Budget Measures (Hansard, 26 March 1981)

§ Mr. Winnick
asked the Chancellor of the Exchequer what representations he has received about his Budget.

§ 15. Mr. Canavan
asked the Chancellor of the Exchequer what reaction he has received to his recent Budget Statement.

§ The Chancellor of the Exchequer (Sir Geoffrey Howe)
I have received numerous and varied representations on many aspects of the Budget.

§ Mr. Winnick
Is the Chancellor aware of the almost unanimous opposition and contempt throughout the country for his Budget? Is he aware that no KGB mole who became Chancellor of the Exchequer could have inflicted greater harm on British industry and its employees than the right hon. and learned Gentleman did in his Budget?

§ Sir Geoffrey Howe
I suppose that I must admire the hon. Gentleman's ingenuity.—[Hon. Members "Why?"] There is not much else to admire. The hon. Gentleman certainly cannot claim to speak on behalf of the British people.

§ Mr. Canavan
Does the Chancellor realise that his Budget has no friends outside the Cabinet and few friends even inside the Cabinet? Since the 20p increase in the price of a gallon of petrol will increase inflation and the cuts in public expenditure will increase unemployment, is not it about time, even at this late date, that the Chancellor considered ditching his disastrous policies which caused a record 1 million increase in the number of unemployed in the last 12 months?

§ Sir Geoffrey Howe
The hon. Gentleman is wholly mistaken if he believes that the increase in unemployment in the last 12 months is attributable to the Government's policies. He might, for example, note that during the same period unemployment in the OECD countries rose by 3 million. It is a general feature. It does no good to proceed on the basis of such assertions. Many people have written to me and my right hon. Friends congratulating the Government on the Budget.

§ Mr. Canavan
Name one.

§ Sir Geoffrey Howe
They recognise that our policies are likely to bring inflation and unemployment under control.

§ Mr. Eggar
Is my right hon. and learned Friend aware that independent studies show that there is little difference in the average number of gallons of petrol used by motorists in rural and urban areas? Does not that show that the Budget in no way discriminates against rural motorists?

§ Sir Geoffrey Howe
My hon. Friend is right to draw attention to some studies which show precisely that. One must take account of the slightly higher mileages driven in rural areas and the slightly higher mileage per gallon. The tax measures are part of the fair distribution of the burden of indirect taxation in the Budget.

§ Mr. Richard Wainwright
Is the Chancellor aware of the disappointment caused by yet another Budget which 1064 lumps together, in the borrowing requirement, borrowing to finance wealth-creating projects which are urgently needed and borrowing simply to finance consumption?

§ Sir Geoffrey Howe
Only if the hon. Gentleman had not studied the White Paper carefully—I know that he has—could he come to that conclusion. The White Paper sets out clearly, for example, the nationalised industries' investment programmes. They provide for higher investment in the years immediately ahead than in the years just past.

§ Mr. Adley
If my right hon. and learned Friend is prepared to examine ways of raising taxation revenue alternative to the petrol tax, will be he take note of a written answer to me yesterday which states that the Government could raise £150 million in taxation by putting VAT on the standard rate of overseas package tour holidays? That would have the simultaneous advantage of helping a home industry. Will he give the suggestion serious consideration?

§ Sir Geoffrey Howe
There are a number of other aspects to that proposal. Any suggestion by my hon. Friend deserves consideration. I make it clear, however, that we stand by the increases on petrol and derv as an essential part of our strategy for reducing the public sector borrowing requirement.

§ Mr. Cook
Will the Chancellor of the Exchequer confirm Monday's written answer that, following the Budget, it will take a mere 33p a week in graduated pension to carry a woman pensioner under the age of 65 over the tolerance limits? Will he confirm that he has thereby brought 500,000 pensioners into the tax net for the first time in history? Did he know that when he laid the Budget before the House? If he did, why did he not tell the House? If he did not know, what does he propose to do to relieve low income pension households from the tax burden which he has thrust upon them?

§ Sir Geoffrey Howe
No woman of the age and type that the hon. Gentleman describes and who is receiving the basic pension will be drawn into the tax net because of the long-standing pattern of tolerance applied by the Inland Revenue. The numbers of people that the hon. Gentleman suggests might be drawn into the tax net who are in receipt of additional pensions or other income are nothing like as large as he suggests.