HC Deb 24 June 1999 vol 333 cc1271-3
2. Mr. Michael Fabricant (Lichfield)

What estimate he has made of the change in tax revenues in 1999–2000 as a result of the Budgets since July 1997. [87057]

The Chief Secretary to the Treasury (Mr. Alan Milburn)

Costings of the measures in the July 1997, March 1998 and March 1999 Budgets can be found in tables 2.2, 1.3 and 1.3 respectively of the appropriate "Financial Statement and Budget Report".

Mr. Fabricant

I am not sure that I will thank the Minister for that answer. Do the tables agree with an impeccable source which says that the increase in taxes this year as a result of the Budgets has been £7.1 billion; that it will be £10.5 billion next year; £9.3 billion the year after; and £40.7 billion over the lifetime of this Parliament? If the right hon. Gentleman disagrees with that, is he aware that he is disagreeing with the economics and statistics section of the House of Commons Library?

Mr. Milburn

The hon. Gentleman is wrong about that, just as he is wrong about most things. If he wants to trade facts, let me tell him that, this year, the tax burden is lower than it was last year; and that, next year and the year after, it will also be lower than it was last year. Another fact is that, if the Conservative party had remained in power, in accordance with the Budget that the right hon. and learned Member for Rushcliffe (Mr. Clarke) set in 1996, in each of those years, the tax burden would have been higher.

The Conservatives have not learned any of the lessons of the general election, when they lost the trust of the British people on tax. Even now, they are planning to increase the taxes of the poorest families in the land. If they had their way and abolished the working families tax credit, 1.5 million of the poorest families would face an extra £24 a week on their tax bills. What clearer contrast could there be between today's Conservative party, committed to penalising the poorest families, and today's Labour Government, committed to helping them?

Mr. Christopher Leslie (Shipley)

Is my right hon. Friend aware of the effect that Conservative amendments to the Finance Bill would have on Government revenues? The cumulative total of what they have proposed so far is more than the extra £40 billion that the Government have allocated for schools and hospitals. Is it not irresponsible for the Conservatives to say that they would match our commitment of £40 billion for schools and hospitals yet to fail completely to say where the money is to come from?

Mr. Milburn

I am grateful to my hon. Friend for that information. He keeps a wary eye on the pledges that the Conservatives make. They think that they can get away with it in the Finance Bill Committee, but they cannot. My hon. Friend is absolutely right: the Conservatives' figures do not add up. The shadow Chancellor says that he wants to match our record increases for health and education but fails to will the means to do so. The amendments that the Conservatives have tabled in the Finance Bill Committee would mean £40 billion less for health and education. Now it is clear: the dividing line is between the Conservative party, committed to £40 billion less for hospitals and schools, and the Labour party, committed to £40 billion more.

Mr. Oliver Letwin (West Dorset)

As the Chief Secretary was so notably unwilling to answer the question from my hon. Friend the Member for Lichfield (Mr. Fabricant), and for the information of those of us who are new to the Front Bench, will he relieve a genuine perplexity on our part about the Labour Government in the light of the Prime Minister's self-proclaimed 100 per cent. rock-solid attachment to new Labour? What is new about a Labour Government raising taxes? Does the novelty perhaps consist in the fact that, instead of announcing it, they pretend that it is not happening?

Mr. Milburn

I welcome the hon. Gentleman to the Front Bench; I suspect that we will have some fun with the new Conservative Front Benchers. Everybody in the country, apart, apparently, from them, knows that taxes are falling. We have introduced the new 10p starting rate; cuts in the basic rate of income tax; cuts in national insurance contributions which even now are benefiting 20 million people; and increases in family income through the working families tax credit and the minimum wage. Those measures were all opposed by the Conservative party.

Mr. Denis MacShane (Rotherham)

Is not one of the major problems of tax revenue caused by those gentlemen who so arrange their affairs as to avoid paying taxes due in this country? Will my right hon. Friend agree to commission the Inland Revenue to investigate Mr. Michael Ashcroft's tax arrangements? It cannot be right that a man who funds the Conservative party so arranges his affairs as to avoid paying tax and then uses the money that he saves to pay for the isolationist policies of the new anti-European Tories. It is wrong that the party of artful dodgers is paid for by a tax dodger.

Mr. Milburn

It would be wrong to comment on the tax affairs of any individual British citizen, but I suspect that my hon. Friend's question is more tailored to Conservative Front Benchers, so perhaps they would be prepared to answer it. The one form of monopoly that they appear to support is the monopoly provision for the financing of the Conservative party.