§ 3.45 p.m.
§ Mr. Kenneth BakerI beg to move,
That leave be given to bring in a Bill to reduce the standard rate of income tax by one shilling in the pound.It is unusual for a private Member to propose a taxing Measure. In fact, there is no precedent for it. However, my proposed Bill is in order since it seeks to reduce rather than to impose taxation. The imposition of taxes is the task of the Government and it has been taken up by this Government with a degree of enthusiasm and efficiency notably lacking in the rest of their activities.I am proposing the Bill because I believe that the one thing which our country needs above all is a reduction in the level of direct taxation. In 1964, the yield of income tax was about £3,000 million. This year, it will be £4,800 million—an increase of 60 per cent., or roughly 10 per cent. a year for each year that the Government have been in office. In addition, about 3 million people who were not paying tax in 1964 are now having to pay tax. They have been sucked into the income tax net. All those people paying tax in 1964 are having to pay a very much higher proportion now.
§ Sir Harmar NichollsOn a point of order. As there was notice of my hon. Friend's proposed Bill to reduce the level of income tax, should there not be a Treasury Minister on the Government Front Bench to take note of what is being said on this important matter?
§ Mr. SpeakerThe Bill is being introduced under the Ten-Minute Rule. A point of order, particularly an idle one, wastes time.
§ Mr. BakerI have pleaded this case with Treasury Ministers before. I find that I speak to deaf ears, so that their absence today is no loss to the House.
It is unnecessary to argue the case that income tax is a major disincentive. When the workers in the industrial firms in my constituency—and I represent mainly an industrial constituency—are asked to work a bit longer on Friday night or Saturday morning, perhaps in the warehouse, their reaction is, "My rate for the job is 10s 1263 and that is what I want to take away with me". Therefore, income tax concerns not just executives and the middle-classes; it is of importance right down to the factory floor.
To put it in another way, in 1964 income tax represented about 9 per cent. of the gross national product. In the third quarter of the present financial year, it represents 14 per cent. If the Government were to implement the Prime Minister's famous pledge that over the life of a Parliament there would be no general increase in taxation, and if he were to apply it to income tax alone, the Government would have to reduce the standard rate by 3s. in the £. Therefore, compared with what the Prime Minister promised, my proposed Bill is a most modest Measure.
Hon. Members opposite, and particularly the Prime Minister, do not like being reminded of their excellent record of increasing taxation. The Prime Minister's memory for the political and economic events of the last six years seems daily to assume more the characteristic of a sun dial in that it records only hours of sunshine. The Government's record is staggering.
The tax manual is a book called Butter-worth's, which runs to 1,000 pages. The first 500 pages of the recent edition of Butterworth's deals with taxes from the period when William Pitt introduced in-income tax in 1799 to 1964. The second part of the book, 505 pages, deals with legislation which has been introduced by this Government in six years, so we have a record of doubling in a period of six years the whole body of tax legislation.
Reverting briefly to the details of the Bill, which is simple, I have chosen a reduction of 1s. in the £ because it is administratively the most simple to deal with. The over-burdened Inland Revenue will not have to expend many millions of man hours in recoding everybody upon the introduction of this change. By reducing the standard rate by 1s. everybody who pays tax, whether he pays tax on earnings or upon savings, will benefit.
I believe that the greatest anomaly of our tax system is that it penalises savings, the accumulations of savings, out of all proportion. Indeed, savings are penalised more in this country than in any 1264 other in the world. If we do not encourage savings we may as well give up any chance of getting the sort of investment which our country so desperately needs.
The cost of the Bill would be about £600 million. Hon. Members may be interested to know where I would find the money. Well, the Chancellor has helped me in this respect, as he will have a Budget surplus of over £1,000 million, and there will be a substantial surplus next year, so by returning to the taxpayers £600 million of their money I would still leave some scope for the Chancellor on 14th April.
Finally, I believe—and it is, of course, a personal subjective opinion, and I do not want to anticipate the debate this afternoon—that now is the time to reflate the economy. But the Government have resigned almost all interest in reflating the economy and have handed that task over to Mr. Victor Feather. I also think that it is psychologically necessary, faced as we are with these enormous wage demands, to reduce direct taxation. I feel sure that all groups of workers and trade union negotiators know very well how much the tax man will take from these increases, and they are calculated to some extent to compensate, and overcompensate, for what the tax man will take from them. I am not saying that tax reductions are a substitute for wage increases, but what I am saying is that a high level of direct personal taxation is adding a flywheel to inflation.
There have been rumours that the Chancellor may also be thinking along similar lines, and if, on 14th April, he suffers a death bed repentance I believe that we on this side of the House will welcome it, but we will draw comfort from the fact that history does not record one instance where generosity on the death bed has actually averted the onset of death.
I would commend the Bill to the House and I hope that it will not be opposed. I think that any Members who go into the No Lobby on the Motion will have an interesting time explaining to their constituents their reasons for rejecting it. So I hope that the Motion will be accepted by the House this afternoon. What our country needs is a Government dedicated to the proposition of fewer, simpler and lower taxes.
§ Mr. SpeakerDoes the hon. Member for Ebbw Vale (Mr. Michael Foot) wish to oppose the Motion?
§ 3.45 p.m.
§ Mr. Michael Foot (Ebbw Vale)I wish to oppose the Motion for leave to bring in the Bill because I regard the speech of the hon. Member for Acton (Mr. Kenneth Baker) and his proposition as a gross abuse of the procedures of the House—[HON. MEMBERS: "No."]—and one which, if it were persisted in, might do serious injury to private Members. I should like to explatin why I take that view.
It is perfectly true that many Private Members' Bills introduced under the Ten-Minute Rule have a propagandist element; there has been a propagandist element behind the private Members introducing them, and I would be the last to object on those grounds. That is a perfectly legitimate purpose, but I believe that if we are to protect the rights under the Ten-Minute Rule procedure, and that procedure at this time of day—and I am all in favour of that—it is necessary for Members to exercise some restraint, to say to themselves that a Bill shall be one which they and the House know is one which can be carried.
If they seek to use the Ten-Minute Rule procedure to introduce Bills which they know perfectly well and which the rest of the House knows perfectly well can never be incorporated into our legislation, such as a Finance Bill and of a Budget, with methods of full discussion, they are abusing the procedure of the House. If it were to be the case that proposals for, say, drastic reductions in taxation by £600 million or thereabouts, were introduced day after day, the House would be driven to take some protection; it would be driven to explain to the public what, I believe, all the more sophisticated part of the public well understand already, that they were not serious proposals at all.
This proposal is designed entirely, as the hon. Member was candid enough to explain, to cause embarrassment, that is to say, he will be able to parade around the country saying that he had proposed a ls. reduction in taxation and that wicked Members like myself had gone into the Lobby against it. [HON. MEMBERS: "Hear, hear."] That confirms my 1266 point. They know that if they do that, it will be a lie. They know it perfectly well, because they know, none better, that the question of taxation under any Government is not dealt with under the Ten-Minute Rule procedure by private Members. Such questions are preeminently questions which are settled by proposals made by the Treasury Bench.
I am sure that the right hon. Gentleman the Member for Enfield, West (Mr. Iain Macleod), who still entertains great ambitions of being able himself to make proposals of this kind in future, will agree with that view entirely. He would not like it at all if the whole of his Budget surplus—not that he is ever likely to get his fingers on it, his greedy, envious fingers on it—were pre-empted by a Bill introduced under the Ten-Minute Rule by a whippersnapper from his own back benches.
Unaccustomed as this present rôle of mine may be, for I have united both Front Benches, everybody in the House knows that the proposition of the hon. Gentleman is a fraud. Everybody knows that it is designed solely for the purpose of political embarrassment and not to assist the purposes of intelligent argument in the House, or, indeed, in the country at all. This is a debasement of Parliament. Somebody, I think it was Mr. Augustine Birrell, once said that the procedures of the House are like the trunk of an elephant: they could fell an oak, or they could pick up a pin, but if an instrument designed to pick up a pin were used to fell an oak, or vice versa, that would bring that instrument into ridicule.
Therefore, I oppose the Motion. Not because I distrust the merits or the demerits of the case—[HON. MEMBERS: "Oh."] All of us know perfectly well that the merits and demerits of such financial questions have to be discussed at length, and nobody has insisted more upon that or more strongly fought for it than the present Opposition Front Bench, who have complained that there has been insufficient time for the discussion of Finance Bills and such matters. This matter will not be discussed—
§ Mr. SpeakerSpeeches under the Ten Minutes Rule procedure are heard without interruption.
§ Mr. FootIt is part of my case, Mr. Speaker, that these matters are much better discussed under the procedures which are laid down for detailed and adequate discussion. Every hon. Members knows that to be the case. That is better than being discussed under this method which, if it is persisted in, will destroy private Members' time. Those who vote for the Motion will not be voting for a reduction in taxation. They
§ will be voting to injure the rights of all private Members on both sides of the House.
§ Question put, pursuant to Standing Order No. 13 (Motions for leave to bring in Bills and nomination of Select Committees at commencement of Public Business):
§ The House divided: Ayes 139, Noes 198.
1269| Division No. 61.] | AYES | [4.0 p.m. |
| Amery, Rt. Hn, Julian | Gower, Raymond | Nicholls, Sir Harmar |
| Archer, Jeffrey (Louth) | Gurden, Harold | Nott, John |
| Astor, John | Hall, John (Wycombe) | Ons'ow, Cranley |
| Atkins, Humphrey (M't'n & M'd'n) | Hamilton, Lord (Fermanagh) | Orr, Capt. L. P. S. |
| Awdry, Daniel | Hamilton, Michael (Salisbury) | Osborn, John (Hallam) |
| Baker, W. H. K. (Banff) | Harvie Anderson, Miss | Page, John (Harrow, W.) |
| Bennett, Sir Frederic (Torquay) | Hastings, Stephen | Pearson, Sir Frank (Clitheroe) |
| Biffen, John | Hawkins, Paul | Peel, John |
| Biggs-Davison, John | Heseltine, Michael | Peyton, John |
| Black, Sir Cyril | Higgins, Terence L. | Pink, R. Bonner |
| Blaker, Peter | Hiley, Joseph | Pounder, Rafton |
| Body, Richard | Hogg, Rt. Hn. Quintin | Price, David (Eastleigh) |
| Bossom, Sir Clive | Holland, Philip | Prior, J. M. L. |
| Boyd-Carpenter, Rt. Hn. John | Howell, David (Guildford) | Pym, Francis |
| Boyle, Rt. Hn. Sir Edward | Hunt, John | Quennell, Miss J. M. |
| Braine, Bernard | Hutchison, Michael Clark | Rhys Williams, Sir Brandon |
| Brewis, John | Iremonger, T. L. | Ridley, Hn. Nicholas |
| Brinton, Sir Tatton | Irvine, Bryant Godman (Rye) | Rodgers, Sir John (Sevenoaks) |
| Bryan, Paul | Jennings, J. C. (Burton) | Rossi, Hugh (Hornsey) |
| Buchanan-Smith, Alick (Angus, N&M) | Jones, Arthur (Northants, S.) | Russell, Sir Ronald |
| Bullus, Sir Eric | Jopling, Michael | Scott-Hopkins, James |
| Campbell, Cordon (Moray & Nairn) | Joseph, Rt. Hn. Sir Keith | Shaw, Michael (Sc'b'gh & Whitby) |
| Carlisle, Mark | Kerby, Capt. Henry | Silvester, Frederick |
| Chichester-Clark, R. | Kershaw, Anthony | Sinclair, Sir George |
| Clark, Henry | Kimball, Marcus | Smith, Dudley (W'wick & L'mington) |
| Cooke, Robert | Kitson, Timothy | Speed, Keith |
| Corfield, F. V. | Lane, David | Stodart, Anthony |
| Costain, A. P. | Legge-Bourke, Sir Harry | Stoddart-Scott, Col. Sir M. |
| Crouch, David | Lewis, Kenneth (Rutland) | Summers, Sir Spencer |
| Cunningham, Sir Knox | Lloyd, Rt. Hn. Geoffrey (Sut'nC'dfield) | Taylor, Sir Charles (Eastbourne) |
| Currie, G. B. H. | Lloyd, Ian (P'tsm'th, Langstone) | Turton, Rt. Hn. R. H. |
| Dalkeith, Earl of | Longden, Gilbert | Wall, Patrick |
| Dance, James | MacArthur, Ian | Walters, Dennis |
| Dean, Paul | Maclean, Sir Fitzroy | Ward, Christopher (Swindon) |
| Digby, Simon Wingfield | Macleod, Rt. Hn. Iain | Ward, Dame Irene |
| Doughty, Charles | McMaster, Stanley | Whitelaw, Rt. Hn. William |
| Eden, Sir John | McNair-Wilson, Patrick (New Forest) | Wiggin, A. W. |
| Elliott, R.W. (N'c't1e-upon.Tyne,N.) | Marten Neil | Wilson, Geoffrey (Truro) |
| Ewing, Mrs. Winifred | Maxwell-Hyslop, R. J. | Wood, Rt. Hn. Richard |
| Eyre, Reginald | Mills, Peter (Torrington) | Worsley, Marcus |
| Farr, John | Mills, Stratton (Belfast, N.) | Wright, Esmond |
| Fisher, Nigel | Monro, Hector | Wylie, N. R. |
| Fletcher-Cooke, Charles | Montgomery, Fergus | Younger, Hn. George |
| Fortescue, Tim | Mon Jasper | |
| Fry, Peter | Morrison, Charles (Devizes) | TELLERS FOR THE AYES: |
| Galbraith, Hn. T. G. | Mott-Radclytie, Sir Charles | Mr. Kenneth Baker and |
| Glover, Sir Douglas | Murton, Oscar | Mr. Norman St. John-Stevas. |
| Goodhew, Victor | Neave, Airey | |
| NOES | ||
| Abse, Leo | Bennett, James (G'gow, Bridgeton) | Brown, Hugh D. (G'gow, Provan) |
| Allaun, Frank (Salford, E.) | Bessell, Peter | Brown, R. W. (Shoreditch & F'bury) |
| Alldritt, Walter | Bidwell, Sydney | Buchan, Norman |
| Allen, Scholefield | Bishop, E. S. | Butler, Mrs. Joyce (Wood Green) |
| Archer, Peter (R'wley Regis & Tiptin) | Blackburn, F. | Carmichael, Neil |
| Armstrong, Ernest | Blenkinsop, Arthur | Carter-Jones, Lewis |
| Ashley, Jack | Booth, Albert | Chapman, Donald |
| Ashton, Joe (Bassetlaw) | Boston, Terence | Coe, Denis |
| Atkinson, Norman (Tottenham) | Bottomley, Rt. Hn. Arthur | Coleman, Donald |
| Bagier, Gordon A. T. | Boyden, James | Concannon, J. D. |
| Barnett, Joel | Bradley, Tom | Crawshaw, Richard |
| Bence, Cyril | Brooks, Edwin | Dalyell, Tam |
| Benn, Rt. Hn. Anthony Wedgwood | Brown, Rt. Hn. George (Belper) | Darling, Rt. Hn. George |
| Davidson, James(Aberdeenshire, W.) | Johnson, James (K'ston-on-Hull, W.) | Panned, Rt. Hn. Charles |
| Davies, E. Hudson (Conway) | Johnston, Russell (Inverness) | Parkyn, Brian (Bedford) |
| Davies, G. Elfed (Rhondda, E.) | Jones, T. Alec (Rhondda, West) | Peart, Rt. Hn. Fred |
| Davies, Rt. Hn. Harold (Leek) | Kelley, Richard | Pentland, Norman |
| Davies, S. O. (Merthyr) | Kenyon, Clifford | Perry, George H. (Nottingham, S.) |
| de Freitas, Rt. Hn. Sir Geoffrey | Kerr, Mrs. Anne (R'ter & Chatham) | Prentice, Rt. Hn. Reg |
| Delargy, Hugh | Kerr, Dr. David (W'worth, Central) | Price, Thomas (Westhoughton) |
| Dempsey, James | Kerr, Russell (Feltham) | Price, William (Rugby) |
| Dewar, Donald | Latham, Arthur | Probert, Arthur |
| Dickens, James | Lawler, Wallace | Rankin, John |
| Dobson, Ray | Lawson, George | Roberts, Rt. Hn. Goronwy |
| Dunwoody, Dr. John (F'th & C'b'e) | Lee, Rt. Hn. Frederick (Newton) | Roberts, Gwilym (Bedfordshire, S.) |
| Eadie, Alex | Lee, Rt. Hn. Jennie (Cannock) | Robertson, John (Paisley) |
| Edelman, Maurice | Lee, John (Reading) | Rodgers, William (Stockton) |
| Edwards, Robert (Bilston) | Lewis, Arthur (W. Ham, N.) | Rogers, George (Kensington, N.) |
| Edwards, William (Merioneth) | Lomas, Kenneth | Rose, Paul |
| English, Michael | Loughlin, Charles | Ross, Rt. Hn. William |
| Ennals, David | Lubbock, Eric | Rowlands, E. |
| Evans, Fred (Caerphilly) | Lyon, Alexander W. (York) | Shaw, Arnold (Ilford, S.) |
| Evans, loan L. (Birm'h'm, Yardley) | Lyons, Edward (Bradford, E.) | Sheldon, Robert |
| Fernyhough, E. | McBride, Neil | Shore, Rt. Hn. Peter (Stepney) |
| Finch, Harold | McCann, John | Short, Mrs. Renee(W'hampton,N. E.) |
| Fitch, Alan (Wigan) | MacColl, James | Silverman, Julius |
| Fletcher, Raymond (Ilkeston) | Macdonald, A. H. | Slater, Joseph |
| Fletcher, Ted (Darlington) | McElhone, Frank | Small, William |
| Foot, Michael (Ebbw Vale) | McGuire, Michael | Snow, Julian |
| Ford, Ben | Mackenzie, Alasdair(Ross&Crom'ty) | Spriggs, Leslie |
| Galpern, Sir Myer | Mackenzie, Gregor (Rutherglen) | Steel, David (Roxburgh) |
| Gardner, Tony | Mackie, John | Steele, Thomas (Dunbartonshire, W.) |
| Ginsburg, David | Mackintosh, John P. | Summerskill, Hn. Dr. Shirley |
| Gray, Dr. Hugh (Yarmouth) | MacMillan, Malcolm (Western Isles) | Thornton, Ernest |
| Grey, Charles (Durham) | McMillan, Tom (Glasgow, C.) | Thorpe, Rt. Hn. Jeremy |
| Griffiths, Eddie (Brightside) | McNamara, J. Kevin | urwin, T. w. |
| Griffiths, Wilt (Exchange) | Mahon, Simon (Bootle) | Varley, Eric G. |
| Wainwright, Edwin (Dearne Valley) | ||
| Hamilton, James (Bothwell) | Mallalieu, E. L. (Brigg) | Wainwright, Richard (Colne Valley) |
| Haming, William | Manuel, Archie | Walden, Brian (Alt Saints) |
| Hannan, William | Mapp, Charles | Wallace, George |
| Harper, Joseph | Marks, Kenneth | Watkins, David (Consett) |
| Harrison, Walter (Wakefield) | Marquand, David | Watkins, Tudor (Brecon & Radnor) |
| Haseldine, Norman | Marsh, Rt. Hn. Richard | Wellbeloved, James |
| Hattersley, Roy | Maybew, Christopher | Whitlock, William |
| Hazell, Bert | Mellish, Rt. Hn. Robert | Wilkins, W. A. |
| Heffer, Eric S. | Mendelson, John | Williams, Alan Lee (Hornchurch) |
| Herbison, Rt. Hn. Margaret | Mikardo, Ian | Williams, Clifford (Abertillery) |
| Hobden, Dennis | Miller, Dr. M. S. | Willis, Rt. Hn. George |
| Horner, John | Milne, Edward (Blyth) | Winnick, David |
| Houghton, Rt. Hn. Douglas | Morris, Alfred (Wythenshawe) | Winstanley, Dr. M. P. |
| Howie, W. | Morris, Charles R. (Openshaw) | Woodburn, Rt. Hn. A. |
| Hoy, Rt. Hn. James | Ogden, Eric | Woof, Robert |
| Hughes, Rt. Hn. Cledwyn (Anglesey) | O'Halloran, Michael | Wyatt, Woodrow |
| Hughes, Hector (Aberdeen, N.) | Orbach, Maurice | |
| Hughes, Roy (Newport) | Orme, Stanley | TELLERS FOR THE NOES: |
| Hunter, Adam | Oswald, Thomas | Mr. John Ellis and |
| Johnson, Carol (Lewisham, S.) | Owen, Dr. David (Plymouth, S'tn) | Mr. Ted Leadbitter. |
§ Sir Harmar NichollsOn a point of order, Mr. Speaker. In the friendliest possible way, I should like to pursue the point of order that I put to you a few minutes ago, when I referred to the fact that when a formal debate on a Treasury matter was in process there was not a member of the Treasury team present.
You, Sir, gave a Ruling and made a comment. I accept the Ruling completely. You said that it was not out of order for a Treasury Minister not to be here. You then added that it was a waste of time to draw attention to that fact.
I would ask whether it is not an accepted convention in the House that, 1270 when a topic affecting a Department is under debate, there should be present a representative from that Department, at any rate to take notes. On consideration, I feel that it would be a dangerous thing for the Chair to suggest that that convention is not important and need not be adhered to.
§ Mr. SpeakerOrder. I should like to say to the hon. Gentleman that, on consideration, I was too kind to him. Previous Speakers have ruled that it is not in order to raise a point of order during a Ten-Minute Bill speech for the very reason that I mentioned when I ruled previously.