which their party took towards the Regulatory Reform Bill. That Bill sought to make it easier for regulations on business to be removed. And what was the thrust of the Opposition's argument? That the Regulatory Reform Bill went too far and that we should not make it easier in the ways we proposed.

However, I should remind the House that the OECD says that we have the lowest level of product regulation among OECD countries; the CBI says that we have more flexible labour regulations; the Economist Intelligence Unit, after carrying out a survey of 60 major economies, says that we are second out of the 60 as the best economy in which to do business, and the first for policy for private enterprise and competition. So, yes, of course there are many ways in which we can improve matters--the enterprise Bill will seek to do so--but I do not think that some of the charges I have heard today stand up to serious argument.

The Bill will encourage enterprise, for example, through insolvency law reform, an issue referred to by the noble Lords, Lord Borrie and Lord Northbrook. I was glad for their support. We will encourage enterprise by removing some of the stigmas on faultless failure while reserving the toughest penalties for the dishonest. We will strengthen competition laws by reform of the competition regime and, as has been said, by the independence of the competition regime from the opinions of Ministers. We will promote safeguards for consumers by introducing new powers to deal with rogue traders and penalties for corporate wrongdoing, whether it be corporate manslaughter or cartels.

I was interested in what the noble Lord, Lord Skidelsky, said on these subjects. Again, I should like the opportunity for a longer debate than we have time for today. The noble Lord thought it was new that we should be pursuing social policies for economic ends. Social policy is, of course, pursued for its own sake and for the sake of a decent and just society, but surely that

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has economic ends and economic benefits as well. Surely it is proper for those ends and benefits to be taken into account in pursuing social policies.

It seems to me that the converse is not true. What the noble Lord described as the Lawson version of supply-side capitalism--which states that you leave to households everything that you can and leave to the state only other things--resulted in the impoverishment of the public services of this country over a period of many years. It will be very difficult indeed--and there is no guarantee of success--to pull up our public services again so that we can no longer be accused of private affluence and public squalor, which is the historical condemnation of the policy of supply-side capitalism.

I turn, very briefly, to the point made by the noble Lord, Lord Hodgson--he was the only one to refer to it--about the Financial Services and Markets Act. He gave a figure for the cost to what he described as "the consumer" of regulation. I suggest that he puts that figure--whether or not it is correct, I do not know--against the vast benefit to this country and to our reputation for probity and successful financial markets of having a regulatory authority that works and brings everything together. I suggest that the benefits to the financial community, let alone to the economy as a whole, far outweigh the costs of proper regulation.

We shall be the first major nation to adopt the one regulator, one body of law approach. We shall have one of the best standards of regulation in the world, and I am sure that other countries will copy us. Yes, there are a number of statutory instruments to be introduced before N2 in November, but we are on target to do that and we have no reason to suppose that business will be taken by surprise by them. If the noble Lord really wants to abolish stamp duty, he is going to have to tell us where the £4 billion that comes from duty, not on trade in this country but on UK shares, will come from. Perhaps the shadow Chancellor, whoever he may be, would like to think about that point. I note what the noble Lord says about the takeover direction. I can write to him on that point if he so wishes.

I wonder whether the House wants me to dwell on the issue of the tax burden, as it is called--or more politely, as we have begun to describe it, the "tax-to-GDP ratio". I use the word "politely", but the description is correct. "Burden" is a pejorative term. The noble Lord, Lord Saatchi, should not smile. He wisely avoided talking about it. It is set to fall in each of the next three years. The direct tax burden on a single-earner family on average earnings is the lowest since 1972. It has fallen from 21.5 per cent to 18.1 per cent. Our tax burden is one of the lowest in the European Union. I am grateful for the support of the noble Lord, Lord Northbrook, in setting out the measures that we have taken to cut taxes for business. The noble Lord is correct. We have cut corporation tax to its lowest level in the history of the United Kingdom. We have cut the small companies' rate of tax by three percentage points, and we have carried out many tax changes. They may be complex, but if so they are particularly

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complex when they deal with "business assets". That is an important definition which ought not to be treated lightly. As I know to my cost, having sold my company before relief for "business assets" was introduced, it is an important complication in the corporation tax system of extreme importance to entrepreneurs and to small companies. I know that the noble Baroness, Lady Miller, will agree with that and will forgive the complication that it necessarily involves.

I turn briefly to the communications Bill. I can confirm to the noble Lord, Lord Brooke, that we shall stick to the 2005 goal for "government online". Our UK online publication in February this year set a target for the most extensive and competitive broadband market in the G7 by the year 2005 by wiring up schools, libraries, further and higher education establishments and so on. We are sticking to that and we take the issues raised by the noble Lord very seriously indeed.

What am I going to say about EMU? I quote:

    "In principle the Government is in favour of UK membership of EMU. In practice the economic conditions must be right. The determining factor underpinning any government decision on membership of a single currency is the national economic interest and whether the economic case for joining is clear and unambiguous. If it is, there is no constitutional bar to joining.

Those were the words of the Chancellor of the Exchequer in October 1997. That may be an "incantation" as the noble Lord, Lord Tomlinson, called it, but I do not see how the noble Lord, Lord Newby, can describe that as giving "unclear signals". We have made the position entirely clear. Every attempt to tease out differences deserves to fail. The only change that we have made is that we have said that the Treasury will complete an assessment of the five tests within two years of the start of this Parliament. That is because we recognise--the noble Lord, Lord Layard, is entirely right--that other matters will not stay the same during any period during which we are not members of European Monetary Union.

The noble Lord, Lord Lea, took exception to the "clear and unambiguous case". It is a question of whether a clear and unambiguous case can be made, a question of whether the economic case for joining is clear and unambiguous. That may be based on ambiguities or disagreements in the arguments but the position that has to be put, first to the Government, then to Parliament, then to the people of this country, must be clear and unambiguous. It would be grossly unfair to do anything else.

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