HC Deb 12 June 1997 vol 295 cc1274-6
11. Mr. Simon Hughes

To ask the Chancellor of the Exchequer when he will next announce changes to departmental public expenditure totals. [1596]

Mr. Darling

I explained to the House yesterday our policy regarding the comprehensive spending review. I also explained that, during the general election campaign and since, we have made it clear that Departments are expected to work within their departmental totals.

Mr. Hughes

Following yesterday's statement, I want to ask a question for the purpose of absolute clarification. If, for example, the Social Security Department and the Minister for Welfare Reform find savings in the social security budget and the Government bring down the social security bill between now and April of the year after next—as everybody hopes that they will—and if, in the same period, the demand for the health service rises and the obvious cost of running the service is more than the figure that the Tory Government set—a figure to which the Labour Government are adhering—will there be any chance of money being transferred from a reduced social security demand to a clearly increased demand for the health service?

Mr. Darling

Unlike the Liberal party, this party and this Government have been very clear that, before we allocate and spend money, we must know where it will come from. The whole purpose of the comprehensive spending review process, which is now under way, is that my right hon. Friends examine their budgets and determine how they can be better spent. As I explained yesterday, we have already started the process in the health service and in education, and we intend to continue the process.

Mr. Canavan

If the Barnett formula is to be reviewed, will the Chief Secretary assure the House that any amended formula will ensure that public expenditure is distributed to the different parts of the United Kingdom on the basis not only of population but of genuine need, and that any additional revenue raised by the Scottish Parliament will be available for additional expenditure within Scotland?

Mr. Darling

As I told my hon. Friend the Member for Linlithgow (Mr. Dalyell) yesterday, the Government will make our proposals on funding the Scottish Parliament in a White Paper, which will be published in time for the referendum campaign and the referendum itself. We have always made it clear that it is important that all parts of the United Kingdom should be funded on the basis of need and in an acceptable manner. That is our intention, and there are no difficulties about it. My hon. Friend the Member for Falkirk, West (Mr. Canavan) will see our proposals in the White Paper, and I am sure that he will think that they are very satisfactory.

Sir Norman Fowler

In spite of that review, will the Chief Secretary confirm that the current arrangements for exemptions from paying prescription charges will remain unchanged?

Mr. Darling

I am interested in the right hon. Gentleman's sympathy for those in need, because the House will remember the review that he conducted in the 1980s. I made it absolutely clear yesterday that all aspects of Government expenditure must be reviewed; there is no question about that. As he will well know, to exclude any part of expenditure would mean that the review cannot be effective. Conservative Members should remember that, unlike them, the Labour party is committed not only to the principles underpinning the national health service but to fairness—which is something that the Conservative party cannot even begin to understand.

Mr. Tipping

Will the Chief Secretary ensure that any review of departmental spending is collective and that there is a careful analysis of issues that are dealt with by more than one Department? If he does so, will there not be a real opportunity of ensuring that hard issues—such as poverty, adding value to people and helping communities to aspire to a new future—have a chance of being successfully addressed?

Mr. Darling

My hon. Friend is quite right. It is absolutely essential that the Government examine the entire range of services, not least health services, for which we are responsible. There is, for example, a relationship between poverty and health and between quality of primary care and subsequent need for hospital acute care. I can assure my hon. Friend not only that will there be reviews across Departments but that the entire process will be reviewed by the Public Expenditure Committee. I am sure that he will be pleased to know that my right hon. Friend the Chancellor and I will supervise that process.