HC Deb 21 March 1974 vol 870 cc1318-9
30. Mr. Grimond

asked the Chancellor of the Exchequer if he will consider introducing different rates of taxation for different zones in the United Kingdom to offset transport charges and encourage regional development.

Dr. Gilbert

I cannot anticipate the Budget Statement.

Mr. Grimond

Will the Minister bear in mind that this system, which is the practice in several countries, is one of the easiest ways of assisting regional development and offsetting freight charges? It is particularly relevant presently in my constituency, as we are faced with a 10 per cent. new charge on freight and the "three-shilling loaf", as it is called. At a future time will the Minister consider this offset?

Dr. Gilbert

I am sure that my right hon. Friend will be grateful to the right hon. Gentleman for those suggestions. As the right hon. Gentleman will be aware, the preservation of a balanced and successful regional policy is an important part of our intention.

Mr. Horam

Will my hon. Friend, instead, consider maintaining the regional employment premium, which is far more relevant to these problems than that suggestion?

Dr. Gilbert

My right hon. Friend the Secretary of State for Industry has already made it clear that the existing arrangements for REP will be maintained while the possibilities for the future are being considered.

Mrs. Kellett-Bowman

Will the right hon. Gentleman remember that REP is extremely damaging to intermediate areas, of which my constituency is one? Will he please take that fact carefully into account in all his estimates of this appalling tax?

Dr. Gilbert

I must say that it is news to me that REP is a tax. The hon. Lady will recognise that REP has been welcomed by the CBI, among other institutions, and its future will depend on discussions that my right hon. Friend is having.

Mrs. Winifred Ewing

Is the right hon. Gentleman aware that there is a very good precedent for the proposal by the hon. Member for Orkney and Shetland (Mr. Grimond)? I cite the example of Norway, or Finland. If the Government are serious about imbalance of population, or anything else, may we suggest that this may be the only way of preventing the clearing of great parts of the population of northern Scotland?

Dr. Gilbert

I thank the hon. Lady for giving us those suggestions from her wide experience. I am sure that my right hon. Friend will be glad to have them and will not be too proud to take them from any source.