HC Deb 30 June 1994 vol 245 cc931-2
4. Mr. Trimble

To ask the Chancellor of the Exchequer how many years it will take, on current tax and growth rates, to eliminate the budget deficit.

The Chief Secretary to the Treasury (Mr. Michael Portillo)

In the Budget, the public sector borrowing requirement was projected to fall rapidly over the next few years and to be broadly in balance by 1998–99.

Mr. Trimble

That is a simple calculation on certain assumptions and not a forecast which, of course, would be subject to the same vagaries and infirmities as are normal in Treasury forecasts. Is it not the case that if we have to wait until 1998–99 to get the Budget under control, there will be no scope for the sort of tax cuts on which the chief Secretary's friends are dependent, unless there is either an increase in the rate of growth or a significant reduction in expenditure?

Mr. Portillo

The hon. Gentleman is right to refer to vagaries; that is why the Budget Red Book sets out a series of different cases with higher and lower growth. If we had higher growth, the PSBR would obviously be eliminated somewhat earlier. The hon. Gentleman is simply underlining what my right hon. and learned Friend the Chancellor has already said—that there can be no question of tax cuts until it is prudent for that to be considered by the Government.

Mr. Sykes

Does my right hon. Friend think that growth rates in this country will be helped by yesterday's disgraceful rail strike and does he agree with the Labour Front-Bench spokesman who recently described Jimmy Knapp as a hero?

Mr. Portillo

It is most extraordinary to have a rail strike being inflicted on the British travelling public and to see the failure by those people who are contending for the Labour party leadership to condemn outright the strike, the damage that it is doing to the British economy and the inconvenience that it is causing to the British people.

Mr. Nicholas Brown

Given the impact of the European economy on domestic growth rates, does the Chief Secretary believe in a single currency in principle —yes or no?

Mr. Portillo

I have nothing to add to what I said on that subject before. My right hon. Friend and learned Friend the Chancellor and I have both made it perfectly clear from the Dispatch Box that that will be a matter for decision by this Parliament if and when the matter is put to Britain, which will not be in this Parliament but in a future British Parliament.