Redistribution of Wealth (Hansard, 3 March 1994)

§ 6. Mr. Gareth Wardell
To ask the Chancellor of the Exchequer if he will make it his policy to redistribute wealth within the United Kingdom.

§ The Economic Secretary to the Treasury (Mr. Anthony Nelson)
The Government's policy is to promote the creation of wealth so that all members of society may be better off.

§ Mr. Wardell
Does the Minister accept the figures in the Inland Revenue statistics for 1993 which show that 10 per cent. of the population own half the marketable wealth in this country? If so, why have the Government targeted the poorest members of our society to be the scapegoats for the Government's economic mistakes over the past decade?

§ Mr. Nelson
The hon. Gentleman, like the Labour party generally, has always been obsessed with relativities rather than realities. Most people are more concerned about their real wealth and earnings than about relativities, and both of those have gone up under the Government. In particular, the wealth of the bottom 75 per cent.—that is most people in this country—has grown by 70 per cent. in real terms since the Government came to office.

§ Mr. Nicholls
Will my hon. Friend congratulate the hon. Member for Gower (Mr. Wardell) on his engaging honesty in bringing to the Floor of the House once more the language of the redistribution of wealth, bearing in mind that that comes from a party which had tax rates of 98 per cent? Does that not show that all the snappy haircuts and good suits on the Labour Benches cannot conceal ancient prejudices?

§ Mr. Nelson
My hon. Friend is absolutely right. The Labour party will always put the redistribution of wealth before the generation of wealth.

§ Mr. Beith
Instead of merely complaining about boardroom salaries, why does the Chancellor not make a contribution to solving the problem by making the tax system more progressive? Will he confirm that from 1 April, people earning £7,000 a year will face a marginal tax and national insurance rate of 35 per cent. while those earning £500,000 or £1 million a year will pay just 40 per cent. in tax?

§ Mr. Nelson
It is important that the tax regime should provide incentive as well as revenue. The richest 10 per cent. paid some 35 per cent. of income tax when the Government first took office; they now pay 45 per cent.

§ Mr. Lidington
Will my hon. Friend stick to economic policies that encourage not the redistribution of wealth, but its creation, because without wealth creation we shall have neither the high personal living standards nor the good public services that we all want?

§ Mr. Nelson
Yes, Madam Speaker.

§ Mrs. Clwyd
What would the Minister say to the people in my constituency who do not have the opportunity to create wealth, and where 61 per cent. of households have incomes of £4,000 a year or less? Is that not real poverty in Britain today?

§ Mr. Nelson
Over the period since the Government came to power, there has been a general increase in the earnings at all points on the distribution scale. A married couple with two children on average earnings are now some 40 per cent.—£83 per week—better off than in 1979. That is a considerable achievement. What matters to most people is their take-home pay and their earnings.

§ Mr. Ottaway
Does my hon. Friend agree that this question demonstrates that the Labour party is interested only in penalising anyone who is prepared to stick their neck out and do something useful for the British economy?

§ Mr. Nelson
My hon. Friend is absolutely right. The Labour party has made no positive contributions towards wealth creation in this country; it is simply the politics of envy that we hear time and again.