HC Deb 31 January 1967 vol 740 cc226-8
12. Mr. Gresham Cooke

asked the Chancellor of the Exchequer by how much the total burden of taxation, central and local, will have increased in the financial year 1966–67 as compared with the calendar year 1964.

Mr. Callaghan

On the basis of the Financial Statement, modified by the Regulator in July, total taxation would increase by about 30 per cent., as compared with an estimated increase of 11 per cent. in gross domestic product up to the end of the first half of 1966–67.

Mr. Gresham Cooke

Would the Chancellor confirm that this amounts to nearly £2,000 million a year? If this is so, does it not mean that it is about £2 a week per family, and is this not one of the most depressing things for the British public, depressing industrial production, and depressing overtime earnings and altogether having an unsatisfactory effect on the country?

Mr. Callaghan

I would not like to confirm the hon. Gentleman's figures but there was a deliberate choice made by the country, and the party opposite when it was in Government, towards the end of its life, that there should he a shift from an improvement in the private standard of life of the individual to an improvement in the collective standards, as expressed in housing, hospitals, and many other ways. It is the job of the Government to try to establish a balance between the improvement in the private standard of life and the improvement in the collective standard. Under the policies that have been followed we have made a very substantial shift, and it is a matter for constant debate as to how far that shift should go.

Mr. Barnett

Would not the Chancellor agree that the best way to prevent increases in taxation and to get the increase in social service expenditure that most of us want is to increase the rate of growth much more than we have in the past? Would he perhaps reverse the priorities that he has given to growth in the economy?

Mr. Callaghan

I absolutely agree that the first priority for the country is to get a healthy rate of growth. We have run a deficit for so many years that we have had to enthrone the balance of payments as the prior objective. The country will be healthy only when we combine a balance of payments surplus, a substantial rate of growth and full employment, and this must be the constant objective.

Mrs. Thatcher

The Chancellor was very verbose in his last but one supplementary answer. In basic English did it mean that this Government planned an increase in taxation?

Mr. Callaghan

No. What it meant is what I said, that a different balance had been struck for the last three years, between improving the private standard of life and improving the collective standards of life. I hope that the hon. Lady can understand that.