HC Deb 15 December 1994 vol 251 cc1062-4
13. Mrs. Roche

To ask the Chancellor of the Exchequer if he will make a statement on living standards.

Mr. Kenneth Clarke

Real household income per head has risen by an average of nearly £50 a week after tax and inflation since 1979.

Mrs. Roche

Will the Chancellor explain why, at the last general election, the Government said that they would raise the living standards of the British people yet now have the gall to expect the typical British family to find £800 a year to pay for the new taxes that he has introduced?

Mr. Clarke

What the hon. Lady calls a typical household is about 1 per cent. of households in the country. She is misusing statistics again. She will have noticed that next year we expect personal disposable incomes to rise by about 1.5 per cent. After taking account of tax and inflation, that is an average of about £5 a week. Those are the first fruits of our economic recovery and we are now set on course for a strong economic recovery, strong manufacturing base, falling unemployment and rising living standards for the people of this country, in line with what we promised at the last election and in marked contrast with the previous Labour Government's record.

Mr. Bill Walker

Does my right hon. and learned Friend agree that one of the clear signs of the improvement in living standards in the United Kingdom is the substantial number of people today who hold shares in companies? Does that not perhaps alter slightly the statistic that 1 per cent. of the population pay capital gains tax?

Mr. Clarke

It does, indeed. Another of the achievements of the past 15 years is the fact that the Conservative attachment to the principle of popular capitalism and every man a shareholder has been taken a great deal further forward, and very many people now own shares in successful British companies. I agree with my hon. Friend that it puts the arguments about capital gains tax in context that such a comparatively small number of taxpayers in this country actually pay capital gains tax.

Mr. Salmond

Would the Chancellor like to take a cut in his pay of 16 per cent. this Christmas? Would he rather work in the British Gas boardroom, where one gets £500,000 a year, or in the showroom, where the £13,000 salaries are being cut by 16 per cent.? If the Chancellor will not do anything about the unacceptable face of privatisation, why does not he introduce a system of taxation that reduces the marginal tax on the poor, and ask people with their snouts in the trough to pay their fair share?

Mr. Clarke

Questions about the management of British Gas must be addressed to British Gas. The hon. Gentleman, like the Labour party, must resist the temptation to return to the days when parliamentary questions, ministerial decisions and political interference determined the commercial policy of institutions that provided the country with utilities. We now have a massive increase of investment in British Gas and falling fuel prices. An extremely strong industry has developed, and I trust that its management will continue to manage it fairly and properly in the public interest.