Commons Sitting of 27 March 2000

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
Oral Answers to Questions
  CULTURE, MEDIA AND SPORT
  The Secretary of State was asked—
  CULTURE, MEDIA AND SPORT

    Subtitling
    Mr. Paul Burstow: What his Department's policy is for increasing the proportion of television programmes that are subtitled. [114851]
    The Minister for Tourism, Film and Broadcasting (Janet Anderson): The Government's aim is to ensure the provision of the maximum practicable amount of subtitling of television programmes. We are encouraging all broadcasters to respond positively to the Royal National Institute for Deaf People's initiative for a voluntary charter on broadcast subtitling, the foreword for which was provided by my right hon. Friend the Secretary of State.
    Mr. Burstow: I am grateful to the Minister for reconfirming the Government's commitment to extending subtitling and other means of improving access to broadcasting for deaf people. I have two requests of the
    2
    Government. First, will the Minister explore further ways of improving the publicity for subtitling with the Independent Television Commission and the BBC? As well as advertisements for "EastEnders" and other programmes, there should be advertisements for this valuable service. Secondly, will she discuss with the Director General of the BBC the fact that the BBC has a lower percentage of subtitled broadcasts than Channel 4 and ITV? That is not acceptable for our public service broadcaster, which should be taking the lead. Will she encourage the BBC to do so?
    Janet Anderson: I assure the hon. Gentleman that the BBC's policy is at least to match the targets set for any other broadcaster. The BBC has recently increased its targets for the subtitling of new digital services to 50 per cent. within five years and 100 per cent. within 10 years. In the early summer, we shall begin a review of the statutory target for the subtitling of digital terrestrial television services. My right hon. Friend the Secretary of State and I will continue a dialogue with the RNID on these important issues.
    Miss Anne Begg: There is a generation of deaf people for whom signing is their only language. They find reading difficult. Will my hon. Friend encourage broadcasters to put out more programmes with signing as an integral part, particularly current affairs programmes?
    Janet Anderson: I assure my hon. Friend that we will take every opportunity to raise that with the appropriate bodies. My right hon. Friend and I are very concerned to ensure that access to those services should be as wide as possible.

    Swimming
    Mr. Nigel Evans: What steps he is taking to encourage greater participation in swimming throughout the country. [114852]
    The Minister for Sport (Kate Hoey): The Government attach great importance to swimming. It is a fun and healthy sport in which youngsters can aspire to excellence. Swimming is a statutory part of the primary national curriculum, giving all young people the opportunity to participate.
    Mr. Evans: I am grateful to the Minister for that response. Will she come to the Ribble valley and take a swimming lesson with me—she could even give me a swimming lesson—and youngsters from local schools? I promise not to leave her languishing in the deep end. That happened to too many parents in the Ribble valley when the county council cut the money for swimming provision, which meant that parents had to pay. That in turn resulted in a halving of the number of swimming lessons. The county council is offering more money this year, but it is still a real-terms cut on two years ago. Will the Minister use her influence with her colleagues at the Department for Education and Employment to ensure that all our youngsters throughout the country have free access to swimming lessons and that no child will be denied those life-saving skills simply because their parents cannot afford to pay?
    Kate Hoey: I remind the hon. Gentleman that we have already swum together in Botswana. I thank him for his question and for his commitment to swimming, which I share. It is important that youngsters get that opportunity at an early age and that swimming should be a compulsory part of the curriculum. Local authorities must bear that in mind when considering how to use their facilities.
    Mr. Nick Hawkins: Does the Minister recognise that there are grave problems with the number of primary school pupils who are not getting the amount of swimming that they need? In particular, will she comment on the fact that Labour-controlled Walsall council has engendered a funding crisis, resulting in swimming pools being closed? Will she ensure that school children and other swimmers in Walsall are properly provided for? Will she reinforce her concerns about the need for all primary school pupils to have proper swimming lessons?
    Kate Hoey: As a result of the concern throughout the country that not all primary school children were getting their full entitlement to swimming, my Department and the Department for Education and Employment asked Ofsted to investigate the issue. That is now happening. I do not know the details of the situation in Walsall, but I shall make a point of finding out. I shall write to the hon. Gentleman if I think it necessary.
    Mr. Andrew Reed: Will my hon. Friend recognise Loughborough's contribution to this country's excellent swimming reputation? It is the home of the Amateur Swimming Association and its outspoken spokesperson, David Sparkes. We need integration between primary schools, medium-term facilities and the excellent facilities that will be required as part of the UK sports institute. Will my hon. Friend ensure that Loughborough's swimming pool is built as soon as possible, to ensure such integration?
    Kate Hoey: My hon. Friend is quite right. Loughborough has been chosen as one of the sites for
    4
    a new 50 m pool. Sport England has given its support in principle, and I hope that the first ground work will be done soon. He mentioned David Sparkes, the chief executive of the Amateur Swimming Association. He is a forthright person who has stood up for his sport, and he has done an enormous amount to make sure that sport is available not just to our highly talented swimmers, but to all. He has done an enormous amount of work on the swimming for life campaign too, and I pay tribute to him.

    Seaside Resorts
    Mr. Ivan Henderson: What steps his Department is taking to encourage the regeneration of British seaside resorts; and if he will make a statement. [114853]
    The Minister for Tourism, Film and Broadcasting (Janet Anderson): Many resorts have been included in the UK's proposals for the new objective 2 structural funds and assisted areas maps. We have also ensured that the chairmen of the new regional development agencies are aware of the importance of resort regeneration. The English Tourism Council has set up a resorts task force, which is due to report in December with a programme of action to assist resorts with their regeneration strategies.
    Mr. Henderson: Does my hon. Friend agree that high-quality bathing water is a major factor in encouraging people to visit our seaside resorts? Does she agree that local authorities and water companies should work together closely to make sure that there is an increase in the number of European blue flags flying over this country's bathing beaches?
    Janet Anderson: My hon. Friend is right, and the Government will do all we can to encourage co-operation between local bodies to achieve as many blue flags as possible. I congratulate my hon. Friend on the fact that his constituency is featured in the tier 3 assisted areas map, and on the fact that Dovercourt—which falls within his constituency—has just received a resort award from the Tidy Britain group.
    Mr. Dafydd Wigley: The quality of water and beaches is central to regenerating our coastline. Will the Minister join me in welcoming last week's figures, which indicated that no fewer than 97 beaches in Wales had been awarded the star award—over a third of the total number of beaches to be granted that status? To ensure that we maximise the number of tourists coming to the UK, will the Minister put pressure on the Treasury to achieve a more realistic value for the pound, so that we can get the benefit of those beaches?
    Janet Anderson: I am sure that the right hon. Gentleman would not wish to advocate any policy which would return us to the policies of the Conservative party. As he knows, there is no going back to boom and bust. I congratulate all those concerned on achieving that status, and I hope that that encourages other resorts around the country to do the same.
    Miss Geraldine Smith: Will my hon. Friend join me in congratulating my right hon. Friend the Chancellor on his decision to remove the

    5
    annual licence duty on small amusement-with-prizes machines, as that will provide a huge boost to the operators of seaside arcades? Is not that another example of the Government's commitment to seaside resorts, along with assisted area status and the other measures taken by the Government? After years of neglect by the Conservative Administration, these measures are certainly welcomed in seaside resorts.
    Janet Anderson: I thank my hon. Friend for that timely question. She is quite right to say that my right hon. Friend the Chancellor has shown, by his action, that he understands some of the problems facing our seaside resorts. As my hon. Friend rightly says, that is in stark contrast to the record of the Conservative party, which did nothing whatever to help to regenerate our important seaside resorts.
    Mr. John Greenway: The seaside resorts are fighting hard to strengthen their appeal, but the Minister will be aware of the understandable concern at the number of asylum seekers being placed in many seaside towns, often in large numbers and without notice. The complete mess that the Government have made of the issue means that asylum seekers already in Britain will remain the responsibility of local authorities this summer.
    This is a sensitive issue, and seaside resorts, like all communities, are happy to take their fair share of asylum seekers. Does the Minister, however, agree that local authorities have the right to be consulted? On behalf of seaside tourism, will she press the Home Secretary to ensure that there is always prior consultation, so that the number of asylum seekers placed in seaside towns can be kept to realistic numbers and be fair to all concerned?
    Janet Anderson: The hon. Gentleman will be aware that this is a matter for my right hon. Friend the Home Secretary and not for me, but I can assure him that we are concerned that there should not be an adverse impact on seaside towns, and the Home Office is in continual discussion with the Local Government Association and local authorities about the particular problems that they might be facing.
    In recognition of the importance of the matter to the tourist industry, I recently had a meeting with the immigration Minister, my hon. Friend the Member for Hornsey and Wood Green (Mrs. Roche), together with Labour Members representing seaside towns, and she gave us reassurances that we found most welcome.

    Coalfield Communities
    Mr. David Watts: What action he is taking to ensure that former coalfield areas benefit from the national lottery. [114854]
    The Secretary of State for Culture, Media and Sport (Mr. Chris Smith): The Government are committed to ensuring that all areas, and especially those in which there are high levels of economic and social deprivation, benefit from lottery funding. My Department and the distributors have therefore jointly commissioned research into the impact of the national lottery on former coalfield areas.
    6
    The results, which are due shortly, are likely to shed further light on the situation and to suggest recommendations for improving it.
    Mr. Watts: I thank my right hon. Friend for that reply, but is he aware that many poor communities lack the expertise to put in an initial bid; and will he consider providing resources for such communities, so that they can prepare good-quality bids?
    Mr. Smith: I take my hon. Friend's point absolutely. We have already put in place several measures to help by changing the way in which lottery money is distributed. We have issued an instruction to the distributors that they must pay particular attention to areas of social deprivation, and enabled them, through the National Lottery Act 1998, to solicit applications and delegate decisions. We have encouraged the introduction of the small grants scheme, and the distributors now have schemes and programmes—such as Sport England's sport action zones policy—that target funding on areas of particular need.
    In addition, my hon. Friend's point is being taken on board through the introduction of a two-stage process in the lottery decision-making procedures, so that an applicant can submit an initial in principle application, get a steer from the distributing body on whether it is likely to attract support, and then embark on the task of working it up further, if it is indeed likely to be accepted in due course.
    Mr. John Bercow: Is it not possible that former coalfield areas have suffered from a lack of lottery proceeds as a direct consequence of the fact that the Secretary of State's constituency, Islington, South and Finsbury, as of 3 March this year, was the seventh largest recipient of lottery funds? Does he intend speedily to address the problem, for fear that if he does not, the hon. Member for Bolsover (Mr. Skinner) will jump out of his pram?
    Mr. Smith: I am pleased to be able to tell the hon. Gentleman that his constituency has received £8.8 million from the national lottery, which is just below the national average—it has not done especially badly. There has been variation across the country, which is a matter of concern. It is of particular concern in the coalfield areas, which is precisely why we have embarked on detailed research to establish why applications have not been coming in from those areas. That is what we want to rectify.
    Mr. Dennis Skinner: Does my right hon. Friend recall that, when the lottery was set up and the Tories were in power, my right hon. Friend the Member for Chesterfield (Mr. Benn), my hon. Friend the Member for North-East Derbyshire (Mr. Barnes) and I asked questions on behalf of the Derbyshire coalfield, because the Tories were so embittered by our politics that they put the lottery applications from our constituencies down among the lowest 10 per cent? In the past few months, we have managed to get a few bob back: not yet as much as has been spent on the millennium dome, but we expect to get that much. I do not expect the hon. Member for

    7
    Buckingham (Mr. Bercow) to know about that, because at the time I was raising those questions, little Noddy was still in his pram.
    Mr. Smith: It is always a pleasure to be able to agree with my hon. Friend. He has rightly identified that we are making progress on that issue. He has also rightly identified that when the lottery was first established it was an application-driven process, with no strategy or provision—as we now have in the directions that are in place for the lottery distributors—for particular attention to be paid to the needs of areas of deprivation. Those factors are now in place and the lottery is working better as a result. I am pleased that my hon. Friend's constituency is now beginning to benefit.

    Regional Television
    Mr. Eric Martlew: If he will make a statement on his powers to intervene in proposed takeovers of regional television stations. [114855]
    The Secretary of State for Culture, Media and Sport (Mr. Chris Smith): My powers in this area are laid down in the Broadcasting Acts 1990 and 1996. They are limited to order-making powers to amend detailed provisions within the Acts. I therefore have no direct power to intervene in a proposed takeover of regional television stations, which is a matter for the Independent Television Commission and the Office of Fair Trading. However, the importance of regional content, regional programme making and the regional flavour of programmes, which were an integral part of the franchises initially awarded to the ITV companies, must remain firmly in place.
    Mr. Martlew: I thank my right hon. Friend for that reply. He is well aware of my opposition to the possible takeover of Border Television. Does he agree that Border Television's licence is unique, in that it covers the full length of the Anglo-Scottish border, and that it would be very difficult for a company based in Glasgow, Manchester or London to replicate the excellent provision that we get on the border at the moment? Does he also agree that takeovers such as the one proposed should be discouraged? If it goes ahead, will he give a guarantee that local content of programmes will continue as now and that some job security will be given to my constituents?
    Mr. Smith: My hon. Friend is absolutely right to identify the particular character of Border Television. It covers both the southern part of Scotland and the northern part of England, and operates in a genuinely cross-border manner. That was the nature of the franchise that was awarded in the first place. Whoever takes the franchise over and whatever happens in the current negotiations, that character must remain clearly in place. I shall expect the ITC to uphold that firmly. I do not want to see identikit programming across the world of ITV, because we must have a proper, regional character to the programmes that we receive on that popular channel.
    Mr. William Ross: Will the Secretary of State see to it that regional television stations are not taken over by interests outwith the United Kingdom, but remain firmly in local hands?
    Mr. Smith: That is ultimately a matter for the ITC, the Office of Fair Trading and the competition authorities, and not for me. However, I am sure that those bodies will take careful note of the hon. Gentleman's point.
    Miss Anne McIntosh: Will the Secretary of State join me in paying tribute to Tyne Tees Television and Yorkshire Television, which cover my constituency? When I was Noddy in my pram, I was brought up on Tyne Tees Television and, like the hon. Member for Carlisle (Mr. Martlew), I am concerned by the proposed takeover and the impact that it might have on local and regional coverage. Can he give a commitment to the House that he will make representations to the decision takers to ensure that the franchise is respected?
    Mr. Smith: The franchises must be respected: the hon. Lady is right. For example, Yorkshire Television makes "Emmerdale", Carlton, which used to be Central, makes "Peak Practice", and Granada makes "Coronation Street". All those programmes have a strong regional character, they are part of the wealth of the fabric of television in this country, and we must protect that.

    Lottery Funding
    Mr. Andrew Love: What steps he is taking to increase the share of national lottery funding for community projects in outer London. [114857]
    The Minister for Sport (Kate Hoey): The Government are committed to the fair distribution of lottery money across all groups and areas of the country and have provided a framework, by means of the National Lottery Act 1998 and policy directions, to ensure that that happens. This framework is already ensuring that a greater number of grants are being given to benefit communities right across the country. Lottery distributors now have schemes in place to focus funding on areas of need, including those in outer London.
    Mr. Love: I thank my hon. Friend for that reply. I congratulate her and my right hon. Friend the Secretary of State on their foresight in choosing Pickett' s Lock in my constituency as the site for the new national athletics stadium. I wish them good luck in their negotiations with the International Amateur Athletic Federation in Paris next week.
    For national and international sport to thrive, however, we need good-quality local and community facilities. I welcome the recent changes introduced by the Government, but local sports men and women in my constituency, which is a deprived area, are still missing out. What further steps can be taken to redress the balance?

    9
    Additionally—
    Hon. Members: Oh no.
    Madam Speaker: Order. It is Question Time. The hon. Gentleman has had a long preamble. He must put a question to the Minister.
    Kate Hoey: I am delighted that my hon. Friend welcomes the decision by UK Athletics, supported by all bodies in sport, that Pickett's Lock in the Lea Valley in his constituency should be proposed as the site for the world athletics championship in 2005. The championship will leave a legacy for the sport of athletics, and we look forward to the negotiations and to the work that must be done to ensure that the event takes place here.
    I agree with my hon. Friend that we must get all our community groups involved and that they should get support from the lottery. We can do more by getting the lottery bodies to be more proactive. I hope that Sport England will go out and talk to the community groups when it first devises its application, so that time is not wasted gathering support and information. That will also save money: consultants often spend a lot of money that belongs to community groups devising applications that could have been compiled if the right support from the statutory organisations had been available to start with.
    Sir Sydney Chapman: I recognise that successful lottery applications must be of good quality and that they must be effective in regenerating local areas. However, when the Minister makes her regional assessment, will she disentangle from the rather large amount that goes to London the pretty considerable element that goes to national institutions, as opposed to the amounts that go towards more local requirements? There is a feeling in outer London, and it is not confined to the hon. Member for Edmonton (Mr. Love), that we do not get a proper share of the cake devoted to our great capital city.
    Kate Hoey: I think that the hon. Gentleman speaks for the many people who feel that their areas do not get a fair share of the national lottery. However, it is true that a lot of money went to very large, high-prestige projects in the first few years of the national lottery, but that is probably only natural. I hope that we can now turn our attention to getting the money down to the grass roots, where it can make a real difference. My right hon. Friend the Secretary of State and I will certainly do all we can to ensure that that happens.
    Mr. Nick St. Aubyn: If he will make a statement on the distribution of unallocated national lottery funds. [114858]
    The Secretary of State for Culture, Media and Sport (Mr. Chris Smith): I am pleased to be able to answer this question, as there has been much erroneous press reporting on the matter in recent days. All the funds in the national lottery distribution fund available for distribution have been allocated to the national lottery distributing bodies, and all but £200 million of this money—just 6 per cent. of the overall amount—has already been committed
    10
    by them. Where money remains in the fund, it earns tax-free interest that goes to the good causes, not to the Government.
    Mr. St. Aubyn: Will the Secretary of State confirm that the amount of unspent lottery charity money is now in the region of £3.5 billion, and that the amount being spent on good causes is only one sixth of the amount people spend on lottery tickets? That is less than half the proportion of lottery proceeds that it was intended would go to good causes. Does not the right hon. Gentleman realise that as long as the money stays in the Government's hands, it will be regarded—quite rightly—as yet another example of a Labour stealth tax? Does he accept that that stealth tax will damage the success of the lottery, just as the Government's other stealth taxes are damaging the British economy?
    Mr. Smith: No, the hon. Gentleman is wrong. For a start, the money is not in the hands of the Government. Secondly, although there is £3.5 billion in the national lottery distribution fund, 94 per cent. of that—more than £3 billion—has been committed by the distributing bodies to particular applications. If the hon. Gentleman thinks—as he seems to—that all normal public accountancy rules should be jettisoned and that, when a project is approved, the entire sum should immediately be given to the project rather being properly fed out as the project is built or developed, I suspect that his right hon. Friend the Member for Haltemprice and Howden (Mr. Davis), the Chairman of the Public Accounts Committee, might have a thing or two to say to him.
    Mr. Lindsay Hoyle: Will my right hon. Friend consider allocating some of that unallocated money to Chorley Little theatre, which has applied on several occasions? The theatre would benefit greatly from the money, if my right hon. Friend would consider helping it.
    Mr. Smith: I hear what my hon. Friend says. I am sure that a properly submitted application to the Arts Council of England would receive proper consideration. It is not for me to decide such things.
    Mr. David Faber: As we heard a moment ago, the Secretary of State has personally pledged £60 million towards the building of a new national athletics stadium. Can he give the House a single previous example of a Minister making such a pledge, at any time since the introduction of the lottery, before an application was received or, indeed, considered by the lottery distribution body? Can he tell us what personal representations he has received from Sport England as to the legality of how that figure of £60 million was arrived at? Most importantly, will he tell us where the estimated extra £70 million needed to build such a stadium will come from?
    Mr. Smith: No money has yet been committed, because there must be a proper application before that can happen. However, £40 million that would have had to be spent by Sport England to create temporary athletics facilities at Wembley has been saved from the exercise. That money and the £20 million that is being returned to

    11
    the pot by the world of football will—it is hoped—be used for the benefit of athletics. That is a sensible proposal.
    Ms Rosie Winterton: Will my right hon. Friend consider making representations to the distribution body about allocating funds to pigeon fanciers in my constituency? They cannot currently benefit from national lottery money because pigeon fancying is not considered a sport. Were my constituents to keep clay pigeons and shoot them, they would be eligible for the money. Will my right hon. Friend take action to show his support for the pigeon fanciers' campaign?
    Mr. Smith: My hon. Friend is right to point out the—perhaps anomalous—fact that pigeon fancying is not statutorily regarded as a sport. Consequently, it cannot, unfortunately, qualify for Sports Council lottery funding. However, if, for example, it was taking place on a piece of derelict ground, it might be eligible for funding under the green spaces initiative of the new opportunities fund. My hon. Friend may want to hold discussions with pigeon fanciers in her area on how to identify ingenious ways of using the lottery system to their benefit.
    Mr. Peter Ainsworth: With regard to Wembley, the right hon. Gentleman should know that the £40 million to which he referred is disputed by Sport England, and that there is no guarantee of the £20 million from the Football Association. It would be nice to have a little more clarity and less spin on the issue.
    Does not the right hon. Gentleman's response to the question of my hon. Friend the Member for Guildford (Mr. St. Aubyn) betray the fact that, yet again, the biggest lottery winner of all is the Chancellor of the Exchequer? Not content with taking 12 per cent. in tax for every pound spent, the Government have ensured that a full third of the good causes lottery money will be syphoned off and used to support core Government spending programmes. The Government are now presiding over a mounting pile of lottery cash, which—as far as most of us can see—is being used primarily to offset the public sector borrowing requirement. With interest rates at 6 per cent., what rate of return is that cash earning? Is it 3 per cent—or 3.5 per cent?
    What does the right hon. Gentleman plan to do to unlock the lottery logjam? Will he be having a word with his right hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson), the Labour candidate for mayor of London, who seems to have some curious views on the lottery?
    Mr. Smith: The hon. Gentleman is wrong about Wembley, as he has been throughout the discussion about it. He is wrong also about the national lottery distribution fund. As I have said, there is only £200 million of uncommitted funds within the NLDF. To ensure that there is no doubt in future about what is happening, I have asked that there should be quarterly reports from each of the lottery distributors, detailing exactly how much they have in the NLDF, what proportion of the funds is committed and what proportion is uncommitted, and their proposals for the spending of that money.
    It is clear that the hon. Gentleman does not think that the creation of the new opportunities fund, with projects being supported related to health, education and the
    12
    environment, is something that the lottery should be supporting. That is the line that he took at the Tory party conference. Does he want to see under, God help us, a future Conservative Government a complete abandonment of the new opportunities fund and an abandonment of the after-school clubs, of the healthy living centres, the cancer initiative and the green spaces initiative? That is precisely what he seems to be telling the House.

    Lottery Funds (Allocation)
    Angela Smith: If he will take steps to consult national lottery players on a regional basis on how the proceeds of the lottery are allocated. [114859]
    The Secretary of State for Culture, Media and Sport (Mr. Chris Smith): Under the National Lottery Act 1998, I instructed lottery distributors to produce and consult on strategic plans, which proposed their priorities for funding. Distributors now have plans in place on which there has been broad consultation. Distributors also take account of public opinion through open meetings, polls and other research.
    The National Lottery Charities Board selects two committee members in each region by lot, using the lottery draw numbers to identify potential members from the electoral roll. The Arts Council has now delegated a substantial proportion of lottery decision making to the regional arts boards. I welcome these moves by the distributors.
    Angela Smith: I welcome that answer from my right hon. Friend. He will be aware that I do not think that my constituents get a fair deal from the lottery. They have spent £60 million on tickets and received back only £1.5 million. I greatly welcome the changes that are being made, but will my right hon. Friend look into the matter to ensure that they come into force quickly? I accept that it is not possible to allocate funds and to link money and expenditure on a constituency basis, but it can be done on a regional basis. I ask for greater consultation with my constituents, given the amount of money that they spend on tickets, on how the money is being spent in their region.
    Mr. Smith: My hon. Friend raises an entirely understandable point. The changes that we brought in with the 1998 Act have enabled the distributors for the first time—this was not put in place by the previous Government—to delegate decision making to a regional level. I believe that to be extremely important. Regional cultural consortiums have a specific remit to advise the lottery distributors on the regional priorities for spending. That will be an added way of ensuring that the voice of the regions in this process is firmly heard.
    Mr. Nicholas Soames: Will the right hon. Gentleman acknowledge that the regional voice, because of the substantial size of some of the regions, is not always nearly sharp enough on constituency applications. I endorse entirely what the hon. Member for Basildon (Angela Smith) has said. Sussex has not done well under the national lottery distribution. Will the right hon. Gentleman see what he can do to refine the structure

    13
    that is there already to ascertain whether he could take up the hon. Lady's suggestion to take the advise-giving process lower than regional level?
    Mr. Smith: I am sure that it will be possible for regional cultural consortiums, regional arts boards, regional committees of the National Lottery Charities Board and other regional elements in the structures now being put in place to consult widely, deep down within the regions, as to the people's priorities for the spending of lottery money. We now have in place—again for the first time ever—an instruction to all the distributing bodies to ensure a fairer geographical spread of national lottery funds. That is beginning to take place, especially as the smaller grants programmes begin to roll out. That contrasts with what happened at the outset when there was a concentration on very large capital projects.

    NESTA Projects
    Dr. Ian Gibson: What assessment he has made of the effectiveness of the projects funded by the National Endowment for Science, Technology and the Arts programme. [114860]
    The Minister for the Arts (Mr. Alan Howarth): NESTA is currently funding a series of pilot projects, prior to going live with its full programmes in the very near future, and I can confirm that it is undertaking detailed assessments of the value and effectiveness of each of these projects. I expect NESTA to make a real difference in tapping the creative potential of the country.
    Dr. Gibson: My hon. Friend will be aware that last week was science and technology week, when many young scientists went into schools and deprived areas to teach the wonders of the science. They took their equipment with them and showed young people how to use it. When grants are given, will my hon. Friend guarantee that science and technology are not, as opposed to the arts, the Cinderella groups and that the wonders of science are brought, and money given, to deprived schools?
    Mr. Howarth: As a distinguished scientist himself, my hon. Friend speaks with authority on this subject and I very much take his point. He will be reassured by the fact that, among the trustees of NESTA, are Sir Martin Rees and Dame Bridget Ogilvie, who have great authority in the scientific field. I entirely agree with my hon. Friend that it is extremely important that we do all that we can to encourage young people to commit themselves to the creative opportunities that scientific study and the pursuit of scientific careers offer. He may agree that one of the unfortunate features of British life has been that, however brilliant our basic science, we seem to have had a national difficulty in getting the benefits of that science out of the laboratory and into the showroom.

    Film Industry
    Mr. Geoffrey Clifton-Brown: What measures he is taking to increase investment in the British film industry. [114861]
    The Minister for Tourism, Film and Broadcasting (Janet Anderson): The Government have set up a strategic body, the Film Council, which will be in place on 1 April under the able chairmanship of Alan Parker, with the specific task of helping to develop a sustainable UK film industry. Over the next three years, the council will have about £150 million in grant in aid and lottery funding to support film.
    Mr. Clifton-Brown: I am sure that the whole House would wish to congratulate last night's British Oscar winners, Michael Caine and Mike Leigh and, in particular, Sam Mendes on his film "American Beauty". Will the Minister therefore examine how it is that more than £100 million of lottery money has been spent on 60 films that virtually no one will ever see let alone go on general release? Would it not be better for lottery funds in the future to go towards seedcorn money producing the Oscar-winning films, such as "American Beauty", of the future?
    Janet Anderson: The hon. Gentleman will be aware that, in future, this will be a matter for the Film Council. The total level of lottery support for film in England is £97 million to date. Perhaps more importantly, the total cost of films supported was £378 million, so the gearing is about three to one. It is important to highlight that, under this Government, investment in film production in the United Kingdom last year was £570 million, up £93 million on the previous year. It is clear that the interests of the British film industry are very dear to the Government's heart.
    Mr. Tom Clarke: Does my hon. Friend agree that she and my right hon. Friend the Secretary of State should be beaming with pride at last night's brilliant British successes in the Oscars? Does she further agree that my right hon. Friend the Chancellor's tax concessions and the Government's strategy for film as a creative industry suggests that the success of British film is there? Not only have the Brits arrived, but we are saying to the world that they ain't seen nothing yet.
    Janet Anderson: My right hon. Friend is right. I take this opportunity to pay tribute to him, because when he was the Minister with responsibility for film, he was responsible for the film policy action group, which produced the document, "A Bigger Picture", and for securing the tax concession that has done so much to regenerate the film industry. He is right to say that the Brits have arrived, and we are very proud of the success of all our people in the Oscars last night. That just goes to show that we have a pool of excellent skills and talent here, and it is no wonder that more and more people want to make their films in Britain.
    Mr. Peter Ainsworth: May I associate myself with the tributes that have been paid to our talented people who have again done well in Hollywood, and who include Phil Collins, who has not yet been mentioned? However, those people did not get very much out of the national lottery. Is the Minister happy that hardly any of the 60 films that have so far been funded by the lottery have earned anything like enough money to cover their

    15
    costs? Is she proud of the fact that of the £97 million of lottery money that has gone into those projects, less than £6 million has so far been paid back?
    I suggest that the hon. Lady and the Secretary of State nominate themselves for a golden raspberry award because the criteria for that award correspond exactly with their achievements. As the president of the Golden Raspberry Foundation said, they
    spend too much, entertain no one and fall flat on their face.
    Janet Anderson: The hon. Gentleman's attempts at humour get more and more pathetic with every Question Time. May I give him a little advice? If he is to continue with this portfolio, he ought to read a little more about the subject and make sure that he is better informed when he comes to the House. "Topsy Turvy", which won two awards last night, for best make-up and best costume and design, is a British film and was made with the help of £2 million of lottery funding from the Arts Council.
    Moreover, is the hon. Gentleman saying that films that we have all enjoyed, such as "Hilary and Jackie", "Ratcatcher", "My Name is Joe", "Shooting Fish" and "An Ideal Husband"—which is the most successful lottery film—should not have been made? If so, the British film industry will be listening carefully to his remarks.

    Museums and Galleries
    Mrs. Ann Cryer: How many children have benefited from his measures allowing free entry to national museums and galleries. [114864]
    The Minister for the Arts (Mr. Alan Howarth): Since additional funds were provided at the start of April last year to enable free entry to those national museums and galleries sponsored by my Department which charge for admission, 4,275,951 children are estimated to have benefited up to the end of January. That figure represents an increase of some 18 per cent. on the same period in the previous 12 months.
    Mrs. Cryer: I have a twofold financial interest in the measures because I have six grandchildren under eight and I am 60, so we will all benefit. Does my hon. Friend agree that the railway operating companies could offer cheap fares to school parties, which would be helpful because more children would go to national galleries and museums in term time, alleviating some of the pressures at weekends and in school holidays? I took three of my grandchildren to the science museum last August on three occasions, and each time the queues were so long that they missed many opportunities to participate in activities that I know they would have enjoyed.
    Does my hon. Friend agree also that the onus is now on the Conservative party to make clear its policy on reintroducing charges for entry to our museums?
    Mr. Howarth: I think that there must be an error on my hon. Friend's birth certificate. However, I would not accuse her of misleading the House, so clearly when she takes her grandchildren to any of our national museums and galleries from the beginning of April she will, like them, benefit from free entry. Those places are popular and, as she says, sometimes the queues are long, and those problems certainly need to be managed. I take her point
    16
    about the desirability of finding ways to enable people to have cheap or even free public transport to national museums and galleries. There is a fund available: the museums and galleries access fund, funded and administered by the heritage lottery fund, which has ring-fenced £7 million to enable museums to run projects that will increase access to their collections. Subject to the discretion of trustees, it would be in order for railway operators to work with museums to take advantage of that funding.
    Several hon. Members rose—
    Madam Speaker: Order. Time is up. The last question took three minutes—we are taking far too long over questions and answers.

  The hon. Member for Middlesbrough, representing the Church Commissioners, was asked—
  CHURCH COMMISSIONERS

    Church Repairs (VAT)
    Miss Anne McIntosh: When he will meet a Minister of the Crown to discuss reduced rates of VAT for church repairs. [114843]
    Mr. Stuart Bell(Second Church Estates Commissioner, representing the Church Commissioners): The hon. Lady will be pleased to learn that I led a delegation to meet the Minister for the Arts on 23 March. The delegation included the hon. Member for South Staffordshire (Sir P. Cormack) and my hon. Friend the Member for Blackpool, South (Mr. Marsden). I thank the Minister, who is still in the Chamber, for his courtesy and his time, as well as for the manner in which he conducted the meeting. I am pleased to say that the meeting was constructive. Although the Church was disappointed not to obtain any relief in the Budget by way of reduced rates of VAT on church repairs, we continue to journey in hope.
    Miss McIntosh: I am grateful to the hon. Gentleman for that answer. Will he join me in renewing our campaign, based on the understanding that other member states of the European Union treat churches as heritage buildings and apply a reduced rate of VAT? Following his meeting with the Minister for the Arts, does the hon. Gentleman think that there is some chance of churches in this country being treated similarly?
    Mr. Bell: I am glad to take the opportunity to thank the hon. Lady and other hon. Members on both sides of the House who have taken an interest in this important subject. It cannot be right that a tax that falls hardest on individual parishes and faith communities also works against the widely accepted view that repair and maintenance play a key role in the conservation and reuse of buildings. We are considering every avenue of discussion with the Treasury, and I shall be glad to examine the point that the hon. Lady raises.
    Mr. Gordon Marsden: Does my hon. Friend agree that it is nonsense that new build in this country attracts no VAT, whereas repairs to historic buildings and churches attract VAT at the full rate? Does he also agree that the importance of church renewal to the rural economy should be presented to colleagues at the Department of the Environment, Transport and the Regions, to be taken into account in the forthcoming rural White Paper?
    Mr. Bell: I am grateful to my hon. Friend for tabling an early-day motion on the subject. He has forcefully pointed out the contradictions between a Government policy that favours conservation and a tax regime that penalises repair and maintenance but zero rates inappropriate alterations and new build, and disadvantages brownfield development in relation to greenfield development. It cannot be right for the Treasury each year to cream off in VAT far more than it gives to English Heritage in grants to help our precious inheritance. My hon. Friend's support and that of hon. Members on both sides of the House will help our efforts to persuade the Treasury, the Department of the Environment, Transport and the Regions and the Department for Culture, Media and Sport to accept our proposals.

    Consultation
    Mr. Simon Hughes: What processes they use for consulting Church members on their proposals. [114844]
    Mr. Stuart Bell(Second Church Estates Commissioner, representing the Church Commissioners): The Commissioners send copies of draft schemes under the Pastoral Measure 1983 by post to parochial church councils and other interested parties. If the scheme is to declare a church redundant, or to deal with the future of a redundant church, they also publish a notice in a local newspaper. Anyone may make representations to the commissioners within the period of at least 28 days prescribed in the notice. On the matter of finances, the commissioners' annual report and accounts will be published shortly and will be widely disseminated within the Church and to the general public.
    Mr. Hughes: On the issue of Church finances, the Church Commissioners are the equivalent of the Chancellor of the Exchequer. Can we ensure that every Church member at diocese, deanery and parish level is annually consulted about the Church's financial policy—for example, on questions of ethical investment and where money should be spent? We must establish a democratic process by which to decide how the Church raises money and how it spends it.
    Mr. Bell: The Church Commissioners will spend their money in accordance with the statute, to pay the stipends of the parish priests and also the pensions. That is our statutory responsibility. In relation to the annual report and accounts, we will seek to disseminate that information as widely as we can. While we welcome suggestions about how we should spend our money, we are nevertheless bound by statute and our statutory obligations.
    Mr. Andrew Reed: Although I welcome the attempts to make the process as open and accountable as possible, does my hon. Friend agree that ordinary church members in the constituencies, like ourselves, feel a long way away from the decision-making process, particularly on questions of ethical investment? Will my hon. Friend give the matter further consideration to see whether there could be greater involvement for ordinary church members, like many of those in the House, who have little say over the present arrangements?
    Mr. Bell: I am grateful for my hon. Friend's question. He will be pleased to know, as the House will be pleased to know, that the unaudited results of the Commissioners for 1999 show that their assets fully committed to the support of the Church's ministry were valued at more than £4.4 billion at the end of last year. I am sure that every churchgoer in the land will be happy to see that, if I may say so, under my stewardship the assets of the Church Commissioners has risen from £3 billion to £4.4 billion.

  The Chairman of the Public Accounts Commission was asked—
  PUBLIC ACCOUNTS COMMISSION

    National Audit Office
    Mr. David Heath: What recent discussions he has had with the Chancellor of the Exchequer on the implications for the National Audit Office of proposals within the Government Resources and Accounts Bill. [114845]
    Mr. Robert Sheldon: Together with the Chairman of the Public Accounts Committee, I met the Chief Secretary to the Treasury in December to put our concern that the Government Resources and Accounts Bill represented a wasted opportunity to bring the powers of the Comptroller and Auditor General and the National Audit Office in line with modern government. That concern was most recently set out in the Public Accounts Committee's ninth report of this Session. Since then, the Bill has addressed some of our concerns and the Chief Secretary has announced a study to recommend suitable audit and accountability arrangements for central Government in the 21st century. I hope that during the remainder of the Bill's passage, the Government will add appropriate enabling clauses to ensure that the review's recommendations can have statutory force.
    Mr. Heath: I am sure that I speak for the entire House in warmly welcoming the right hon. Gentleman back to his place.
    Does the right hon. Gentleman welcome the announcement by Ministers that they were prepared to continue to talk about bringing executive non-departmental public bodies into the remit of the National Audit Office, or is he disappointed that the necessary

    19
    provisions have not already been put into the Bill? Will he take part in those discussions over the next few weeks?
    Mr. Sheldon: Clearly, there is much to be done. Parliamentary accountability must go hand in hand with Government accountability. Many Treasury Ministers in the past have been allies of the ideas of the Public Accounts Committee in bringing these matters to the front, so that we could follow public money where it goes. That is the important aspect. We must be able to follow that public money, in most cases—not necessarily all, but in most cases—so that we can show that the money has been properly spent. That is the only way in which we can achieve such accountability, which both the Public Accounts Committee and the Public Accounts Commission dearly want.
    Mr. Dale Campbell-Savours: On the behalf of the staff of the National Audit Office, may I express their thanks to Mr. Duncan Goodhew for ensuring that my right hon. Friend is here today to represent the National Audit Office in the dispute with the Treasury?
    Mr. Sheldon: I am overwhelmed by the generosity of so many friends.
    Mr. Geoffrey Clifton-Brown: May I, too, offer the right hon. Gentleman a warm welcome on his return to the House? Does he recall that during the passage of the Government Resources and Accounts Bill, we had a long discussion about the fact that the European Court of Auditors in many instances has greater access than our own Comptroller and Auditor General? Does he think that that is right?
    Mr. Sheldon: Clearly, that is wrong. Not only that, but the Audit Commission has power to seek information, which the National Audit Office does not. There are obviously a number of gaps, which must be closed.

  The hon. Member for Middlesbrough, representing the Church Commissioners, was asked—
  CHURCH COMMISSIONERS

    Church Revenues
    Mr. Paul Flynn: What is his estimate of the proportion of Church revenues that will be donated by congregations in 2020. [114846]
    Mr. Stuart Bell(Second Church Estates Commissioner, representing the Church Commissioners): In 1997, congregations provided approximately 62 per cent. of the Church of England's income. It is the hope and aspiration of the Church that giving by individuals will increase and that they might, on average, give 5 per cent. of their net income by 2020.
    Mr. Flynn: Did my hon. Friend read a rather bleak forecast in a recent edition of the Church Times, which said that if current trends in the decline of congregations continued, they would reach nil by 2020? While I congratulate my hon. Friend on the great improvement in the finances of the Church under his stewardship, does he accept that a problem was created by the clergy of the Church of England opting out of the state earnings-related pension scheme, and thus not benefiting from the marvellous far-sighted initiative of a previous Labour Government that is enjoyed by retired clergy of the Church in Wales?
    Mr. Bell: My hon. Friend will be interested to know that more people attend church on a Sunday than go to football matches on a Saturday. The Church has been around for 2,000 years; I therefore surmise that it will survive the next 20.

European Council (Lisbon)
3.30 pm
The Prime Minister (Mr. Tony Blair): With your permission, Madam Speaker, I should like to make a statement.
With my right hon. Friends the Foreign and Commonwealth Secretary and the Chancellor of the Exchequer, I attended a special meeting of the European Council in Lisbon on 23 and 24 March.
Ever since the Government took office, we have consistently advocated the need for comprehensive economic reform in the European Union. From the first European Council that I attended at Noordwijck, to the launch of the British presidency and since, we have made clear that the central European economic issue for Britain in this Parliament is reform: how we modernise the European social model and how Europe embraces the enterprise agenda and seeks to match the dynamism of the United States, while preserving our commitment to social justice.
The idea of holding a special summit at Lisbon on economic reform was originally put forward as a joint British-Spanish initiative. The Portuguese presidency has been rightly praised for the energetic and thorough way in which it took the issue forward.
The challenge that faces Europe today is fundamental. In many aspects of the new knowledge economy, the United States has established a clear lead. Seventy per cent. of all electronic commerce business in the world is conducted in the US; less than 20 per cent. in Europe. Despite the gathering strength of Europe's economic recovery and the advances that we have made in some key areas—for example, mobile telephones—15 million European men and women are without jobs.
The Council marks a sea change in European economic thinking. It points Europe in a new direction—away from heavy-handed intervention and regulation, towards a new approach based on enterprise, innovation and competition. As part of that fundamental reorientation of economic policy, the Council agreed a series of concrete measures with clear deadlines, including: rapid agreement this year on an effective legal framework for e-commerce in the EU; a fully liberalised and competitive telecoms market by the end of the next year; access to the internet for all schools by 2001; electronic access to the main basic public services by 2003; the introduction of a European diploma for basic information technology skills; a Community-wide patent by the end of 2001, making European patent protection as simple, inexpensive and comprehensive as it is anywhere in the world; and Government and Community procurement to be done fully online by 2003.
The need for reform is not confined to the so-called new economy. We agreed at Lisbon on the need for urgent measures to make the European economy as a whole more competitive, flexible and dynamic.
To support that objective, the Council reached the following conclusions: there must be faster liberalisation of previously protected sectors like gas, electricity and transport; there should be further support for European research and development, with the European investment bank making an additional 1 billion euro available for venture capital to support small businesses over the next
22
three years; there should be a general reduction in the level of state aids throughout the Union; the financial services action plan should be implemented in full by 2005, with earlier progress in priority areas—for example, the introduction of a single prospectus for companies raising capital across the EU and the elimination of barriers to investment in pension funds. The Council also agreed that a European charter for small firms should be developed to clear the obstacles to the growth of small businesses.
On those and other matters, we agreed to benchmark each member state's performance and progress not only against other countries in Europe but, when appropriate, against the best in the world.
We also agreed that EU social policy must be modernised to respond to changing employment patterns, increasing life expectancy and deepening social exclusion.
Again, the European Council agreed on a number of specific measures to take the new agenda forward. We agreed action to combat social exclusion, with member states setting targets on specific matters such as unemployment, youth unemployment, overall employment and child poverty. We agreed to halve by 2010 the number of 18-to-24-year-olds excluded from the labour market because of low educational qualifications. We finally opened up the issue of the long-term sustainability of member states' pension systems and the need to reform them across the European Union. We agreed to establish a new Europe wide database on jobs and learning opportunities. We agreed to put lifelong learning at the centre of job creation and to monitor each member state's progress against a series of agreed aims. We also agreed to improve equal opportunities, to increase the provision of childcare and to promote greater flexibility in the management of working time.
Each year, the European Council will now meet to examine progress and agree further action specifically on economic reform.
The Lisbon European Council represents a turning point in Europe's approach to economic and social policy. With a sound macro-economic framework in place and the euro safely introduced, the concrete actions agreed at the Council should help to deliver an increase in the European Union employment rate over the next 10 years, from an average of some 61 per cent. today to something close to 70 per cent. I have no doubt that that is achievable. In the last three years, we have created more than 800,000 jobs in Britain. In Spain, there have been more than 1 million new jobs. In France, too, employment has risen by over 800,000 in the last three years, which, in part, reflects new measures to cut the cost of labour.
Above all, the European Council agreed that, once again in Europe, we can seriously contemplate a return to full employment. That post-war goal, achieved 30 or 40 years ago but then abandoned, is back on the agenda, and quite right too—each citizen unemployed is a resource wasted. We have had the courage to recognise that the aspiration cannot be met unless we are prepared to make the fundamental reforms that are necessary to equip our countries for the modern age—for a 21st century economy. The true significance of Lisbon lies in the combining of traditional aims and values with modern means and reforms.
We also had a full discussion of the situation in the Balkans, including the continuing problems in Kosovo and Montenegro. We agreed that the countries of the

23
region needed to be brought more into the European mainstream, and committed us to enhancing economic assistance through, among other things, early trade liberalisation. The Lisbon Council recognised the immense progress made since the Kosovo conflict began a year ago, but agreed that a more coherent approach on the part of the international community was needed. We asked the Council's Secretary-General, Javier Solana, and the European Commission to present early recommendations on how to strengthen the impact of the European contribution, and enhance co-ordination of the overall international effort. We believe that that will enable Mr. Solana and Chris Patten to promote a more coherent international strategy for Kosovo and the region.
Finally, we discussed relations with Russia on the eve of the presidential elections, agreeing on the need for a full partnership between the European Union and Russia and emphasising again our concerns about the situation in Chechnya. I spoke to President Putin this morning to congratulate him on his emphatic election victory. He was very conscious of the weight of responsibility on his shoulders, both to restore order and democracy in Chechnya and to rebuild the Russian economy.
The Lisbon summit was highly successful. By getting our way in Europe, we are indeed standing up for Britain's economic interests. Making Europe more dynamic benefits Britain. More competition in Europe means new markets for British business; more enterprise in Europe means more jobs in Britain; more electronic commerce means more opportunities for British companies; more jobs, cheaper goods and better access to the internet are good for Britain.
Once again, constructive engagement has been shown to be the right policy for Britain and for Europe.
Mr. William Hague: I join the Prime Minister in welcoming the completion of another democratic election in Russia. Hon. Members in all parts of the House wish Vladimir Putin well in the difficult responsibility that he has taken, and fervently want him to succeed in promoting prosperity and bringing order and stability to his country, while always remembering the value of liberty and freedom.
The whole House will also endorse what the Prime Minister said about the importance of peace and stability in the Balkans. One year after the start of the NATO action, I know that he recognises that serious problems remain in Kosovo. As the Lisbon conclusions state, Europe and the international community need to provide support in a
much more co-ordinated, coherent fashion.
Will the Governments in Europe now ensure that our service men, operating in extremely difficult circumstances, receive the political back-up that they deserve at all times?
Following the discussions at Lisbon, can the Prime Minister categorically deny stories on the front pages of today's newspapers claiming that the Government intend to opt into the full Schengen arrangements, which would mean abandoning our own immigration and border controls? That would cause great alarm and be a very serious policy mistake.
24
We welcome the fact that the central topic for discussion at Lisbon was economic and social reform. It is obviously sensible for the Heads of Government to discuss what can be done to promote the creation of more jobs and sustainable economic growth. However, it is notable that there was a great deal more adoption of targets—benchmarking exercises, reports and studies, strategic goals, co-ordination exercises, commonly agreed indicators, reflections on Commission communications, exchanges of experience on information networks, "a European innovation scoreboard" and "a European award for particularly progressive firms"—than of actions. Many or all may be sensible in themselves, but is not the real challenge to turn them into action?
Is it not the case that, alongside all those targets, a major shift in the direction of policy is needed if the European Union is to overcome the problem of high unemployment and catch up with America in the development of the new economy? Is it not time for everyone to recognise that businesses, not Governments, create real jobs? Should not Governments cut down on red tape and regulation and get out of business's way? Unless all that happens, the setting of targets and empty gestures will be all that is remembered in future years. All those Air Force meals will have been eaten in vain, even by the Chancellor and the Foreign Secretary. It is vital to remember that such rhetoric will not create a single job. If the object—[Interruption.] We are all entitled to have a little dig at Ministers now and again.
If the object is to create jobs, as we all agree that it should be, why did the Prime Minister do the following in the summit communiqué? Why did he commit himself to the so-called pending tax package—tax harmonisation by another name? Will that not lead to higher taxes in countries such as Britain? Why did he commit himself to renewing the European social model—the very thing that has led to such high unemployment in Europe in the first place? Is he aware of Lionel Jospin's comment that
People tell us to take inspiration from Anglo Saxon countries. That isn't our approach at all?
Why was President Chirac able to conclude after the summit that the
European social model was recognised by all?
What, exactly, gave him that idea? Why did the Prime Minister give the green light to the forthcoming French presidency on proposing a new five-year European social agenda at the Nice summit, about which the Confederation of British Industry, for example, has expressed great concern? As the International Herald Tribune noted:
Some reports said that France had been isolated at the summit meeting in opposing the…views championed by Mr. Blair and Mr. Aznar, but these reports emanated mostly from the British Prime Minister's spokesman. Alastair Campbell.
Surely not! Whoever could imagine such a thing?
Although we welcome any genuine commitment to updating the public procurement rules and completing the financial services internal market, if adapting the economy for global competition is a priority—again, we agree that it should be—why did the Prime Minister agree to drop the target dates for the liberalisation of transport and energy markets? Last year, at the CBI conference, he described some of the working time directive as "over the top". In a speech to business leaders in Bristol, he said:
A lot of these different regulations that have come about from a slightly different era can be revisited again.

25
Was not Lisbon a unique opportunity to put his money where his mouth is, reform such things as the working time directive and say precisely which regulations will be revisited? If he does not do those things, he will be accused of saying one thing to the CBI and another in Europe. Of course he would not want to be accused of that. Was not Lisbon a chance to turn those words into action?
Although we welcome the holding of the summit and the subjects that it discussed and believe that it is time to set Europe on the path of free enterprise and increased prosperity and to shorten some scandalously long dole queues, is it not also time to recognise that soundbites, pious pledges and rhetoric will have to be backed up by action to cut the burdens of tax and regulation, which still stand in the way of job creation?
The Prime Minister: I am glad that the right hon. Gentleman at least welcomed the fact that the summit took place, and that it was on this topic. The trouble is that, if we pursued the policy that he outlines, no such summit would ever take place under a British initiative. He is dedicated to attending his first European Council to renegotiate the treaty of Rome. [Interruption.] That may come as a shock to Conservative Members, but that is their party's policy.
The other day, the Bruges group of MPs—to which 120 Conservative Members are signed up—told the right hon. Gentleman that the option of withdrawal should be clearly contemplated if the treaty renegotiation was not agreed. He has never been able to name a single country in favour of a treaty renegotiation—not one. [HON. MEMBERS: "Norway."] We will glide over that small misunderstanding. As he cannot name one such country, it is highly unlikely that he would be able to initiate such a summit. Anyway, I shall leave that aside and come to the points that he made—[HON. MEMBERS: "Oh!"]—out of generosity to the right hon. Gentleman.
I shall deal first with the issue of the Balkans and Kosovo. Of course our service men and women have our strong political back up—they have had that all the way through. However, the real issue is how we better co-ordinate European and international action. The purpose of highlighting the roles of Javier Solana and Chris Patten is to have at the right level people with the authority and weight to carry through the decisions that the international community is making. Following the Lisbon summit, I hope that there will be greater clarity and co-ordination, and therefore a greater push given to our efforts in Kosovo.
It is barely a year since the conflict ended. Even though there are still enormous problems in Kosovo, let us never forget that it is better that those people are back in Kosovo than still being shut out of their homeland. We need to ensure that, having won the conflict, we also win the peaceful resolution following it.
On the Schengen arrangements, there is no question of us giving up border controls. That story was wrong, as could have been discovered had the Conservative party asked us. We have made it clear that we will work more closely under the Schengen arrangements on police co-operation, judicial co-operation, tackling organised crime and drug trafficking. That is perfectly sensible. However, I remind the right hon. Gentleman that, at Amsterdam, this Government won the legal protection of our border controls, and we do not intend to give that up.
26
The right hon. Gentleman said that the summit was all targets and no action. That is unfair: it was both targets and action. It is important to have targets on key issues to do with education and employment, but we also agreed measures on gas, electricity and telecommunications liberalisation. Specific measures were agreed by the European investment bank on the help that it will give small businesses. A directive on electronic commerce was agreed, and there were agreements on information technology skills to make them portable across Europe. There was a set of deadlines and agreements on Government procurement of services, which is immensely important. It would not be right to say that the Council was all targets and no specific action: it was a mixture of both targets and action, and rightly so.
On the tax package, we are committed to finding agreement, and I believe that we can do so on our terms. We are not against everything in the tax package. Indeed, we are strongly in favour of some parts of it. We want tax laws that are used as a hidden state subsidy to be removed, and that is a major part of the tax package. We must resolve the issue of the withholding tax, but we are making progress on that, and it is sensible that we continue to be engaged in discussion. It is always better to win the argument, and I believe that we can.
The right hon. Gentleman asked me why I agreed to the European social model. Let me make it clear, because he has misunderstood our position. I fully support the notion of a European social model—I am 100 per cent. in favour of it—but it should be updated, reformed and modernised for today's world. In case the right hon. Gentleman thinks that that is an extraordinary thing to say, let me quote to him from the Single European Act 1985, to which Margaret Thatcher, no less, signed up—that should instil calm and discipline in Conservative Members. An article, to which she agreed, states:
Member states shall pay particular attention to encouraging improvements, especially in the working environment, as regards the health and safety of workers, and shall set as their objective the harmonisation of conditions in this area, while maintaining the improvements made.
It is not so long ago that even those whom Conservative Members worship was prepared to take a slightly more open-minded view towards the social agenda. Margaret Thatcher also recognised, rightly, that Europe should have a social dimension, but that it should be sensible and improve employment and job opportunities for people.
In relation to the working time directive, I said that I believed that some parts of it were "over the top" because I thought that some of it was an unnecessary interference with the way in which employers run their business. For that very reason, we revisited it and have issued new guidance and made it more flexible, but the directive was agreed in 1990 under the previous Conservative Government.
In relation to the issue of dole queues and how we shorten them, one of the great points about the summit was that it recognised that there will be pockets of high unemployment and social exclusion that traditional policies of macro-economic demand management will simply not cure. It is for that very reason that, in this country, we have the new deal. I would have hoped that, if the right hon. Gentleman believed in cutting the dole queues, he would support a measure that has cut them here by 200,000. A total of 200,000 young people have

27
jobs in this country today as a result of precisely the same type of measure that the rest of Europe is now willing to follow.
This summit has been highly successful not simply for Britain, but, most important of all, for Europe. It set a new direction for European economic policy. It has set very clear policy and targets for how we are going to achieve it. It is a very straightforward, clear example of how a positive, constructive engagement, rather than destructive negativism, yields results not just for Europe but, far more important, for Britain.
Mr. Charles Kennedy: On the last part of the Prime Minister's statement, may we echo the sentiments expressed in congratulating and wishing President Putin well? As the Prime Minister took the opportunity a couple of weeks ago to visit him, perhaps he might be able to flesh out whether there is some early possibility of the new president visiting this country. While we all wish him well in all parties, equally, in all parties there will be those of us who will want to express direct concern to him—appreciating the difficulties that he faces domestically—over some of the military engagements that he was, apparently, willing to sanction in Chechnya, which must be a great humanitarian concern.
In regard to the Balkans in general and to Kosovo in particular, the Prime Minister speaks about the need for "enhanced economic assistance". Will he clarify whether there has been further more detailed discussion about that? On television yesterday, Chris Patten said, for example, that the issue is either greater contributions from member states, or a rearrangement of existing budgets within the European Union. Can the Prime Minister give us some further flesh on those bones?
There is much to welcome in the Lisbon summit conclusions, but, at the end of the day, the communiqués must be judged in terms of not just their words, but actions. Will the Prime Minister acknowledge that liberalisation and greater deregulation are welcome, but that the truth is that, over the past five years, the burden of bureaucracy emanating from Whitehall has been significantly in excess of that emanating from Brussels? Therefore, if we wish to see more liberalisation and deregulation within the single market, we must tackle some of the problems at home, as well as some of those at a European level.
Can the Prime Minister clarify the French position in respect of liberalisation? What is their position in respect of energy and utilities in particular? A date has been specified on the liberalisation of telecoms, but not on those two other sectors. Can he clarify what the position is and whether the French are proving a particular obstacle?
The Prime Minister is right to say that, where Britain takes a lead, we can benefit in Britain and Europe benefits with that. Where the Government is still not taking a sufficient lead is on the issue of the euro. Given the generally positive response that he had at the weekend, will he and his colleagues redouble their efforts so that we make continuing constructive progress in Europe, and do not disappear up the cul de sac that the Conservative party is offering?
The Prime Minister: I think that I can promise at least not to do the latter, I hope.
28
President Putin has a standing invitation to visit this country. Of course we continually express our concerns about the action in Chechnya. Nevertheless, I believe that the European Union was right to emphasise the importance of engaging with Russia.
On the Balkans, at least currently, it is more a case of ensuring that the economic aid that we have already agreed gets through and is used properly in Kosovo and in the wider Balkan strategy. I think that, if that were happening, people would look far more favourably on any fresh applications. In my view, it is essential that we co-ordinate the different aspects of that policy. I and other European leaders have been concerned at the recent lack of co-ordination. Our efforts will therefore be directed at improving that.
On liberalisation, the important thing is the combination of liberalisation in the internal market plus measures that improve social justice. Traditionally, there has been at least as much regulation coming out of Whitehall as out of Brussels. I hope that the right hon. Gentleman will therefore support us in the measure that we wish to introduce to make it easier to get rid of unnecessary regulation. It is important that Governments are doing that themselves nationally, as well as at a European level.
The most important aspect of this economic summit is that the focal point was on measures to reduce unemployment and to improve educational qualifications and skills—whereas, if this type of economic summit had been held a few years ago and discussed social policy, the focal point would have been on regulation. I think that that is a big difference.
We have agreed to open up the energy and utilities market in each individual country as quickly as possible. Some countries have a different position on the matter—France has been mentioned. On the other hand, as we all know, French utilities have quite a significant part of the British utilities market. Obviously, we point that out to our French colleagues as well. It is important to realise that that process of liberalisation will go on, and that it is the right process for the future of Europe.
Our position on the euro remains as it is.
Mr. Ian Pearson: I welcome the Lisbon summit's progress on market liberalisation and the prominence that it has given to electronic commerce. However, does my right hon. Friend agree that we must aim at providing internet access for all, and that particularly the elderly stand to benefit enormously from being able to buy goods on-line? Will he therefore consider providing free internet training courses for pensioners and letting our grannies go Windows shopping?
The Prime Minister: That bit came a little late for the Budget. Certainly one of the principal purposes of the summit was to improve access to the internet, and we agreed a series of measures to do that, including measures on access to learning centres as well as access to the internet in schools. We are in the process of setting up 1,000 learning centres across the United Kingdom, so that people should be able to get access to decent information technology literally wherever they live. We are also giving help—both tax breaks and a subsidy—for information technology courses. That action will help our

29
elderly as much as people in the work force, who will need increasing access to internet skills to be able to do their job.
Sir Peter Tapsell: After what has happened to Rover and the west midlands, did the Prime Minister, at Lisbon, repeat his wish at the earliest practicable moment to place the British pound under German management by joining the euro?
The Prime Minister: I did not. Our position on the euro remains unchanged. That was a fairly bizarre intervention, in the light of the comments that have been made about the matter. Our concern is to ensure that we do everything that we possibly can for the workers who have been displaced by the news. It is important that we do so. The difference between this Government and the Government whom we replaced is that we recognise that we have a responsibility and an obligation to develop job opportunities and, particularly where restructuring occurs, to help people to find new employment.
Mr. David Winnick: Is my right hon. Friend aware that—both before the elections, and in their immediate aftermath—a number of Russians have expressed fears about the possibility of an authoritarian regime being restored to Russia? Is not the position of the European Union and of the British Government that we do not want any type of repression—military or otherwise—in Russia, but we want a fully law-based state with justice and protection for ordinary people in Russia?
The Prime Minister: I agree entirely. That has to be the purpose of the European Union's engagement with Russia.
Sir Raymond Whitney: Is it not surprising, but nonetheless welcome, that the Prime Minister's statement made no reference to the third way? Was the third way discussed at Lisbon, or does the Prime Minister now accept that the concept is dead and that, as a collection of empty clichés, it deserved to die?
The Prime Minister: No, I do not. Perhaps I shall send the hon. Gentleman cuttings from the various foreign media that have paid tribute to the influence of the third way on the summit.
Mr. Bill Rammell: Does my right hon. Friend share my view that, when the European Union talks of pursuing structural reform to increase competitiveness and modernising the European social model, it shows that Europe is working to this country's agenda? Does that not show that we can and do win the debate in Europe, as was reflected throughout the quality press in Europe at the weekend? Should that not be contrasted with the view of the Conservatives, who increasingly want to renegotiate the past and join the North American Free Trade Agreement at the expense of our position in Europe, in the process putting 3.2 million British jobs at risk?
The Prime Minister: I do not know whether the initiative on NAFTA has the blessing of those on the Conservative Front Bench but, if we joined NAFTA, we would have to leave the European Union. That is probably
30
why it has been proposed by those who have proposed it. My hon. Friend is right to say that we are modernising the European social model and combining policies for enterprise with policies that tackle social exclusion. That answers the question from the hon. Member for Wycombe (Sir R. Whitney).
Mr. Dafydd Wigley: I warmly welcome the full employment targets, particularly the gender balance targets that have been accepted. Does the Prime Minister accept that, to take those targets forward in the UK, we need action plans for employment on a UK level and within the nations and regions? Do we not need to look at the guidelines for the Bank of England to make the maintenance of full employment one of its targets, alongside inflation?
The Prime Minister: Of course it is important that activity to stimulate jobs and tackle social exclusion happens in every part of the UK. I think that the Bank of England's remit is the right one. We have long since moved beyond the notion that, by taking a responsible view of inflation, we are somehow acting in a way contrary to the interests of employment. The balance between the Bank of England remit and the Government remit is the right one.
Mr. Denzil Davies: Given that 13 of the official languages of the member states of the European Union are not English and that the language of the internet is English—or perhaps American—is there not a strong likelihood that, in the age of the internet, the European Union may never catch up with America?
The Prime Minister: That is a slightly limited view of how people can develop in the modern world. Some Scandinavian countries that are at the forefront in developments of new technology and the internet use English perfectly easily. That is the world in which we live. A better way of putting it is that the fact that English is the internet language gives us a huge opportunity, which we should use.
Mr. Ian Taylor: The Prime Minister is at his best when he follows a positive Conservative agenda, which the previous Government set on opening up Europe for e-commerce, on telecoms liberalisation, the first stage of which was reached in 1997, and on movements towards a European patent. I congratulate the Prime Minister on those issues. Will he ensure that the target dates are met? The Commission has real power and must exercise its responsibility. There are always ways to throw obstacles in the course of progress on such issues at Council of Ministers meetings. I hope that the Commission will be given the authority to ensure that all member states, including those which are less likely to be enthusiastic, are obliged to carry out the commitments that they made at Lisbon.
The Prime Minister: Of course, where there is European legislation, the Commission will have a power to enforce it. It will be able to take an active role on issues such as the European patent, when we develop it. There will be a European Council every year on economic reform, which will also provide impetus.

31
The Conservatives used to take a sensible view of Europe. In the first six or seven years even of Margaret Thatcher's time as Prime Minister, whatever some of the rhetoric, a constructive attitude was taken. The single European market was a British Government initiative. Conservative Front Benchers express their horror at what the Labour party's policy used to be; it is precisely for that reason that we changed it. What a shame it is that, as we left our extremism behind, the Conservatives took it up.
Dr. Phyllis Starkey: I very much welcome the positive role that the UK Government played in persuading our European partners to address the issue of promoting employment and enterprise. Was the UK-Swedish joint statement before the Council on promoting female entrepreneurship discussed by the Council? Did the Council take up some of its positive suggestions about removing barriers to women entrepreneurs?
The Prime Minister: It is for precisely that reason that the Council's conclusions contained passages on the better balance of work and family life and on more flexible time. We recognise that specific groups of people have had difficulty gaining access to such things as venture capital, which are necessary to start businesses. The UK tabled a number of papers with other countries, and the contents of the Swedish paper were well reflected in the Council's conclusions.
Mr. Patrick McLoughlin: Did the Prime Minister have time to discuss the future of Sellafield with either the Irish or Danish Governments?
The Prime Minister: I did discuss that with the Irish Taoiseach, who expressed concern on environmental grounds—a traditional Irish concern. I gave him the traditional British answer, which is that we are sure that the procedures are entirely safe.
Mr. Piara S. Khabra: The Prime Minister is considering participating in the Schengen agreement. I hope that he will not open this country's borders to facilitate the entry of racists into this country to stir up racial trouble.
The Prime Minister: Of course we will not do that. As I said, the border controls of the UK remain in place. The purpose of our further engagement with Schengen is to tackle some cross-border issues that we really need to tackle.
Mr. David Curry: It was bad luck that Lionel Jospin arrived at the summit hotfoot from a total retreat on pensions reform, a failure to reform the Finance Ministry and yet another capitulation to France's extremely greedy public sector unions. Does the Prime Minister understand why it is that, however much we want the agenda that he has outlined to succeed, and we have genuine concerns about the willingness and ability of the continent's socialist Governments to deliver it? Would he take them aside and explain to them that socialism does not work?
The Prime Minister: I shall make two points in response to the right hon. Gentleman. First, real reform is
32
going on in the rest of Europe. A FF40 billion tax cut has been proposed by the French Government in various areas to encourage business, and liberalisation is being pursued also in certain areas. In Germany, there is a comprehensive corporate tax reform package. In Denmark and Holland, for example, major welfare reform is taking place. All those countries have centre-left Governments.
Secondly, it would be true to say that some people take a different position in terms of their enthusiasm for economic reform. That would be entirely natural. What is different now is that they are in the minority, not the majority. It is also different because this country, by engaging in the process and in the summit, has been able to get a result. That is surely the right way to approach the matter. There will be people with different views on different aspects of economic reform. The important thing is that a summit such as this, dedicated to economic reform and with the specifics that it contained, would have been unthinkable a few years ago. It would be instructive for the right hon. Gentleman and some of his Conservative colleagues to read the French press if they want to see where the balance of argument lies.
Mr. Dale Campbell-Savours: Does not the raft of highly important initiatives that my right hon. Friend led the discussions on in Lisbon point the way to an early decision on entry into the euro? May I suggest that the five conditions should be met as soon as possible, because business men in my constituency now totally reject the Tory approach and want entry into the euro?
The Prime Minister: Of course the Conservatives' approach would be a disaster. To rule out the euro irrespective of the economic circumstances for a certain period or forever—whatever is their latest policy—would be a disaster, sending a terrible signal right across Europe about Britain and British industry. It would put at risk the 800,000 jobs linked to inward investment. Surely the policy of keeping the option open, making the economic tests clear and saying that the final decision should be with the British people in a referendum is the right decision.
I emphasise to those who want me to commit myself to going in without regard to the economic circumstances that it is an economic and monetary union, so the intelligent way forward is to set down the economic conditions and pursue them, with the final choice left to the British people. We should neither stay out nor join without having proper regard to the economic circumstances.
Mr. John Swinney: I welcome the direction of the Prime Minister's statement. Does he recognise the genuine challenge of e-commerce for the small and medium-sized enterprise community, as it is estimated that only about 7 per cent. of SMEs are equipped to trade on the internet? What was agreed at the summit specifically to intensify preparedness to trade on the internet, and does he believe that it would be strengthened by a swifter time scale for joining the single currency?
The Prime Minister: The most important measures for small businesses are telecoms liberalisation, the charter for small businesses that was agreed and the programme of the European investment bank. For the United

33
Kingdom, the measures announced by my right hon. Friend the Chancellor in the Budget—in particular, the tax relief for small businesses in relation to investment in technology—will have a big impact. Perhaps the most important thing that we can do is to keep emphasising to our business community that the whole question of the internet and electronic commerce is not only about businesses specifically engaged in that business: every business will be affected by the new technology, so they should all look into how they can use it. It has been interesting to see the number of not only multinational but UK companies that have recognised within the past 12 months that that has to be their No. 1 business priority.
Mr. Tam Dalyell: Was anybody in Lisbon the least bit surprised that it was deemed unsafe for George Robertson to go to Mitrovica? If the Prime Minister talks about winning the peace, does he not have to address the subject of Serbia—a wounded and deeply resentful animal—and may it not mean spending a great deal of money and talking, however unpalatable it may be, to Mr. Milosevic?
The Prime Minister: Of course we discussed the Balkans and Serbia in detail. Money is reserved for Serbia, but there has to be the democratic transition. We are not prepared to put money in the pockets of Milosevic. It is important for us to keep up the pressure for change there, to engage properly with the democratic opposition in Serbia and to recognise that it is in the interests of a wider Balkan strategy for Serbia to become a proper democratic state. We are working to that end, and that is really the best thing that we can do.
Mr. Tim Collins: Does the Prime Minister have any message from Lisbon for the hon. Member for Liverpool, Walton (Mr. Kilfoyle), who is about to give him a message?
The Prime Minister: I have not the faintest idea what the hon. Gentleman is talking about.
Mrs. Alice Mahon: On the Balkans, does the Prime Minister agree that it is equally important to get back home the 800,000 refugees who are now living in Serbia, a quarter of a million of whom have been ethnically cleansed from Kosovo? During a recent visit to a camp there, my hon. and learned Friend the Member for Medway (Mr. Marshall-Andrews) and I witnessed at first hand just how miserable the conditions are, and we were informed by the Red Cross and the United Nations High Commissioner for Refugees that sanctions are really hurting refugees, some of whom have been there for eight years. Did the European Council discuss what could be done to relieve the plight of those 800,000 people, or do we have undeserving and deserving refugees?
The Prime Minister: No, we certainly do not have those two categories. We have agreed already that humanitarian aid can go to those refugees, and that is not the principal problem. The principal problem is how one reconstructs Serbia while a highly dictatorial, undemocratic regime is in place there. That we cannot allow. My hon. Friend is right to say that there were refugees from Kosovo into Serbia. but think how much worse the situation would be if we had allowed Kosovo
34
to be ethnically cleansed and we had a million Kosovo Albanian refugees going around Europe. The only way forward was to right the wrong that was done and work constructively to win the peace, but that cannot be done—or at least, it is far more difficult—while Milosevic remains in power in Serbia.
Mr. Julian Brazier: While the Prime Minister was having discussions with colleagues on the sustainability of pensions, did he tell his European colleagues that when he took office, this country had as much saved in its pension funds as the whole of the rest of Europe put together? Did he advise them to do what he has done, which is to tax £5 billion a year out of pension funds, and to tax even very small amounts of dividend income held by pensioners, while at the same time providing a minimum income guarantee to those who have not been able to provide for their pensions?
The Prime Minister: That is a slightly different topic. First, the single most important aspect is the value of the money in people's pension funds. As a result of what has happened in this country over the past two or three years and the strength of the economy, that value is high and has risen enormously. Secondly, the lop tax rate on savings has been very helpful and, thirdly, we have agreed a series of measures—such as lifting the savings rate on capital and ensuring that all pensioners get a proper tax-free winter allowance—that help not just the poorest pensioners. I make no apologies, as I have said before to the hon. Gentleman and his colleagues, for taking the necessary measures in the first two years of office to ensure that we eliminated the huge financial deficit that we inherited. The worst thing that we could possibly have for pensioners is a return to the high inflation and the boom-and-bust days that were presided over by his party's Government.
Mr. Dennis Skinner: Is my right hon. Friend the Prime Minister aware that, when all the glitz and the glamour of the Common Market and the summits and the rosy-eyed views have been removed, bosses still have power to sack workers? Did he bump into any of the Germans across there, and tell them that the British people are disgusted by the way in which BMW tore up all the so-called agreements that were started when the Tories were in power when they negotiated the Rover deal in the first place? Whatever happened to the social chapter and the mountain of legislation that is supposed to protect workers inside the Common Market? Will he tell BMW, if he has not told it already, that it is time that it operated in a totally different fashion? If it believes in togetherness, it should not have sacked those workers like it did, leaving us to try to pick up the pieces. If he did not do that, I hope that he will get on the blower immediately.
The Prime Minister: We certainly did, and we have repeated our concern about BMW management's handling of this situation and our strong disagreement with the way in which the announcement was made. We have made that clear all the way through. It is worth pointing out that the German Chancellor also made clear on Saturday his disagreement with the way in which BMW handled the issue. We are living in a European market in which changes will be made, but the very

35
reason that we want to be part of the social chapter is to ensure that basic minimum standards in the workplace apply to people.
Mr. John Wilkinson: Are not the bland words in section 3 of the communiqué on the western Balkans belied by the dire report of Secretary-General Solana and Commissioner Patten on the situation in Kosovo? Will not the Government and their European partners have to make up their minds whether to get more deeply involved in the military task of containing the growing insecurity in Kosovo or to get out?
The Prime Minister: The conclusions welcomed the paper by Solana and the European Commission, so I do not believe that they were bland. The very purpose of raising the issue in that way was to ensure that Europe co-ordinates its assistance better.
There will inevitably be problems sorting out an issue such as Kosovo, especially given the wider problems in the Balkans. However, the alternative—a policy of disengagement—would be disastrous. It would destabilise the entire region, and lead to renewed bouts not just of ethnic conflict, but also of ethnic war, into which we would inevitably be drawn back. That is why I took the view from the very beginning that we had to become engaged with the conflict. We shall see the peace through in the same way that we saw the conflict through.
Mr. Ben Bradshaw: Is my right hon. Friend aware of the other comments made by the German Chancellor at the weekend, when he said that the
36
liberalisation and deregulation achieved at Lisbon would not have been possible without the leadership shown by the British Government? Does my right hon. Friend agree that the best proof that Lisbon was a success is the deafening silence about the summit among the anti-European British newspapers?
The Prime Minister: The summit showed that, with a positive attitude in Europe, Britain can be successful. I hope that we carry on learning that lesson.
Mr. David Chidgey: In the Prime Minister's discussions about security and stability in the Balkans, did he touch on the acute problem of the shortage of law-enforcement officers in Kosovo? Was he made aware of the high regard in which British police officers working on secondment there are held? British officers lack of firearms training means that there is a great shortage of them, although the authorities in Kosovo say that they would be more than happy to provide that training because they value the officers' skills so highly. Will the Prime Minister revisit the matter and make more British police officers available to restore peace in Kosovo?
The Prime Minister: We are doing what we can, and we have already doubled the contingent of British police officers in Kosovo. I understand what the hon. Gentleman says about firearms training, although I think that the matter is a little more complicated. However, we are also providing additional help to crack organised crime. We are giving a range of help and we stand ready to do more, but that help has to be given in conjunction with the authorities in Kosovo.

Points of Order
4.22 pm
Mrs. Angela Browning: On a point of order, Madam Speaker. Have you received a request from the Secretary of State for Trade and Industry to come to the House and report the progress made in the various meetings that he has held over the past 10 days on the subject of Rover? You will know that the right hon. Gentleman was due to open this afternoon's debate on the Budget but, because the Government has withdrawn him, there will now be no Budget debate dedicated to business and industry. Are you able to use your influence to ensure that the House is kept apprised of this matter, which is very important, especially in the midlands?
Madam Speaker: I am not aware that the Secretary of State for Trade and Industry is seeking to make a statement on the subject to which the hon. Lady referred. However, those on the Treasury Bench will have heard the plea of the hon. Lady, who speaks officially on these matters for the Opposition, and perhaps we shall be hearing something soon.
Mr. Bob Russell: On a point of order, Madam Speaker. I seek your guidance and protection for Back-Bench Members in respect of oral questions. Two weeks ago, I drew Question 7 for this afternoon, but my question was subsequently removed from the Order Paper. The question had to do with Wembley stadium, so who should answer it if not the Secretary of State for Culture, Media and Sport or the Minister for Sport? I understand that the question was transferred to another Department. Do you not agree that in such cases the matter should be discussed with the hon. Member concerned?
Madam Speaker: I cannot agree that there should be discussion with the hon. Member concerned. I believe that the question was not only about Wembley, but also about rail links to the stadium. It is for the Minister involved to determine whether a question should be transferred. I understand that the hon. Gentleman tabled his question on 13 March, and that it was transferred on 15 March. I accept his word as an hon. Member that he was not informed of the transfer until this very day, and I very much deprecate that. I have sympathy with the hon. Gentleman's position, and I hope that he will take my remarks this afternoon from the Official Report and use them to make the strongest possible representations to the Secretary of State concerned.

Residential Care Homes and Nursing Homes (Medical Records)
4.24 pm
Mr. Paul Flynn: I beg to move,
That leave be given to bring in a Bill to require persons registered to carry on residential care homes or nursing homes to keep records concerning medicines and their use; to provide for inspection of such records by medical practitioners; and for connected purposes.
The whole House will have been shocked at the level of abuse in homes for young people that have been revealed in the past few years. However, at least a similar level of abuse exists in homes for the elderly, and it remains hidden. The majority of residential homes are run in an exemplary manner by kind, dedicated staff that receives poor wages for their thankless and trying work. However, a recent television programme, secretly filmed in a residential home, revealed a degree of physical and verbal violence against residents that would shock us all.
The purpose of the Bill is to counter another form of abuse—the use of medicinal drugs in such homes. Many families tell a similar story of relatives who, although frail, were active and lively, but, within a short period of entering a home were reduced to inactivity, their behaviour being similar to that of zombies. That is usually explained as being the result of the declining faculties of the residents concerned. However, there is a wealth of evidence to suggest that over-medication is the major factor.
All independent studies have found vast over-prescription of powerful, anti-psychotic drugs. In Glasgow, 28 nursing homes were visited to examine the prescribing of the "chemical cosh" to 217 residents. The study found that 190—88 per cent. —of those residents did not need the drugs. At the end of the day, some nursing homes routinely switch off their patients with the lights. An elderly person living in a nursing home receives four times as many prescription items as elderly people living in their own home. On average, elderly people in nursing homes are given between six and seven medicines—some take as many as 19—many of which are inappropriate and unnecessary.
The use of neuroleptic drugs is of special concern. Such drugs are meant for the deeply psychotic—for the treatment of senility, mania and dementia. The two main drugs are Melleril and Largactil; those drugs and several others reproduce, as a side-effect, the symptoms of dementia. It is often impossible to tell whether the dementia is from natural causes or from the drugs. Another survey found that although 10 per cent. of nursing home residents suffer from serious psychiatric disorders, 50 per cent. rather than 10 per cent. of them receive those powerful drugs.
I am grateful for help in preparing the Bill from several groups, including Action on Elder Abuse and Age Concern, which have given me some recent examples of what is happening. I was told of one nursing home where all the residents are woken up at
6 am and made to go to bed at 6.30 pm.
Age Concern said:
It has been suggested that the residents are drugged in the evening to go to sleep early, as this would not happen naturally.
Elderly people are put to bed at 6.30 pm; when they wake up they are drugged again and hauled out of bed at 6.30 am because that suits the shifts of the staff.

39
The organisation gave another typical example in which groups of elderly people were being sedated without prescription. Age Concern stated:
A relative believed the owner was in financial difficulties. Sedated elderly required less attention and less staff. The home went broke. The health of one lady improved when she was removed from the home.
That woman went on to a milder drug, although she is addicted for life to the drug that was illegally prescribed to her in that home. Age Concern noted that a prosecution is possible.
Those are not isolated examples. Every independent investigation of such homes undertaken in the United States and in this country reports gross over-use. The most devastating conclusion of such reports is that when the use of those powerful drugs has been reduced or stopped, there has been little, if any, deterioration in the patient's health. The drugs were being needlessly prescribed.
There are possible remedies. Today, I heard about a trial carried out in the Ceredigion area by a local health group. I cannot give the final conclusions because they have yet to be presented to the National Assembly for Wales, which will report on them. However, the trial was a great success. A pharmacist visited 111 individuals; it was found that 194 of the drugs that had been prescribed were unnecessary for a variety of reasons. Many of them were withdrawn. The report stated that the health of those individuals has been improved, and a saving of £15,000 has been made on the drugs bill. That sum can now be given to the homes so that they might provide real help in the form of extra staff and extra care. It is far better for those in residential care to have a helping hand or an attentive ear rather than to be driven into oblivion by a drug.
40
Manchester school of old age psychiatry ran similar pilot schemes, sending groups of pharmacists into residential homes. In every instance that resulted in fewer drugs being used.
I hope that the Bill will be incorporated in the Care Standards Bill. I am grateful to a new group named Action on Elder Abuse centre for ageing, the Alzheimer's Disease Society and Age Concern for the help that they have given me in preparing the Bill. Residential homes are a reality of life for an increasing number of elderly people. In too many cases we are failing to provide the safety, comfort and peace of mind that we all hope to enjoy in our final years.
As politicians, we often agonise over problems for which there are no realistic remedies. The Bill will provide a practical, safe and affordable remedy that can rescue tens of thousands of defenceless, frail and elderly people from the lives of misery and confusion that are now being imposed on them by others out of ignorance, neglect or greed.
Question put and agreed to.
Bill ordered to be brought in by Mr. Paul Flynn, Mr. Eddie O'Hara, Mr. Gordon Prentice, Dr. Doug Naysmith, Dr. Brian Iddon, Mr. Paul Burstow, Mr. Mike Hancock, Mr. Andrew George, Dr. Evan Harris and Mr. Dafydd Wigley.

Residential Care Homes and Nursing Homes (Medical Records)
  RESIDENTIAL CARE HOMES AND NURSING HOMES (MEDICAL RECORDS)
  Mr. Paul Flynn accordingly presented a Bill to require persons registered to carry on residential care homes or nursing homes to keep records concerning medicines and their use; to provide for inspection of such records by medical practitioners; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 9 June, and to be printed [Bill 98].
Orders of the Day
  WAYS AND MEANS
  Order read for resuming adjourned debate on Question [21 March].

  AMENDMENT OF THE LAW
  Motion made, and Question proposed,
  That it is expedient to amend the law with respect to the National Debt and the public revenue and to make further provision in connection with finance; but this Resolution does not extend to the making of any amendment with respect to value added tax so as to provide—

  (a) for zero-rating or exempting a supply, acquisition or importation;

  (b) for refunding an amount of tax;

  (c) for varying any rate at which that tax is at any time chargeable; or

  (d) for any relief, other than a relief which—

  (i) so far as it is applicable to goods, applies to goods of every description, and

  (ii) so far as it is applicable to services, applies to services of every description. —[Mr. Gordon Brown.]

  Question again proposed.

  Budget Resolutions and Economic Situation
  Mr. Deputy Speaker (Mr. Michael Lord): Before I call the Minister, I remind the House that Madam Speaker has put a limit of 10 minutes on all Back-Bench Members' speeches during the debate.
  4.33 pm
  The Secretary of State for Social Security (Mr. Alistair Darling): This is the last day of this year's Budget debate. The debate has shown the clear dividing lines between the Government and the Opposition. We are building a strong economy that allows us to build strong public service, whereas Conservative policies would return us to the boom-and-bust economy of the past. If we want to know what the Opposition think about public services, we have only to look at their plans to dismantle the national health service.
  We have strong public finances because we took tough decisions during the first two years of this Parliament. We cut the huge debts that we inherited and we gave the Bank of England independence, something that was opposed by the Conservatives at the time. Our public finances are strong. We are in surplus, not deficit. By getting people back to work and by cutting the costs of social and economic failure, my right hon. Friend the Chancellor of the Exchequer found that he had about £3 billion more available to spend than he would have done but for the change of Government.
  For the first time in a generation, social security spending is under control. The rate of growth in this Parliament is less than half the rate under the Conservative Government. Spending will remain under control provided that we continue to reform the welfare state and get more people into work, tighten the gateways to benefit and take tougher action on fraud. By keeping
  42
  spending under control we can spend more on our priorities, such as helping families with children and supporting pensioners.
  Tightening the gateways is important. Because of the action that we have taken, we are already on course to save £1 billion over this Parliament by cutting down on fraud and error in income support alone. We have also called time on the hidden economy which thrived during the Tory years. I can announce that, from next year, there will be 400 more specialist investigators across government to crack down on fraud. Specialist teams throughout the country will check the identities of people claiming benefits and suspected of making fraudulent claims. Following Lord Grabiner's report, the Government will introduce proposals to deal with persistent offenders who work and claim benefits at the same time. There is no excuse for benefit fraud; we will not tolerate it.
  Social security spending almost doubled under the previous Government because of their economic and political failure. They spent more and more while the number of households with no one in work doubled and child poverty trebled. It is a scandal that, at the beginning of the 21st century, it falls to this Government to eradicate child poverty, which grew so much under the Conservative Government. They spent more and more as a result of their failure, and their response was simply to leave things to the market. That remains their response today, whereas our response is fundamental reform, and we are now beginning to see the results of those reforms.
  The key to cutting the bills of economic failure is getting people back to work. Work provides opportunity and helps to remove children from poverty; and a lifetime in employment makes for a good pension. That is why this Government are determined to help people find work and to make work pay—helping people to help themselves. There is more help now available, with the working families tax credit, the new deals and the minimum wage. Long-term unemployment has more than halved, youth unemployment is down by 70 per cent. and there are more vacancies in the economy. We believe that welfare reform and getting people into work is the key not just to cutting the bills of economic failure, but to making sure that individuals can prosper and do well.
  There are 1 million vacancies in the economy. We therefore believe that a new approach—a new culture—is needed by Government to help people fill those job vacancies. That is why, this month, we announced a new agency for work, bringing together the Benefits Agency and the Employment Service. From next year, there will be a single gateway for everyone of working age. We are ending a system that is designed simply to hand out benefits. Instead, we are designing one that is geared to getting people into work and helping them to become independent.
  We have active help backed by measures to help work pay, such as the working families tax credit. Some 1.4 million families are gaining about £24 a week, and all of that would be put at risk were there ever to be the return of a Tory Government.
  Mr. Chris Pond: Will my right hon. Friend seek an intervention from Conservative Members? The Conservative party has performed one or two U-turns

  43
  on these issues, but will he seek a categoric statement as to whether it would retain or scrap the working families tax credit?
  Mr. Darling: One only has to read what Conservatives have said about the working families tax credit to see their hostility towards it. I know that they have performed one or two U-turns, such as that on the minimum wage. However, it is hard to believe a party that was so vehemently against the minimum wage, when it now tells us that it is in favour of it. Who knows? The Tories will be calling for an increase in it next.
  The Conservative party is still against the new deal, but I suspect that it is quiet now because of its embarrassment. After nearly 20 years in government, and despite all the rhetoric and all the promises to cut social security spending, it managed to double the amount of social security spending. That was not because people were better off as a result of more generous benefits or anything like that: it was simply that the Conservative Government needed to spend more and more because of mass unemployment. What was worse, it presided over a situation in which one generation of the unemployed led to a second generation of people who were unemployed.
  Mr. John Bercow: Will the right hon. Gentleman give way?
  Mr. Darling: I shall certainly give way; it did not take long to provoke at least one Conservative Member. The hon. Gentleman must be deeply embarrassed by the fact that, whatever else the Conservatives did in the past 20 years, they manifestly failed to control social security spending. We have done that, and we shall continue to do so.
  Mr. Bercow: That was a very long-winded apologia. Is the Secretary of State aware that, on the Government's own statistics for the new deal for lone parents, only 4.5 per cent. of lone parents who were sent invitation letters have secured employment as a result? More than 434,000 have failed to do so. Does the right hon. Gentleman not recognise that, if the new deal for lone parents were a school, it would have been closed by the Secretary of State for Education and Employment?
  Mr. Darling: I shall come on to lone parents shortly, but I can tell the hon. Gentleman that nearly 90 per cent. of lone parents who come in for interview under the new deal join the scheme, and a growing number go on to work. A recent report showed that once lone parents are in work, they are more likely than other people to stay in work, and the survey found that nearly half of those who went into work were still in work five years later. Lone parents have a motivation that people without children do not have—the motivation to look after their children. The new deal for lone parents has been a success, and as I shall tell the House shortly, we intend to build on that.
  I was saying that not only will we help people into work through the new agency, which will make sure that everyone of working age comes through that single gateway, but we are easing the transition to work. The Budget introduces a new simple job grant, with a benefit
  44
  run-on for housing costs, which makes it easier for people receiving mortgage support to try out a job: if the job does not work out, they will not lose that benefit.
  We are helping people to get work, and 260,000 people have found a job while on a new deal programme. Yet it is worth noting that the Tories were against every aspect of the new deal. We are extending and improving those programmes because so many people have found work. We are reducing unemployment, but there are many people who are not in work who could work and want to work. That is why we introduced the new deals for disabled people and for lone parents.
  As I said, 90 per cent. of lone parents who come in for interview join the new deal, and one in three of those go on to find work. Starting this October, and going nationwide from April next year, we intend to roll out national work-focused interviews for lone parents on income support with children of school age. People have a right to expect support, but in turn they have a responsibility to find out what help is available. By 2004, every lone parent whose youngest child is over five will have to come in for an interview as a condition of receiving benefit. We shall begin to implement that next year. We are providing the help and advice that people need, but they should be made aware of what help is available to get them into work.
  The Tory alternative, which is simply to cut off all income support the minute the youngest child reaches 11, as well as to remove all help and advice and scrap the new deal and the working families tax credit, will not help; it will only increase poverty. Helping lone parents and, importantly, their 1.7 million children, is an essential part of our drive to eradicate child poverty. We are the first Government ever to commit themselves to halving child poverty within 10 years and eradicating it in a generation. After all their U-turns and policy changes, it will be interesting to find out whether the Tories are prepared to support us in that commitment. No decent society and modern economy such as ours should tolerate so many children living in poverty.
  We are determined to tackle poverty and its causes, including the poverty of opportunity and expectation that has blighted the lives of too many children. In this Parliament alone, as a result of all the measures that have been announced in the Budgets since we took office, more than 1 million children will be taken out of poverty. By any reckoning, that achievement should make people proud of what this Government have done.
  We are tackling the causes of poverty, not only through education and housing policies, but through extra help such as the sure start maternity grant for mothers with new babies, which rises to £300 from October. We are also helping those children whose parents cannot work with an increase of £4.35 for children under 16 in families who are receiving income support and the working families tax credit.
  Mr. John Townend: Is not one of the greatest causes of the increase in child poverty the breakdown of the institution of marriage? What have the Government done in the Budget to encourage marriage?
  Mr. Darling: In fact, the biggest single cause of child poverty is parents not being in work for long periods. I would take the hon. Gentleman's remarks more

  45
  seriously if he had ever paid any attention to, or expressed any concern about, the mass unemployment over which the Conservative Government presided during the 1980s and early 1990s. If he wants to see the problems of poverty at their most acute, he should visit those areas where employment was decimated in the early 1980s, and where parents were given no help to get back into work.
  Mr. Darling: The hon. Gentleman can shake his head if he likes. In my 13 years as a Member of Parliament, I have never heard him express an interest in poverty, but if he is now taking such an interest, he should look at what is being done to help children who live in poverty. I commend the report that the Government produced last year, and which we will produce every year; it will enable people to judge our performance on eradicating child poverty within a generation. We are determined to ensure that every child in this country has the best possible start in life.
  Mr. David Davis: The Secretary of State picks his statistics carefully. According to his definition, the highest cause of child poverty is families without a working parent, but the second highest is single-parent families. Therefore, will the right hon. Gentleman answer the question asked by my hon. Friend the Member for East Yorkshire (Mr. Townend): does the right hon. Gentleman think that encouraging marriage is an appropriate objective for Government policy?
  Mr. Darling: The right hon. Gentleman has inadvertently made my case: for most families, lack of work is the problem. He mentions lone parents, and too many children living in poverty are the children of lone parents who are not in work. About 800,000 lone parents are not in work, and we want to ensure that those who can work do so.
  Mr. Townend: What children need is fathers.
  Mr. Darling: The hon. Gentleman is quite right to emphasise the role of fathers. The Tories set up a system that collapsed under its own weight, so we are reforming the Child Support Agency—in fact, the Bill to achieve that reform returns to the House of Commons later this week. The result of our reforms will be that nearly 1 million children will get more money than they do at present; in some cases, they will get money for the first time.
  We are tackling child poverty on several fronts, including ensuring that absent parents—usually fathers—pay what is due and making it easier for them to do so. We are also helping lone parents into work—giving them help that was never available in the past. Essential to eradicating child poverty is running a stable economy—something that eluded the Conservatives for almost 20 years—creating an environment in which work can flourish, and establishing conditions in which there are more jobs in the economy than ever before. The parents of some children cannot work, so we are helping them, as well as providing an extra £26 a week for children who are severely disabled in early life.
  46
  All that help was never available in the past, and most of the measures introducing it were opposed by the Tories. Many of the measures are still opposed by them and would be threatened by the return of a Conservative Government.
  Mr. Malcolm Bruce: Will the Secretary of State give way?
  Mr. Darling: We have not heard from the Liberal Democrats yet, and since there is only one here—[HON. MEMBERS: "Three."] —I shall give way.
  Mr. Bruce: Will the Secretary of State consider the irritation caused to disabled people by the fact that they have to demonstrate how disabled they are and how much their disability costs them in order to claim disability living allowance? Many find that both demeaning and difficult. It goes against the grain of encouraging people to be independent to force them to advertise the extent of their dependency to qualify for a benefit that many of them need.
  Mr. Darling: The hon. Gentleman will accept that there has to be a test to determine eligibility for DLA, but he should be aware that we are changing the assessment to determine not what people cannot do, but what they can do. The new personal capability assessment will be introduced from next year; it is currently being piloted to ensure that it is effective. We should always ask of anyone of working age what that individual can do, because many people of working age want to and can do something that will enable them to become more independent. In the past, the test has been too negative. We want to change that.
  Mr. Dafydd Wigley: In that spirit, is it the Secretary of State's intention to examine the rules of the independent living fund and the way in which that operates as a disincentive for people to remain in work? Glaring cases have been reported in the press and drawn to the right hon. Gentleman's attention. The matter needs to be looked into.
  Mr. Darling: We have increased the disregard in relation to the ILF. We are examining the rules for all such benefits and keeping them under review. Our objective is to make it as easy as possible for people who want to work—even to do a little bit of work—to do so.
  With regard to children, one of our reforms will make the system supporting children much more effective than it is at present, with the introduction from 2003 of the integrated child credit, which will draw together all the help that we give for children across the benefits and tax system into a single, simple credit paid to the main carer. There will thus be a single source of income to support the poorest families, which they can take with them as they move into work.
  If it is right to tackle child poverty, it must also be right to tackle another Tory legacy—pensioner poverty. Later this week I shall publish figures showing that too many pensioners have lost out in the past. We are making reforms to the pension system for the future so that we avoid the situation that we now face. If it had not been for the changes that we have introduced, almost a third of the working population would be heading towards retirement on income support from day one.

  47
  We are making long-term reforms, increasing access to pensions and reforming the state earnings-related pension so that the state second pension is more effective. However, there are still too many pensioners who are poor now. Pensioner income as a whole has increased faster than average earnings, but the problem is that too many pensioners have lost out. That is why we introduced the minimum income guarantee, which from this April will be worth £78 for a single pensioner.
  We want to reward thrift. Time and again in the House, right hon. and hon. Members have asked us to look at the capital limits that determine whether someone is entitled to the minimum income guarantee. Capital limits had not been increased since 1988. Clearly, that situation could not be allowed to continue, so from April next year the lower capital limit on savings for the minimum income guarantee will be doubled from £3,000 to £6,000, and the upper limit will rise to £12,000 before anyone loses entitlement to the minimum income guarantee.
  Mr. John Swinney: I am grateful to the Secretary of State. He said that he would announce the figures later this week showing how pensioners have lost out in the past. We will be interested to see those figures. On the assumption that that is because many pensioners are unaware of their entitlements and in some cases are afraid to take up their entitlements, how confident is the right hon. Gentleman that the minimum income guarantee will he accessed by pensioners any more than the previous devices that were put in place to protect pensioners from poverty?
  Mr. Darling: The hon. Gentleman may be interested to know that the paper that I intend to publish shows a number of reasons why there are pensioners with less income than they should have. Pensioner incomes have been rising faster on average than earnings because the generation now retiring built up occupational pensions in the 1950s, 1960s, 1970s and so on. Part of the problem is that too many people of working age did not have access to an occupational pension. That is why we are introducing stakeholder pensions, which will benefit about 5 million people.
  The second problem facing people now retiring is that because too many people have been on low incomes, or in some cases no incomes at all—people who were carers, people with disabilities, and people with broken work records and so on—SERPS did not help them. They did not earn very much, so they did not get very much. The reforms that we are making to the state second pension, which in some cases will double the amount that the low-paid get, will ensure that more and more people are retiring on a higher pension.
  Thirdly, many people who are already retired, and for whom it is therefore too late to save, are losing out.
  I return to the point about the minimum income guarantee. When the capital limits applicable to the minimum income guarantee are extended, the support received by a pensioner with savings of £6,000 could rise by £12 a week. Half a million pensioners will gain overall.
  We want to make sure that everyone who is entitled to the minimum income guarantee gets it. On Wednesday, I shall launch the biggest campaign of any Government
  48
  for a take-up of the minimum income guarantee. We are determined to ensure that all pensioners get the money to which they are entitled. They should claim it if they are entitled to it.
  Kali Mountford: I congratulate the Government on making such an effort to ensure that money goes to the poorest pensioners and not necessarily to all pensioners. Is it not the case that the new winter fuel payment, which was not available under any previous Government, helps that group the most, because it is not deducted from the minimum income guarantee?
  Mr. Darling: My hon. Friend is right. The winter fuel payment is extremely popular and provided a great deal of help not only to pensioners on low incomes but to all pensioners. It is perhaps a measure of its popularity that when we announced that we would extend it to households with members who were over 60, we received thousands of calls every week asking about it. It is very useful; it comes in a lump sum before Christmas and thus helps pensioners to pay the sometimes substantial bills that they incur at that time of year. The winter fuel payment benefits all pensioners, but perhaps it has greater value for those on low incomes.
  Mr. Gordon Prentice: Before my right hon. Friend leaves that point—
  Mr. Darling: I was not going to leave it; it is such a good point that I might stay with it a little longer. However, I shall give way to my hon. Friend.
  Mr. Prentice: It worries me that so many pensioners do not benefit from the minimum income guarantee. It would be a simple matter to include a few pages of large type in the pension book. Every pensioner has a pension book, and including those pages would encourage people to claim what was theirs.
  Mr. Darling: My hon. Friend will realise later this week that the Government have made several proposals that draw attention to the minimum income guarantee. I do not share his optimism about everyone reading their pension books from cover to cover, and many pensioners receive payments by other means than an order book. We must ensure that they, too, know about the minimum income guarantee.
  The Government are determined to do more to lift many more pensioners out of the low income bracket. That is why I shall launch a consultation document on the way in which we can best develop a new pensioners credit for the next Parliament. It will take account of and help those pensioners who have not only modest savings, but modest occupational pensions.
  For the poorest pensioners, the scope of the minimum income guarantee will be extended; the pensioners credit on which we launch a consultation document will show how we are helping pensioners who have modest occupational pensions.
  We are helping all pensioner households—some 10 million pensioners—through this year's winter fuel payment increase to £150. We should also remember that we cut VAT on fuel whereas the Tories doubled it. We have reintroduced the free eye tests that the Conservatives

  49
  ended when they were in government. From November, free television licences will be available for pensioners who are over 75. That group comprises some of the poorest pensioners.
  We are spending an additional £6.5 billion on new help for pensioners during the Parliament.
  Mr. David Ruffley: Will the right hon. Gentleman confirm that the pensioners credit will not be scored as negative income tax in future Red Books?
  Mr. Darling: Why does not the hon. Gentleman wait until he reads the consultation document on the pensioner credit? I would have thought that he would be more interested in its proposals for helping pensioners. Most pensioners will want to know about that. Perhaps the hon. Gentleman's question shows the Conservative party's disregard for the welfare of pensioners in this country.
  The Budget drives forward our reforms—
  Mr. William Ross: Will the right hon. Gentleman give way?
  Mr. Darling: I am conscious of the 10-minute rule, and that it is not fair to Back Benchers if I speak indefinitely, but I shall give way for the last time.
  Mr. Ross: I am curious about the way in which the right hon. Gentleman arrived at the figure of £6,000 savings. Has he simply applied indexation to take account of the inflation rate or earnings since 1988?
  Mr. Darling: We simply doubled the figure. Time and again, I have stood at the Dispatch Box and rightly been asked by hon. Members—even Conservative Members, who did nothing about it in their last 12 years of government—to increase capital limits. I wanted to ensure that they were increased significantly. I believed that doubling the figure would make a useful start. The system is relatively easy to understand. The figure starts at £6,000, and goes all the way up to £12,000. I think most pensioners will welcome that, and I am glad to be Secretary of State at the time of its introduction. The pensioners credit will take the policy one step further.
  As I was saying, this is a Budget that drives forward our reforms to make the welfare state fit for the 21st century. By controlling expenditure, we are able to do more for the people whom we want to help, including pensioners and families with children. We are helping people into work; we are making work pay; we are eradicating child poverty; we are making pension reforms for the future. We are a reforming Government, and this is a reforming Budget. It is building a strong economy, and we are building strong public services. This is a Budget for all our people.
  5 pm
  Mr. David Willetts: Let me deal first with the figures relating to public spending, which must be at the heart of the Budget judgment and the statement that we heard last week. It is also at the heart of new Labour's
  50
  claims on social security spending. I remind the Secretary of State that in 1996 the Prime Minister, in order to get elected, said:
  Our priorities should be to re-order public spending so that we're spending less on welfare and more on areas like education.
  That is the promise that the Government made in order to get elected, but what is the reality?
  The reality—if we use the Chancellor's preferred, although admittedly now notorious, method involving cumulative increases from the 1998–99 cash base—is as follows. Social security spending is up by £32.4 billion, way ahead of education spending, which is up by £19.7 billion, and even ahead of health spending, which is up by £26.8 billion. Far from saving money on social security in order to put more into education and health, the Government are putting more into social security than they are putting into either education or health.
  Mr. Darling: As the hon. Gentleman wants to make something of this point, may I ask him a question? Does he not accept that most of the increases to which he refers are discretionary—that we are spending more on pensions and on families with children? That is good spending; what we cut was the bad spending on high unemployment and economic waste.
  Mr. Willetts: The Secretary of State is quite right. The biggest single item in the Budget measures comprises increases in means-tested benefits—benefits which, according to any normal person's reading of the Prime Minister's reference to welfare, are exactly what he was talking about. One cannot pledge to spend less on welfare and then claim credit for putting more into means-tested benefits.
  The Government have no coherent agenda for saving money on social security. To be honest, I do not think that they even have a coherent agenda for spending money on social security. That certainly seems to be the view of two previous Social Security Ministers, both of whom have helpfully contributed their views on the Secretary of State and his strategy only today. In a book published today, the right hon. Member for Birkenhead (Mr. Field) says:
  New Labour came to power committed to transform welfare. That revolutionary intent has fractured.
  He also says:
  Welfare changes, masquerading as reform, have undermined the principle of work, mocked the idea of saving, and weighted public policy against people who tell the truth.
  That is the judgment of a former Minister responsible for welfare reform on the Secretary of State's strategy, if we can call it that.
  Mr. Frank Field: Does not the weakness of the hon. Gentleman's attack lie in the fact that his Government implemented the very same strategy?
  Mr. Willetts: I shall turn shortly to the figures relating to means-tested benefits, which the right hon. Gentleman has a long and distinguished record of criticising.

  51
  The right hon. Gentleman is well known as a critic of the Government's approach to welfare reform. What is perhaps more striking is what the former Secretary of State, the right hon. Member for Camberwell and Peckham (Ms Harman), said today. She said:
  There are too many departmental fingers in the pie, but no clear lead, no effective co-ordination and culture clashes between different departments. It can't go on like this. Government policy on the family is incoherent and ineffective.
  Two previous Ministers who do not agree on much do at least agree on what they think of the present Secretary of State and his approach to social security reform. To have alienated one predecessor may be regarded as a misfortune; to have alienated both of them is distinctly careless.
  Let us discuss pensions, to which the Secretary of State referred. The absence of a clear strategy is obvious as soon as we put together the different policy announcements and statements that he has made to the House in the past year. Less than six months ago, his reluctant hon. Friends were whipped through the Lobby to means-test disabled people with modest occupational pensions. How did he justify that policy? He did so on this ground:
  The first thing that our reforms will achieve is to do more for people who need help most.—[Official Report, 3 November 1999; Vol. 337, c. 306.]
  He argued for more means testing in other words, but up pops the Chancellor and now we have a universal heating addition to help with winter fuel costs, regardless of circumstances, and a universal free television licence for over-75s, regardless of circumstances. One moment the Government pop up to defend means tests when they hit people with modest occupational pensions; the next moment, the same people are suddenly to receive new universal benefits.
  Mr. Pond: Does the hon. Gentleman understand that one role of means tests is to pull some of those people out of the wreckage created by the Conservative party in government? Does he not accept that the figure referred to by my right hon. Friend the Secretary of State—we are giving £6.4 billion back to pensioners during this Parliament—represents a good record, given that that sum is two thirds of the amount that his party took from pensioners over 18 years?
  Mr. Willetts: I am afraid that that figure is a typical new Labour spin statistic that takes no account of, for example, the attack on occupational pensions represented by the taxation of the dividends that pension funds receive.
  I would accept a strategy that was at least consistent. If the Secretary of State regularly told the House that he believed in more means testing, we could understand that, although we might disagree. If he told the House that, above all, we need more universal benefits, we could understand that. However, we and pensioners up and down the country cannot understand how one week they all have to be means-tested and targeted, but the next they are to receive new universal benefits. Those are the same people. One moment they are being deprived of the dividend credit, which pensioners with modest savings
  52
  below the full value of the personal tax allowance used to receive, but the next he pops up and proudly announces that he is introducing a pensioners credit. To do what? To help pensioners with modest savings, he says. No wonder this country's pensioners are totally confused by the Government's approach to social security. The previous Secretary of State and the previous Minister of State are right to say that there is no coherent and consistent strategy.
  Mr. Jim Cunningham: The hon. Gentleman accuses my right hon. Friend the Secretary of State of confusing people on pensions, but would he like to tell us his policy?
  Mr. Willetts: What we have said is perfectly clear: we support the increase in the capital limits for pensions, although I have to say that this is the first time that there has ever been a special capital limit for pensioners that does not apply to other income support recipients. We believe that pensioners should become more affluent as a result of a combination of personal and occupational savings, as well as the receipt of state benefits. We criticise the Secretary of State above all because, through his changes in the tax treatment of pensions, he has attacked future pensions and the value of the savings provision of people in funded pensions.
  Mr. David Watts (St. Helens, North): Can we clarify the position? Is the hon. Gentleman saying that he would like the pensions budget to be cut? If so, will he be specific about which parts would be cut?
  Mr. Willetts: I shall not go through individual items of the Budget. Before the next general election, we shall set out a Conservative policy for pensions that will ensure that people enjoy rising living standards because of a combination of occupational pensions and savings, which the Government are attacking, and social security benefits.
  Mr. Darling: I want to question the hon. Gentleman on one point, as he has made so much of it. Can I take it from his remarks that the Conservatives would get rid of the winter fuel payment?
  Mr. Willetts: Before the next election, we shall announce the Conservative approach to pensions, which will ensure that pensioners enjoy rising living standards through a combination of funded savings and assistance from benefits.
  I shall now deal with welfare to work and the new deal for lone parents. We want families as well as pensioners to be better off. We particularly appreciate the importance of ensuring that families are better off in work than out of work. That is why the late Lord Joseph introduced family income supplement almost 30 years ago. Baroness Thatcher and my right hon. Friend the Member for Sutton Coldfield (Sir N. Fowler) introduced family credit 15 years ago to boost the incomes of low-income working families, but that is written out of the history books of new Labour.
  We believe in ensuring that people are better off in work than out of work. I therefore welcome the important, if unglamorous, measures in the Budget that the Secretary of State has introduced to improve the run-ons for housing benefit and for people on income support, especially those

  53
  with mortgages. We accept those practical measures to ensure that people move from unemployment into work and are not caught out by administrative hoops and hurdles. In fact, those proposals may be the Secretary of State's last sensible decision before he relinquishes that area of policy entirely to another Minister. We recognise that those measures make sense.
  However, our doubts about the effectiveness of the new deal are confirmed by figures in the Treasury's own document, which was published only last month. Chart 3 in that document is revealing, because it shows long-term youth unemployment falling steadily from 1994. I challenge the Secretary of State to get out a magnifying glass and identify any change in the downward trend of youth unemployment since the introduction of the new deal. Anyone surveying that chart would not be able to identify the point at which the new deal for young people came in. The fact is that the downward trend in youth unemployment was established long before the new deal was introduced, and it has continued at the same rate. The new deal has had no effect whatever.
  The Secretary of State referred to the new deal for lone parents, for which he is directly responsible. The Government are supposed to believe in evidence-based policy, but their presentation of the statistics on the new deal for lone parents is nothing short of a disgrace. The findings from their evaluation of the new deal are presented in a deeply misleading way.
  Let me take the Secretary of State through some of the tricks that he plays, and which I am afraid he played again today. It is extremely difficult to extract information from the Government. We know from parliamentary answers that of the 450,000 single parents sent invitation letters under the new deal for lone parents, only 4.5 per cent.—20,000—have gone into employment.
  However, the Secretary of State and his Ministers quote much larger figures. The Under-Secretary of State for Social Security, the hon. Member for Wallasey (Angela Eagle), gave a figure of more than 28,000, and the Minister in the other place quoted almost 41,000. How do they reach those larger figures? Single parents who apply to join the gateway and come knocking on the door of the jobcentre because they are so keen to get into work are not part of the new deal and do not receive an invitation letter. But those lone parents who turn up at a jobcentre are counted as a success for the new deal, even though they are not part of the target group for the new deal and have never received an invitation letter. They have nothing to do with the invitation letters that the Secretary of State sends out. To start with a figure of 450,000 letters and then say that 40,000 lone parents have got work as a result of the new deal is to present the statistics in a misleading way.
  That is not the end of the fiddle. Only the other day, in his press release about the evaluation of the new deal for lone parents, the Secretary of State said:
  the number of lone parents on income support was 3.3 per cent. lower than it would have been without NDLP—
  the new deal for lone parents. One might feel that it is a rather modest figure, but at least it is a step in the right direction. The evaluation compares the new deal for lone parent pilot areas with areas where there was no new deal for lone parents. When we studied the evaluation, we found that 17 per cent. of lone parents in the new deal pilot areas had moved into work, but that, in the
  54
  comparison areas, where there was no new deal, 18 per cent. had done so. In other words, more moved into work in areas where there was no new deal, so what it actually did was zero.
  The Secretary of State was strictly correct when he said that 3 per cent. fewer lone parents were on income support. Why? In areas with the new deal for lone parents, more lone parents repartnered, to use the language of his evaluation report. More ended up married or cohabiting. He may claim credit for quite a lot of things, but he cannot claim credit for ensuring that lone parents get married as a result of the new deal.
  Mr. Pond rose—
  Mr. Willetts: I hope that the hon. Gentleman will explain and justify the misleading presentation of the statistics for which the Secretary of State is responsible.
  Mr. Pond: The hon. Gentleman is sharing his confusion over the matter with the rest of the House, but perhaps the Secretary of State will explain the matter to him later.
  Once the lone parents in my constituency have waded through the statistics that the hon. Gentleman has thrown them, they will know one thing: presumably, the Conservative party would scrap the help and advice that they get through the new deal for lone parents. They will also be anxious—I am sorry to return to the matter, but I have not had an answer—about whether it would scrap the working families tax credit, too. Please can they have an answer to that?
  Mr. Willetts: We believe in helping people into work. At the next election, we will have policies that are a jolly sight more effective at doing that than the new deal for lone parents and some of the other measures that the Secretary of State has introduced. I will now turn to the working families tax credit because it is an important part of the Government's claimed agenda on welfare reform.
  The Chancellor says that this is a Budget for hard-working families. Let us look at how it affects such families. What about the 100,000 hard-working families who are brought into higher rate tax as a result of the abolition of the married couples allowance? What about the millions of families who are losing that allowance, with compensation from the children's tax credit coming in a year later? What about the 300,000 hard-working families who will find that they have been brought into a marginal tax rate of 47 per cent. as the children's tax credit is withdrawn? Those families are not rich. They will be earning perhaps £30,000. They would not regard themselves as massively rich. There are 300,000 of them. They face a 47 per cent. marginal rate as the children's tax credit is withdrawn.
  What about the 950,000 families—a figure in the Red Book; again, strangely, the Secretary of State did not refer to it—who we know from page 79 of the Red Book will face marginal deduction rates of 60 per cent. or more as a result of Budget 2000? The figure is up by 200,000 from that before the Budget of 1998. What about the 800,000

  55
  families who will lose the married couples allowance and do not receive any compensation whatever for that? What are the Government doing to help them?
  Kali Mountford rose—
  Mr. Willetts: Perhaps the hon. Lady will enlighten us.
  Kali Mountford: Perhaps the hon. Gentleman will tell the House whether it is true that family credit reached only half as many people as the working families tax credit and child credit. While he is on about the married couples allowance, is it not true that the child care tax credit is worth more than that allowance ever was?
  Mr. Willetts: To be honest—again, we had to extract the information through parliamentary answers—the answer is that the working families tax credit gets to nothing like twice the number of recipients of family credit. Ministers hope that it will, but it has not reached anything like double the number of recipients of that credit yet.
  What about a matter to which the Secretary of State did not refer at all in his Budget speech? In fact, I am not aware that he has ever referred to it in any speech on social security or welfare reform—namely, the tax credit-child credit agenda that the Chancellor launched in his November 1999 pre-Budget statement and that was further carried forward in the Budget statement last week. We have child benefit, working families tax credit, child care credit, children's tax credit, the integrated child credit and the employment tax credit, a set of measures, allowances, credits and tax credits through which, across the country, our constituents will have to wade simply to make any sense of the tax and benefit regime facing them. I do not think that 20 people in the United Kingdom will understand the tax credit regime that the Government are creating. Decent working people—whom we all want to be better off in work than out of work—will not be assisted by that set of measures, but will be totally perplexed and confused by them.
  The Chancellor is so restless. Although the working families tax credit has not yet been delivered in the pay packet—that will happen in April 2000—we have already had the reform after the reform after the change that has not yet happened. An integrated child credit will be introduced, in 2003, to replace a children's tax credit that has not yet been implemented—it will be implemented in 2001—which, in turn, reverses payment of the working families tax credit in the pay packet, which has not yet happened but happens next month. Talk about a Government jumping over themselves in their eagerness to reform the tax and benefit system!
  I remind Ministers of what they have said about the issue. In a written answer, the Paymaster General said:
  Payment of WFTC through the pay packet is central to demonstrating the rewards of work and making work pay for families on low incomes.—[Official Report, 15 March 2000; Vol. 346, c. 183W.]
  If it is so essential, why are Ministers taking all the child support elements in the working families tax credit and reverting to paying them as a benefit to the carer in 2003? If it was so essential when the Paymaster General
  56
  delivered that parliamentary answer, on 15 March 2000, why is she now taking half of the working families credit tax credit and—lo and behold—delivering it once more as a benefit to the carer?
  I think that there is a reason for the sheer perplexity and confusion of the Chancellor's policy: to disguise a humiliating U-turn. Having whipped his troops through the House on the argument that it is essential that those benefits are delivered through the pay packet, he is doing a rapid volte-face, after suddenly discovering that a significant proportion of those benefits should be paid instead as benefits to the carer.
  The Financial Times reported the Chancellor's launch of the working families tax credit as follows:
  The chancellor, who was joined at the launch by Dennis the Menace, Postman Pat and a Womble, said that linking payment to work through the pay packet meant there is "enormous scope to increase take-up".
  What the report does not say is that the Chancellor invited them back to the Treasury to write his policies, which is what they have done.
  The Chancellor will go into the next general election with a pledge to take £50 a week out of the pay packet of people on working families tax credit and pay it instead as a benefit. It is not my job to tell the Secretary of State for Social Security about the Labour party's history, but I should tell him that many people in his party may have longer memories than he has and may remember the reasons why Labour believes it lost in 1970 and 1979. One of the reasons—the right hon. Member for Birkenhead will remember this—was messing around with wallet and purse, getting into the minefield of which allowances people should receive through the pay packet and which benefits should be paid instead to the mother.
  The Chancellor, with almost cavalier disregard for either logic or the history of his own party, is entering that minefield again, and he will come to regret it. The fact is that there is no clear strategy. It may be wrong to say that there is no clear strategy, because there is one strategy.
  Dr. Stephen Ladyman: My constituents may well be as confused as the hon. Gentleman suggests about the credit system that the Government have introduced. However, the message that I am receiving is that they are consoling themselves rather well by counting their money and spending it on their children.
  Mr. Willetts: The hon. Gentleman can take the view, if he likes, that it does not matter how we help families, provided that overall family income is higher. That would be a consistent point of view. However, in that case, the argument for taking some of the money out of the working families tax credit and paying it instead as an integrated child credit completely falls. Conversely, he could take the view that it does matter whether the money is paid to the husband or the wife. If he takes the view that it matters, he cannot go into the Lobby in favour of the working families tax credit, as it will be next month, and then go through the Lobby—as he will have to—to justify a completely different system. I leave it to him to choose which position he adopts.
  Mr. Jim Cunningham: The House would have more respect for the hon. Gentleman if he explained the confusion that his Government created with the 22 tax increases.
  Mr. Willetts: On any measure of tax increases, this Government's record is outrageous.
  I should give the Government credit—if I may use that word in this context—for perhaps having a strategy. If there is an underlying strategy, it is one of means testing. They criticised the situation that they inherited, in which approximately one quarter—6.5 million—of Britain's 27 million families were on one or more means-tested benefits. They said that that figure was too high. Let us look at what the Government are doing about that.
  The working families tax credit adds another 500,000 to the total number of people receiving means-tested benefits. An estimate from the House of Commons Library says that the integrated child credit will add another 3.5 million. The Treasury suggests that the employment tax credit could reach another 300,000 to 400,000 households. We do not yet know how many people will be covered by the pensioner credit, but it extends means testing to the income range in which many pensioners are concentrated. There could well be at least another 2 million pensioners on means-tested benefits.
  Taken together, those measures will bring at least 6.5 million more families into means testing, thus doubling the amount of means testing in the system. Not a quarter but a half of all families will be means-tested by the time the Government have finished their business, yet the Chancellor told a Labour party conference:
  I want the next Labour Government to achieve what in 50 years of the welfare state has never been achieved—the end of the means test for our elderly people.
  He is not ending the means test—he is doubling it. The Government should be ashamed of what they are doing in the Budget.
  Mr. Darling: Can I take it from what the hon. Gentleman is saying that a future Conservative Government would remove all those benefits that have been extended during this Parliament?
  Mr. Willetts: In this debate, we are dissecting the Chancellor's Budget judgment. It is clear that the Government have no coherent strategy for welfare reform.
  5.27 pm
  Mr. Tom Pendry: I intend to be brief. I join others who have congratulated my right hon. Friend the Chancellor on the presentation of the Budget and on its content. It was a generous and imaginative Budget that struck a chord with the majority of people in this country. It commands support from the Institute of Directors, the Trades Union Congress, the British Medical Association and many others across the political divide. That must be good news for my right hon. Friend.
  I particularly commend the resources going to the national health service, which have been widely welcomed by hon. Members on both sides and by people throughout the national health service. Before entering the House, I had the privilege of being a trade union official in the national health service, dealing with the wages and
  58
  conditions of NHS workers. I know how low their morale has been over the years. I believe that it will be much higher as a result of the Budget, because of the expectation that the Government will carry out their promises, as I am sure that they will.
  The education service in my deprived constituency is also looking forward to the extra resources. My right hon. Friend the Chancellor has committed £4.5 billion extra for education in the coming year alone—an 8.5 per cent. real-terms increase in England. I know that that will be welcomed throughout the teaching profession and by parents across the country.
  The education service in my constituency will be anxious to acquire a good deal of the new money that is available because of the state of our schools, which have been crumbling over the years as a result of the actions of previous Conservative Governments.
  There is inevitably an "however" in any Budget, and I come to my "however". As good as the Budget is, there are one or two areas of concern, and I appeal to my right hon. Friend the Chief Secretary to the Treasury not to close the door on what I am about to say concerning what I believe to be an injustice to my local authority in Tameside, and perhaps one or two other councils, when set against a good and positive move for many other local authorities. I refer to the effect caused by the Royal Assent to the Finance Bill in terms of stamp duty reliefs. Stamp duty reliefs are being introduced for transfers and leases of land and buildings to registered social landlords.
  My local authority, believing in Government policy, set about transferring its housing stock. The transfer to a new chartered housing trust is scheduled to take place today. Royal Assent, of course, is not expected until July. Tameside council is likely to lose out on the exemption, as the proposals stand. The decision to delay stamp duty relief until Royal Assent of the Bill was made, I understand, by the Treasury alone, and the Department of the Environment, Transport and the Regions was not consulted. DETR officials may be in the process of trying to obtain an understanding from the Treasury as to why the decision was taken without consultation.
  Whether or not DETR officials are taking this matter up with the Treasury, I would like my right hon. Friend not to close his mind to my plea on behalf of my council, and to state that the Government are prepared to receive representations from me and my parliamentary colleagues from the area in order that some assistance can be given to the council.
  This is not a question of sour grapes by the council. I am pleased that my right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) is in his place, and I am sure that he would agree with me. The council is pleased that the Government have accepted the argument that stamp duty should no longer be applied to transfers of housing stock to registered social landlords. However, the way in which it has been applied does not meet Tameside's position, as it was in the vanguard of all large councils in pursuing this option. Indeed, it was the first metropolitan district council to do so.
  The council's transfer brings in from the private sector some £230 million of investment to deal with much-needed repair to houses in my constituency and those of my colleagues. I request that the Minister take this matter on board and give me and my colleagues from Tameside the opportunity to present the case to him for backdating this change which arises out of the Budget.

  59
  It would be grossly unfair if the council—which was so brave and robust in its approach to the Government's initiative—did not benefit from the changes. I recognise that such a change may well be difficult, but certainly it is technically possible. I am sure that the Minister would not wish my council to be treated unjustly. I am sure that, if possible, he would seek ways of getting around this problem.
  I conclude as I began by saying that this is a good Budget, one which will command the support of the vast majority of people in this country. Those of my constituents to whom I have spoken since the Budget consider it to be a far-sighted Budget, and the Chancellor should be congratulated on his achievement.
  5.34 pm
  Mr. Steve Webb: It is disappointing to see the Secretary of State leaving, as my party has some policies on social security from which he might like to learn.
  I want to make a brief contribution on what the Budget does for pensioners: it has to be brief, because there was so little for them. Among the measures for pensioners with savings and small occupational pensions, there was a lift in the capital limits. We pressed for that, and the Government have given a little ground. Six weeks ago, we had a debate on the uprating order for capital limits for this April. We said that £3,000 was too low, but the Government forced their troops to vote for that limit. A few weeks later, they changed their mind.
  Pensioners will have to wait not until this April, but until April 2001 for the capital limits to be raised. Assuming that we get the predicted May 2001 election, the capital limit will have stayed at £3,000 for the entire Parliament. How dare the Secretary of State criticise the Conservatives for freezing a limit that he, too, has frozen for an entire Parliament? Even with the changes, from £6,000 onwards pensioners will still be assumed to get 20 per cent. interest on their savings: £1 per week per £250 of capital. How can the Government continue to assume that crazy rate?
  It gets worse. There were supposed to be measures for pensioners with small occupational pensions. When will we get action on that? Who knows? We are to have a review, with action in the next Parliament, so an elderly pensioner who voted for Labour in 1997 may get action in 2003 or 2004. Why are Britain's pensioners having to wait so long? The Department of Social Security is once again a Department of dither and delay.
  The problem is not only with savings. Last April, we were promised a take-up campaign for the minimum income guarantee—the Government's flagship policy. The Minister of State, Department of Social Security, said:
  we will certainly make the announcement before the end of this month.—[Official Report, 7 February 2000; Vol. 344, c. 77.]
  He gave himself three weeks. The Secretary of State has just promised an announcement some time this week. How does the Department manage to lose three weeks in three weeks? How can it not tell what it will do a few weeks hence? What goes on in the Department when promises are made only to be followed by dither and delay? What do people do there all day?
  60
  There is a fundamental point about the winter fuel money. Yes, there is to be an extra £50 per household, but that is less than £1 a week, shared between a couple. The men aged from 60 to 64, who were brought in by court cases, were first told that there would be an announcement soon, and now Baroness Hollis tells them that they will not have the money soon: it will not even be a summer fuel payment, and they will have to wait for Christmas. They were entitled to it three years ago, but the Government messed up, and they may finally get their backdated payments next Christmas. Why cannot the Government get things sorted out?
  The fundamental point is that there was extra money for pensioners in the Budget, and it went on winter fuel payments: it did not go on the basic state pension. In a few weeks' time, pensioners will again get 75p. If a Government with hundreds of millions of pounds for pensioners cannot spend it on the basic state pension this year, will they ever do so?
  The Chancellor, incredibly, was reduced to announcing what he guessed next year's retail prices index-linked rise for pensions was likely to be. He knew that this year's rise was so embarrassing that he did not want to mention it, so he said that he thought there would be a rise of £2 or so next April. The best that he could promise pensioners was that, if they were lucky, they would get an inflation-based rise next April. That proves that there is no future under this Government for the basic state pension. When there is money for pensioners, it does not go on the pension. What is wrong with the basic state pension?
  5.38 pm
  Mr. Peter Kilfoyle: I congratulate the Chancellor on a well-presented Budget. There is little doubt that it has been received well by commentators, the public and, not least, the Opposition. It sets out a clear emphasis on the renewal of public services and will be welcomed by those who are heavily reliant on those services. The extra resources for the national health service, in particular, will be welcomed by ordinary people throughout the country, although in my region, the north-west, we will look carefully at how the resources are allocated, given the poverty in the service in the region relative to the south-east of England—at least, in many specialties.
  The Chancellor will recognise that, within regions, social class remains a key determinant of good health. He will recall the comments of Lord Patel, who said:
  Infant mortality rate for social class V births was 70 per cent higher than social class I births.
  Lord Patel also read part of the report of a recent inquiry. He said:
  the research interviewers encountered examples of poverty and deprivation of a degree which they could hardly believe was possible in late 20th-century Britain.—[Official Report, House of Lords, 16 February 2000; Vol. 609, c. 1282-3.]
  The distortions of class appear in health provision as much as in the wider economy, and influence access to many services. Thus, the infusion of resources into the NHS, together with the Government's pledge to eradicate child poverty and their commitment to education, has the potential to transform the lives of a whole new generation. That must be applauded.
  However, what of an existing generation, many of whose votes elected the Attlee Government, and whose work and taxes were the key to the founding and financing

  61
  of the welfare state? Many pensioners hold the view that the failure to link average earnings and pensions has cost them dearly. More importantly, they believe that winter fuel payments and concessionary television licences are a diversion, welcome though they are. What pensioners want is an increase, week on week, in the basic pension.
  That is not just a matter of economics: it is a question too of pensioners' dignity. After all, a lifetime of paying tax and national insurance contributions was their part of a bargain with the state to maintain the welfare state. They believe that it is hardly their fault if the state is having difficulty meeting its side of the bargain. They look to a Labour Government to right that wrong, with specific commitments on the basic pension, rather than consultations and aspirations.
  I hope that this does not sound churlish, as I believe that I am merely reflecting the views of the pensioners who speak and write to me. I know that the Government have done many good things, for which they seem, at times, to get little credit. The Government have said that they will not pass by on the other side of the road and, generally, they do not. However, I do not recall that the good samaritan extended his hand to the man who fell among thieves only to remonstrate with him that he was the author of his own demise.
  I can reel off the official statistics relating to my constituency that show how many more people are in some sort of work or another, the level of investment in schools, and many other things. However, my constituents often feel that they are being chastised for being unemployed. The reality for many of them—we must look at the matter from their perspective—is that the training on offer is often for non-existent jobs.
  That should be of no surprise, given the generational, long-term unemployment that exists in many parts of the country, but a claimant count rather than an International Labour Organisation figure does not make the gap between reality and wishful thinking magically disappear. Perhaps if the Government felt able to be less stridently moralising towards so many of our fellow citizens, they would be surprised at the immense good will felt in the country towards their positive policies.
  For example, my right hon. Friend the Chancellor promised to crack down on fraud. Virtually everyone agrees that it is right to do so, but many fear that there is a Calvinist mindset in Government that associates poverty and deprivation with blaming the victim. We know that areas with no jobs exist, that many people are genuinely disabled, and that some people are too ill to work. To know the truth, all that we need to do is listen.
  The sense of injustice might be minimised if we could be harsher with those at the other end of the socio-economic scale who defraud the country and who use lawyers and accountants to cover their tracks. A few determined prosecutions with deterrent sentences for such people might lessen the cynicism felt by easier targets, who increasingly believe that no one speaks for them.
  When I resigned as a Minister, I did so because I believed that what are known as heartland issues would gain increased salience, as would matters relating to the regions of England. In many people's eyes, those matters are interchangeable, but I have never claimed that. There is merit in the Prime Minister's argument that there are wide economic disparities. From a political perspective, there are heartlands everywhere.
  62
  The present Government have taken a radical view of their role, and they rightly pride themselves on the devolution of powers to Scotland, Wales and—next—to London. The rest of us ponder on what that means for England outside the metropolis. We wonder when we will be afforded the flexibility that a degree of regional autonomy would bring. That would require a change in the colonial Raj mentality epitomised by the Government offices implementing decisions in the regions. It will certainly require a new financial settlement with the English regions.
  The current view from the provinces is that key decisions are taken by a very small number of people sitting in Whitehall at the apex of a highly centralised Government. They operate through a civil service machine that mirrors that rigid hierarchy, which stamps its will on the regions, and whose practice is based on what many believe are highly discriminatory financial arrangements.
  Why, I am asked, should Scotland and Wales be advantaged by the Barnett formula? Why does the area cost adjustment favour south-east England? How do the changes in derelict land grants and Housing Corporation allocations, taking money to the over-developed south-east, help to alleviate the problems of the north? I cannot answer such questions. That is why I looked to the Budget for some hope of economic relief for English regions that are sometimes hard-pressed, especially in their manufacturing base.
  I was disappointed. The Chancellor's reference to regional policy was remarkably brief. Given the agenda he outlined in the Budget, I was surprised that there was no sign of a new deal for the regions of England. Historically, such regions have driven the national economy, but, over the past 20 years, far too many of them have suffered from downsizing or relocation. They still have an economic life, but it is subject to the vagaries and prejudices of decisions taken in London.
  Is not it time that we looked again at the different economies of the United Kingdom? After all, wage and house price inflation are more symptomatic of conditions in the south-east than elsewhere. The costs are borne elsewhere in the country through the loss of jobs—"A price worth paying", as the seemingly unaccountable Governor of the Bank of England once said.
  Instead of a recognisable economic policy in the regions, we have venture capital, with a target of £120 million for a venture capital fund for the north-west. Having announced that modest target, the Chancellor referred to a regional fund for
  the formation of local clusters in high-tech industries.—[Official Report, 21 March 2000; Vol. 346, c. 863.]
  Within an hour of his speech, MPs representing north-west constituencies were told that the Government would not yield on the transfer of the Diamond project—a high-tech synchrotron investment of £500 million—to Oxford. If ever there was a mixed message to a region, the north-west received one on Budget day.
  Furthermore, an increasing number of regions are looking to European structural funds to create investment opportunities. Such funding depends on a three-way partnership between national Government, the European Union and the private sector. It is designed to focus studied intervention on the poorest parts of Europe. However, ultimately, it depends on the British

  63
  Government making a commitment on match funding to draw down money from the private sector and from Europe. I waited in vain for some reference in the Budget to that vital element of regional regeneration—it did not come.
  Perhaps there will be announcements before, and at the next stage of, the comprehensive spending review. I certainly hope so. The Prime Minister referred to the differences between north and south, and to the differences within those regions. He should have looked at the work of Anne Power, the deputy director of the Centre for Analysis of Social Exclusion. She found that there is a poverty cluster of 40,000 in Tower Hamlets; in Hackney, the figure is 25,000. Those figures are terrible and they need to be addressed. However, in north Liverpool, the number is no fewer than 250,000; in Manchester, there are 170,000 souls in the poverty cluster. The sheer scale of the problem in regions such as mine gives urgency to the case. The problems cannot and will not be sorted out from Whitehall alone.
  That is why I ask the Chancellor—monarch of all he surveys after his Budget—urgently to reconsider regional economic policy and European structural funds. I remind him that political praise is extremely ephemeral—sic transit gloria mundi. I know that these are difficult matters for him to cope with; they will take up much time and effort. However, he has the wherewithal to deal with them. The rewards for success will be great—politically and economically. Failure cannot be contemplated.
  5.48 pm
  Sir Peter Tapsell: I am sure that the hon. Member for Liverpool, Walton (Mr. Kilfoyle) will understand that, because of the 10-minute limit on Back-Bench speeches, I cannot debate with him the many interesting points that he made. However, I agree with much of what he said. The points that he made on regional matters are true and valid. There are geographical difficulties of course. Middle England is found only in the south-east, but the core vote—if by that is meant the people who are suffering—can be found in large numbers in my constituency of farmers in north-east Lincolnshire.
  The hon. Gentleman ended his speech with a famous Latin quotation. As the Chancellor drives along in his Treasury chariot, behind him should be the little dwarf who used to say to triumphalists, "remember that you are mortal."
  I hope that the House will forgive me if I try to talk about the Budget as a whole—obviously it is impossible to do so adequately in the few minutes available for my speech. The Government managers do their best to dumb down the Budget debate by having the Prime Minister make a great statement on health on the first day of the debates, and then sending him back to make another not-so-great statement about his visit to Lisbon on the day when we wind up the debates.
  I have discussed the Budget with a few friends who I have known over many years and who have taken an interest in financial and accountancy matters. They tell me that in recent years they find Budgets more and more difficult to understand. It is only when they hear them discussed on television after the Budget speech that they
  64
  can begin to make head or tail of them. I have managed to scrape a living in the City for 40 years, paying 83 per cent. in tax on my meagre earnings under a Labour Government, but I share my friends' problem.
  I have heard rumours that the Chancellor has got rid of the portrait in his room of Mr. Gladstone and has replaced it with a drawing of Little Jack Horner. I can well understand why he has done that. The right hon. Gentleman is not interested in making money fructify in the pockets of the people. He likes to sit in the corner and pull out occasional plums from what will prove to be an enormous Finance Bill.
  It is difficult even for the so-called experts to understand the present Chancellor's Budgets because he has withdrawn many of the old familiar guidelines and building blocks of the past. He no longer includes key elements of information. However, distant and always golden horizons are confidently scanned.
  For instance, what is the Chancellor's overall Budget judgment? That used to be the central point of Budgets. Previous Chancellors talked about "a touch on the tiller", "Steady as you go" and "too much port and overripe pheasant", for example. We do not have an overall Budget judgment from the Chancellor. He has not told us whether this is an expansionary, a neutral or a restraining Budget. Is it a redistributive Budget? If so, from whom to whom?
  The Chancellor concentrates almost entirely on indirect taxation, which is generally regarded as being regressive. That is to say, it hurts the poor. In relying on indirect taxation, he heaps as much of it as he can on business. That is a perfectly respectable socialist thing to do. Sir Stafford Cripps, when he did the same sort of thing, was honest about it. If the Chancellor is to put big new taxes on business—the most dramatic and the most often mentioned was the £5 billion raid on pension funds, which has caused many of my constituents to complain to me that they will have either lower pensions or will have to pay higher premiums than they previously thought—at least he should explain that it is happening, and why. It may be economically justifiable, but it should be explained.
  I was a stern critic of the excessive monetarism, as I saw it, of Margaret Thatcher from 1979 to 1981. I even called for the Conservative Chancellor's resignation on the day of the 1981 Budget. But at least I have always recognised, as a Keynesian, that the money supply is an important component of economic policy. As far as I know—I have not re-read the Chancellor's speech because it was bad enough having to listen to it in the first place—the right hon. Gentleman never mentioned money supply or the trend of it. That is another key factor that we have not heard about.
  The state of the reserves was not mentioned. There are many who think that with our enormous trading pattern our present reserves are inadequate and should be built up. Selling gold and using 40 per cent. of the proceeds to buy euros, which have fallen against the value of gold by 18 per cent. since the sale started, does not seem to be a very good way of building up reserves.
  Savings used to be a very important part of Budget speeches. There was always a special section in previous Budgets in which great tributes were paid to Lord Mackintosh and the savings movement and in which reference was made to the enormous importance of

  65
  personal savings. There was no reference to savings in the Budget speech. In fact, savings are falling catastrophically.
  There was no mention of the balance of trade. Who would have guessed that in the latest quarter the trade deficit was the worst for 25 years? It is extraordinary that the Chancellor thinks that he can hurry through a Budget speech while omitting fundamentals. The right hon. Gentleman is fond of saying that we will get away from boom and bust, but the truth is that we are in the middle of a boom and that if we are not careful we shall go into another bust situation.
  At the moment, when fiscal tightening is required, the Chancellor has loosened the reins. The Budget, as the chief economist of Saloman's has said, will increase public expenditure by 5 per cent., which will be the biggest stimulus for many years. What will the effect of that be on interest rates and on the strength of sterling, which is extremely relevant to what the hon. Member for Walton was saying? Farmers in my constituency, people in the north-west and exporters generally are suffering because of the high level of sterling. It is amazing that the Budget does not address the central threat to the Government's entire economic and European strategy, which is the over-priced pound.
  To boast about national health service expenditure three years ahead is complete pie in the sky. I invite all right hon. and hon. Members to re-read Churchill's Budget speech of 1929, and then read Philip Snowden's Budget speech of 1932. That was a three-year gap. The country was at the peak of a boom in 1929, and only three years later there was the most extreme depression, when pensions had to be cut. The Royal Navy even mutinied because of cuts in pay. That is what can happen in three years. I am not saying that it will happen again, but any Chancellor who confidently says that he will have huge sums to spend three years ahead is talking nonsense.
  Finally, I direct my remarks to my right hon. Friend the Member for Kensington and Chelsea (Mr. Portillo), the shadow Chancellor, who with his first-class honours degree in modern history, albeit from Cambridge, will understand them. Apropos the volte face on our attitude to an independent central bank and the Monetary Policy Committee, I do not have time to develop my theme as I would like. However, I remind my right hon. Friend that when Pope Pius IX, having lost his temporal constituency, hit back by announcing the dogma of papal infallibility in 1870, the great Roman Catholic historian, Lord Acton, said:
  I have no intention of changing my religion because the Pope has changed his.
  That is exactly my attitude on an independent central bank.
  5.58 pm
  Mr. Robert Sheldon: First, I join my hon. Friend the Member for Stalybridge and Hyde (Mr. Pendry) in hoping that sympathetic consideration will be given to the transfer of housing stock in Tameside.
  We see in the Budget a large and unanticipated increase in revenue. For the year 2000–01, the surplus on the current budget was estimated at £4 billion at the time of the previous Budget. It is now estimated at £14 billion. It is likely that there is still more to come because omitted
  66
  from the Red Book is the result of the auctioning of telephone licences, which will add £7 billion to £10 billion to the revenue. If my right hon. Friend the Chancellor had accepted that much of that money could be spent, he could have increased spending even more in his prudent and cautious proposals.
  My right hon. Friend wants to see not only the spending of money but the effect that it will have on actual outcomes. One of the consequences of that is performance measures. That is something to which we must have regard in the national health service, which will take so much of the extra spending. The unusual feature of the Budget is that levels of tax and tax changes are not the only important announcements. The centrepiece was the large additional sums that will be going into the NHS.
  The question that we have to ask ourselves was why that and other expenditure measures did not wait for the spending review due to take place this summer. That announcement, and my right hon. Friend the Prime Minister's unprecedented statement the following day, made the impact that was clearly intended. Due to my right hon. Friend the Chancellor's management of the economy, Budget priorities have been changed to allow for essential expenditure, particularly in the national health service.
  The reason for that spending announcement was that, at the heart of this operation of the new financing of the NHS, is the need to ensure that money is spent properly. Secretary of State after Secretary of State has tried to get decisions implemented. There are two extreme scenarios—we could leave it to the health authorities and use cajolery, or we could try get some form of direct control. Given the size and complexity of the NHS, direct control is not possible. Another possibility is a form of halfway house, which in the past has never been properly effective. My right hon. Friend the Prime Minister is now throwing his authority behind the Department of Health, and I believe that that is worth doing.
  The Public Accounts Committee has made regular criticisms, and chief executive after chief executive has appeared before us. Only a few years ago, the chief executive of the NHS sent a question to the 191 health authorities, and, after six months, only 133 replied. Almost 60 did not even bother to reply to the chief executive. What sort of NHS is that?
  Clearly, the knowledge that the full power of the state is to be put behind the way in which the large increases in expenditure are spent must have some effect. It will not be easy. How that will work out in practice is yet to be determined, but I am sure that, if the money had just been forthcoming without the change in the administration of it, we would have seen, as we have so often seen, it disappearing into expenditures that were only distantly related to the ends that the Government quite rightly seek.
  In the debate last Wednesday, the right hon. and learned Member for Rushcliffe (Mr. Clarke) said:
  I think that our monetary authorities are too hawkish. We need a better and a more genuinely independent Monetary Policy Committee, with a membership drawn from a wider range of people.—[Official Report, 22 March 2000; Vol. 346, c. 1023]
  The right hon. Gentleman has got something; the MPC needs someone from outside. It does not just fix the interest rates, it determines the parameters of the Chancellor of the Exchequer's room for manoeuvre. All his decisions on fixing tax rates, coming to his Budget

  67
  judgment and deciding expenditures are constricted by his anticipation of the consequent actions of the MPC and they way that they will impinge on his decisions. The Chancellor of the Exchequer has a joint decision on the economy and the financing of our country with, in important particulars, the MPC having the last word.
  Interest rates are influenced particularly by inflation—especially in house prices—in the south and not by industry in the north. Membership of the MPC needs to be more open and its arguments must be more publicly accountable. Who puts the case for manufacturing industry is another question that we must consider.
  I also agree with my right hon. Friend the Member for North Durham (Mr. Radice). The rate of exchange with the euro—not that with the dollar, because it has not changed much—is the key. I hope that the euro rises, and I had dearly hoped that one of the early actions after the general election in 1997 would have been to decide to enter the euro at the same date as other member countries. When that did not happen, I urged that we should announce our definite intention to join even though, for economic reasons, the date for that might not be given. That could have affected the euro-pound exchange rate.
  We seem not to have taken fully into account the fact that, over the past three years, the pound has risen from 2.50 to 3.15 against the deutschmark—an increase of 26 per cent. One cannot run many businesses with such a relationship, and the increase has taken place over a relatively short time. Few manufacturers are able to overcome such a hurdle—whether in maintaining their exports or in competing with imports. We often forget that manufacturers have the double problem of exporting and competing with much cheaper imports. That is why I consider that the MPC, with its powerful effect on the entire UK economy, needs members with a wider understanding than it has at present. I argue that for reasons of economic judgment and on the much lower level that the ability to justify decisions depends on a much wider outlook.
  The expectation in the November pre-Budget report was that the balance of payments deficit in 2000 would be £10.25 million. Only a few months later, that figure is now £20.5 billion. Why has the balance of payments deteriorated so rapidly? We need answers on that. Manufacturing industry is not the size that it was, but it is still important.
  My right hon. Friend the Chancellor has quite rightly referred to prudence with a purpose. I agree with him wholeheartedly on that, because 1997 represented the best possibility for the Labour party to show itself as the party of responsibility. Next year, money GDP will be more than £1 trillion. If there were any uncertainty about the firm control of the economy, the trillion-pound economy could have been represented as an inflationary surge. It has been the character of my right hon. Friend to stand ready to refute such an interpretation.
  However, 1997 was the first time ever that the incoming Labour Government had a working majority and the absence of an economic crisis. That meant two things. First, we did not have to take desperate measures to deal with a crisis, and secondly, we could take the long view because of our parliamentary majority. That, indeed, was the basis of prudence, but, as my right hon. Friend
  68
  reminds us, prudence must have a purpose. Caution is sensible only if it leads to using the fruits of that caution in due course.
  In due course, that caution has yielded us low inflation, lower unemployment and a stable-growth economy. That is a great achievement. If we had had a lower pound, the management of the economy would have represented the greatest economic success this century. We have to hope that such a level of success awaits us yet.
  In the Budget, my right hon. Friend has made use of his new-found freedom of action. He has had the space to defer the fruits of a Labour Government until they have been earned. He has done what all past Labour Chancellors have wished to do. In that, he has helped to bring about a reconciliation between traditional Labour and new Labour. To his many achievements, this valuable one must be added.
  6.7 pm
  Mr. John Townend: As could be expected from this Chancellor, we have had a Budget with a high degree of spin. He naturally claimed how well the economy was doing and, on that, he has been supported by the right hon. Member for Ashton-under-Lyne (Mr. Sheldon). However, as my hon. Friend the Member for Havant (Mr. Willetts) pointed out, the Chancellor did not highlight the balance of payments deficit, which is forecast to rise to no less than £28.25 billion, that growth in business investment is set to fall from 7.75 to 2.5 per cent., that growth in productivity is slowing, that manufacturing industry is struggling because of high interest rates and the high pound, that savings are falling and that the tax burden is rising.
  The Prime Minister and the Chancellor have told us on numerous occasions that this is a pro-business Government. In the short time that I have available, I want to deal with that myth and to identify the areas in the Budget that are bad for business. The benefits for business, once one calculates what they are worth, do not add up to a row of beans.
  First, I wish to refer to the increased tax on DERV. Despite this country having the highest taxes on DERV in the European Union and pump prices being forced up by rising oil prices, the Chancellor has increased the tax by an extra 1.89p per litre. Therefore, the differential between what French hauliers pay in Calais and British hauliers pay here has become even greater. The burden of transport costs hits all industries, but it particularly hits struggling manufacturers and it forces up costs. The small reduction in vehicle excise duty still leaves a massive gap between British and French rates—Britain's rates are no fewer than eight times greater than those in France. Is it any wonder that the British haulage industry is in the doldrums?
  Despite the fact that, before the Budget, petrol tax was the highest in Europe, the Government have increased the duty, which will affect all businesses, large and small. It will particularly affect workers who live in country areas such as my constituency of East Yorkshire and who have no alternative but to use a car to get to work and to take their children to school. Is it not incredible that 80 per cent. of every pound that one pays the garage owner goes to the Government?
  The increase in taxation on company cars is also bad for business, and will hit representatives who do a high mileage. I find it incredible that the people who will

  69
  benefit from these changes are those who do a low mileage and who have a company car as a perk. If the Government think that representatives can do an efficient job using public transport, that confirms how ignorant are the vast majority of Labour Members about running a business.
  The Budget considerably increased the burden of taxation on business, and mainly did so stealthily. The climate change levy is in a mess, and it would not have been necessary to impose any burden on business at all if the Government had not prevented the building of new gas-fired power stations, which would have enabled us easily to meet the worldwide regulations on emissions.
  New tax rules will cost multinational companies billions of pounds and could well drive some company head offices overseas. The Government do not seem to know how much that will cost industry. Their estimate and that of PricewaterhouseCoopers are very different. We learn that insurance companies will have to pay billions more in tax due to changing rules for that industry. That follows the Revenue losing a case before the tax commissioners. That fact has had to be dug out of the papers; it was not mentioned in the House.
  The oil industry is annoyed that it will have to pay an extra penny a litre in tax because last year's tax was based not on inflation but on estimated inflation. The change in stamp duty will probably affect businesses more than it will affect householders because most commercial and industrial property sales are for properties costing over £500,000 and will now incur 4 per cent. tax. A small point, but one that demonstrates the Government's attitude to business, is that they have increased airport tax for business travellers, specifically to hit business men.
  The Government have talked a lot about the additional tax allowance to help the computer industry, but that is more than offset by the stealth tax of IR35, which is already causing a brain drain and will undermine the e-commerce enterprise culture.
  One would have thought that, with the decline in manufacturing industry and the rise in income from service industries, the Government would do everything possible to keep the City competitive. Yet stamp duty on share transfers is higher here than in many of our competitor countries. I know that many people were hoping for a reduction, but they did not get one.
  I have been in the brewing industry all my life, and I have declared that interest. Despite the enormous amount of smuggling, instead of beginning to reduce the differential between duty rates in the UK and France, the Government have increased beer duty again by a penny a pint. That will only make smuggling more profitable.
  The Chancellor did not put up the duties on spirits, but he did not reduce the differential. He said in his Budget speech that duty on wine will rise only by inflation—by 4p a bottle. I checked at the beginning of his speech, and he said that
  inflation is 2.2 per cent.—[Official Report, 21 March 2000; Vol. 346, c. 858.]
  I must assume that he is not very good at mathematics or that he is telling porkies because a rise of 4p a bottle is an increase of 3.4 per cent., which is 50 per cent. more than inflation. However, it gets worse because when one studies the figures one realises that the increase per bottle is not 4p but 4.4p.
  70
  The Chancellor has done nothing to reduce the differential between wine and sparkling wine, and there is absolutely no justification for that differential. Sparkling wine is smuggled more than ordinary wine. He will never deal with smuggling unless he reduces the duty differential by about 50 per cent., as Denmark had to do.
  A 25p increase in the price of cigarettes will also be a tremendous boost to the profits of smugglers, who now make more money from smuggling tobacco than from smuggling drugs, and will encourage under-age smoking. I find that policy incredible because it hits poor people, who spend more on cigarettes and who cannot go over to the continent in a large car every three or four months and fill up with supplies of cigarettes at a knockdown price.
  Agriculture is on its knees, and the Government have done nothing for the industry in the Budget. They have only imposed more burdens in the form of fuel duties, the climate change levy and stamp duty on the sale of farms. What help does the Budget give to the fishing industry? None at all. What help is there for small businesses? Very little. What progress has been made in reducing the burden of regulations? Virtually none.
  Every month, more and more regulations are imposed on small businesses by the EU and the Government. They include the working time directive, packaging waste regulations, the social chapter, trade union rights, maternity rights and paternity rights, all of which are causing chaos for small businesses. Now we hear that the Government are considering allowing people who have had a baby to tell their employer that they will return not to their full-time job but to a part-time job. How will a small firm with one accountant get two people to do one job? That is a nonsense, as is paternity pay. If the Government introduce paternity pay, how can a small business let one of its key people go for 13 weeks? That is ridiculous.
  One other aspect of the Budget that I find reprehensible is that it confirms that the Government do not believe in supporting the institution of marriage. They are more concerned with the rights of unmarried mothers and homosexuals. That is confirmed by the abolition of the married person's tax allowance and the Government's intention to repeal section 28 of the Local Government Act 1988. Other attacks on the taxpayer which particularly affect the family are the repeal of mortgage tax relief and the increase in stamp duty.
  6.18 pm
  Mr. Tom Clarke: In my constituency, as in most, jobs are of the utmost importance. In the short time available, I shall concentrate on the Budget's impact on the objective of full employment, the need for effective training and the importance of small businesses.
  I was delighted to hear the Chancellor use the term "full employment", which was endorsed again by the Prime Minister today. Full employment, designed as opportunity for all, is an objective that I very much welcome. I want to look at what has been happening to my constituency since the new Government were elected. The picture is impressive, although I do not urge complacency; my constituents would not allow me to do so, and they would be right.
  Since the election, unemployment in Coatbridge and Chryston has fallen by 21 per cent. to 6.1 per cent., which is the lowest level that anybody of my generation can

  71
  remember. That is still too high, and I continue to make the plea for a reduction. Long-term unemployment has fallen by 59 per cent. Youth unemployment, which I thought so important that I made it the main subject of my maiden speech in 1982, is down by 65 per cent.
  As I listen to criticisms of the Government, I am reminded of the fall of the Callaghan Government, when, throughout the country, there were huge posters saying "Labour isn't working". I do not blame the shadow Chancellor for that influential poster, because he was probably advertising Ribena at the time, but we are entitled to compare today's figures for my constituency with the figures that the Government inherited. Under the Conservatives, our oil revenues were squandered on propping up 3 million unemployed people. The huge dissatisfaction that accompanied such levels of unemployment tore our society apart. I am glad that we are improving our employment figures. Judging by the comments of my right hon. Friend the Prime Minister today, we are inspiring other European countries to do the same.
  Training is of vital importance. I accept that the definition of a job has changed. Some people argue that the excellent figures we are now seeing hide certain facts, and I concede that not everyone who leaves the dole queue goes into work. However, that argument misses the point. Many people have entered training and education schemes, but such training is essential in the globalised society in which Great Britain is attempting to function. Foreign investors tell us repeatedly that our skills base is utterly inadequate. The most recent "Regional Trends" survey tells us about our skills stocks, and two statistics stand out: only 13 per cent. of the population in any given region of the UK have a university degree, and 18 per cent. have no formal qualifications whatever. Many firms do not take training seriously enough. I cannot believe that people in constituencies such as mine, which once boasted huge skills in engineering, shipbuilding and metallurgy, are incapable of responding to the challenge of training. We must recognise that the lack of commitment displayed by some employers—not all—represents the tightest possible bottleneck around employment growth in Britain.
  Opposition Members have spoken of the crucial importance of small businesses and the vital role that they play in job creation. As my right hon. Friend the Chancellor rightly pointed out, the burden of future job creation will fall on small businesses, which now account for nearly 40 per cent. of national turnover, compared with less than 20 per cent. less than a generation ago. That does not sound like complacency. In the past two years, a further 100,000 small businesses have registered in the United Kingdom, which is a tribute both to the general culture of entrepreneurship fostered by the Government and to the Microsoft revolution, which has given companies the capability easily to use modern software to enter markets at minimal cost. The boost given to internet firms by my right hon. Friend, whom history will probably acknowledge as the first e-Chancellor, is extremely welcome in a modern, competitive society.
  However, we cannot be complacent. Although we are increasing the number of technology-based dot.com companies, we still have too many "Dot Cotton" companies: well-meaning old things that are poorly
  72
  equipped to adjust to the challenges of cyberspace and globalisation. Sometimes, I think that too many people who run businesses think that Intel Pentium is a Romanian footballer. We have to change that. It is vital to future employment that we do not shirk the challenges of globalisation, but that we shape and mould the future for the benefit of all of our people.
  My great concern, which is reflected in the main thrust of the Budget, is that an economy in which a significant proportion of the population is unable to fulfil its potential is far poorer and far less productive than others. Real hope lies in providing real opportunities through training schemes such as the new deal to all who want—indeed, need—to work. In that spirit, I believe that the Budget truly helps those who have been left out of too many Budgets for far too long, especially families who seek, but who have been unable to find, work and the children of the poorest families—not least in my constituency—who represent the future. I have examined the Budget and I welcome this comprehensive debate. One day, the Opposition might apologise for that long-gone poster, because, after a little less than three years in government, the evidence suggests that Labour is working.
  6.27 pm
  Mr. David Davis: I would normally have spent a little time dealing with the welcome parts of the Budget, such as the Cruickshank bank reforms; however, given the time constraints, I shall have to focus on the rest of it instead.
  I hope to refer to several of the comments raised by the right hon. Member for Coatbridge and Chryston (Mr. Clarke), especially his interesting points about small businesses. I welcome back the right hon. Member for Ashton-under-Lyne (Mr. Sheldon). I believe that this is his first outing since he has been away, and it is good to see him back on form, punching as hard as ever. He will forgive me if I turn his illustration of a glass half full into one of a glass half empty.
  The Budget is dominated by short-termism and flawed foundations. The Chancellor likes to charge business with being short-termist, yet he, too, is guilty of that charge. It is difficult to think how else to describe a Budget which, on the basis of rosy economic forecasts, projects a £25 billion adverse change in the fiscal balance on the presumption that the business cycle will not really bite. If it does bite, that will add about £50 billion to that adverse figure. That adds up to a burden with which the country cannot cope, and that will lead to cuts such as those that we have seen under previous Labour Governments.
  Laying aside the aggregate fiscal position—because others have already spoken about it—I turn to the overall strategy set out in this and the last three Labour Budgets. Between 1945 and 1979, the Budgets of both Labour and Conservative Governments were highly interventionist. They piled on to the British economy large quantities of regulations, great complexity, and a very high tax burden. The initial effect of that meddling was relatively benign—it took time to bite; but the process continued through the 1940s, 1950s and 1960s and its effects grew until, in the 1970s, it became apparent that they were disastrous. Politicians do such things because the early effects of regulation and of tax and spend are apparently positive. They have explicit benefits, for which politicians get the credit. The simple fact is, however, that the significant

  73
  harm that is done by over-regulation and over-taxation is both diffuse and delayed. That is what led to the slow-motion crippling of the British economy through the pre-Thatcher years.
  I am afraid that this Budget and its two predecessors fall into a similar trap. The Budget contains a wide range of over-burdensome, over-meddlesome and wholly ineffective measures, as several hon. Members have mentioned.
  The right hon. Member for Coatbridge and Chryston spoke about the growth in e-commerce and in small businesses. The measures on e-commerce in the Budget are irrelevant to most e-commerce entrepreneurs. The idea that the dot.com companies will somehow change their tactics because of the minor and rather complex proposals in the Budget is laughable.
  Furthermore, those measures will do nothing to reverse the effect of the disastrous IR35 measures that are already in place. They will merely add to the complexity of the system and add to the £10 billion of extra regulation that has been piled on British business in the past few years.
  The problem of complexity—often to no end—is the real harm of the stealth tax tactic, in which it is used as a way to conceal taxes from the public. Such complexity is harmful in itself. It creates jobs for tax accountants, but destroys jobs for everyone else.
  The commitment to high regulation, high complexity and high spend and tax may create short-term political advantage—no doubt that is the intent of the Budget—but it does long-term economic harm. It is exacerbated by other regulations from Europe—perhaps not as many as some of my hon. Friends may assert, but certainly plenty.
  Listening to the Prime Minister's comments on the Lisbon summit today, one had to conclude—particularly given what is happening in France, where the French Prime Minister is signing up to the documents about which we heard today—that if the Government believed what they were told there, they do not understand how free enterprise works,
  A more accurate view of the regulatory burden from Europe would perhaps be achieved if hon. Members read the comments and the article by Otmar Issing, the German nominee on the board of the European central bank, who stated in the German papers this week that the entire anti-regulation strategy of the European Union was flawed and would fail. It would serve to increase regulation, rather than reducing it.
  As well as the risks of short-termism, the Budget contains other fundamental flaws in its underpinning assumptions. The Chancellor advertised the Budget in advance as a crackdown on the black economy. A survey last week showed that only about one in 10 people believed that it would work, and they are probably right.
  So far, all the initiatives, of which there have been many, and all the announcements, of which there have been even more, have led to no real change. Fraud levels have not gone down by a penny. The Government are not alone in that, but if they put the crackdown on the black economy at the centre of the Budget strategy, one would hope for better than that.
  The introduction of the working families tax credit is likely to make matters worse, because its complexity will make fraud easier. Its predecessor in the United States, the EITB—the earned income tax benefit—is renowned for being subject to both fraud and administrative failure.
  74
  Many of us on both sides of the House want poverty reduced, but the Government have chosen a complex and probably ineffective way of doing that. Moreover, when the Department of Social Security was doing the preliminary work on the working families tax credit, it cancelled a programme that would have allowed that benefit to be better designed to avoid fraud. We all support the aim, but the mechanism will prove to be flawed.
  There are similar weaknesses in other mechanisms. The strategic defence review and the funding in the Budget for the Ministry of Defence is dependent on the so-called smart procurement process. Having observed smart procurement, I have not yet seen an improvement in purchase price or purchase quality achieved by the Ministry of Defence. This weekend's papers mentioned selling off Aldershot to fund the SDR—an extraordinary proposal demonstrating the failure of another underpinning assumption in the Budget.
  That brings me briefly to the most high-profile aspect of the Budget—the spending proposals for the national health service. The increases there are made necessary by the failure of the Government to meet their own promises—a failure arising from weaknesses of policy, organisation and management, as well as funding, but exacerbated by the cash starvation over the past two years.
  The Prime Minister recognised last week that the NHS could not use the extra £2 billion without sharp changes in its effectiveness. We all agree with that. Let us look at the size of the problem. Suppose that the £2 billion was divided among three possible uses. First, there are those areas that simply need extra money and can be dealt with quickly. The most obvious is the marginal cost of matters such as drugs. We could dramatically improve the drugs policy to make drugs to treat cancer, multiple sclerosis and other conditions available to all patients throughout Britain, so that we could have a truly national health service, rather than the fractured one described by the right hon. Member for Ashton-under-Lyne. It would cost hundreds of millions to put that right, not billions.
  Secondly, the money could be used to increase the utilisation of existing capacity. Again, that would cost hundreds of millions of pounds, not billions. That would leave significantly more than £1 billion to spend, with only one possible aim: to increase the capacity of the health service. As the Minister said, we cannot do that through the Government's mechanisms.
  When the extra money is spent, it will be interesting to see whether the Government use their new private finance initiative mechanism to bring much more private sector skill and entrepreneurialism into the health service to provide new hospitals and new capacity, and to make their promises on funding amount to something.
  All these undertakings and others guarantee an increase in the public service inflation rate. That is one of the effects of increasing expenditure. For a Chancellor who is wedded to the concept of prudence, the Budget is incredibly fragile. Aggregate expenditure—
  Mr. Deputy Speaker: Order. The right hon. Gentleman's time is up.
  6.37 pm
  Miss Geraldine Smith: The priorities of my right hon. Friend the Chancellor's Budget are also the priorities of the people of Morecambe

  75
  and Lunesdale. I warmly welcome the extra money for the national health service and schools, and the additional help for families and pensioners.
  The Chancellor has delivered a massive boost for the NHS. The immediate cash injection of £2 billion is part of the largest ever package of spending on our health service. Over the next four years, spending on the NHS in real terms, over and above inflation, will increase by 6 per cent. —double the average of 2.9 per cent. achieved by the Tories.
  Whereas last year we spent just over £1,850 per household on the NHS, by 2004 that will have increased to £2,800 per household—a cash injection of 50 per cent. That should be compared with the shabby Tory policy on health, which would provide a two-tier health service in which ability to pay would determine the quality of treatment and care received.
  I welcome the additional income for schools in my constituency. The extra £1 billion announced in the Budget will help schools to recruit more teachers and purchase more books and equipment. The money will go directly to head teachers and help them to improve standards in our schools. I know that they have been asking for that for some time.
  I am pleased to see measures in the Budget to help pensioners. The further increase in the winter fuel payment from £100 to £150 to be paid to all households where someone is over 60 is most welcome. That will benefit almost 21,000 pensioners in Morecambe and Lunesdale. From 1 November, pensioners over 75 will benefit from free television licences, which will help 8,000 pensioners in my constituency, who will save £104 a year on the licence fee.
  I am delighted that the Chancellor is to increase the capital limits on the minimum income guarantee. Everyone will welcome the Government's commitment to developing the minimum income guarantee for pensioners who have made some provision for their retirement. After a lifetime of work, those pensioners' financial position has been steadily eroded. That is unjust and unacceptable. I therefore look forward to the proposals of my right hon. Friend the Secretary of State for Social Security to assist those pensioners who have small second pensions and whose income is just above the minimum income guarantee.
  I represent a seaside resort and I am pleased about the decision to remove the annual licence charge of £645 on small amusement-with-prizes machines which cost 10p or less to play. The British Amusement Catering Trades Association, along with the seaside group of Labour Members, has campaigned hard on that. I should like in particular to thank a local BACTA representative in Morecambe, Mrs. Norah Slater. Norah and I spent a sunny afternoon in Morecambe visiting all the amusement arcades on the promenade. It made me realise what a wonderful job I had. I could spend my time mixing with holidaymakers and playing in amusement arcades. It was time well spent because I, like many other Labour Members, made representations to Treasury Ministers. I am glad that the Government listened. Their policy will mean that amusement arcades can expand; it will help seaside resorts and give operators a huge boost. It is further proof of the Government's commitment to seaside resorts.
  76
  Many seaside towns have been given assisted area status. Morecambe has been successful in gaining that. That will give an impetus to our resorts, which were so badly let down by the previous Administration.
  The increases in the working families tax credit and in child benefit are good news. The 1p cut in the basic rate of income tax next month means that next year, the tax burden on working families in my constituency will be the lowest since 1972.
  The Tories bang on about tax having risen as a proportion of gross domestic product in the past two years. Although that is true, they neglect to say that that is largely due to the billions of pounds that the previous Tory Government borrowed. The Government are steadily repaying that. The overall tax position has now stabilised and figures are set to fall. My right hon. Friend the Chancellor was able to announce more for our public services, our pensioners and families because we have strengthened the economy.
  Today in my constituency we have stability and low inflation. Thanks to the new deal, youth unemployment has decreased by 77 per cent. and long-term unemployment is down by 58 per cent. since the last election. I believe that the Budget will help to provide security and opportunity for all. It is a Budget for the hard-working people of Morecambe and Lunesdale and I commend it to the House.
  6.43 pm
  Mr. Dafydd Wigley: I shall not follow the hon. Member for Morecambe and Lunesdale (Miss Smith) into the intricacies of the one-armed-bandit Budget that she described. I am conscious that this may be the last time I address the House during a Budget debate, because I am standing down at the next election. The 10-minute contribution that I shall make contrasts with the speech that a predecessor of mine in Caernarfon made in 1909: Lloyd George spoke for four and a half hours, which would constitute the whole of our debate.
  Mr. David Davis: Go on, beat it!
  Mr. Wigley: No, I shall resist the temptation.
  We are considering what appears to be an election Budget. We must welcome aspects of it—for example, its recognition of the need to help children in the poorest families, as well as the much-needed increased spending on health and education.
  Mr. John Hayes: Will the right hon. Gentleman give way?
  Mr. Wigley: I am sorry, but it is difficult to give way under the circumstances.
  I should have liked the Budget to include more spending on specific social programmes, especially housing. In my constituency—and I suspect in many others—there is a massive backlog in house renovation. People have to wait years for work to be done. That backlog is at the heart of many difficult social problems. For that reason, it would have been better if the income tax rate had not dropped from 23p to 22p in the pound, and for the £2,000 million to be available for spending on housing programmes and perhaps for doing a little more for state pensioners. If resources are to be used to reduce

  77
  the effect of income tax, I should prefer them to take those on the lowest incomes out of the taxation system altogether.
  The 9p per gallon increase in the price of petrol will devastate rural areas at an immensely difficult time. People in rural Wales pay the highest cost for petrol anywhere in the world, at a time when our economy is suffering great difficulties. That should be considered.
  I want to refer in greater detail to increases in resources for the health service. The Secretary of State for Wales estimates that it will mean an increase of £99 million for health in Wales in 2000–01, and £153 million in the following year. However, that will depend on the way in which the National Assembly for Wales decides to share out the block money that is passed to it. A problem arises with that. I want to consider the way in which the Barnett formula interacts with the Chancellor's intentions in the Budget.
  The Barnett formula dictates that the money that goes to Wales and Scotland depends on the size of the population. Expenditure on health in Wales is 9 per cent. higher than in the United Kingdom in general. That is because we have an older population. Many people retire to Wales. That is understandable; it is a lovely place. However, a large proportion of health costs are incurred in the last six months of a person's life. There is therefore a greater demand for health expenditure in Wales. If the increase through the Barnett block is based on population, that means that there is relative convergence and less money to fulfil the needs of the population. The simplistic approach of such a per capita share-out causes difficulties.
  Over the next three years, there will be a drop in the proportion of expenditure on health in Wales as compared with the rest of the United Kingdom—from 5.5 per cent. this year, to 5.2 per cent. next year, to 5.1 per cent. in the subsequent year. The Government's correct and laudable Budget objectives of trying to ensure that more money goes to the sharp end of health care will thus not be achieved in Wales because of the workings of the Barnett formula. I hope that we can move towards a more sophisticated approach to the distribution of money by developing need indicators so that resources can be distributed in a way that corresponds to need.
  Mr. Hayes: Will the right hon. Gentleman give way?
  Mr. Wigley: I am sorry, but I cannot give way because of the 10-minute rule. I am trying to squeeze in what I have to say.
  Mr. Hayes: On a point of order, Mr. Deputy Speaker. For the benefit of all hon. Members, could you confirm my belief that Madam Speaker has ruled that interventions add to an hon. Member's time and do not subtract from it?
  Mr. Deputy Speaker: The general principle is that the clock stops for an initial intervention and restarts when the hon. Member who is addressing the House responds.
  Mr. Wigley: I hope that points of order come into the same category.
  Mr. Hayes: The right hon. Gentleman is renowned for his generosity and courtesy. He will be glad to know that I wanted to support him by saying that his points apply
  78
  not only to health but to education. It is all very well saying that extra money is to be given, but funding should be granted according to need. The Budget announcements did not make allowance for that. The smallest, least fashionable schools in rural Wales and in rural Lincolnshire will benefit least from the extra money, while the big, popular schools will benefit most. The right hon. Gentleman's points on health apply to education.
  Mr. Wigley: Restart the clock, Mr. Deputy Speaker! I rapidly move on from that valid point to the effects of the Barnett formula and the way in which it interplays with European objective 1 money for Wales. We looked for that in the Budget, but it was not forthcoming.
  Two years ago, before Wales got objective 1 status from the European Union—I congratulate the Government on achieving that—we had a total control budget for the Welsh block of £7,908 million. The basic budget for the National Assembly for Wales remains at that level this year. The original budget that was published in November was £7,909 million. The figures are almost identical. No additional money was available to enable us to provide match funding, or even public expenditure survey cover for the European element.
  Wales is supposed to receive £360 million a year from objective 1 spending in areas of acute poverty in the coming financial year, but owing to the operation of the Barnett rules we shall not receive an extra brass farthing. For every £10 million paid by Europe to meet Wales's needs, the Treasury will knock £10 million from the Barnett block. We are no better off than we would have been if we had not been given objective 1 status. I can identify with what was said by the hon. Member for Liverpool, Walton (Mr. Kilfoyle), and the same applies to South Yorkshire and Cornwall.
  The Budget has done nothing to deal with that central dilemma. If we are to find match funding and PES cover from within the Welsh block, we shall have to do it at the expense of health and education—the very priorities that the Chancellor tried to promote in the Budget.
  That brings me to the central weakness of the Budget. I refer to the problem caused to the economy of Wales and, indeed, other parts of the United Kingdom by the overvalued pound, to which others have referred. It undermines manufacturing industry. We have seen what it is doing to Rover now, and there will be knock-on effects in Wales. We have also seen what it is doing to the steel industry. I do not accept the Government's line that the steel crisis is being whipped up by the media; I know of companies in my constituency whose margins are being hit by up to 30 per cent. because of the level of the pound. They are finding it difficult to compete in export markets, and are being undermined at home by the sucking in of imports. The same applies to farming and tourism. The three bases of the Welsh economy—manufacturing, farming and tourism—are all being hit.
  The right hon. Member for Haltemprice and Howden (Mr. Davis) spoke of the danger of inflation. Any inflationary pressure will tempt the Bank of England to raise interest rates again. That will put the pound up again, which will undermine manufacturing, farming and tourism. All the gains that we hope to secure from the strategy of the Budget will then be undermined, and we will be back where we started.
  6.52 pm
  Mr. John Grogan: The right hon. Member for Haltemprice and Howden (Mr. Davis) was right to try to characterise the three Budgets presented by the current Chancellor. Although I disagree with the right hon. Gentleman's conclusions, I think that the Budgets have a common theme. Rather than re-establishing the principle of meddling, they have re-established the principles of European democratic socialism and made them popular for a new generation in Britain.
  It is not meddling to provide decently funded public services of a certain quality. It is not meddling to re-establish, once and for all, the goal of full employment as a central element of our policies. Nor do I consider it meddling to make the alleviation of poverty another such goal. One of the things that make me proudest of the Budget is the conclusion by the Institute for Fiscal Studies that those who have benefited most from the three Labour Budgets, taken together, are the poorest 10 per cent.
  I want to explore the impact of the Budget on three traditional industries. I shall conclude with references to coal mining and agriculture, but I shall concentrate on a traditional British industry, albeit one that occupies only a small part of the Budget. I refer to betting and bookmaking. Buried in the Budget papers, and given even less publicity initially than the welcome reduction in VAT on women's sanitary products, was a press release headed "Reform of Betting Duty". That was a very definite title: it referred not to a review of betting duty, but to a clear commitment by the Government to reform it according to a tight timetable. Customs and Excise must present its proposals to the Chancellor by July, and he has promised to make his own definite proposals in the pre-Budget statement in November.
  Why does the betting industry matter? It is a traditional industry and a traditional British success story, but like many other such industries it is having to adapt to a new age of increased international competition and to the challenges of e-commerce. In the press release to which I referred, the Chancellor has set out his objectives, which are
  a fair basis for UK bookmakers to compete internationally; a fair opportunity for horse racing to secure financial support; and a fair contribution from the industry towards general tax revenues.
  I would have added a fourth criterion: a fair deal for the British punter.
  I have a bit of an interest in this. One of the first things that I did after being elected was collect my winnings from William Hill in Selby. In an entirely legal form of insider trading, I had obtained odds of 3:1 against myself. Nine per cent. of my bet went to a levy; 6.75 per cent. of that went towards general betting duty. In the case of a bet on horse racing, the extra money goes to the horse racing industry, but in the case of a general bet such as the one I made, it goes to the bookmakers.
  There are tremendous opportunities for the British betting industry to expand in the coming years. We lead the world in that respect. Ladbrokes is the biggest bookmaker in the world, and gambling is cross-cultural—that is one of its attractions. An American writer, Heywood Hale Brown, commented:
  The urge to gamble is so universal and its practice so pleasurable that I assume it must be evil.
  I would not go as far as that, but gambling must be well regulated, it must be honest, it must protect minors and it must be innovative—and that characterises much of the British betting industry.
  80
  Many hon. Members may not be particularly interested in sports betting, but I draw their attention to a column in the New Statesman by Charlie Whelan, who has had comments to make about previous Budgets. Each week, he highlights particularly interesting bets that people can make on politics and other issues. A few weeks ago, he asked which national newspaper Piers Morgan would be editing on 1 October 2000, offering odds of 6:4 on The Mirror, 7:4 on The Express and 50:1 on The Sun. In February, following the resignation of my hon. Friend the Member for Liverpool, Walton (Mr. Kilfoyle), he asked which Labour Minister would be the next to resign. I shall leave hon. Members to look at the odds, given such an unlikely event.
  In another column, Charlie Whelan asked whether the Leader of the Opposition was likely to become a father in the millennium year. He offered 6:4 against that, 6:4 against the Chancellor's marrying, and 8:1 against a certain baby's being called Tony.
  Many innovative bets are available, but they face two challenges. One is international competition. Not too long ago, in May 1991, Victor Chandler International set up business in Gibraltar offering telephone bets to the British public, with a levy of not 9 per cent.—which I had to pay on my bet in Selby—but 3 per cent. That posed a big challenge to the British betting industry, to which all three major bookmakers have responded by setting up their own offshore operations. The Irish Government have responded by cutting betting duty from 10 to 5 per cent. Perhaps not unconnected with that is the fact that the Irish Prime Minister, Finance Minister and Agriculture Minister are often to be seen at the Curragh and at Cheltenham—they clearly have a particular interest in the industry. However, the lower levy in Gibraltar is plainly having an impact on the competitiveness of British bookmaking.
  On the other hand, there is expansion in e-betting—betting on the internet. At present the figures are quite small, but MMD, a London research agency, predicts that by the end of next year internet betting—on sports alone—could account for £9 billion. Britain has a competitive advantage in sports betting. In America, it is all but outlawed. A Bill presented by Senator Jon Kyl of Arizona, who wants to kill off e-betting, is currently going through Congress.
  British bookmakers have a tremendous opportunity to gain that competitive advantage. What should we do? I think the Chancellor was right not to reduce betting duty in the Budget. At present the revenues are holding up— £490 million will be raised in betting duty this year, as opposed to £480 million last year. Nevertheless, I think that he should do what the press release promises he will do, and consider radical solutions such as abolishing betting duty altogether and replacing it with a tax on the profits of the bookmakers. That might be a very effective way of maintaining the revenue, while allowing the industry to compete. At a stroke, it would also abolish any form of illegal gambling, as there would no longer be any incentive to engage in it, and the anomaly in the levy, which means that some of the 9 per cent. levy on non-horse racing bets goes direct to the bookmakers, as with my bet in Selby. I would welcome that small but important measure.
  I want to use my final couple of minutes to refer to agriculture and coal mining in Selby. Both those traditional industries are exchange rate sensitive, both are

  81
  going through difficult times and both are looking for a restatement of that other traditional principle of European social democracy: that we are not afraid, when necessary, to intervene in the market—not to prop up failing industries but to aid transition from one phase to another.
  This is an extremely important week for the coal mining industry. My right hon. Friends in the Cabinet have before them a paper that talks of modest state aid—perhaps £60 million to £70 million—compared with the £3 billion of state aid that subsidised the French, Spanish and Italian coal industries last year. That money would allow the most efficient deep-mined coal industry in Europe to bridge the gap between the price that it can offer and the price of internationally traded coal, which is on the increase. The subsidy would last for only two years, until the relevant European treaty runs out in 2003. Although pits will close under Labour and industries will contract, I urge the Government to come to a quick decision on the coal subsidy and to reaffirm the principle that, unlike the Conservatives, we will not allow industries to contract overnight in the completely uncivilised and uncaring manner that characterised the 1980s and 1990s.
  7.2 pm
  Mr. John Swinney: The right hon. Member for Coatbridge and Chryston (Mr. Clarke) called the Chancellor the first e-Chancellor. I wondered whether that was a casual remark that reflected the internal politics of the Labour party. Perhaps it was a suggestion that he might be a virtual Chancellor or virtually a Chancellor, but it was certainly an interesting assessment of what the Budget has produced.
  My first reaction to the Budget was that never has a Chancellor had so much and given away so little. As the days have passed, my view has not changed. The Budget represents a missed opportunity, and that will become more apparent to members of the public as the issues are debated. If I judge the public mood in Scotland just now, voters want substantial investment in key policy areas—health, education and poverty—and they have made it clear that they want substantial new resources to be invested to counter 20 years of under-investment.
  I do not judge the public mood to be enthusiasm for income tax cuts at the expense of valuable investment in our public services, and I want briefly to consider the tax structure. The Government are stretching and moving the balance of taxation so that it is much more in favour of indirect taxation. The Institute for Fiscal Studies says that the Chancellor has made about 40 per cent. of the changes to indirect taxation, which is regressive as it hits those on lower incomes disproportionately harder. What he gives with one hand, such as child benefit increases, he takes away with the other in indirect taxation.
  I ask the Chancellor to consider reversing that trend in future Budgets and to make the structure of taxation fairer and more transparent. The grudging way in which the Government have at last confirmed that the tax burden has increased—they were forced to do so—makes a compelling case for greater transparency in the system. With a £60 billion war chest at his disposal over the next five years, he could have achieved so much more investment in our public infrastructure, but has failed to do so.
  Aspects of the Budget are to be welcomed, particularly any measures to improve the living standards of those on lower incomes who have children. Measures that make
  82
  people better off in work rather than on benefits are to be encouraged. We recognise that encouraging work is one the best routes out of poverty and have argued that case, but unemployment is still a major factor. It increased in Scotland in the last quarter, and rates of more than 10 per cent. are common in several Scottish constituencies. The Government's economic strategy must address the issue of getting people into work before they can take advantage of initiatives such as the working families tax credit.
  The fact that the Chancellor has left the Scottish economy in a sterling straitjacket is one reason for those pockets of higher unemployment in Scotland. Since the Government came to power, 22,000 manufacturing jobs have been lost in Scotland and a further 600 losses were announced only last Thursday. The pound has appreciated against the euro by a massive 35 per cent. since 1996, crippling manufacturing industry and exporters in Scotland. I was struck by the powerful speech of the right hon. Member for Ashton-under-Lyne (Mr. Sheldon), who argued for Monetary Policy Committee decisions to take much greater account of the economic conditions in areas of the United Kingdom outwith the south-east of England. They are increasingly putting home-grown businesses in Scotland at a competitive disadvantage in relation to a number of our European competitors.
  The Chancellor has to be asked, what was in the Budget for jobs in Scotland and for high-quality, sustainable employment? We need investment. Where were the initiatives to encourage growth in manufacturing? Where was the encouragement for research and development in our traditional industries? Although we appreciate and support interest in encouraging e-commerce, a sea change in telecoms pricing, regulation and infrastructure—much more than the package of measures announced in the Budget—is needed to make that possible.
  I have commented on low-income families and the measures taken to support people in those circumstances, but we must also address the challenges facing pensioners, who are among the poorest in our society. Measures to reduce fuel poverty through the winter allowance are welcome, but other measures such as the minimum income guarantee for pensioners are unproven in respect of securing the type of income that pensioners truly require. The hon. Member for Northavon (Mr. Webb) amply showed why the Government have failed to get across the importance of the minimum income guarantee and what it does to compensate pensioners, who have been given a wholly unsatisfactory 73p increase in their pension.
  I want to comment on the public spending commitments announced in the Budget. The Chancellor is good at using headline-grabbing numbers in his Budget statements, but I want to examine some of the detail of the figures, beginning with health spending. All hon. Members will welcome any increase in investment in the national health service, which is required after 20 years of neglect, but the increase will not deliver health spending on a par with the European average, as the Prime Minister promised on 16 January. The Institute for Fiscal Studies has calculated that UK health spending must increase by 8.5 per cent. to reach the European average in five years. There is still some way to go.
  I want to consider the additional £2 billion available next year and how that will translate into health spending in Scotland. According to a statement from the Secretary

  83
  of State for Scotland, the Scottish public will benefit to the tune of £173.3 million. That should be considered against the reality that Scottish hospitals are expected to be £50 million in deficit by the end of this financial year and all trusts are expected to miss their waiting list targets for next year. Furthermore, above inflation and well-deserved pay increases are already stretching NHS budgets. That suggests that the additional resources provided by the Chancellor could allow the health service in Scotland to stand still rather than take any stride forward.
  The 6.1 per cent. increase in health expenditure in the United Kingdom as a whole will not translate into a 6.1 per cent. increase in Scotland because of the Barnett squeeze. Scotland will have slower growth in health expenditure than the rest of the United Kingdom. However, the health of the Scottish public is not improving at a faster rate than that of people in the rest of the United Kingdom. Recent research by the university of Bristol shows the incidence of cancer among men in Scotland to be higher than among men in England. It is also higher among women in Scotland. The Barnett mechanism represents a loss of hundreds of millions of pounds to the NHS in Scotland over the coming five years.
  On education spending, Scotland will receive £86.6 million from the additional £1 billion announced by the Chancellor, according to the Secretary of State. Putting that into the context of the cuts made at local authority level by the Labour party shows the damage that has been done to our core educational services. Next year, local authority education funding will be £540 million lower in real terms than it was in the last year of the Conservative Government, when none of us believed that we could go any closer to the bottom. The Chancellor did not mention the long-term position of education funding beyond this financial year.
  A number of hon. Members across the political spectrum referred to petrol prices. I have had to make this point in every Budget debate since I was elected to the House to represent a large rural constituency in Scotland. The price of petrol has risen by 25 per cent. since the Labour party came to office in 1997. In our rural communities, car transport is the fundamental brick on which every aspect of activity is built, so is it any wonder that people are feeling the strain of the punitive taxation being applied to the economy of rural areas? That is made even more surreal and nonsensical by the fact that Scotland is the largest oil-producing country in Europe.
  The Chancellor will argue that any larger increases in spending would not be in line with fiscal and monetary policy, and would put pressure on the Bank of England to raise interest rates further. That is yet another example of economic policy being led by the overheating of the economy in the south of England and the issues connected with house price inflation. For too long, the Treasury orthodoxy has been high interest rates and a high pound due to overheating in the south of England. The price for that is being paid in the economy of Scotland, where enormous damage has been done to the competitiveness of our key industries—our exporters, who trade on our behalf. Unless we have economic conditions that are in tune and in line with the circumstances that are required
  84
  in Scotland, and not those that pervade in the south of England, continued damage will be done to the economy of the people of Scotland.
  7.12 pm
  Mr. Colin Burgon: Over the past few days, hon. Members will have listened to their constituents' views on the Budget. It is good that those views are reflected in the Chamber. The first subject that I should like to cover has probably not had much of a mention in the Budget debate so far. It is the Government's decision to introduce an aggregates levy of £1.60 per tonne, which will come into effect in April 2002—not soon enough for many of us.
  The Government have made it clear that the extraction and transportation of aggregates impose real costs on local communities, in the form of noise and vibration, dust, loss of biodiversity and amenity and visual intrusion. My constituency boundary is made up of the river Wharfe to the north and the river Aire to the south. Both rivers have extensive mineral workings in the proximity. The Aire valley in particular has suffered from decades of mineral extraction, and many local people in such places as Methley and Allerton Bywater now want environmental regeneration of the area.
  I sincerely hope that the new levy will help in that process. By ensuring that the environmental impact of sand and gravel extraction is more fully reflected in prices, I hope that we will encourage a shift in demand away from virgin aggregates towards alternative materials, such as recycled aggregate.
  I am delighted to praise Leeds city council on the recent demolition of its civic hall annexe, which was a vivid illustration of how building materials can be recycled and our environment protected. In my inquiries about the work done by the council, I was told:
  If normal demolition practices were followed the site would have needed a substantial amount of fill material to raise the ground levels to make the site safe.
  The hard materials would have been removed to a land fill site for disposal, both of which have a considerable cost implication—
  and I would add an environmental implication:
  The process of crushing the hard material on site and using it as fill material to raise the levels, saved on the purchase of fill materials and the costs of tipping …
  The project started by hand stripping and salvaging as much materials as possible, this included all timber, the roof covering, glazing and non structural metal work. The structural metal frames were then removed for recycling and the remaining concrete structure crushed to be used as fill materials over the site.
  The Government's stance in the Budget will encourage such an enterprising approach. I hope that where Leeds leads, others will follow.
  The second item I want to address is education. In discussions that I had with head teachers in my constituency last week, the Chancellor's policy of extra payments of between £3,000 and £9,000 for primary schools and between £30,000 and £50,000 for secondary schools met with universal support. The heads were doubly delighted that the money will go straight to them. Projects that they were looking to fund from this additional money included general refurbishment work in the schools, expansion of information and communication technology, extra help for special needs children, extra

  85
  help to develop reading skills, and staff training and development, which is vital given all the changes taking place in education.
  Head teachers also told me that they hoped that they would be allowed a fair degree of discretion on spending this extra money. As I cannot envisage many of them either buying a new car or going on an exotic holiday with this money, I hope that we can allow these hard-working professionals to spend that money wisely and effectively. There was also a plaintiff plea that this money should be paid every year. I promised to pass that request on to the Chancellor.
  In Wetherby over the weekend I met people involved in Church Action for Poverty. They gave a general welcome to the Budget, but cautioned me that much more remains to be done to achieve the Government's goal of eradicating child poverty within 20 years. They welcomed the fact that the Budget will lift 1.2 million children out of poverty by the end of 2001, but more than 2.5 million children remain trapped in poverty. That is a sobering thought, and shows what a huge task the Government have set themselves.
  Those people also welcomed further measures to tackle fuel poverty among the elderly, with the boost in the winter fuel allowance to £150 a year. The minimum income guarantee was also welcomed. I share the general concern that, as last year, almost 1 million pensioners are not claiming their entitlement. I was hoping that the Government would soon launch an effective, high-profile benefits take-up campaign targeted at that group. Hon. Members can imagine my delight when I heard the Secretary of State say that that would start this Wednesday, and I look forward to that.
  I am aware that the Government are spending an additional £6.5 billion on our pensioners over the lifetime of this Parliament. However, many of us believe that we still have some distance to travel to address all the concerns of our pensioners, who never lose an opportunity to let us know their thoughts on this subject, and long many they continue to do so.
  I was pleased to hear from pensioners and others that there has been widespread welcome for the extra £2 billion for the NHS. It is clear that that step, combined with organisational reform of the health service, commands tremendous support among the electorate.
  There is also a recognition that the Labour Government are delivering a platform of stability and steady growth, with low inflation and sound public finances. Their aim of delivering security and opportunity for all commands the support that will enable the Chancellor to continue as the great helmsman of the economy. I commend the Chancellor and all his excellent work.
  7.18 pm
  Mr. David Ruffley(Bury St. Edmunds): I detected that the Chancellor's Budget statement last week was received less well outside this place than his previous Budgets. I venture to suggest three main reasons for that.
  First, on the macro-economic side, the Chancellor paints a rosy picture in the Red Book, but it contains some flaws. He claims that next year and the year after he is locking in a fiscal tightening. That is not quite what it appears. The Budget contains a 0.6 per cent. of GDP fiscal loosening. If we take the outturn on the fiscal side for the
  86
  fiscal year we are in, rather than the pre-Budget report numbers and the March 1999 forecast, it shows a 0.6 per cent. fiscal loosening.
  Why is that significant and problematical? The answer is that the fiscal boost has meant that GDP numbers will have to be upgraded, and the Monetary Policy Committee will, as a result, have to tighten policy. There has been a significant fiscal stimulus. Total managed expenditure is running at a 5 per cent. real terms increase in the coming year. It is clear that the City is looking at GDP forecast upgrades. As a result of the Budget, there will probably be a 0.25 per cent. increase in base rates.
  The second concern on the macro side is that the Chancellor seems to think that he has abolished the business cycle—that he has ended boom and bust for ever. That is his view of the planning horizon in the next Parliament, as stated in the Red Book, but the problem is that he has not abolished the business cycle.
  We must remember that, in previous Budget statements, the Chancellor mentioned what was happening in the major economies—Japan and the United States, the two biggest in the world—and what the outlook was. He did not say it in the statement, but, burrowed away on page 25 of the Red Book, he says something revealing: there are downside risks to economic growth, on which the whole Budget is predicated. The Red Book says:
  the risk remains of a sharp slowdown in the US and continued weakness in Japan with adverse effects on UK prospects.
  Let us remember that, in the second half of last year, Japan went into recession.
  That is important to remember. The Budget should have come with a health warning. Other straws in the wind concern City analysts. House prices went up by 15 per cent. last year. Equity withdrawal is at 3.5 per cent.—not 5 per cent. as in the 1980s, but it is rising. There was a trade deficit of more than 5 per cent. in the last quarter of last year. The Chancellor inherited a 0.5 per cent. of GDP trade deficit at the beginning of 1997. It is now bigger than at any time in the boom in the 1980s. These concerns are not flagged up. If the GDP numbers are not delivered in the next three to five years, all the wonderful suggestions that he puts forward on public spending will not come to pass.
  My second reason for being concerned about the Budget, and why there has been a relatively tepid response to it, is that the Chancellor uses the rhetoric of being pro-business and business friendly, but the reality is otherwise. Christopher Humphries, director general of the British Chambers of Commerce, said after the Budget:
  Businesses have learnt not to be fooled by the Chancellor's headline announcements. Brown has not done enough to ease the increasing tax and administrative burden on business.
  Of course he has not. He has done nothing to sort out IR35, which is driving entrepreneurs out of this country, or to tackle the national insurance contribution liability on employees who exercise share options in non-IR approved share option schemes. He has done nothing to cut the 3,000 new regulations that have been imposed on business since the 1997 general election—nor the £5 billion a year increase on business that the CBI has described in relation to the Chancellor's three previous Budgets.
  What does the Budget amount to? It amounts to much gimmickry, instead of tough action on the things that I have listed. There are gimmicks on research and development. There is R and D for small businesses when

  87
  everyone knows that the lion's share of decent and proper R and D is by bigger players, who are not catered for in the Budget. The R and D fiddly tax credits are ill targeted and add complexity to the system, as the Institute for Fiscal Studies has demonstrated in the past few days. Small businesses that have to administer the working families tax credit are being turned into unpaid tax collectors for the Government. According to the Inland Revenue, one case of working families tax credit will cost a small business £135 in manual administration. What are the Government doing about that? Nothing.
  We would have liked to see more emphasis on non-hi-tech small businesses. Constituencies such as mine would have liked simple measures to cut business rates for small businesses: village pubs and small independent retailers in the market towns of East Anglia and rural Britain. It could have been done in a tax-neutral way, increasing the poundage for out-of-town superstores and giving relief at the bottom end for small shops. There is nothing for the small business man in the Budget—the type of business that I represent.
  The third reason why it is a problematical Budget is that it contains the same old nonsense and deception on taxation. It is a redistributive Budget. There is nothing wrong with that in and of itself, so why does the Chancellor not tell the people that the benefit is going to unemployed couples with children and to single parents, as the IFS distribution tables clearly demonstrate?
  The reason why the Chancellor does not talk about that is because middle Britain has been clobbered to pay for that. It is the 9p up, 1p down Budget. It is true that a typical family is some £600 a year worse off. It is £100 a year worse off because of average council tax increases. It is £200 a year worse off because of the personal pension tax. Cuts in the married couple's allowance and MIRAS increase the cost of living for the typical family. Following the Budget measures on increasing petrol duty, people will pay £175 a year more on average.
  I remind hon. Members that the Red Book demonstrates that the tax burden will be higher at the end of the current Parliament than the burden that Labour inherited at the beginning of the Parliament. We know that Alastair Campbell coughed to that truth. It is about time that the Labour party owned up to it in the House in this debate.
  We have the problem further down the track of the tax burden in the next Parliament. The Labour party will doubtless observe that it flattens out a bit. Why? Because borrowing will take the strain. In this fiscal year, public sector net borrowing is £11.9 billion in surplus. Fair enough, but what happens in 2004–05? Lo and behold, there is a public sector net borrowing deficit of some £13 billion.
  What is going on? Is it true that the Government are letting borrowing take the strain, rather than see the tax burden rise ever higher in the next Parliament? The evidence shows that that is exactly what the Government are up to, so sensitive are they to the charges of increasing taxation under their Administration and on their watch.
  The Budget paints a rosy picture on the macro side. It should come with a health warning. It comes with promises about cutting tax. It gives nothing back to middle England. It comes with the news that there is little
  88
  here for small businesses in rural Britain. It is a sign that it is not a Budget for hard-working people of middle Britain, let alone its rural areas.
  7.26 pm
  Mr. Jim Cunningham: I start my Budget speech, perhaps, a little unusually. In the midlands, the Rover situation predominates. I am sure that hon. Members on both sides of the House are concerned about that and would not try to make any political capital out of it.
  I want to focus on regional funds. I hope that my right hon. Friend the Chief Secretary will talk about those in his winding-up speech, or talk to his colleagues about it. I understand that about £500 million is available in what is known as the umbrella fund—the national and regional fund. I hope that my right hon. Friend will take that on board and look at it, given the Rover situation. Admittedly, it is too early to say what rescue package can be put together—I recognise that—but we should be a little more vigilant with regard to the fund.
  Equally, I should like my right hon. Friend to take on board the surrounding clusters. For the House's information, clusters take on board regional development agencies, which could play a significant part in rejuvenating Longbridge and in what happens after Longbridge. Clusters and RDAs could also encourage the development of business incubators and infrastructure for small business.
  All those issues are interrelated and they can be a little complex, but it is useful highlighting some of them—especially given that many hon. Members will have constituents who could be affected by Rover: not only jobs at Rover's distribution centres will be affected, but—one can pluck a figure out of mid air—between 20,000 and 50,000 other jobs could be affected, depending on how the situation develops. It is a serious issue which is well worth raising right at the beginning of a Budget speech. If my right hon. Friend does not want to address the issue now, he could discuss it with his ministerial colleagues when considering possible action.
  I welcome the Budget, particularly the extra spending on education. Over the years, certainly under the previous Government, education and health provision suffered. After the previous Government's 18 years in power, we are still trying to pick up the pieces. It is not always possible, in three years, to pick up the pieces and end the predicament in services that have been damaged over 18 years. I also welcome the vital help for small business, which has created 3 million jobs, and possibly 3.5 million jobs. It is not always generally appreciated that, these days, small businesses are the engine of the economy. They are certainly the engine of the west midlands economy.
  I welcome the fact that more money is being provided to fight crime. We often debate crime in the House, and we all have our own views on how it should be fought, but it is vital that the public, police and drug traffickers see that we are prepared to provide more money to tackle crime. I am sure that the parts of Coventry that I represent will welcome any additional expenditure on fighting crime.
  The Opposition have made great play today about the Government omitting something from the Budget or trying to hide something in it. However, when they talk

  89
  to us about new taxes or tax increases, it is well worth reminding them who introduced 22 new taxes. They also mentioned the abolition of mortgage interest relief at source and the married couple's allowance. However, who but the previous Conservative Government started attacking MIRAS and the married couple's allowance? The Opposition have double standards.
  Mr. Webb: Using the same method to calculate that Conservative Members introduced 22 tax increases, how many tax increases have the current Government introduced?
  Mr. Cunningham: It is not for me, but my right hon. Friend the Chancellor to answer that. If the hon. Gentleman asks him, I am sure that he will tell him.
  It ill-behoves Conservative Members to attack the Government on those issues. Opposition Members suggested that we have hidden the extent of our borrowing—what about the £28 billion that the previous Government borrowed, or the £40 billion that they borrowed just to fund unemployment? How do they answer those questions? Ultimately, the British people have had to pick up the tab for that borrowing. The Labour Government have not only reduced borrowing, but delivered public services—including the new expenditure on the health service and on education that I mentioned.
  The Opposition should reflect further on their comments. I noticed that the Opposition spokesmen were very good on the attack, but very poor on policy and suggesting alternatives. One or two of my hon. Friends tried to elicit from Opposition spokesmen what they would do in the same circumstances, but we are still waiting for an answer. They gave us the usual reply, "Wait and see what we put in our general election manifesto." It will be very interesting to see what they include in their manifesto.
  Opposition Members also mentioned agriculture and fishing. Need I say more than "BSE"? Who made a mess of that? Who made it very difficult for Britain to export beef? The previous Government were certainly not forthcoming either in reporting on or dealing with that matter. A couple of weeks ago, we had a debate on the fishing industry. As hon. Members pointed out in that debate, who—more than 18 years ago—agreed the quotas that have created problems for our fishermen? Not Labour Members, but Conservative Members agreed those quotas, and they should be reminded of it.
  The issue of the state earnings-related pension scheme has crept into the debate. It has been debated in the House on very many occasions. However, who caused the confusion with SERPS? We still do not know what Conservative Members would do to remedy the situation. The Government have cleared up the SERPS issue. Although the SERPS and general pensions mis-selling issues have been around since 1986, I do not hear Conservative Members saying very much about them.
  An issue on which we should reflect—it is too late to do it in this Budget, but it should be food for thought for the next Budget—is an increase in the basic state pension. The Chancellor will have to have a look at that. In the next Budget, we must also address the issue of links or produce an alternative to them that will convince the United Kingdom's many pensioners. Although it is not the Chancellor's fault, after 18 years of the previous
  90
  Government many pensioners feel hard done by. We have to clear up those issues as soon as possible and say what will replace SERPS.
  Conservative Members were also complaining about the increase in the social security budget. I do not mind real terms increases in the social security budget if those who need help receive it. Previously, the Tories made cuts in the social security budget—they thought that it was more about cutting public expenditure than about helping the needy.
  This Budget is a good and a balanced Budget. Although all Budgets are very difficult, I hope that this one is another step down the road of addressing the grievances that people have felt because of the previous Government's 18 years in office.
  7.37 pm
  Mr. William Ross: I listened today to the right hon. Member for Ashton-under-Lyne (Mr. Sheldon), who said that the Government were in a very happy position because they have had a surge in revenue. I think that he was referring, at least partly, to the fact that we are now repaying debt, rather than having to borrow. I remember the roars of joy from Conservative Members—and even from Ulster Unionist Members—when, a good many years ago, we first had a public sector repayment situation. However, that disappeared. It also did not arise for quite the same reasons that the current one has arisen: because of a surge in revenue.
  The Chancellor expects that revenue surge to continue. His projections show that, for the next few years, public expenditure as a proportion of gross domestic product will decrease. That makes it clear that he expects revenues to continue to increase. I just hope that his hopes are realised. However, I should not be so confident about it. As has already been said in the debate, even at the best of times we cannot forecast very far ahead.
  Mr. Owen Paterson: I am grateful to the hon. Gentleman for giving away some of his limited time. Has he seen table C4 on page 196, which shows that by 2004–05 borrowing will increase to £13 billion?
  Mr. Ross: That is exactly what I mean. I remember that, one year, there was a £50 billion overdraft that no one had really expected. I therefore do not think that any party should crow too much about the level of future danger. Those dangers are real, and it takes only a relatively small percentage change to put a Government into surplus or deficit.
  I am looking for a Chancellor and a Government who will establish a programme that will, so far as is humanly possible, lead to a steady reduction in the nation's public debt. If we could get rid of that debt, even if it took 20 or 30 years, what a wonderful benefit it would be to the community and to the country generally.
  Mr. Andrew Tyrie: Will the hon. Gentleman give way?
  Mr. Ross: No. I am sorry, but we each have only 10 minutes to speak. The hon. Gentleman may get a chance to make his own speech.
  Hon. Members have referred to the fuel allowance for the over-60s. No doubt the £150 is welcome, as are the concessions on television licences that were announced

  91
  some time ago, but I do not favour that way of supporting pensioners. It would be much better if we lumped together the £150 for the fuel allowance and the £70 or £80 for the television licence and gave pensioners an extra fiver a week throughout the year. It would be much better to allow people to decide how to spend their entire pension income rather than giving them money for a specific purpose. It is not the right way to do it—it smacks of grandmother looking after the children and doling out so much money for sweeties and so on. People should be allowed to make up their own minds. They do not suddenly lose the capacity to manage their affairs when they reach 65.
  I welcome the increase in the savings limit from £3,000 to £6,000 before income support is affected. When, earlier, I asked the Secretary of State for Social Security how he had arrived at the figure of £6,000, he told me that he had just doubled the previous figure; he had just plucked a figure out of the air. If I told my bank manager that I needed £20,000 and, when asked why I wanted it, said "I just thought of the figure", I do not think that I would get an overdraft. The House deserves a better explanation than the laughter that I got when I questioned the Secretary of State. I asked whether the figure was indexed, and if so whether it was linked to earnings or inflation. I do not think that he knew.
  I went to the Library and picked up one of its excellent booklets, which shows the value of the pound from 1750 to 1998. I noticed that from 1988 to 1998, which is the period that we are interested in, there was a 52 per cent. increase. We can take it that 160 per cent. or 165 per cent. would have been sufficient indexation for that period. On what basis will the Government increase the savings limit before entitlement to income support will be affected next year and the year after? Can we be told? Has anyone thought that far ahead? If not, it is time that someone did, because the answer that I received was not good enough.
  The costs of care for the elderly in nursing homes has not been addressed. A Committee of this House produced an excellent report some years ago; action on it is long overdue. When will it happen? When will something be done for British pensioners overseas, some of whom live in penury for many years? It is time that that was addressed if we are really trying to do something for our pensioners.
  I am also concerned about road fuel. The right hon. Member for Caernarfon (Mr. Wigley) and the hon. Member for North Tayside (Mr. Swinney) referred to the cost of petrol in Scotland and Wales. Lucky fellows—they do not know how lucky they are. I am sorry that they are not here to hear me say this. They do not have a land frontier. A friend of mine happened to be in Londonderry one day and his medium-sized car was nearly empty of diesel. He drove across the frontier and saved £13 in one fill. The savings on filling up a lorry would run to a lot more. The practical result of that is the destruction of the fuel retailers within 20 miles of the border. They have gone or are existing on a small income from groceries, praying that something will happen to improve their position. The Government have to take action. I heard of one firm that drives its lorries across the border once a week and saves £11,000 a month. That is in addition to
  92
  the smuggling that helps the terrorist organisations that control the trade. When will the Government do something about that dreadfully serious situation?
  The other related issue that concerns me is the 25p increase in tax on a packet of cigarettes. That does no good and we have argued against such increases for years. The cigarettes go out of Gallaghers in Ballymena today and are on the market stalls in two weeks. It is time that this counter-productive tax was stopped and the Government reached a common-sense arrangement.
  I am also concerned about the reduction in air passenger duty for economy flights in Europe. That is all well and good, but those of us in Northern Ireland who want to get to Great Britain in a day have to fly. I cannot get from my constituency to Westminster by ferry and car in a single day, yet we are not given the concession that the Government have found for the highlands and islands. The Chancellor's excuse for that concession was that it would reflect the importance of air transport to the daily life of that remote region. Twenty miles of water makes Northern Ireland a remote region. It is time that the Government recognised that we have a problem that cannot be resolved except by a reduction in that tax. It is a nasty discrimination against the people of Northern Ireland.
  I welcome the money that is being made available for schools and roads, but I should like to know what sums are involved. I should also like to know whether the funding is a one-off or will be repeated. We need to be told. I want to know how much money is available for roads. Are we still expecting to sell Belfast city harbour? It is time that we were given that information.
  No mention has so far been made of the fact that landfill tax is going up by 10 per cent.—far more than the level of inflation—from £10 to £11 a tonne. That is another of those little figures plucked out of thin air with no explanation. We all know the problems that the landfill tax has caused in some rural areas, with illegal dumping right, left and centre. I am not sure that it is the best way to raise revenue.
  7.47 pm
  Dr. Stephen Ladyman: As I have only 10 minutes, I shall not deal in detail with the speech of the hon. Member for East Londonderry (Mr. Ross). However, he made a plea for the winter fuel allowance and the free television licence for the over-75s to be scrapped and the money added to the basic weekly state retirement pension. If we did that, poorer pensioners would lose the benefit of that money from their income support. We would have to change the rules for income support as well. In the mean time, at least the Government's proposals are a convenient and simple way of channelling resources to poorer pensioners and giving a boost to other pensioners.
  We have heard a variety of pleas from the Conservatives. I have heard a plea to spend money on gold rather than schools. I have heard a plea to support oil companies rather than the British coal industry. I have heard a plea that we should give favourable treatment to the tobacco industry almost in preference to the health service. However, I have not heard a justification for the tax guarantee.
  One or two Conservatives have touched on one of the major flaws in that policy by talking about the economic cycle. The Conservatives appear to have forgotten—or not

  93
  to have worked out yet—that for every 1 per cent. below trend growth in the economy, £10 billion will be wiped out from receipts, which means that £10 billion of savings must be found. If the Conservatives believe that we have not got rid of boom and bust and that one day the economy will slow, they must also accept that they are going to go into an election promising that, even in those years, they will cut further the money available for public spending. A 1 per cent. cut in the tax burden means a further £10 billion of cuts.
  Mr. William Ross rose—
  Mr. Hayes rose—
  Dr. Ladyman: I shall give way later. I should like to make some progress first. It would take £10 billion of cuts to make 1 per cent. of savings, and £10 billion to deal with the fact that the economy was growing at a 1 per cent. slower rate than expected. Suddenly, they would have to find £20 billion of cuts.
  We have heard this week that the Conservatives now think that our spending on the health service is a good thing, and Conservative spokesmen outside this House have, I believe, said that they believe that our spending on education is a good thing. Their savings must therefore come from the social services budget, as it is the only significant pot of money left for public spending.
  When the Secretary of State was speaking, Conservatives laughed at his comment that there was good spending in the social services budget and bad spending. Bad spending, he said, was money spent on keeping people out of work. Good spending was the money that we were spending to encourage people back into work and making work pay.
  Mr. Paterson: Will the hon. Gentleman give way?
  Dr. Ladyman: Later.
  Mr. Paterson: Will he give way on that point?
  Mr. Deputy Speaker (Mr. Michael J. Martin): Order. The hon. Gentleman is not giving way.
  Dr. Ladyman: Bad spending is something over which the Government have no control. It is money that must go to those people who are out of work. At a time when the economy is slowing down, unemployment will either be steady or will rise, so that the spending of bad money will be increasing. Therefore, the savings that the Conservatives would have to find to honour their tax guarantee would be from the good spending in the social services budget, such as the working families tax credit and the child care benefit.
  Mr. Paterson: The hon. Gentleman talks about good and bad spending. The Red Book shows that spending on social security benefits is increasing from £93.3 billion to £104.5 billion in 2001–02. Is that good or bad spending, according to his definition?
  Dr. Ladyman: The position was set out clearly by the Secretary of State, who defined the measures that the Government have taken to make work pay as good
  94
  spending. I believe that to be good spending. The Tories' tax guarantee would force them to cut that money at a time when the economy was slowing down—when that money could do the most good.
  Mr. Nick St. Aubyn: Will the hon. Gentleman give way?
  Dr. Ladyman: No, not with the 10-minutes rule.
  Mr. St. Aubyn: On a point of order, Mr. Deputy Speaker.
  Mr. Deputy Speaker: I hope that this will not be a point of order about interventions.
  Mr. St. Aubyn: It is a serious point of order. The hon. Member for South Thanet (Dr. Ladyman) said that his time was limited. Would you confirm that time spent on interventions—
  Mr. Deputy Speaker: Order. The hon. Gentleman knows the rules as well as I do. I am not here to run O-level classes in interventions.
  Dr. Ladyman: I am grateful, Mr. Deputy Speaker. The time limit would allow the hon. Member for North Shropshire (Mr. Paterson) to intervene, but I would then have to answer him, and lose more time.
  Another criticism of the Budget has concerned exchange rates. One of the easiest ways of dealing with the problem would be to join the euro—something that the Conservatives have made clear they do not want. I share their view that the time is not right to join the euro.
  Those hon. Members who have made a plea to join the euro should answer this point. They come from regions of this country where manufacturing is being hardest hit. To convince me that the time is right to join the euro, they must show that they have a robust way of sharing out the public spending that must be provided within euroland in such a way that we in this country would not have to cut our public spending to control the inflation caused by increased public spending in some of the less-developed regions of Europe. Until they can answer that question, they cannot offer a convincing argument to their own constituents as to why joining the euro would benefit their regions.
  I wish to refer to the effect of this and previous Budgets since we came to power. By April 2001, the average household will be £460 better off; on average, families with children will be £850 better off; a single-earner family with two children on £25,000 a year will see a 10 per cent. rise in living standards; a single-earner family with two children on £12,500 a year will see their real living standards increased by around 20 per cent; the poorest two-child families on income support will be £1,500 better off; 1.2 million children are to be lifted out of poverty; a 75-year-old on the minimum pensioner income guarantee will have an annual income that is £950 a year higher.
  These are the achievements of this Budget, taken in the round with previous Budgets. Conservative Members can scoff as much as they like, but these are the facts. They can try to confuse the issue as much as they like,

  95
  but my constituents are counting the extra money in their pockets, and they will take that into account at the next election.
  I do not often use the words of Baroness Thatcher to support my case, but she once said that the Good Samaritan was able to help only because he had the money to do so. One thing that has annoyed me about the response to the Budget has been people saying that it is a redistributive Budget for the Labour heartlands. They forget that the previous two Budgets from the Government prepared the way for this Budget. In effect, they were equally redistributive, because they allowed us to earn the money that we are using in this Budget to make this a fairer and more prosperous country.
  I congratulate the Chancellor on the cut in amusement machine licence duty. My hon. Friend the Member for Morecambe and Lunesdale (Miss Smith) referred to that earlier, and said that it would boost the seaside arcades in her constituency. It will be a boost to arcades in my constituency also, but, more importantly, the world's two leading companies manufacturing these machines are in my constituency. I can tell the House that there are several hundred workers in my constituency breathing a huge sigh of relief that, thanks to the Budget, they know that their jobs are safe.
  I thank the Chancellor for the extra resources that he is giving to combating smuggling. We have a real problem in east Kent as a result of the build-up of smuggling and the fact that organised crime is becoming involved. I am delighted to see that the Government have started to address that.
  This is a Budget for fairness and to increase prosperity. It is a Budget for the health service and for schools. It is a redistributive Budget that I am proud to support.
  7.57 pm
  Mr. Andrew Tyrie: I would like to say a few words about the Red Book, which very few people seem to talk about. That is not surprising, since it is virtually impossible to understand. I am not sure that anybody knows the relationship between all the numbers in the Red Book. Maybe some of my right hon. and hon. Friends will help me out. I wish to say a few words about the affordability of public spending in general, and health spending in particular.
  Everybody welcomes increases in public spending, but they are only worth having provided that they are affordable over the cycle and that the higher spending in the long run does not end up lowering the long-run growth rate. That can happen either because of the disincentive effect of the taxation that has to be brought in to pay for the spending, or because that taxation is distortive, which itself will reduce the growth rate.
  I see virtually no understanding of the possible relationship between higher spending and poorer long-run economic performance in the Red Book, and we heard virtually nothing from the Chancellor about that. It is back to the old days of taking growth for granted, and that is a dangerous road to go down. Control of public spending is very difficult to manage and easy to lose. It takes only a small flicker over the business cycle—a downturn in overall economic performance—and public spending becomes extremely difficult to control.
  96
  The problem is that Labour is in a state of complete denial about the existence of cycles. The Government say that they have put an end to boom and bust and that somehow they are not in a business cycle. The Red Book says that everything will return to trend; that could be above trend for a period and then suddenly get straight back to trend.
  Hidden in the Red Book are some interesting spending figures. Over the next couple of years, spending will increase from 38 per cent. to 40 per cent. of gross domestic product, although the outer years are not given and there is no explanation of how that will be paid for, except perhaps if one looks closely at the borrowing line. There is a table showing an increase in borrowing in the outer years to £13 billion.
  What will the Bank of England say when it has had a good go at trying to understand the Red Book? It will not just sit there and watch spending, taxation and borrowing rise. It will take these facts into account in taking its decisions. Overall, it is likely to conclude that the Budget will require interest rates to be raised, perhaps not immediately, but soon. That will mean a higher exchange rate, which will bring more problems for manufacturers.
  Part of the price of higher spending—including health spending—will be an exacerbation of some of the problems that have already been caused by the strong pound. That will not be the only factor that the Monetary Policy Committee takes into account. It will ask why we should have above-trend growth for a while and never need to go below trend, and why the Government believe that they have abolished a swing around the average, when all other Governments and economies worldwide have always been vulnerable to it. That will make it cautious in its judgment on the Budget.
  The MPC will also consider several of the accounting fiddles in the Red Book, the biggest of which is how the private finance initiative is treated. If PH did not exist, each year's capital spending implied by it would be added back in the first year to the budget lines of the individual spending Departments, and spending would look several billion pounds higher for each year in the Red Book. The MPC will do its internal accounting on that basis, not on the basis of PFI pushing liabilities back to future years.
  Will we get anything for the extra spending? My hon. Friend the Member for Havant (Mr. Willetts) gave an excellent explanation of why it is unlikely that we will get much in social security. We will have a lot of extra spending without any clarity on how better to allocate it.
  The massive announcement of 6 per cent. per annum growth in health spending for the next four years has been accompanied by the biggest load of waffle that I have ever heard from a Prime Minister to explain the reforms that are supposed to make effective use of the money. There is a great danger that a high proportion of it will be swallowed up in higher pay. I do not necessarily begrudge health workers higher pay, but there is no point in raising public spending if that is where it all ends up. I am very concerned that the increase in health spending may in any case prove undeliverable if there is a downturn in the cycle. We should have had greater clarity on what the spending was designed to achieve.
  It has often been said over the past few days that the increase in health spending is unprecedented, which is true over the four years, but the Conservative Government increased health spending by 6 per cent. for a run of two

  97
  years, between 1991 and 1993, and that increase was a spectacular success because it was accompanied by the introduction of the internal market, which generated a huge increase in productivity.
  Generally agreed tables have been published for productivity in the health service, derived from Department of Health statistics, and they show that increase very clearly. The figures have been published since about 1985. I predict that, when the figures are published for the outturn from the latest increases, we will find that productivity has fallen dramatically. I would not mind betting that productivity could be negative for a time.
  Mr. St. Aubyn: I know from my constituents, as I am sure that my hon. Friend knows from his, that fundholding general practitioners are horrified at how money that they used to spend wisely and effectively in delivering good health care is being wasted in the system. I even know of patients who have had their lives put at risk—in one case, a life was lost—because the treatment that they would have had under the fundholding system was denied them under the more bureaucratic system that the Government introduced.
  Mr. Tyrie: The evidence is overwhelming that primary care groups are less efficient in delivering health care than GP fundholding. I believe that evidence from King's Fund research shows fairly conclusively that the introduction of GP fundholding increased productivity and reduced waiting times. Indeed, one of the reasons for the increase in waiting times has been the Government's ideological decision to get rid of GP fundholding, which was a profound mistake.
  The Government should have delayed the announcement of all their spending increases until they had worked out a package of reforms to accompany them. They should have awaited the July spending review, but they did not, because pressure from No. 10 Downing street to spend the money became overwhelming. We have heard that the Prime Minister was receiving an almost daily note on how big the fiscal adjustment would be, so that he could make up his mind how much of it to spend.
  The plain fact—although these things are covered up—is that the Prime Minister won the battle with the Chancellor on making a huge political gesture. Partly as a result, we now have a Chancellor who has taken some risks with the public finances and is spending money without knowing exactly what he can buy with it. He is not being prudent and he does not have a clear purpose: exactly the opposite of "Prudent for a Purpose", as it says on the cover of the Red Book.
  Why has the Chancellor done this? It is because of the coming general election. It is obvious to the public that that is what is going on. They will know that there will be a price to be paid, no matter who wins the election, in higher taxes or worse.
  8.7 pm
  Mr. Nigel Beard: If the new Labour Government had started spending in 1997 to remedy the state of decline and neglect of our public services, they would have compounded the huge deficit in public finances that they inherited. Today, the
  98
  Government would not have been discussing the future of the International Monetary Fund: the IMF would have been discussing the future of the Government.
  When the first Labour Government for 18 years took office, they faced a world of globalised financial markets that could pass judgment on them instantaneously at the flick of a switch. A financiers' veto would have been far from democratic, but it could, nevertheless, have negated the Government's authority for the rest of the Parliament. There would have been no glad, confident progress on education and health and all the other public services, and the air would have been filled with denunciation, recrimination and righteous anger. None of that would have done Britain any good at all.
  The decisive way in which control of monetary policy was passed to the Bank of England signalled to the financial community that the Government would not play political games with economic policy. By creating confidence, the new Labour Government sustained the authority and opportunity that they had gained at the polls to deal with deep-seated and long-neglected problems of our society and our economy.
  First and predominant among the problems was that of the economy itself, with poor productivity derived from a lack of investment and innovation. The previous Government thought that Britain should find its way in the world as a low-cost economy, not using the inherent skills of an ingenious people but vying with the cheap labour economies of Asia and becoming the below-stairs society of western Europe. Their conduct of economic policy amplified the trade cycle to create two of the most severe recessions of the century. A cocktail of divisive ideology and incompetence has for ever characterised the Conservative party as the party of boom and bust.
  That strategic weakness of economic policy has been the origin of many of the difficulties facing businesses in Britain: they could not be sure of market demand even three or four years ahead, so they were reluctant to invest either in expansion or in new technology. The long-term pay-off of research and development was considered too risky, so our innovation record and international competitiveness weakened.
  The first and greatest economic achievement of this Government, which is in danger of being taken for granted, has been to create a climate of economic stability and an expectation of that continuing. With that foundation much else becomes possible, for both businesses and Government.
  Having achieved that foundation, the Government have made another profound break with the past. They have not said that economic strength must dominate and overshadow every other aspect of life, but neither have they said that social policy should predominate, whatever the state of the economy. The Government have recognised that economic strength depends on social justice and a fair society, and that those factors in turn depend on the creation of wealth. That is why the minimum wage, the working families tax credit and fairness at work, to name but a few policies, have had a high priority, alongside reducing corporation tax, encouraging investment, encouraging research and development, and helping small businesses.
  Another break with the past is pursued further in this Budget. It is the knowledge-based economy—the determination to build this country's economic strength by

  99
  cultivating and applying the talents and skills of our people. It is an economic policy that works with the grain of individual fulfilment and ambition. Gone is the hopelessness of the low-wage economy, with competitiveness based on low cost and minimal safeguards at work.
  The Government's vision is of a British economy based on people as its most precious asset. That is the meaning of the new deal, now expanded to all the long-term unemployed, which trains them for work and brings them in from the wilderness of poverty and rejection. That is the meaning of the emphasis on education, from infant schools to universities, and the meaning of lifelong learning. It puts an end to the doors of educational opportunity being slammed shut too early in people's lives.
  The economic power to which our policies have given rise must clearly be directed at one of the top priorities recognised by people of all incomes and all backgrounds—the national health service. It has been clear for at least 20 years that the health service has been underfunded. For many years we told ourselves that although many countries, such as America, spent more on health, their services were not as good. Our NHS was better value for money, we told ourselves. Up to a point that was true, but it lulled us into a complacency that lingered long after the alarm bells should have been ringing.
  The Tory Government's response to gathering problems was to move as near to privatisation as they thought that they could get away with. Far from being regenerated, the national health service declined. The principles on which it was founded were eroded, and despite the dedicated selflessness of its staff, improvisation to maintain the service predominated over modernisation. In that barren period, the NHS put out few new growth shoots, despite immense advances in medical thinking and techniques.
  Mr. Hayes: Will the hon. Gentleman give way?
  Mr. Beard: No, as I have only a short time in which to speak.
  The Government's strategy, in which increased resources are considered to be the key to modernising a public service, is the right one, and the vast majority of Britain knows that. That is why the Opposition, after denouncing previous plans for increased spending as reckless, have now endorsed plans for spending even more. It is a death-bed repentance, but they should remember that death-bed repentances never avoid death. The British public know that to trust the Tory party with the national health service would be like Red Riding Hood trusting the wolf.
  This Budget's strength lies in it completing the foundations of a stable and expanding economy, and providing the resources and priorities for reform and modernisation of our public services. It has rightly been widely acclaimed, but there is a ghost at the feast—European economic and monetary union, and Britain's relationship with it.
  100
  The present strength of the pound against the euro is damaging the prospects for manufacturing industry and is indirectly opening up a gap between the economic prospects of south-east England and those of other regions.
  Mr. Hayes: Will the hon. Gentleman give way?
  Mr. Beard: No, I will not.
  The pound's strength does not reflect the relative strength of the British and continental economies, even allowing for their being at different points in the trade cycle. There could, therefore, be a sudden fall in the value of the pound which, though desirable for several reasons, would have a shock inflationary effect that would need to be counteracted.
  The value of the pound is therefore a rogue element in the Budget calculations. Short of the Government losing the confidence of the financial markets—which is not likely, given their splendid record of economic management—there is little that they can do to influence the rate of exchange. The only means of remedying that impotence is membership of EMU.
  Whatever else may be said, if the United Kingdom had joined in the beginning, the pound would not have surged to its present height; manufacturing would have been protected; and interest rates would be half their current level. The arguments against our reaping those benefits by joining EMU, when the convergence criteria are met, have to be much stronger than a denunciation of Johnny Foreigner and his devious ways.
  There is a danger in viewing the Budget piecemeal.
  Mr. Paterson: Will the hon. Gentleman give way?
  Mr. Beard: No.
  If we consider the Budget on a piecemeal basis, there is a danger that we will miss the wood and only see the trees. Taken as a whole, this Budget gives concrete expression to Labour's vision of a modernised Britain of the 21st century. It moves the process of modernisation into a higher gear. Its appeal goes beyond the self-interested analysis of gainers and losers from individual tax changes. In giving practical force to a vision of Britain in the 21st century, its appeal is to the latent idealism of Britain today.
  Mr. Deputy Speaker: Order. Time is up. I call Mr. Nigel Waterson.
  8.18 pm
  Mr. Nigel Waterson: I am very pleased indeed to have the opportunity to contribute to this Budget debate, even though time is limited.
  A couple of days before the Budget, I was reading the obituary of Bombardier Ferrebee. Who was he, and why did he rate an obituary in The Times? He was, of course, the bomb aimer who dropped the bomb on Hiroshima.
  As I sat listening to the Budget, the thought came into my head that it reminded me of that famous radio broadcast that Emperor Hirohito made after the bombs were dropped. That was the first time that the Japanese public had heard the voice of their emperor. The broadcast

  101
  contained the immortal piece of understatement, "There has been a development in the war that is not necessarily to Japan's advantage."
  I thought of that phrase when I listened to the Chancellor's speech. The spirit of that long-dead Japanese speech writer seems to live on in the modern Treasury. Whoever wrote the Chancellor's speech was a master of the same sort of understatement—the best recent example of which was the Chancellor's comment in his 1997 Budget speech. In effect, he was staging a raid worth £5 billion on pension funds, but he said he was making other tax changes to "encourage" companies to invest profits in the future—an example of the Hirohito school of speech writing, if ever I saw one.
  As time is limited, I shall touch briefly on some of the ways in which my constituents are disadvantaged by the Budget; in particular, I shall show how the Budget speech differs from reality. The best example is the national health service. Naturally, the Opposition welcome the new money for investment in the NHS, but we are concerned whether it will be put to the best use.
  It is clear that the Government have panicked. A winter of pressures—problems with waiting lists and so on—has caused them to throw money at the problem rather than to think rationally about it. However, as we approach the winding up of the Budget debate, it has emerged—only a few days after the Budget speech—that the boast of 10,000 new nurses was really a repackaging of a previous announcement. That figure had been included previously. Furthermore, the boast about the percentage of gross domestic product to be devoted to health included the figure spent on private health care. That is complete hypocrisy—not only are the Government against private health care on principle, but one of their first acts was to abolish tax relief for private medical insurance for people over retirement age.
  Mr. Hayes: As my hon. Friend has thoroughly studied the Red Book, he will be aware that even that inflated figure does not take the proportion spent on health to the amount that would be necessary to bring it in line with European averages. At one time, the Prime Minister said that was a pledge; then he said it was an aspiration. The Budget total is about 6.1 per cent. of GDP; but we need to spend 7.5 per cent. of GDP in order to reach that aspiration.
  Mr. Waterson: My hon. Friend makes an excellent point.
  In my local hospital, Eastbourne district general, there have been many problems during recent months. We have seen the resignation of the chairman and the chief executive, and there is still a shortage of nurses. Recently, the new chief executive told me that it was not really a matter of money, but of finding nurses to recruit. About 15 Filipino nurses were due to arrive last week to try to help plug the gap.
  When I visited the hospital recently, I saw the dedication and hard work of everyone there, but I also noticed that almost none of the wards had an unoccupied bed. That was after the flu epidemic that caused so many problems. I also understand that we are now about 1,000 behind the waiting list target for operations. Politicians should not make silly, simplistic election promises about waiting lists—those who do so should go down with the ship.
  102
  Another important matter is the effect on transport. We have standstill Britain; a pitiful amount of new money is to be spent on transport. In my area, there is the shambles of the Polegate bypass. That scheme was all set to go ahead when we left office in 1997; it was postponed, although it is likely to start later this year. In the meantime, the Government have paid £5 million on account to the contractors not to build the road that they were supposed to build.
  Another road, the new A22, is known as the road to nowhere; although it is almost finished, it cannot be joined up because of the bypass problem. The sum of £100,000 is being spent simply to guard it from vandals and others. If that is how that relatively small amount of extra money is to be spent, we cannot expect any great changes in standstill Britain.
  The Budget will have an effect on older people—especially pensioners—in my constituency and elsewhere. Of course, we welcome the increase in the savings and earnings limits and in the higher winter fuel allowance. However, why is there only to be consultation over the new credit for pensioners? Surely the Government realise that there is a growing feeling of unfairness among pensioners—those who have made the effort to provide for their retirement are seen as second-class citizens under the Government's policies. As co-chairman of the all-party group on older people, I am constantly made aware of that sense of unfairness on the part of many of our pensioners.
  Pensioners have already seen the abolition of the married couples allowance, of the widows allowance, of tax relief on private health care insurance and of tax credits on dividends. They have experienced the £5 billion raid on pension funds. On top of all that, they have seen a plethora of stealth taxes, for example on petrol. Council tax is going up by 8 per cent. in my constituency—nobody's pension is increasing by 8 per cent. How are pensioners to pay that increased tax?
  Furthermore, pensioners in my constituency are receiving less in services, largely because of a Liberal Democrat-controlled borough council and a Lib-Lab pact at county level. They will pay an 8 per cent. increase when inflation is about 2 per cent. That is a stealth tax. Some older people in my constituency and elsewhere may have to dip into their winter fuel allowance simply to be able to pay the extra council tax.
  Some of the Budget's small print was about basic banking services; the Chancellor mentioned that about 1.5 million people do not have bank accounts. However, in my constituency, we have the absurd situation that the Meads branch of Barclays bank is to close on 7 April—with no consultation with local residents or customers—merely because of a contraction in the banking network. Our Order Papers are awash with early-day motions about similar closures; Barclays alone is closing about 170 branches throughout the country.
  The Meads branch is used by older people; they will not be able easily to go to the town centre to the remaining Barclays branch. If elderly people do not have bank accounts, they are dependent on their local post office. At the same time as bank branches are closing, the Government are introducing policies that will close many local post office throughout the country.
  In conclusion, this Budget—like all the Chancellor's previous Budgets—exists on two levels. On the surface, it is all spin and good news, but when we consider the

  103
  detail—even only 24 hours after the speech—we see that it is full of hidden traps; there are stealth taxes and disadvantages for people in my constituency and elsewhere. I have described how it will affect the health service, transport and older people—especially pensioners—in my constituency and in other parts of the country. Those are the realities, which will become increasingly apparent as the months roll on, of yet another Budget from a Chancellor who taxes more but delivers less.
  8.28 pm
  Mr. John Home Robertson: There is something wonderfully implausible about listening to Tory Members, such as the hon. Member for Eastbourne (Mr. Waterson), calling for more public expenditure after all their years of talking a completely different language. It is even more implausible when the hon. Gentleman does so during the Budget debate after my right hon. Friend the Chancellor's announcement of massive increases in public expenditure—on the national health service and on education, to name but two.
  This year was the first time for many years that I was unable to be in the Chamber to hear the Budget speech. When my right hon. Friend made his statement last week, I was in Stornoway in connection with my new duties as a junior Minister in the Scottish Parliament. However, my right hon. Friend might be interested to know that people in Stornoway were happy to hear reports of the cut in air passenger tax for people living in the Scottish islands. That was well received.
  I welcome this opportunity to commend the Chancellor's skilful management of the economy, and to assure the House that the overwhelming majority of Scots do not subscribe to the peculiar brand of Scottish nationalist economics that we heard again from the hon. Member for North Tayside (Mr. Swinney). He called for more public expenditure and less taxation. That defies logic and invites ridicule. I hope he is aware that we are keeping a careful tally of nationalist spending commitments as they add up over the years. The Scottish school of economics is rather more realistic and rather less reckless. Indeed, we have had the best of Scottish economics from a Scottish Chancellor. I can say with absolute confidence that the Budget will command great respect in Scotland, not least because it provides for such substantial investment in the national health service and in education.
  Unemployment in my constituency is lower than it has ever been in my 22 years as a Member of this place. Living standards are improving as both public and private investment grows. My right hon. Friend's stewardship of the economy is succeeding spectacularly to the benefit of all our constituents. However, as a Back-Bench Member here, if not in the other Parliament north of the border, I hope that my right hon. and hon. Friends on the Government Front Bench will not mind if I express a couple of mild anxieties. After all, that is our job.
  First, important primary and manufacturing industries are suffering to a degree from the weakness of other currencies in relation to sterling. Obviously, that is the consequence of the Government's good management of
  104
  the economy. However, there is legitimate anxiety about advantages enjoyed by importers and the disadvantages endured by exporters from the United Kingdom.
  Mr. Hayes: Will the hon. Gentleman give way?
  Mr. Home Robertson: No. I hope that the hon. Gentleman will forgive me, but I do not have much time.
  The present situation tends to confirm my strong personal belief that it will be in the best interests of the United Kingdom to join the single European currency as soon as circumstances permit. Clearly they do not permit at present, for the reasons that I have illustrated. It will be to the benefit of our exporters especially and our economy in general, especially the manufacturing economy and our primary industries, if we are linked with the European single currency. I hope that it will be possible to make rapid progress in that direction.
  My second concern is about the rights—I think that we should talk about the rights as much as the needs—of pensioners and older people generally. We owe a great deal to those who endured the second world war and the hardships of the post-war years. The extra £50 winter payment in addition to the £200 that my right hon. Friend the Chancellor has already made to those people, together with other measures, is a huge help and an appropriate acknowledgement of our debt of gratitude to them. Unfortunately, the baseline increase of 73p appears inadequate when it is considered in isolation.
  I know that my right hon. Friend the Member for Coatbridge and Chryston (Mr. Clarke) will understand my point, especially in relation to former miners who are suffering from respiratory diseases. I welcome the fact that the Government have been able to provide funds to compensate these people. I wish only that we could move rather more quickly to pay out the money that has been made available for that purpose.
  Thirdly, I hope that the Under-Secretary of State for Social Security, my hon. Friend the Member for Wallasey (Angela Eagle), will forgive the Scottish Minister with responsibility for fisheries for taking the liberty as a Back-Bench Member in this place of saying something about the peculiar predicament of share fishermen that has arisen recently. Share fishermen have always been able to claim benefit when their boats have not been able to put to sea for a period of days. That can happen as a result of bad weather, mechanical breakdown, the skipper having a hangover or for a multitude of other reasons. It is not the fault of the crew if their boat cannot go to sea. Hitherto it has been possible for people to claim benefit in those circumstances. It is vital that they should be able to do so at such times to support their families
  It appears that there has been a recent change in the paying of benefit to share fishermen in the form of the jobseeker's allowance. A number of my constituents have drawn this matter to my attention. The system has changed and it has become a great deal more difficult for such claims to be dealt with. I have written to my hon. Friend the Under-Secretary of State for Social Security and I am grateful to her for her reply, but I reiterate that share fishermen have paid a high rate of national insurance contributions over the years and that they have a unique form of employment. They are not jobseekers in the strict interpretation of the term. From time to time they are prevented, by a range of circumstances beyond

  105
  their control, from going to work. Their families should have the benefit of the support that they have paid for through their contributions. I hope that we shall be able to overcome this local or national difficulty, which has recently come to light in my constituency.
  I am delighted to congratulate my right hon. Friend the Chancellor on a characteristic display of prudence combined with generosity, those two best Scottish qualities. He has made massive investments in the NHS and in education. It is essential that these investments should be translated into real improvement in those services. That is the task facing Ministers, NHS trusts and local authorities. I am sure that it will be picked up with great enthusiasm south of the border, as it will by my ministerial colleagues, Susan Deacon and my hon. Friend the Member for Strathkelvin and Bearsden (Mr. Galbraith), north of the border. The Budget presents great opportunities for investment and for improving services in our country. It is exactly what the people voted for in 1997.
  8.38 pm
  Mrs. Eleanor Laing: It is truly a pleasure to be able to take up the remarks of the hon. Member for East Lothian (Mr. Home Robertson). I mean that, because it is good to see him in this place. It is encouraging to know that he, unlike many of his colleagues, still considers it worth attending the Chamber, despite his membership of the other place north of the border.
  Having paid the hon. Gentleman a compliment which he probably does not welcome, I must immediately criticise one of the first things he mentioned, namely, his theory that the Chancellor is the best Scottish economist. I must disagree with him. The best Scottish economist by a long way was, and always will be, Adam Smith, whose belief was that the country would prosper by having peace and low taxes. How right he was, and how right he still is.
  It is a great pity that the Chancellor of the Exchequer does not appreciate the value of low taxation. By his actions, and from examination of the detail of the Budget, it is obvious that he wants the British people to believe that he believes in low taxation when what he delivers to them is far from that.
  It had not been my intention to speak in the debate. However, because I spent the weekend in my constituency listening to what people were saying about the Budget, I feel an obligation to express their annoyance and anger about how the Budget will affect them. I shall mention two particular matters. The first is the dishonesty of the Chancellor's stealth taxes, and the second is the Government's obvious and complete lack of understanding of small businesses and how they work.
  The stealth tax on which I shall concentrate is stamp duty. Many Labour Members may honestly believe that it affects only a small proportion of the population. In my constituency, that is not the case. The Chancellor has introduced an enormous increase in stamp duty for properties worth more than £250,000. In my constituency—this may genuinely surprise some Labour Members—£250,000 buys a modest, three-bedroomed family house. It is easy to understand who is being victimised by the Chancellor and about whom he simply does not care. The first problem that my constituents have with the Budget, and especially with stamp duty as a stealth tax, is that it is vindictive towards ordinary families.
  106
  The second problem is that the increase in stamp duty will obviously fuel an increase in house prices in the south-east. Of course it will; that is so obvious it is hardly worth mentioning. However, it seems that the Government have not noticed that fact—or perhaps they do not care.
  Like all taxes, stamp duty—which does so in such a sneaky way—takes spending power away from the individual and gives it to the Government. They have estimated that the increase in stamp duty will produce £365 million for the Exchequer by 2003. That is £365 million that people throughout the country will not be able to spend in the way that they would have wished.
  I come now to the affect that stamp duty will have on small businesses. They need flexibility and confidence, not more red tape and extra burdens. However, they constantly receive the latter from this Government and this Chancellor. Stamp duty affects not only domestic but commercial properties. If a small business's ability to invest and expand is burdened by extra stamp duty, it is obvious that the business itself is also burdened.
  Stamp duty has another effect on small businesses. People who buy houses would, in normal circumstances, employ people to work on those houses. However, those people will now be less able to employ others—they will have less money to spend because they will give so much to the Chancellor in stamp duty. That leads to one obvious conclusion: the Government simply do not understand and do not try to understand small businesses.
  I appreciate that the Chancellor pays lip service to small business. However, neither he, nor members of his Treasury team, nor most Labour Members have ever worked as small business people. [HON. MEMBERS: "Not so.''] If Labour Members have done so, I am willing to take interventions from them. Can they tell me that they know from personal experience what it is like not to know how much money one will earn by the end of the month, whether one can attract sufficient orders and how the business will go over the next few months? Do they know about the stress involved? Have they faced the risk of the family home being mortgaged to raise money to expand the business and to employ people?
  In this debate, Labour Members have said that small businesses fuel the economy. That is true. The hon. Member for Coventry, South (Mr. Cunningham) said that. His words were correct, but the arguments that he used to back his case were wrong. The Government clearly do not understand small business. If they did, they would surely not, for example, have increased stamp duty or be pursuing IR35, which entirely undermines small entrepreneurs who are doing their very best to work for themselves and their families and to use the skills that the education system has given them for the good of their communities, their businesses and the country as a whole. The Government pay lip service to those entrepreneurs—but they say one thing and do another.
  Another aspect of the Budget and the Prime Minister's statement the following day angered the constituents to whom I spoke over the weekend. They listened to the Chancellor and read Wednesday's newspaper reports of what he said, but they know that they did not discover what he will do and what the Budget's real effect will be on them. Several of them told me, "Listening to the Budget statement might be entertaining, but it is what the Chancellor does not say that counts." Conservatives

  107
  Members know that it is only a week or 10 days after the Budget that the people of Britain begin to understand what it will mean for them. They understand not because of what Treasury Ministers say, but because of the analysis carried out by Conservative Members.
  What annoyed my constituents most of all was that the Prime Minister gave the wrong figures on how much the Government intend to spend on the health service in the coming years. The Prime Minister stood at the Dispatch Box and gave the wrong figures, and nobody on the Benches behind him helped or corrected him.
  I would never suggest that the Prime Minister would deliberately mislead the House, but I suggest that it is even more worrying that he did not realise that he was misleading the House. He cannot have it both ways. I cannot suggest that he knowingly misled the House, so it is obvious that he unknowingly did so. That has considerably worried my constituents because although the vast majority of them disagree with the Chancellor and the Prime Minister, they should at least be confident that when the Prime Minister gives a figure, it is the truth. How sad that that is not the case.
  8.46 pm
  Mr. Tony Colman: After the rather mealy-mouthed comments of the hon. Member for Epping Forest (Mrs. Laing), may I say that on the streets of Putney and Roehampton there was a great welcome for the Budget, particularly for the new money for education and the health service, and we are seen to be delivering on our election promises.
  My constituents want us to be elected for a second term, and they want to ensure that, unlike the Tories, who appear to be committed to reducing spending on the NHS with their so-called guarantee of tax cuts, we are committed to increasing health service spending. Indeed, we are the only party with that commitment. Money for the health service is particularly important to my constituents, who want to ensure that the new community hospital at Queen Mary's university hospital in Roehampton is completed. That will happen only if there is a Labour Government.
  I want to draw to the attention of the House the Budget's strengths in wealth creation. I support the measures that will encourage enterprise in the British economy; this is very much a Budget for enterprise. I state an interest in that I am chair of the Share Issues Group—I hasten to add that the position is unpaid—which has met the Financial Secretary to the Treasury several times to discuss issues concerning share options. I am particularly drawn to those matters because in my time as a managing director I took great advantage of the available share options schemes. It is important to reward people at all levels within a business, and the initiatives in the Budget are excellent ways to ensure that we will do so.
  Mr. Hayes: Will the hon. Gentleman give way?
  Mr. Colman: No, I am afraid that I do not have time.
  I draw the attention of the House to the new enterprise management incentives scheme, and the increase from 10 to 15 in the number of employees in small companies
  108
  who are eligible to join the scheme. That will help in the recruitment and retention of key employees by small higher risk companies.
  Mr. Hayes rose—
  Mr. Colman: I shall not take interventions because we are very short of time.
  The access to tax advantage share options of up to £100,000 is obviously important to ensure that those who take the risk of getting involved in start-ups are able to benefit.
  Warming to my theme, I am particularly concerned about the all-employee share plan schemes, which the Budget has made attractive to companies of all sizes and much easier to operate. I was particularly pleased that the save-as-you-earn share save scheme remains in the armoury of available options. That has been the bedrock of saving by employees because it ensures that they are all able to save in a building society on a failsafe basis and purchase shares at a pre-agreed price. More than 1,200 companies currently have an SAYE share save scheme and 1.75 million employees are in those schemes. A second scheme that will continue under the Budget is the company share option scheme. Currently, 3,570 companies are part of the scheme, covering 450,000 employees.
  Most important is the confirmation provided in the Budget that we are going ahead with the new all employee share plan, the details of which are set out in Inland Revenue REV3. I shall outline the advantages of the new scheme. Employers can give employees shares worth up to £3,000 each year, free of tax and national insurance. Out of their pre-tax salary, employees can buy partnership shares up to a maximum value of £1,500 a year, again free of tax and national insurance. Employers can match those partnership shares by giving employees up to two free shares for each partnership share that they buy. That is an extremely important means of encouraging share ownership.
  Initial indications are that 350 employers in the United Kingdom are expected to set up such a scheme in the coming months, as it comes into operation. The result will be that an additional 500,000 employees in the UK will, for the first time, own shares in the company for which they work. That number is expected to grow to about 2.5 million over the next three years. I hope that hon. Members on both sides of the House applaud such an increase in employee share ownership—in fact, I see the Opposition spokesman, the hon. Member for Arundel and South Downs (Mr. Flight), nod in agreement. It is nice to see Opposition support for the Budget.
  A cause of concern that has been the subject of a meeting I had with Treasury representatives is national insurance charges and unapproved share option gains. It should cause the whole House concern, as it does the Government. I remind the House that the concern centres on dot.com companies, which often encourage employees who have scarce skills to join them, not by paying high wages, which they cannot afford, but by offering large unapproved share option gains. I applaud such a means of tackling the scarcity of skilled individuals, for if we do not solve that problem, such companies will move abroad, especially to the United States.

  109
  The Government have proposed a consultation on three options to resolve the problems. The proposals would allow
  a voluntary agreement between employer and employee that:
  All the employer's NICs liability on unapproved share option gains will be met by the employee, or
  Part of the employer's liability on these gains, or the excess above a predetermined amount, will be met by the employee, or
  The employer's NICs liability is to be met by the employee but, by mutual agreement, the employer could take on the statutory liability at the time it is incurred.
  It is extremely important that we resolve that issue. My hon. Friend the Financial Secretary to the Treasury tells me that the timetable for the consultation is extremely limited and that he looks forward to introducing measures—perhaps in the other place—to deal with the problem.
  Labour Members might be surprised by my paean of praise for share options, but it is important to realise that share options can spread wealth to everyone who works in industry and commerce. In California, even those who have played only a modest role in a dot.com start-up—perhaps as a cleaner or a secretary—can become dollar millionaires through the success of the company in which they have invested their time and effort. It is not enough to own shares in a pension fund, at arm's length; we need the hands-on experience of share ownership in the company for which we work, so that we get behind it.
  One of the great problems of capitalism is that there are not enough capitalists. I was in Atlanta recently and picked up a book by one Jeff Gates, called "The Ownership Solution—Towards a Shared Capitalism for the Twenty-First Century". I recommend it to the House. The author argues that we need to ensure that there is more share ownership across the entire community.
  James Wolfensohn, the president of the World bank, has said:
  "Ownership is the sine qua non of sustainable development.
  Bob Swann, who is president of the Schumacher Society, has stated:
  "The community we all long for can't be realised with only 6 per cent. of the population owning shares. This has to change.
  The Budget is a first move to ensure that we are re-engineering capitalism for inclusion. I recommend it to the House.
  8.55 pm
  Mr. Tim Collins: The hon. Member for Putney (Mr. Colman) will forgive me if I do not follow his interesting remarks on share ownership, given the lack of time available. I entirely agree with him as to objective, although there will inevitably be some differences between us about the method of achieving that objective.
  I shall make some general observations about the Budget, before turning to specific constituency points. The hon. Member for Bexleyheath and Crayford (Mr. Beard) said earlier that he would speak about a ghost at the feast. There seem to me to be three or four ghosts at this feast, of which the first and perhaps most worrying is the collapse in the savings ratio.
  The Chancellor and the Prime Minister are fond of speaking about the fact that the Budget and their economic management have laid the ground for strength
  110
  and economic stability in the future, but nothing could more clearly indicate the way in which they are storing up trouble for the future than the fact that the savings ration has halved since 1997.
  That was in direct response to the outright declaration of war against the pension funds, which the Government launched in their first Budget, with the £5 billion a year raid on pension funds; the abolition of PEPs and TESSAs—working systems—and their replacement with what can generously be described as an imperfect and untried ISA system, which is much less generous in its tax treatment; and a reform of the social security system, if it can be graced with that noun, which has resulted in a situation in which, I am told, unless one can be sure to retire with a pension fund worth £100,000, it is not worth saving at all through one's working life. That is the situation that the Government have produced.
  The second ghost at the feast is the issue of economic growth. Why is it that as far ahead as the Red Book can project, economic growth under the Blair-Brown economic miracle is not expected to return to the level at which it was in the last year of the previous Conservative Government? Not for as far ahead as the Government can foresee do they foresee economic growth getting up to the level at which it was when there was a Conservative Administration in charge.
  The third ghost at the feast is the Government's projection of a doubling of the balance of payments deficit—hardly an indication of a strong economy, soundly based for the future. In that context, I refer to the remarks that a Downing street spokesman—no doubt Mr. Alastair Campbell—is supposed to have made today about Sellafield in Cumbria. Whatever one's views about nuclear processing, that happens to be the single greatest generator of foreign exchange, bar none, in this country.
  The spokesman said that it was now up to Sellafield to make its own case. That was an abdication of responsibility, an insult to more than 10,000 extremely skilled workers in Cumbria and an indication of a somewhat flippant attitude towards a very important generator of foreign exchange.
  A filling station owner in my constituency told me recently that he takes in £1.8 million a year at his filling station, of which £1.7 million a year goes straight off to the tax man. He says that he might as well take down the BP sign and put up a sign reading "HM Inland Revenue".
  The Budget contained yet another increase in petrol prices. We see an urban-based Government who have no recognition of the impact on my constituents and those of some of my hon. Friends, for whom the car is not a luxury or an option, but a necessity. In my constituency, some of the poorest people are two-car families. Both cars may be ramshackle, but that is the only way in which those families can access even the modicum of public services available in rural areas. In that respect, the Budget was extremely disappointing for people in south Cumbria.
  Before I deal with other constituency points, I shall take up the charge that has been made by several Labour Members, that Conservatives can never advocate greater spending in their own constituencies because there is no such thing as waste under the Government. It is impossible to reallocate priorities and inconceivable that one could identify savings. Perhaps I can give the odd example of possibly being able to find a penny or two to spend more wisely elsewhere.

  111
  Let us consider the £1 billion a year extra that is being spent simply on administering government. The Chief Secretary, who is present, is the guardian of the public purse. Why not establish a rule that if three Cabinet Ministers travel from this country to the same meeting, they must travel on the same aeroplane rather than having one aeroplane each? That might save some money for more worthy causes.
  What about the hundreds of millions of pounds that are wasted through the Government's mismanagement of asylum seekers? Huge amounts of public money are spent unnecessarily because the Home Secretary has lost his grip on his Department.
  Police officers in my constituency, to whom I spoke on Friday, are greatly worried about the reports that the cost of the inquiry into the events on Bloody Sunday 28 years ago could escalate to £100 million. For 2 per cent. of that sum, Cumbria constabulary could be removed from its current predicament of having to sack police officers, shut police stations and withdraw services from people across that rural county. I do not believe that a historical inquiry needs to spend 50 times more than the amount of money that would relieve the policing problems of my constituents and the county of Cumbria.
  It is a question of priorities. My hon. Friend the Member for Eastbourne (Mr. Waterson) referred to the saga of a bypass in his constituency. It was postponed by the Government, although it was ready to roll when they came to office. He said that £5 million had been paid to a contractor so that he would not build the bypass. The bypass will fortunately be built.
  However, in my constituency, we still await the completion of the A590 High Newton and Low Newton bypass. Sadly, that bypass, which is the Barrow-in-Furness industrial area's only link to the rest of the country and passes through two stone farm buildings, despite being a dual carriageway for the remainder of its length, is needed to avoid a death trap. Only 10 days ago, someone was again killed on that stretch of road because the Government postponed the construction of a bypass that is desperately needed. Yet again, the Government make false economies, and believe that they save money while they rack up costs in lives and public expenditure by not spending wisely.
  Let us consider the national health service. The tentacles of the Inland Revenue reach Cumbria, and plenty of money is siphoned out of south Cumbria. Sadly, less of it is recycled. The Westmorland Gazette has run an excellent campaign called Heart Line, which draws attention to the fact that the number of people who wait for more than a year for heart bypass operations has more than doubled in south Cumbria since the Government were elected. One gentleman, Mr. Gordon Graham, who fortunately had his operation last week, had to wait almost 18 months for a life-saving operation, yet the Government boast about the billions of pounds that they announced last week for the NHS.
  Six months ago, £50 million was announced for heart care, but none has yet been allocated to the north-west, even though the region has the worst heart problems in the country. We do not want announcements; we want to know that the money will be transferred from the sticky fingers of the Whitehall bureaucrats to the people who need to spend it.
  112
  I want to quote from a copy of a constituent's letter to the Prime Minister. The Chancellor is present, and he ought to hear it. My constituent lives in Grange over Sands. Her letter to me states:
  Find enclosed photocopies of my tax forms and pay slips. The most recent tax forms show that I will be thousands of pounds down in the taxable allowances I would normally get, starting in the tax year April 2000.
  This is … a result of decisions made by your government.
  She explains that she is a teacher at a comprehensive school, where she works five days a week. She is a care worker on Friday evenings, Saturdays and Sundays. How on earth, she asks, can she be expected to manage on a cut of £70 a month?
  The Chancellor should note these words:
  I voted for a Labour Government for all the years the Conservatives were in power and so far I have never been poorer … I will never vote Labour again. You are simply a bunch of liars.
  Millions of others will never vote Labour again.
  9.5 pm
  Mr. Ivan Henderson: I can tell Ministers that the head teacher of Clacton County high school, whom I met today, was very pleased with the £50,000 that the Budget has given his school.
  My constituency contains a mixture of leisure industries, small businesses, large businesses and resorts. It also contains all the problems that resorts bring with them—for instance, areas of severe deprivation. The fact that the Government are working with a task force to examine some of the problems of seaside resorts has been welcomed by those living in what could be described as pockets of deprivation.
  The Chief Secretary to the Treasury, my right hon. Friend the Member for Oxford, East (Mr. Smith), will know of the problems in my area. We launched the new deal there because unemployment was so high—owing, I might add, to the shipping policy of the Conservative party. It decimated the British shipping industry. The Government have introduced a tonnage tax in an attempt to repair the damage.
  Let me return to the subject of education, and point out that the £50,000 provided for the head teacher in Clacton was in addition to the provision of an education action zone covering 23 schools in my area, £3 million for the next three years and the promise of a language status college for the Harwich school. Pupils there are looking forward to working with those in other countries, learning Dutch, Chinese languages and Spanish.
  Mr. Hayes: Will the hon. Gentleman give way?
  Mr. Henderson: No, because I do not have much time.
  Seaside resorts contain many retired people. More than 30,000 pensioners in my constituency welcome the minimum income guarantee, and 12,300 welcome the Government's introduction of free television licences. Those pensioners also welcome the winter payment of not £20, not £50, not £100 but £150 that they will receive. The other day, a pensioner in my constituency reminded me that pensioners had to wait for seven days and freeze before they got £10 out of the last Government. Now they have £150 automatically, irrespective of weather conditions.

  113
  Pensioners in my constituency also welcome the additional funds for rural transport. The links between Harwich and Clacton were withdrawn under the Conservative Government because of their deregulation of bus services. Now pensioners can benefit from bus services in seven villages, following their previous isolation; moreover, from next April they can benefit from bus services with no charge for bus passes and half-price bus fares. More than 30,000 pensioners will benefit.
  Mr. Russell Brown: Free bus passes for pensioners are a godsend. Does this not open up avenues to which pensioners have never had access before? Pensioners who have felt trapped in the past will now be able to travel thousands of miles.
  Mr. Henderson: My hon. Friend is dead right. Pensioners in my constituency lost that choice under the last Government. Indeed, pensioners in the constituency of the hon. Member for North Essex (Mr. Jenkin) have gained from the establishment of transport links in several villages, from Manningtree to Clacton. They have written to me to congratulate the Government on restoring those rural transport links.
  My pensioners know that the previous Government, not this Government, withdrew the wages link with pensions. My pensioners know who abolished free eye tests—not this Government, who restored them. My pensioners know which party put value added tax on fuel—not the Labour Government, who made it as low as they possibly could. The Conservative party deregulated bus services and left my pensioners without services, but this Government have put more money into rural transport to make it much easier for them to get to towns around my constituency.
  9.11 pm
  Mr. Matthew Taylor: Over four days of debate the parties have set out their election platforms, and none more clearly than the Conservatives, who have responded to the Budget and will seek to fight the election with claims of a tax-cutting agenda. However, those claims have been revealed to be entirely incredible on four grounds. First, when presented with health and education increases, for which they did not ask, they merely rolled over and accepted. There is no argument that health and education need that money, but equally no Conservative Members argued for those increases before the Budget—they argued for tax cuts. There is no credibility there. Their credibility falls further away if we read their policy documents, which argue for extra money for roads, police, prisons and the Army. The list goes on.
  The Conservatives also have no credibility because we are about to hear from a shadow Chancellor who argues against the very tax increases that he started to implement when he was a Treasury Minister—cutting mortgage interest relief at source and the married couples allowance and introducing the fuel tax escalator. There is no credibility there.
  The fourth reason why the Conservatives have no credibility is also the very reason why the British public have remained mystified for three years about why they have not seen the improvements in public sector services such as health and education that they might have expected. In fact, the Government have got rid of the Tory
  114
  deficit—£28 billion in one year—which they inherited. It was a record deficit when the shadow Chancellor was at the Treasury.
  The tax increases which have been imposed—the Government made a nonsense of themselves by pretending they had not happened—have closed the deficit gap—as, indeed, the Conservative Government planned to close it through tax rises as well. It has been closed, but as a result the extra money has not gone into public services in substantial amounts. The tax increases have paid for the deferred taxation to which the previous Conservative Chancellor frequently refers, the deficit run up by the shadow Chancellor and his hon. Friends.
  Only now, with the deficit closed, are the Government starting to put serious money into some public services. However, the problem is that they have deceived the public by claiming increased funding that did not really take place. That is Labour's credibility problem. If there is any startling element in the Budget, it must be the fact that Ministers keep a straight face when they talk about "massive improvements" and increases of £2 billion for health and £1 billion for education, when only a week ago they were telling us that they had put £21 billion into health and £19 billion into education. One or the other is not true, and we all know that those earlier huge increases were not true. They never existed—they were funny money, which is why the public services did not receive them. If they were true, Labour Members could not boast of the £2 billion for health today.
  Having said that, at last we are talking real money. Now the health money is real, not funny money. It happens to be the money that we advocated for the Budget—what we proposed, to the penny. We shall not criticise that proposal. During debates in the past few weeks some Labour Members have said that our comments on health were carping, but I do not know what more we can say. We acknowledge that the Government are right, it is the right amount, it is being put in now and it will make a difference. We think that the money should have been provided earlier, but when we argued for that we were told that we were being unrealistic. What was unrealistic one week is prudent this week, but we welcome it none the less.
  Labour Members must understand that sticking to Conservative Budget proposals in the early years of this Parliament for longer than was needed, stacking up an election war chest, has resulted in the problems in health of which we are all too well aware. People have not had treatment when they needed it, and some people have lost their lives as a result. It has been bust and boom in the public services, even if the Chancellor can rightly say that he has avoided that in the economy.
  We are also starting to see real money for education, but it is not sufficient for the changes that Liberal Democrats would like. It will not guarantee average class sizes of no more than 25 in primary schools. It is certainly not sufficient to abolish tuition fees in England and Wales, as they will be in Scotland thanks to the Liberal Democrat influence in government there. It will not be sufficient to increase higher education funding as a proportion of national wealth, which has been slashed since Labour came to office.
  Most significantly, the money will not be sufficient to reach the proportion of our national wealth spent on education under the Tories. That is the extraordinary thing

  115
  about the Labour record on education. Labour pledged to raise the proportion of wealth spent on education, but in fact it has been cut.
  In the Budget debate last week, the Secretary of State for Education and Employment claimed that next year the proportion of national wealth spent on education would reach 5 per cent. compared with the 4.9 per cent. inherited from the Conservatives. That sounds rather good, but when we look at the figures it turns out not to be true. We asked the House of Commons Library if it could come up with that figure, but the answer was no. We phoned the Department for Education and Employment and asked it how it had come up with that figure, but it did not know. It suggested various possibilities, but when we said that none of them seemed to work, it said that we were right. We asked the Library to ask the Department for Education and Employment, and it could not come up with a figure either. It seems that an apology is due to the House.
  The Secretary of State for Education and Employment has given a figure that not one official or the House of Commons Library can substantiate. The Government will not meet the 5 per cent. figure next year. Indeed, they will be at least a couple of points short. Over the Parliament, on average they will be short of what the Conservatives spent. Not one single year so far have the Labour Government given an increase of the size provided each year under the previous Prime Minister.
  Education has certainly not been the Government's priority. Why is that, and why have pensioners been short-changed? The Government talk about an increase in pensioners thresholds, but that will not come in for a year. They talk about a review of the amount of savings that pensioners are allowed, but any proposals will not come in for several years. If pensioners are lucky enough they will get 75p on their basic pension, but a woman with a low record of payments will get less than that.
  The Chancellor likes to include the £50 extra winter fuel payment, but we should not forget that it is not on the terms suggested in the briefings: it is a household payment, not an individual payment, so it does not add anything like £1 a week on top of the 75p. Why have the Government done that? There are two possible answers. First, they did not mean it when they said in their manifesto that they wanted pensioners to share in the growing wealth of the economy. Even allowing for the heating allowance—the one payment that pensioners will get in the coming year as well as the 75p—pensioners will share in only half the growth in the economy and a third of the growth in average earnings. That is not pensioners sharing in the growing wealth of the economy.
  Secondly, the Chancellor has attempted to put money into health at the same time as making a 1p cut in tax. Therefore, he could not give the amount that is actually needed in education and, even more important, had to raid the social security surplus, giving £2 billion to health, which meant that it was not available for pensioners, who lose out. Labour Members know that that is true and how angry pensioners are. I hope that they are making that message clear to the Chancellor. They have time to try to retrieve the situation and to show that the Government believe in the state pension.
  A great unspoken element of the Budget is the high pound. There are the problems at Rover. There were 120,000 job losses last year. Exports are down 9 per cent.
  116
  Imports are up 10 per cent. From November to now, the predicted trade deficit has doubled from £10 billion to £20 billion—a record. The Chancellor had nothing to say about any of that. He is willing to let jobs go in farming and manufacturing. He has forgotten that he has a task beyond tax and spend: to look after those in real jobs in those areas.
  9.20 pm
  Mr. Michael Portillo: I begin by welcoming the right hon. Member for Ashton-under-Lyne (Mr. Sheldon) back to the House.
  I congratulate the Chancellor of the Exchequer. There is no denying that he is a clever fellow, but I congratulate him in particular on his luck: he is a lucky Chancellor. He did not invent the British recovery. The economy has been growing since 1992. Unemployment has been falling since 1993. He did not invent either the fantastic performance of the American economy. Nor did he invent the recovery in Europe.
  When we listen to the Chancellor deliver any Budget, we see that he is well aware that he is clever, but it is not apparent that he is aware that he is lucky. He repeats the phrase "boom and bust" so often that I am afraid that he believes that he has abolished the economic cycle. Hubris comes before nemesis. Pride comes before a fall. Any Chancellor who thinks that he has abolished economic cycles has lost touch with the real world. That is when Chancellors make mistakes. No Labour Chancellor's career has ended in success. I do not suppose that his will end in success, either. Perhaps the Budget is the beginning of the end for the reasons that my right hon. Friend the Member for Haltemprice and Howden (Mr. Davis) and my hon. Friend the Member for Bury St. Edmunds (Mr. Ruffley) gave.
  The Chancellor is never too old to perform new tricks. This year, he raised tax allowances and duties by the rate of inflation. That sounded even-handed, but it turns out that tax allowances that reduce the tax that we pay rose by a measure of inflation that was calculated as 1.1 per cent. The duty on petrol was raised by a different measure of inflation that came out at 3.2 per cent. The difference between the two raised £500 million in extra taxes for the Chancellor. Anyone watching, or any taxpayer who used such a trick when filling out a tax return, would receive a visit from the Inland Revenue before he could say, "Geoffrey Robinson."
  When the Chancellor describes the Budget as "Prudent for a Purpose", people will have every right to ask what he means by that: how prudent is it and what is the purpose? This is the Chancellor who has attacked prudence whenever the British people have shown prudence. He attacks people who save. He has scrapped the married couples allowance and so attacked people who marry. Starting next month, couples will lose £200 a year. By scrapping mortgage interest relief, he has attacked those people who wanted to own their own homes and is costing them £225 a year.
  Then the Chancellor attacked people who wanted to make provision for themselves in pensions. The average 30-year-old will have to invest £200 extra a year to make up just for the tax that the Chancellor has taken out of people's pension funds.
  The Chancellor said that this would be a Budget for hard-working families. However, new figures—independent figures—from the Library released today

  117
  show that a typical working family is already paying £670 extra a year under Labour. As the hon. Member for North Tayside (Mr. Swinney) said, that includes the punitive tax on petrol. Yet, Labour Members still have the gall to pretend that working families are paying less tax than at any time since the Government of my right hon. Friend the Member for Old Bexley and Sidcup (Sir E. Heath), who is in the Chamber.
  The Chancellor repeated that ludicrous claim on Sunday, on the "Breakfast with Frost" programme. The only family that is like that—the mythical Brown family—is a family that does not smoke, does not drink, is not married, does not drive a car and does not even have a local council. The Chancellor's claim to be cutting tax on families is pathetic. No one believes it, and he should at least come clean and admit that it is absolutely bogus.
  If the Chancellor is out of touch with families, he is out of touch with the new economy, too. In the global economy, highly mobile individuals and highly skilled people will seek out the low-tax environment and the low-tax Finance Ministers wherever they can find them on the face of this globe.
  Mr. Derek Twigg: Will the right hon. Gentleman give way?
  Mr. Portillo: Not on this point; sit down.
  The Chancellor has become wholly insular.
  Mr. Twigg: Will the right hon. Gentleman give way?
  Mr. Deputy Speaker: Order. The right hon. Gentleman has stated that he is not giving way, and that should be enough.
  Mr. Portillo: The Chancellor has become a Canute-type figure, wishing away the tide of global competition and closing his eyes to the threat to the London stock exchange that is posed by the lower rates of stamp duty in other markets. He ignored the threat to gambling revenue from internet gaming. He failed to see that higher tobacco might reduce revenue and boost smuggling, but he has pressed on regardless.
  Now we come to the infamous IR35. In this Budget, the Chancellor doubled his estimate of how much that tax would raise—and so we must now double our estimate of how bad will be the brain drain and how bad will be the damage to Britain. IR35 is one of the taxes that this Chancellor of the Exchequer never even announced in the House of Commons. This year, he showed at least some consistency by not announcing another stealth tax that also is aimed at the new economy and that also sounds like a character from "Star Wars". This year's IR35 is called BN2J. BN2J is the Chancellor's stealth tax on British world-beating companies and an attack on double taxation relief.
  The world's largest accountancy firm said that BN2J will make the United Kingdom one of the least attractive locations for international companies. [Interruption.] All that Labour Members can do is to jeer at the world's largest accountancy firm. They jeer because the Government do not realise that, in the new economy, the choice will not be between lower taxes and better public services. In the long run, taxes must be low enough to
  118
  attract investment from all around the world, so that we can fund better public services. The Government are taxing more and regulating more, and Britain is headed in the wrong direction.
  As for the Budget speech, I say, as my hon. Friend the Member for Louth and Horncastle (Sir P. Tapsell) said: the Chancellor devoted so much work to the things that did not appear in his speech. If he had announced the taxes clearly in his Budget speech, he would have been forced to admit that taxes have increased by a net 8p under this Government—a 9p up, 1p down Budget. We know that this is a Chancellor who dispenses with tradition. However, now he has dispensed with the ultimate tradition of announcing Budget tax rises in his Budget speech. Moreover, all those tax rises have been introduced by a party whose Prime Minister promised not to increase taxes "at all".
  Mr. Barry Gardiner: I am grateful to the right hon. Gentleman for giving way, particularly on that point about not increasing taxes. He and his leader have guaranteed that they would give away £15 billion in tax cuts to the richest members of society. What effect would that have on public services?
  Mr. Portillo: We have made no such pledge. I do not know what the hon. Gentleman is talking about.
  The tax rises were introduced despite the fact that we had been promised no tax rises. Labour Members now like to claim that the Prime Minister never said that, but they should reflect on the fact that they would not even be in the House today if he had not told the British people that. He has not fulfilled his promise.
  There are many other prime ministerial promises that he has not fulfilled either. He said that class sizes would be smaller, but they are larger today. He said that waiting lists would fall, but the waiting list to get on the waiting list is double today. He said that he would be tough on crime but, for the first time in six years, crime is rising again in this country. [Interruption.]
  Mr. Deputy Speaker: Order. I must plead with the House to come to order. The right hon. Gentleman is addressing the House and there should be no private conversations. [Interruption.] Order. That goes for Mr. Bercow as well.
  Mr. Portillo: We have heard promises, promises, promises from the Government. For three years they have been a promising Government, but those promises look pretty pale and washed out today.
  It turns out that the Chancellor is not so much clever as too clever by half. The press and the public now do not believe a word of his Budget. Even the BBC chose to advertise their Budget coverage by saying that it would be
  an analysis of everything the Chancellor won't be saying.
  The Sun newspaper said that it was a Budget that would need the seven-day test before judgment could be passed. It has indeed been a seven-day wonder. Today, on the seventh day, let us review where we have got to: day 1, the CBI said that this was not the Budget that they had been hoping for; day 2, a double taxation measure in the Budget's small print was exposed as costing British business billions of pounds; day 3, more small print was exposed, with a massive hike in company car tax; day 4,

  119
  contrary to what the Chancellor said in his Budget speech, figures showed that the net increase in the Budget was £1.4 billion of extra taxation; day 5, we had the revelation that different rates of inflation had been used for computing allowances that benefit people from those used for duties that people have to pay; day 6, the Health Secretary admitted that the 10,000 new nurses announced by the Chancellor were not 10,000 new nurses at all, but a reannouncement; day 7, which is today, new figures have shown that the average burden of taxation on a typical family is £670 extra a year under Labour. The Budget has unravelled. It is not so much a seven-day wonder as another demonstration that a week is a long time in politics.
  Mr. Beard: When my right hon. Friend the Chancellor has proposed increases in spending on the health service in previous Budgets, the Conservatives have denounced it as reckless. Now the Government propose to spend even more, the Conservatives endorse that spending.
  Mr. Portillo: Another Member who cannot get his facts right. We never denounced the increases in health spending.
  I am coming to the issue of health. The Prime Minister came here on Wednesday and delivered a mass of gobbledegook about the health service. It was the most embarrassing performance from a Prime Minister in the House of Commons in living memory. It was extraordinary. The Prime Minister who had announced enormous increases in health service spending gave us a demonstration of how to snatch defeat from the jaws of victory.
  Mr. Ivan Henderson rose—
  Mr. Portillo: The hon. Gentleman might learn something if he keeps his seat for a moment.
  We welcome the extra money for health and education and we are committed to good public services, but we want good value for money.
  We have been promised so much by the Government. We were promised huge results from the first comprehensive spending review, and it turned out to be a comprehensive spending failure. Now, at least if the national health service turns out not to improve at all, we will know who is to blame. The Prime Minister has taken responsibility personally for this. The Prime Minister is running things—just as he did with welfare reform, and he ran that straight into the sands.
  I re-emphasise that we support the extra money on health and education. [HON. MEMBERS: "Oh!"] Oh yes. However, we do not support all the Government's record on public spending. We do not support the tens of millions of pounds that the Government are spending on scrapping the pound sterling when the moderate majority of people in this country want to keep the pound. We do not support the hundreds of millions of pounds incurred by the Government by making Britain into a soft touch for asylum seekers. We do not support the £1,000 million pounds extra that the Government are spending on running Whitehall Departments.
  120
  We do not support a £32 billion increase in social security spending, which comes from a party which said that it would not have to increase taxes because it would take all the money from reducing welfare bills.
  Several hon. Members rose—
  Mr. Deputy Speaker: Order. The right hon. Gentleman does not want to give way. A lot of noise is coming from those on the Government Benches. I do not want to hear them again.
  Mr. Portillo: This was the Chancellor's fourth Budget. Over the previous three Budgets, the Chancellor has built for himself a reputation for slipperiness and for obfuscation. [Interruption.]
  Mr. Deputy Speaker: Order.
  Mr. Portillo: The Chancellor has become famous for his fine delivery on the day and his non-delivery after that.
  For those who were on the look-out in the Budget for more tricks than treats, it entirely lives up to those perverted expectations. The Chancellor talked of prudence, but he has flouted his own rules for developing responsible public spending plans. He has committed Britain to returning to borrowing even if the economy continues to grow without interruption. He has talked of helping pensioners, but he has abolished their married couple's allowance and the additional age allowance that applied to older people.
  The Chancellor claimed to be helping single parents, but he abolished the personal allowance on which single parents rely. He boasted of helping families, but he has swept away their tax allowances and he has loaded duties on to families' essential weekly spending. He posed as the friend of business while managing to increase problems for the old economy, and he has piled on extra taxes to make sure that we keep the new economy at bay. His slogan was "Prudent for a Purpose", but he has cut the ground from all those people who have been prudent with the purpose of providing for their future.
  After so much twisting and spinning, the public are awake to the Chancellor's tricks. After so many launches and relaunches for the NHS, nobody expects anything now beyond political grandstanding and jobs for the boys. This is indeed a Chancellor who taxes more and delivers less.
  9.39 pm
  The Chief Secretary to the Treasury (Mr. Andrew Smith): Before I start, Mr. Deputy Speaker, I have to draw the attention of the House to the fact that there have been two minor amendments to the original Budget resolutions as they now appear on the Order Paper. These are to take account of representations to widen the scope of the provisions affected.
  First, on resolution 28—concerning the gift of shares to charities—the original proposal, announced in the pre-Budget report, was to allow only gifts of listed shares to charities. Following representations on the proposal, an extension to a wider range of shares and securities was announced in the Budget, and that is what is in the Order Paper.

  121
  The provision on the tax treatment of acquisition, disposal or revaluation of certain rights in resolution 41 has been widened to allow tax relief for all indefeasible rights to use a telecommunications cable system and not only the international submarine ones mentioned in the original wording. Both changes are designed to widen the scope of the new tax reliefs, and should be welcomed by all hon. Members.
  Unlike the shadow Chancellor, it will not take me 13 minutes to get to the health service. Nothing could have been clearer from the right hon. Gentleman's speech than that the Tories are the party of privatisation of the health service.
  What is the Tory reaction to the Budget? For most of the week, the Tories put their faith in Mr. Wyman of PricewaterhouseCoopers. Mr. Wyman claims that billions of pounds—£8 billion to £10 billion, even—will be lost if we impose measures to tackle tax avoidance. The Opposition jumped on the tax avoidance bandwagon, claiming that Mr. Wyman right, yet when he came to the Treasury, he could not produce the name of one company, one piece of analysis or one figure to make his claims stand up. He promised to bring us the name of a company affected, but could not. Then we find that Mr. Wyman is no ordinary adviser: he was the former tax adviser to Neil Hamilton when he was the Minister for Corporate Affairs. That is the shadow Chancellor and the Conservative party: the tax avoider's friend.
  In opening the debate, my right hon. Friend the Secretary of State for Social Security set out eloquently how we are building on the platform of stability that we have been creating over the past three years. We are able to meet our rules of fiscal prudence while at the same time releasing significant new resources for the nation's priorities: tackling child poverty, providing extra support for pensioners and encouraging work and enterprise. That was all widely welcomed by my hon. Friends.
  We had an extraordinary reply from the hon. Member for Havant (Mr. Willetts), who said that he could understand a totally means-tested system or a totally universal system; what he plainly could not understand was a pragmatic mix of universal entitlement and targeted help to ensure that we help all pensioners while getting the most help to the poorest. Let us remember that by 2001 we will be spending an extra £6.5 billion on pensioners, and as a direct result the average pensioner household will get an extra £400 a year and the 1 million poorest pensioners will be £1,000 a year better off.
  Of course there is more to do, as we have said, but there could not be a clearer contrast between Labour in government, tackling pensioner poverty, and the Tories in government, who allowed pensioner poverty to grow to obscene levels.
  Now the shadow Social Security Secretary threatens to take away the winter fuel payment. When directly challenged by my right hon. Friend, he refused to say that the Tories would keep it. There could be no clearer illustration of the fact that the Tories cannot square their so-called tax guarantee with civilised levels of public provision. We heard nothing whatever from the shadow Social Security Secretary or from other Conservative Members about what the Tories would do—two brains, no policy seemed to be the message.
  My hon. Friend the Member for Stalybridge and Hyde (Mr. Pendry) welcomed the Budget's health and education commitments in particular, and asked a specific question
  122
  about the transfer of land for social housing that his local authority, Tameside, was completing ahead of Royal Assent to the Finance Bill. He sought the opportunity to present Tameside's case for exemption from stamp duty. I assure my hon. Friend that I shall look into the matter, and I will be pleased to give the council the opportunity to make that case.
  The hon. Member for Northavon (Mr. Webb) asked why we had not put the extra money for the winter fuel allowance on the basic pension. The answer is very simple, and it was given by my hon. Friend the Member for South Thanet (Dr. Ladyman). It is that to do so would have no benefits whatever for the poorest pensioners. What is more, the course suggested by the hon. Member for Northavon would be subject to tax. It seems that the Liberal Democrats are as usual engaged in striking postures way beyond anything that they promised in their election manifesto. In reality, they do nothing to help those in greatest need.
  I welcome the positive things about the Budget that my hon. Friend the Member for Liverpool, Walton (Mr. Kilfoyle) said. I thank him for his recognition of the good things that we are doing to improve the health service and schools in his constituency. This was a Budget for the whole country, and it is right for the Government to take positive action to ensure that the benefits are shared across all regions and nations of the United Kingdom.
  In my hon. Friend's region alone, the new regional venture capital funds will help create £210 million in funding for investment. The north-west employment zone will provide tailored help for 6,500 long-term unemployed people. The three action teams for the region, each receiving funding of £1.5 million, will help match the unemployed to vacancies in a further three areas in the north-west.
  The new deal has already helped 57,000 young people in the region where the constituency of my hon. Friend the Member for Walton lies. Moreover, 170,000 families in the region will benefit from the working families tax credit, and 200,000 families benefit from the minimum wage. I hope that the whole House will welcome the actions taken in a Budget that is a Budget for the whole country.
  My hon. Friend the Member for Walton also asked about the structural funds and match funding. The right hon. Member for Caernarfon (Mr. Wigley) made the same inquiries in relation to objective 1 funding. I assure the House that those matters are being considered as part of the spending review. We fully appreciate their importance for regional regeneration, and we are committed to making them a success. However, we must not forget that we only got objective 1 status—for west Wales, the valleys and all the other regions—because people elected a Labour Government.
  The hon. Member for Louth and Horncastle (Sir P. Tapsell) questioned the overall fiscal stance of the Budget. Not only does the Budget represent fiscal tightening as compared to the plans announced last year—to the tune of 0.3 per cent. of gross domestic product next year, and 0.2 per cent. of GDP the year after—but it keeps the public finances sound. This year's projected current

  123
  surplus is £17 billion, while the projected figures for subsequent years are £14 billion, £16 billion, £13 billion, £8 billion, and £8 billion.
  Sir Peter Tapsell: How is it possible to argue that this Budget is tightening the fiscal position and, simultaneously, to announce huge extra expenditure?
  Mr. Smith: The answer is that we cut the debt interest payments that were costing this country £4 billion a year under the Conservative Government' s incompetent and profligate management. Conservative Members might like to contrast what we are doing with the public finances in surplus, with the debt of £50 billion that the previous Conservative Government ran up. That allowed debt as a share of national income to rise to 44 per cent. of GDP. We have cut it to 37 per cent., and the Red Book shows that it will fall further, to one third.
  I turn to the contribution from my right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon), whom I too am very pleased to see back in the Chamber in such good health. My right hon. Friend praised the Budget's provisions for the national health service, as did all Labour Members and a number of Opposition Members.
  My right hon. Friend also raised the needs of manufacturing, as did several other hon. Members. Our measures on capital allowances, on capital gains tax and on research and development credit; the £1 billion venture capital fund; and the small business and clusters measures that were welcomed by my hon. Friend the Member for Coventry, South (Mr. Cunningham) will all help manufacturing. However, the most important thing that we can do is to continue to deliver the essential foundation for lasting success and macro-economic stability so that manufacturers—like other businesses—can plan ahead against a backdrop of low and stable inflation, sound public finances and steady growth. That is the way to continue prosperity in this country.
  I now turn to the comments of the shadow Chancellor. One might have thought that, in his first speech to the House as shadow Chancellor, we would have heard from him a vision of how the economy, or Britain, would have fared under a Conservative Government—perhaps that is optimistic, but some people would have expected it. Instead, we heard the usual mix of contradiction, confusion and extremism that is the current Tory party.
  We heard a lecture on honesty from the man who drove through the 22 Tory tax increases that broke all their promises. We heard demands for a recognition of marriage in the tax system from the man who, when in office, made the deepest cuts in the married couples allowance. We heard a homily on low taxation from the man who, as Chief Secretary, increased the tax burden by the largest amount in history.
  The truth is that the right hon. Gentleman and his hon. Friends would return us to the dismal days of the previous Tory Government, in which he played a part. All would be driven by their only economic policy: the irresponsible, incredible, uncosted and unfair tax cuts for the few to which they are committed through their so-called tax guarantee.
  By contrast, we are building economic stability, with 800,000 more people in work, and take-home pay up by 10 per cent. during this Parliament. Their irresponsible
  124
  guarantee to cut taxes irrespective of economic circumstances would, as the shadow Chancellor must know, risk driving up the deficit and returning us to the Tory boom and bust of the Major years. That was when 1 million businesses went under and tens of thousands of families were in negative equity, or losing their homes. By contrast, we are cutting taxes for hard-working families; we are introducing the 10p rate; the 22p basic rate; the working families tax credit, which the Tories would scrap; and the children's tax credit.
  The Tories' tax guarantee would mean tax cuts only for the privileged few. We know that from the shadow Chancellor's own words in his list of commitments. This month, he confirmed the Tory policy of transferable tax allowances. That would cost about—[Interruption.] Does the right hon. Gentleman deny that is his policy? It seems that he does. I shall go on to the next commitment.
  The right hon. Gentleman said that he wants tax relief for private medical insurance at a cost of at least—[Interruption.] Does he deny that that is his policy? I am tempted to ask him which of our policies he disagrees with, but I shall carry on with my list.
  The right hon. Gentleman also said that he supported the abolition of capital gains tax. Does he still do so? [Interruption.] The Tory document of last October offers top tax rate cuts—[Interruption.]
  Mr. Portillo: As the Chief Secretary has made three outrageous claims, will he please produce the sources for all of them?
  Mr. Smith: If the right hon. Gentleman is now saying that he does not believe what he was previously on record as saying, we accept that he has done a U-turn and has changed his mind.
  Mr. Portillo: Why will the right hon. Gentleman not give us the sources?
  Mr. Smith: I cited the Tory document of October 1999 offering top tax rate cuts—£600 million for every 1p off.
  Mr. Portillo: No, that will not do. The right hon. Gentleman quoted me. Give me the sources.
  Mr. Smith: They are the 1997 manifesto, the right hon. Gentleman's personal manifesto the year before last and the Tory document of last October. I shall send him chapter and verse on every one of these claims. He cannot seek so easily to resile from the pledges that he has made.
  The right hon. Gentleman and the Conservative party are committed to the few and not the many in this country. The Opposition's tax commitments would deprive the national health service of the resources that the Government have committed over the next four years. The Tory commitments mean that they cannot match the four years of funding that we have announced. The right hon. Gentleman—I suppose that he will challenge this—said:
  Gordon Brown can either reduce taxes or he can increase public spending. What I would recommend is that he use that money to reduce taxes.
  He is not challenging that one. He is making it crystal clear that he cannot fund the spending increases in health, education and other public services that the Government are bringing forward.

  125
  It is clear what the Opposition's policies would mean for the NHS. In place of a publicly funded NHS, they would have a privatised system where the care received would depend on the amount of money that the individual pays. Whereas Labour is investing to build a modern NHS, the Tories would reduce the NHS to a second-rate safety net.
  Only last week the shadow Chancellor said:
  I do believe that in the long term you've got to create some new sources of finance, you know, may be companies can help with insurance schemes.
  Mr. Portillo: What is the source?
  Mr. Smith: The right hon. Gentleman asks for the source, and it is his interview on 19 March during GMTV's "The Sunday Programme".
  It is as a result of our sound stewardship of the economy and public finances that we are securing rising living standards, reduced borrowing, lower taxes for hard-working families, extra support for pensioners and substantial investment in health, education and other public services. The increasingly clear choice before the British people is between a Government who are delivering a strong economy and a strong society and an Opposition who are wedded to irresponsible pledges and plans which simply do not add up. In contrast, our priority has been to cut taxes for hard-working families and ensure strong public services for the many, whereas Conservative Members peddle reckless tax cuts for the few.
  It is a choice between a Government who keep our promises and an Opposition who could not keep theirs. In this debate Conservative Members have confirmed themselves as the incoherent in pursuit of the undeliverable. Our Budget is indeed prudence for a purpose. It is a Budget for the whole country. It is the Budget that people voted for when they voted Labour and a Budget of which we can all be proud. I commend it to the House.
  Question put and agreed to.
  Resolved,
  That it is expedient to amend the law with respect to the National Debt and the public revenue and to make further provision in connection with finance; but this Resolution does not extend to the making of any amendment with respect to value added tax so as to provide—

  (a) for zero-rating or exempting a supply, acquisition or importation;

  (b) for refunding an amount of tax;

  (c) for varying any rate at which that tax is at any time chargeable; or

  (d) for any relief, other than a relief which—

  (i) so far as it is applicable to goods, applies to goods of every description, and

  (ii) so far as it is applicable to services, applies to services of every description.

  MADAM SPEAKER then, pursuant to paragraph (3) of Standing Order No. 51 (Ways and Means Motions), put forthwith the Questions necessary to dispose of the further motions.

  2. BEER (RATE OF DUTY)
  Motion made, and Question put,
  That—

  (1) In section 36(1) of the Alcoholic Liquor Duties Act 1979 for "£11.50" there shall be substituted "£11.89".

  (2) This Resolution shall have effect on and after 1st April 2000.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.
  The House divided: Ayes 370, Noes 142.

  Division No. 120]

  [10.1 pm

  AYES

  Abbott, Ms Diane

  Casale, Roger

  Ainger, Nick

  Cawsey, Ian

  Ainsworth, Robert (Cov'try NE)

  Chaytor, David

  Alexander, Douglas

  Chidgey, David

  Allan, Richard

  Clapham, Michael

  Anderson, Donald (Swansea E)

  Clark, Dr Lynda (Edinburgh Pentlands)

  Anderson, Janet (Rossendale)

  Ashdown, Rt Hon Paddy

  Clark, Paul (Gillingham)

  Ashton, Joe

  Clarke, Charles (Norwich S)

  Atherton, Ms Candy

  Clarke, Eric (Midlothian)

  Atkins, Charlotte

  Clarke, Rt Hon Tom (Coatbridge)

  Austin, John

  Clarke, Tony (Northampton S)

  Baker, Norman

  Clelland, David

  Ballard, Jackie

  Clwyd, Ann

  Banks, Tony

  Coaker, Vernon

  Barnes, Harry

  Coffey, Ms Ann

  Barron, Kevin

  Cohen, Harry

  Battle, John

  Coleman, Iain

  Bayley, Hugh

  Colman, Tony

  Beard, Nigel

  Cook, Rt Hon Robin (Livingston)

  Beckett, Rt Hon Mrs Margaret

  Cooper, Yvette

  Begg, Miss Anne

  Corbett, Robin

  Beith, Rt Hon A J

  Corbyn, Jeremy

  Bell, Stuart (Middlesbrough)

  Corston, Jean

  Benn, Hilary (Leeds C)

  Cotter, Brian

  Benn, Rt Hon Tony (Chesterfield)

  Cousins, Jim

  Bennett, Andrew F

  Cranston, Ross

  Benton, Joe

  Crausby, David

  Berry, Roger

  Cryer, Mrs Ann (Keighley)

  Betts, Clive

  Cryer, John (Hornchurch)

  Blackman, Liz

  Cunningham, Rt Hon Dr Jack (Copeland)

  Blair, Rt Hon Tony

  Blears, Ms Hazel

  Cunningham, Jim (Cov'try S)

  Blizzard, Bob

  Cunningham, Ms Roseanna (Perth)

  Blunkett, Rt Hon David

  Boateng, Rt Hon Paul

  Curtis-Thomas, Mrs Claire

  Borrow, David

  Dalyell, Tam

  Bradley, Keith (Withington)

  Darling, Rt Hon Alistair

  Bradley, Peter (The Wrekin)

  Darvill, Keith

  Bradshaw, Ben

  Davey, Edward (Kingston)

  Brake, Tom

  Davies, Rt Hon Denzil (Llanelli)

  Brand, Dr Peter

  Davies, Geraint (Croydon C)

  Breed, Colin

  Dean, Mrs Janet

  Brinton, Mrs Helen

  Denham, John

  Brown, Rt Hon Gordon (Dunfermline E)

  Dismore, Andrew

  Dobbin, Jim

  Brown, Rt Hon Nick (Newcastle E)

  Donohoe, Brian H

  Brown, Russell (Dumfries)

  Doran, Frank

  Browne, Desmond

  Dowd, Jim

  Bruce, Malcolm (Gordon)

  Drew, David

  Buck, Ms Karen

  Dunwoody, Mrs Gwyneth

  Burden, Richard

  Eagle, Angela (Wallasey)

  Burgon, Colin

  Eagle, Maria (L'pool Garston)

  Burnett, John

  Edwards, Huw

  Burstow, Paul

  Efford, Clive

  Butler, Mrs Christine

  Ellman, Mrs Louise

  Byers, Rt Hon Stephen

  Ennis, Jeff

  Cable, Dr Vincent

  Etherington, Bill

  Campbell, Mrs Anne (C'bridge)

  Ewing, Mrs Margaret

  Campbell, Rt Hon Menzies (NE Fife)

  Field, Rt Hon Frank

  Fisher, Mark

  Campbell-Savours, Dale

  Fitzsimons, Lorna

  Cann, Jamie

  Flint, Caroline

  127

  Flynn, Paul

  King, Ms Oona (Bethnal Green)

  Follett, Barbara

  Kirkwood, Archy

  Foster, Rt Hon Derek

  Ladyman, Dr Stephen

  Foster, Don (Bath)

  Laxton, Bob

  Foster, Michael Jabez (Hastings)

  Lepper, David

  Foster, Michael J (Worcester)

  Leslie, Christopher

  Fyfe, Maria

  Levitt, Tom

  Galloway, George

  Lewis, Ivan (Bury S)

  Gapes, Mike

  Lewis, Terry (Worsley)

  Gardiner, Barry

  Liddell, Rt Hon Mrs Helen

  George, Andrew (St Ives)

  Linton, Martin

  George, Bruce (Walsall S)

  Livsey, Richard

  Gerrard, Neil

  Lloyd, Tony (Manchester C)

  Gibson, Dr Ian

  Llwyd, Elfyn

  Gilroy, Mrs Linda

  Lock, David

  Godman, Dr Norman A

  Love, Andrew

  Godsiff, Roger

  McAvoy, Thomas

  Goggins, Paul

  McCabe, Steve

  Gordon, Mrs Eileen

  McCafferty, Ms Chris

  Gorrie, Donald

  McCartney, Rt Hon Ian (Makerfield)

  Griffiths, Jane (Reading E)

  Griffiths, Nigel (Edinburgh S)

  McDonagh, Siobhain

  Grocott, Bruce

  Macdonald, Calum

  Grogan, John

  McDonnell, John

  Gunnell, John

  McIsaac, Shona

  Hall, Mike (Weaver Vale)

  McKenna, Mrs Rosemary

  Hall, Patrick (Bedford)

  Mackinlay, Andrew

  Hancock, Mike

  Maclennan, Rt Hon Robert

  Hanson, David

  McNamara, Kevin

  Harman, Rt Hon Ms Harriet

  McNulty, Tony

  Harris, Dr Evan

  MacShane, Denis

  Heal, Mrs Sylvia

  Mactaggart, Fiona

  Healey, John

  McWalter, Tony

  Heath, David (Somerton & Frome)

  Mahon, Mrs Alice

  Henderson, Doug (Newcastle N)

  Marsden, Gordon (Blackpool S)

  Henderson, Ivan (Harwich)

  Marshall, David (Shettleston)

  Heppell, John

  Marshall, Jim (Leicester S)

  Hesford, Stephen

  Martlew, Eric

  Hewitt, Ms Patricia

  Meacher, Rt Hon Michael

  Hill, Keith

  Meale, Alan

  Hinchliffe, David

  Merron, Gillian

  Hodge, Ms Margaret

  Michael, Rt Hon Alun

  Hoey, Kate

  Michie, Bill (Shef'ld Heeley)

  Home Robertson, John

  Michie, Mrs Ray (Argyll & Bute)

  Hood, Jimmy

  Milburn, Rt Hon Alan

  Hoon, Rt Hon Geoffrey

  Miller, Andrew

  Hope, Phil

  Mitchell, Austin

  Hopkins, Kelvin

  Moffatt, Laura

  Howarth, Alan (Newport E)

  Moonie, Dr Lewis

  Howells, Dr Kim

  Moore, Michael

  Hoyle, Lindsay

  Morgan, Alasdair (Galloway)

  Hughes, Ms Beverley (Stretford)

  Morley, Elliot

  Hughes, Kevin (Doncaster N)

  Morris, Rt Hon Ms Estelle (B'ham Yardley)

  Hughes, Simon (Southwark N)

  Humble, Mrs Joan

  Morris, Rt Hon Sir John (Aberavon)

  Hurst, Alan

  Mountford, Kali

  Hutton, John

  Mullin, Chris

  Iddon, Dr Brian

  Naysmith, Dr Doug

  Illsley, Eric

  Norris, Dan

  Jackson, Ms Glenda (Hampstead)

  Oaten, Mark

  Jackson, Helen (Hillsborough)

  O'Brien, Mike (N Warks)

  Jenkins, Brian

  O'Hara, Eddie

  Johnson, Alan (Hull W & Hessle)

  O'Neill, Martin

  Johnson, Miss Melanie (Welwyn Hatfield)

  Palmer, Dr Nick

  Pearson, Ian

  Jones, Rt Hon Barry (Alyn)

  Pendry, Tom

  Jones, Helen (Warrington N)

  Perham, Ms Linda

  Jones, Ieuan Wyn (Ynys Môn)

  Pickthall, Colin

  Jones, Ms Jenny (Wolverh'ton SW)

  Plaskitt, James

  Pollard, Kerry

  Jones, Dr Lynne (Selly Oak)

  Pond, Chris

  Jowell, Rt Hon Ms Tessa

  Pope, Greg

  Keeble, Ms Sally

  Powell, Sir Raymond

  Keetch, Paul

  Prentice, Ms Bridget (Lewisham E)

  Kemp, Fraser

  Prentice, Gordon (Pendle)

  Kennedy, Jane (Wavertree)

  Prescott, Rt Hon John

  Khabra, Piara S

  Primarolo, Dawn

  Kidney, David

  Prosser, Gwyn

  Kilfoyle, Peter

  Purchase, Ken

  King, Andy (Rugby & Kenilworth)

  Quinn, Lawrie

  128

  Radice, Rt Hon Giles

  Stunell, Andrew

  Rammell, Bill

  Sutcliffe, Gerry

  Raynsford, Nick

  Swinney, John

  Reed, Andrew (Loughborough)

  Taylor, Rt Hon Mrs Ann (Dewsbury)

  Reid, Rt Hon Dr John (Hamilton N)

  Rendel, David

  Taylor, Ms Dari (Stockton S)

  Robinson, Geoffrey (Cov'try NW)

  Taylor, David (NW Leics)

  Rogers, Allan

  Taylor, Matthew (Truro)

  Rooker, Rt Hon Jeff

  Temple-Morris, Peter

  Rooney, Terry

  Thomas, Gareth (Clwyd W)

  Ross, Ernie (Dundee W)

  Thomas, Gareth R (Harrow W)

  Rowlands, Ted

  Thomas, Simon (Ceredigion)

  Roy, Frank

  Timms, Stephen

  Ruddock, Joan

  Tipping, Paddy

  Russell, Bob (Colchester)

  Todd, Mark

  Ryan, Ms Joan

  Tonge, Dr Jenny

  Salmond, Alex

  Touhig, Don

  Salter, Martin

  Trickett, Jon

  Sanders, Adrian

  Turner, Dennis (Wolverh'ton SE)

  Sarwar, Mohammad

  Turner, Dr Desmond (Kemptown)

  Savidge, Malcolm

  Turner, Dr George (NW Norfolk)

  Sawford, Phil

  Turner, Neil (Wigan)

  Sedgemore, Brian

  Twigg, Derek (Halton)

  Sheerman, Barry

  Tyler, Paul

  Sheldon, Rt Hon Robert

  Tynan, Bill

  Simpson, Alan (Nottingham S)

  Vis, Dr Rudi

  Singh, Marsha

  Wallace, James

  Skinner, Dennis

  Walley, Ms Joan

  Smith, Rt Hon Andrew (Oxford E)

  Watts, David

  Smith, Angela (Basildon)

  Webb, Steve

  Smith, Rt Hon Chris (Islington S)

  White, Brian

  Smith, Miss Geraldine w(Morecambe & Lunesdale)

  Whitehead, Dr Alan

  Wicks, Malcolm

  Smith, John (Glamorgan)

  Wigley, Rt Hon Dafydd

  Smith, Llew (Blaenau Gwent)

  Williams, Rt Hon Alan (Swansea W)

  Smith, Sir Robert (W Ab'd'ns)

  Snape, Peter

  Williams, Alan W (E Carmarthen)

  Soley, Clive

  Williams, Mrs Betty (Conwy)

  Southworth, Ms Helen

  Willis, Phil

  Spellar, John

  Winnick, David

  Starkey, Dr Phyllis

  Winterton, Ms Rosie (Doncaster C)

  Steinberg, Gerry

  Wood, Mike

  Stevenson, George

  Woodward, Shaun

  Stewart, David (Inverness E)

  Worthington, Tony

  Stewart, Ian (Eccles)

  Wray, James

  Stinchcombe, Paul

  Wright, Anthony D (Gt Yarmouth)

  Stoate, Dr Howard

  Strang, Rt Hon Dr Gavin

  Tellers for the Ayes:

  Stringer, Graham

  Mr. Graham Allen and

  Stuart, Ms Gisela

  Mr. David Jamieson.

  NOES

  Amess, David

  Curry, Rt Hon David

  Ancram, Rt Hon Michael

  Davies, Quentin (Grantham)

  Arbuthnot, Rt Hon James

  Davis, Rt Hon David (Haltemprice)

  Atkinson, David (Bour'mth E)

  Day, Stephen

  Atkinson, Peter (Hexham)

  Donaldson, Jeffrey

  Baldry, Tony

  Dorrell, Rt Hon Stephen

  Beggs, Roy

  Duncan, Alan

  Bercow, John

  Duncan Smith, Iain

  Beresford, Sir Paul

  Evans, Nigel

  Blunt, Crispin

  Faber, David

  Body, Sir Richard

  Fabricant, Michael

  Boswell, Tim

  Fallon, Michael

  Bottomley, Peter (Worthing W)

  Flight, Howard

  Bottomley, Rt Hon Mrs Virginia

  Forth, Rt Hon Eric

  Brady, Graham

  Fox, Dr Liam

  Brazier, Julian

  Gale, Roger

  Browning, Mrs Angela

  Garnier, Edward

  Burns, Simon

  Gibb, Nick

  Butterfill, John

  Gill, Christopher

  Cash, William

  Gillan, Mrs Cheryl

  Chapman, Sir Sydney (Chipping Barnet)

  Gray, James

  Green, Damian

  Chope, Christopher

  Greenway, John

  Clark, Dr Michael (Rayleigh)

  Grieve, Dominic

  Clarke, Rt Hon Kenneth (Rushcliffe)

  Hague, Rt Hon William

  Hamilton, Rt Hon Sir Archie

  Collins, Tim

  Hammond, Philip

  Cran, James

  Hawkins, Nick

  129

  Hayes, John

  Randall, John

  Heald, Oliver

  Redwood, Rt Hon John

  Heath, Rt Hon Sir Edward

  Robathan, Andrew

  Heathcoat-Amory, Rt Hon David

  Robertson, Laurence

  Hogg, Rt Hon Douglas

  Roe, Mrs Marion (Broxbourne)

  Horam, John

  Ross, William (E Lond'y)

  Howarth, Gerald (Aldershot)

  Ruffley, David

  Hunter, Andrew

  St Aubyn, Nick

  Jack, Rt Hon Michael

  Sayeed, Jonathan

  Jackson, Robert (Wantage)

  Shephard, Rt Hon Mrs Gillian

  Jenkin, Bernard

  Shepherd, Richard

  Key, Robert

  Simpson, Keith (Mid-Norfolk)

  King, Rt Hon Tom (Bridgwater)

  Smyth, Rev Martin (Belfast S)

  Laing, Mrs Eleanor

  Soames, Nicholas

  Lait, Mrs Jacqui

  Spelman, Mrs Caroline

  Lansley, Andrew

  Spicer, Sir Michael

  Leigh, Edward

  Spring, Richard

  Letwin, Oliver

  Steen, Anthony

  Lewis, Dr Julian (New Forest E)

  Streeter, Gary

  Lidington, David

  Swayne, Desmond

  Lilley, Rt Hon Peter

  Syms, Robert

  Lloyd, Rt Hon Sir Peter (Fareham)

  Tapsell, Sir Peter

  Loughton, Tim

  Taylor, Ian (Esher & Walton)

  MacGregor, Rt Hon John

  Taylor, John M (Solihull)

  McIntosh, Miss Anne

  Thompson, William

  Maclean, Rt Hon David

  Townend, John

  McLoughlin, Patrick

  Tredinnick, David

  Madel, Sir David

  Tyrie, Andrew

  Major, Rt Hon John

  Walter, Robert

  Malins, Humfrey

  Wardle, Charles

  Maples, John

  Waterson, Nigel

  Mates, Michael

  Wells, Bowen

  Maude, Rt Hon Francis

  Whitney, Sir Raymond

  Mawhinney, Rt Hon Sir Brian

  Whittingdale, John

  May, Mrs Theresa

  Widdecombe, Rt Hon Miss Ann

  Moss, Malcolm

  Wilkinson, John

  Nicholls, Patrick

  Willetts, David

  Norman, Archie

  Wilshire, David

  O'Brien, Stephen (Eddisbury)

  Winterton, Mrs Ann (Congleton)

  Ottaway, Richard

  Winterton, Nicholas (Macclesfield)

  Page, Richard

  Yeo, Tim

  Paice, James

  Young, Rt Hon Sir George

  Paterson, Owen

  Tellers for the Noes:

  Pickles, Eric

  Mr. Geoffrey Clifton-Brown

  Portillo, Rt Hon Michael

  and

  Prior, David

  Mr. Peter Luff.

  PART I

  WINE OR MADE-WINE OF A STRENGTH NOT EXCEEDING 22 PER CENT.

  Description of wine or made-wine

  Rates of duty per hectolitre

  £

  Wine or made-wine of a strength not exceeding 4 per cent.

  47.58

  Wine or made-wine of a strength exceeding 4 per cent. but not exceeding 5.5 per cent.

  65.42

  Wine or made-wine of a strength exceeding 5.5 per cent. but not exceeding 15 per cent. and not being sparkling

  154.37

  Sparkling wine or sparkling made-wine of a strength exceeding 5.5 per cent. but less than 8.5 per cent.

  166.70

  Sparkling wine or sparkling made-wine of a strength of 8.5 per cent. or of a strength exceeding 8.5 per cent. but not exceeding 15 per cent.

  220.54

  Wine or made-wine of a strength exceeding 15 per cent. but not exceeding 22 per cent.

  205.82

  (2) This Resolution shall have effect on and after 1st April 2000.
  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.
  Question accordingly agreed to.

  3. CIDER (RATES OF DUTY)
  Resolved,
  That—

  (1) In section 62(1A) of the Alcoholic Liquor Duties Act 1979—

  (a) in paragraph (a) for "£161.20" there shall be substituted "£166.70";

  (b) in paragraph (b) for "£37.92" there shall be substituted "£39.21"; and

  (c) in paragraph (c) for "£25.27" there shall be substituted "£26.13".

  (2) This Resolution shall have effect on and after 1st April 2000.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

  4. WINE AND MADE-WINE (RATES OF DUTY)
  Resolved,
  That—
  (1) For Part I of the Table of rates of duty in Schedule 1 to the Alcoholic Liquor Duties Act 1979 there shall be substituted—

  5. HYDROCARBON OIL (RATES OF DUTY AND REBATE)
  Motion made, and Question put,
  That—

  (1) In section 6(1A) of the Hydrocarbon Oil Duties Act 1979—

  131

  (a) in paragraph (a), for "£0.5288" there shall be substituted "£0.5468";

  (b) in paragraph (b), for "£0.4721" there shall be substituted "£0.4882"; and

  (c) in paragraph (c), for "£0.5021" there shall be substituted "£0.5182".

  (2) In section 11(1) of that Act—

  (a) in paragraph (a), for "£0.0265" there shall be substituted "£0.0274"; and

  (b) in each of paragraphs (b) and (ba), for "£0.0303" there shall be substituted "£0.0313".

  (3) In section 13A(1A) of that Act—

  (a) in paragraph (a), for "£0.0367" there shall be substituted "£0.0379"; and

  (b) in paragraph (b), for "£0.0567" there shall be substituted "£0.0586".

  (4) In section 14(1) of that Act, for "£0.0265" there shall be substituted "£0.0274".

  (5) This Resolution shall have effect as from 6 o'clock in the evening of 21st March 2000.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.
  The House divided: Ayes 321, Noes 192.

  Division No. 121]

  [10.15 pm

  AYES

  Abbott, Ms Diane

  Butler, Mrs Christine

  Ainger, Nick

  Byers, Rt Hon Stephen

  Ainsworth, Robert (Cov'try NE)

  Campbell, Mrs Anne (C'bridge)

  Alexander, Douglas

  Campbell-Savours, Dale

  Anderson, Donald (Swansea E)

  Cann, Jamie

  Anderson, Janet (Rossendale)

  Casale, Roger

  Ashton, Joe

  Cawsey, Ian

  Atherton, Ms Candy

  Chaytor, David

  Atkins, Charlotte

  Clapham, Michael

  Austin, John

  Clark, Dr Lynda (Edinburgh Pentlands)

  Banks, Tony

  Barnes, Harry

  Clark, Paul (Gillingham)

  Barron, Kevin

  Clarke, Charles (Norwich S)

  Battle, John

  Clarke, Eric (Midlothian)

  Bayley, Hugh

  Clarke, Rt Hon Tom (Coatbridge)

  Beard, Nigel

  Clarke, Tony (Northampton S)

  Beckett, Rt Hon Mrs Margaret

  Clelland, David

  Begg, Miss Anne

  Clwyd, Ann

  Bell, Stuart (Middlesbrough)

  Coaker, Vernon

  Benn, Hilary (Leeds C)

  Coffey, Ms Ann

  Benn, Rt Hon Tony (Chesterfield)

  Cohen, Harry

  Bennett, Andrew F

  Coleman, Iain

  Benton, Joe

  Colman, Tony

  Berry, Roger

  Cook, Rt Hon Robin (Livingston)

  Betts, Clive

  Cooper, Yvette

  Blackman, Liz

  Corbett, Robin

  Blair, Rt Hon Tony

  Corbyn, Jeremy

  Blears, Ms Hazel

  Corston, Jean

  Blizzard, Bob

  Cousins, Jim

  Blunkett, Rt Hon David

  Cranston, Ross

  Boateng, Rt Hon Paul

  Crausby, David

  Borrow, David

  Cryer, Mrs Ann (Keighley)

  Bradley, Keith (Withington)

  Cryer, John (Hornchurch)

  Bradley, Peter (The Wrekin)

  Cunningham, Rt Hon Dr Jack (Copeland)

  Bradshaw, Ben

  Brinton, Mrs Helen

  Cunningham, Jim (Cov'try S)

  Brown, Rt Hon Gordon (Dunfermline E)

  Curtis-Thomas, Mrs Claire

  Dalyell, Tam

  Brown, Rt Hon Nick (Newcastle E)

  Darling, Rt Hon Alistair

  Brown, Russell (Dumfries)

  Darvill, Keith

  Browne, Desmond

  Davies, Rt Hon Denzil (Llanelli)

  Buck, Ms Karen

  Davies, Geraint (Croydon C)

  Burden, Richard

  Dean, Mrs Janet

  Burgon, Colin

  Denham, John

  132

  Dismore, Andrew

  Jones, Rt Hon Barry (Alyn)

  Dobbin, Jim

  Jones, Helen (Warrington N)

  Donohoe, Brian H

  Jones, Ms Jenny (Wolverh'ton SW)

  Doran, Frank

  Dowd, Jim

  Jones, Dr Lynne (Selly Oak)

  Drew, David

  Jowell, Rt Hon Ms Tessa

  Dunwoody, Mrs Gwyneth

  Keeble, Ms Sally

  Eagle, Angela (Wallasey)

  Kemp, Fraser

  Eagle, Maria (L'pool Garston)

  Kennedy, Jane (Wavertree)

  Edwards, Huw

  Khabra, Piara S

  Efford, Clive

  Kidney, David

  Ellman, Mrs Louise

  Kilfoyle, Peter

  Ennis, Jeff

  King, Andy (Rugby & Kenilworth)

  Etherington, Bill

  King, Ms Oona (Bethnal Green)

  Field, Rt Hon Frank

  Ladyman, Dr Stephen

  Fisher, Mark

  Laxton, Bob

  Fitzsimons, Lorna

  Lepper, David

  Flint, Caroline

  Leslie, Christopher

  Flynn, Paul

  Levitt, Tom

  Follett, Barbara

  Lewis, Ivan (Bury S)

  Foster, Rt Hon Derek

  Lewis, Terry (Worsley)

  Foster, Michael Jabez (Hastings)

  Liddell, Rt Hon Mrs Helen

  Foster, Michael J (Worcester)

  Linton, Martin

  Fyfe, Maria

  Lloyd, Tony (Manchester C)

  Galloway, George

  Lock, David

  Gapes, Mike

  Love, Andrew

  Gardiner, Barry

  McAvoy, Thomas

  George, Bruce (Walsall S)

  McCabe, Steve

  Gerrard, Neil

  McCafferty, Ms Chris

  Gibson, Dr Ian

  McCartney, Rt Hon Ian (Makerfield)

  Gilroy, Mrs Linda

  Godman, Dr Norman A

  McDonagh, Siobhain

  Godsiff, Roger

  Macdonald, Calum

  Goggins, Paul

  McDonnell, John

  Gordon, Mrs Eileen

  McIsaac, Shona

  Griffiths, Jane (Reading E)

  McKenna, Mrs Rosemary

  Griffiths, Nigel (Edinburgh S)

  Mackinlay, Andrew

  Grocott, Bruce

  McNamara, Kevin

  Grogan, John

  McNulty, Tony

  Gunnell, John

  MacShane, Denis

  Hall, Mike (Weaver Vale)

  Mactaggart, Fiona

  Hall, Patrick (Bedford)

  McWalter, Tony

  Hanson, David

  Mahon, Mrs Alice

  Harman, Rt Hon Ms Harriet

  Marsden, Gordon (Blackpool S)

  Heal, Mrs Sylvia

  Marshall, David (Shettleston)

  Healey, John

  Marshall, Jim (Leicester S)

  Henderson, Doug (Newcastle N)

  Martlew, Eric

  Henderson, Ivan (Harwich)

  Meacher, Rt Hon Michael

  Heppell, John

  Meale, Alan

  Hesford, Stephen

  Merron, Gillian

  Hewitt, Ms Patricia

  Michael, Rt Hon Alun

  Hill, Keith

  Michie, Bill (Shef'ld Heeley)

  Hinchliffe, David

  Milburn, Rt Hon Alan

  Hodge, Ms Margaret

  Miller, Andrew

  Hoey, Kate

  Mitchell, Austin

  Home Robertson, John

  Moffatt, Laura

  Hood, Jimmy

  Moonie, Dr Lewis

  Hoon, Rt Hon Geoffrey

  Morley, Elliot

  Hope, Phil

  Morris, Rt Hon Ms Estelle (B'ham Yardley)

  Hopkins, Kelvin

  Howarth, Alan (Newport E)

  Morris, Rt Hon Sir John (Aberavon)

  Howells, Dr Kim

  Hoyle, Lindsay

  Mountford, Kali

  Hughes, Ms Beverley (Stretford)

  Mullin, Chris

  Hughes, Kevin (Doncaster N)

  Naysmith, Dr Doug

  Humble, Mrs Joan

  Norris, Dan

  Hurst, Alan

  O'Brien, Mike (N Warks)

  Hutton, John

  O'Hara, Eddie

  Iddon, Dr Brian

  O'Neill, Martin

  Illsley, Eric

  Palmer, Dr Nick

  Jackson, Ms Glenda (Hampstead)

  Pearson, Ian

  Jackson, Helen (Hillsborough)

  Pendry, Tom

  Jenkins, Brian

  Perham, Ms Linda

  Johnson, Alan (Hull W & Hessle)

  Pickthall, Colin

  Johnson, Miss Melanie (Welwyn Hatfield)

  Plaskitt, James

  Pollard, Kerry

  133

  Pond, Chris

  Stewart, David (Inverness E)

  Pope, Greg

  Stewart, Ian (Eccles)

  Powell, Sir Raymond

  Stinchcombe, Paul

  Prentice, Ms Bridget (Lewisham E)

  Stoate, Dr Howard

  Prentice, Gordon (Pendle)

  Strang, Rt Hon Dr Gavin

  Prescott, Rt Hon John

  Stringer, Graham

  Primarolo, Dawn

  Stuart, Ms Gisela

  Prosser, Gwyn

  Sutcliffe, Gerry

  Purchase, Ken

  Taylor, Rt Hon Mrs Ann (Dewsbury)

  Quinn, Lawrie

  Radice, Rt Hon Giles

  Taylor, Ms Dari (Stockton S)

  Rammell, Bill

  Taylor, David (NW Leics)

  Raynsford, Nick

  Temple-Morris, Peter

  Reed, Andrew (Loughborough)

  Thomas, Gareth (Clwyd W)

  Reid, Rt Hon Dr John (Hamilton N)

  Thomas, Gareth R (Harrow W)

  Robinson, Geoffrey (Cov'try NW)

  Timms, Stephen

  Rogers, Allan

  Tipping, Paddy

  Rooker, Rt Hon Jeff

  Todd, Mark

  Rooney, Terry

  Touhig, Don

  Ross, Ernie (Dundee W)

  Trickett, Jon

  Rowlands, Ted

  Turner, Dennis (Wolverh'ton SE)

  Roy, Frank

  Turner, Dr Desmond (Kemptown)

  Ruddock, Joan

  Turner, Dr George (NW Norfolk)

  Ryan, Ms Joan

  Turner, Neil (Wigan)

  Salter, Martin

  Twigg, Derek (Halton)

  Sarwar, Mohammad

  Tynan, Bill

  Savidge, Malcolm

  Vis, Dr Rudi

  Sawford, Phil

  Walley, Ms Joan

  Sedgemore, Brian

  Watts, David

  Sheerman, Barry

  White, Brian

  Sheldon, Rt Hon Robert

  Whitehead, Dr Alan

  Simpson, Alan (Nottingham S)

  Wicks, Malcolm

  Singh, Marsha

  Williams, Rt Hon Alan (Swansea W)

  Skinner, Dennis

  Smith, Rt Hon Andrew (Oxford E)

  Williams, Alan W (E Carmarthen)

  Smith, Angela (Basildon)

  Williams, Mrs Betty (Conwy)

  Smith, Rt Hon Chris (Islington S)

  Winnick, David

  Smith, Miss Geraldine (Morecambe & Lunesdale)

  Winterton, Ms Rosie (Doncaster C)

  Wise, Audrey

  Smith, John (Glamorgan)

  Wood, Mike

  Smith, Llew (Blaenau Gwent)

  Woodward, Shaun

  Snape, Peter

  Worthington, Tony

  Soley, Clive

  Wray, James

  Southworth, Ms Helen

  Wright, Anthony D (Gt Yarmouth)

  Spellar, John

  Starkey, Dr Phyllis

  Tellers for the Ayes:

  Steinberg, Gerry

  Mr. Graham Allen and

  Stevenson, George

  Mr. David Jamieson.

  NOES

  Allan, Richard

  Burnett, John

  Amess, David

  Burns, Simon

  Ancram, Rt Hon Michael

  Burstow, Paul

  Arbuthnot, Rt Hon James

  Butterfill, John

  Ashdown, Rt Hon Paddy

  Cable, Dr Vincent

  Atkinson, David (Bour'mth E)

  Campbell, Rt Hon Menzies (NE Fife)

  Atkinson, Peter (Hexham)

  Baker, Norman

  Cash, William

  Baldry, Tony

  Chapman, Sir Sydney (Chipping Barnet)

  Ballard, Jackie

  Beggs, Roy

  Chidgey, David

  Beith, Rt Hon A J

  Chope, Christopher

  Bercow, John

  Clark, Dr Michael (Rayleigh)

  Beresford, Sir Paul

  Clarke, Rt Hon Kenneth (Rushcliffe)

  Blunt, Crispin

  Body, Sir Richard

  Collins, Tim

  Boswell, Tim

  Cotter, Brian

  Bottomley, Peter (Worthing W)

  Cran, James

  Bottomley, Rt Hon Mrs Virginia

  Cunningham, Ms Roseanna (Perth)

  Brady, Graham

  Brake, Tom

  Curry, Rt Hon David

  Brand, Dr Peter

  Davey, Edward (Kingston)

  Brazier, Julian

  Davies, Quentin (Grantham)

  Breed, Colin

  Davis, Rt Hon David (Haltemprice)

  Browning, Mrs Angela

  Day, Stephen

  Bruce, Malcolm (Gordon)

  Donaldson, Jeffrey

  134

  Dorrell, Rt Hon Stephen

  Moss, Malcolm

  Duncan, Alan

  Nicholls, Patrick

  Duncan Smith, Iain

  Norman, Archie

  Evans, Nigel

  Oaten, Mark

  Ewing, Mrs Margaret

  O'Brien, Stephen (Eddisbury)

  Faber, David

  Ottaway, Richard

  Fabricant, Michael

  Page, Richard

  Fallon, Michael

  Paice, James

  Flight, Howard

  Paterson, Owen

  Forth, Rt Hon Eric

  Pickles, Eric

  Foster, Don (Bath)

  Portillo, Rt Hon Michael

  Fox, Dr Liam

  Prior, David

  Gale, Roger

  Randall, John

  Garnier, Edward

  Redwood, Rt Hon John

  George, Andrew (St Ives)

  Rendel, David

  Gibb, Nick

  Robathan, Andrew

  Gill, Christopher

  Robertson, Laurence

  Gillan, Mrs Cheryl

  Roe, Mrs Marion (Broxbourne)

  Gorrie, Donald

  Ross, William (E Lond'y)

  Gray, James

  Ruffley, David

  Green, Damian

  Russell, Bob (Colchester)

  Greenway, John

  St Aubyn, Nick

  Grieve, Dominic

  Salmond, Alex

  Hague, Rt Hon William

  Hamilton, Rt Hon Sir Archie

  Sanders, Adrian

  Hammond, Philip

  Sayeed, Jonathan

  Hancock, Mike

  Shephard, Rt Hon Mrs Gillian

  Harris, Dr Evan

  Shepherd, Richard

  Hawkins, Nick

  Simpson, Keith (Mid-Norfolk)

  Hayes, John

  Smith, Sir Robert (W Ab'd'ns)

  Heald, Oliver

  Smyth, Rev Martin (Belfast S)

  Heath, David (Somerton & Frome)

  Soames, Nicholas

  Heath, Rt Hon Sir Edward

  Spelman, Mrs. Caroline

  Heathcoat-Amory, Rt Hon David

  Spicer, Sir Michael

  Hogg, Rt Hon Douglas

  Spring, Richard

  Horam, John

  Steen, Anthony

  Howarth, Gerald (Aldershot)

  Streeter, Gary

  Hughes, Simon (Southwark N)

  Stunell, Andrew

  Hunter, Andrew

  Swayne, Desmond

  Jack, Rt Hon Michael

  Swinney, John

  Jackson, Robert (Wantage)

  Syms, Robert

  Jenkin, Bernard

  Tapsell, Sir Peter

  Jones, Ieuan Wyn (Ynys Môn)

  Taylor, Ian (Esher & Walton)

  Keetch, Paul

  Taylor, John M (Solihull)

  Key, Robert

  Taylor, Matthew (Truro)

  King, Rt Hon Tom (Bridgwater)

  Thomas, Simon (Ceredigion)

  Kirkwood, Archy

  Thompson, William

  Laing, Mrs Eleanor

  Tonge, Dr Jenny

  Lait, Mrs Jacqui

  Townend, John

  Lansley, Andrew

  Tredinnick, David

  Leigh, Edward

  Tyler, Paul

  Letwin, Oliver

  Tyrie, Andrew

  Lewis, Dr Julian (New Forest E)

  Wallace, James

  Lidington, David

  Walter, Robert

  Lilley, Rt Hon Peter

  Wardle, Charles

  Livsey, Richard

  Waterson, Nigel

  Lloyd, Rt Hon Sir Peter (Fareham)

  Webb, Steve

  Llwyd, Elfyn

  Wells, Bowen

  Loughton, Tim

  Whitney, Sir Raymond

  MacGregor, Rt Hon John

  Whittingdale, John

  McIntosh, Miss Anne

  Widdecombe, Rt Hon Miss Ann

  Maclean, Rt Hon David

  Wigley, Rt Hon Dafydd

  Maclennan, Rt Hon Robert

  Wilkinson, John

  McLoughlin, Patrick

  Willetts, David

  Madel, Sir David

  Willis, Phil

  Major, Rt Hon John

  Wilshire, David

  Malins, Humfrey

  Winterton, Mrs Ann (Congleton)

  Maples, John

  Winterton, Nicholas (Macclesfield)

  Mates, Michael

  Yeo, Tim

  Maude, Rt Hon Francis

  Young, Rt Hon Sir George

  Mawhinney, Rt Hon Sir Brian

  May, Mrs Theresa

  Tellers for the Noes:

  Michie, Mrs Ray (Argyll & Bute)

  Mr. Geoffrey Clifton-Brown

  Moore, Michael

  and

  Morgan, Alasdair (Galloway)

  Mr. Peter Luff.

  Question accordingly agreed to.

  6. HYDROCARBON OIL (MIXING OF LIGHT OIL)
  Resolved,
  That provision may be made about the mixing of different kinds of light oil.

  7. HYDROCARBON OIL (AMENDMENT OF DEFINITIONS OF TYPES OF OIL)
  Resolved,
  That provision may be made for amending the provisions of the Hydrocarbon Oil Duties Act 1979 defining different types of oil.

  8. HYDROCARBON OIL (MISUSE OF REBATED HEAVY OIL)
  Resolved,
  That—
  (1) Section 13 of the Hydrocarbon Oil Duties Act 1979 shall be amended as follows.
  (2) In subsection (1)—

  (a) for "or, as the case may be, his becoming so liable" there shall be substituted "or his becoming so liable (or, where his conduct includes both, each of them)", and

  (b) the words from "; and the Commissioners" to the end shall be omitted.

  (3) After subsection (I) there shall be inserted—
  "(1A) Where oil is used, or is taken into a road vehicle, in contravention of section 12(2) above, the Commissioners may—

  "TABLE

  1. Cigarettes

  An amount equal to 22 per cent. of the retail price plus £90.43 per thousand cigarettes.

  2. Cigars

  £132.33 per kilogram.

  3. Hand-rolling tobacco

  £95.12 per kilogram.

  4. Other smoking tobacco and chewing tobacco

  £58.17 per kilogram.".

  (2) This Resolution shall have effect as from 6 o'clock in the evening of 21st March 2000.
  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968;
  The House divided: Ayes 364, Noes 7.

  Division No. 122]

  [10.27 pm

  AYES

  Abbott, Ms Diane

  Ballard, Jackie

  Ainger, Nick

  Banks, Tony

  Ainsworth, Robert (Cov'try NE)

  Barnes, Harry

  Alexander, Douglas

  Barron, Kevin

  Allan, Richard

  Battle, John

  Anderson, Donald (Swansea E)

  Bayley, Hugh

  Anderson, Janet (Rossendale)

  Beard, Nigel

  Ashdown, Rt Hon Paddy

  Begg, Miss Anne

  Ashton, Joe

  Berth, Rt Hon A J

  Atherton, Ms Candy

  Bell, Stuart (Middlesbrough)

  Atkins, Charlotte

  Benn, Hilary (Leeds C)

  Austin, John

  Benn, Rt Hon Tony (Chesterfield)

  Baker, Norman

  Bennett, Andrew F

  Benton, Joe

  Burstow, Paul

  Berry, Roger

  Butler, Mrs Christine

  Betts, Clive

  Byers, Rt Hon Stephen

  Blackman, Liz

  Cable, Dr Vincent

  Blair, Rt Hon Tony

  Campbell, Mrs Anne (C'bridge)

  Blears, Ms Hazel

  Campbell, Rt Hon Menzies (NE Fife)

  Blizzard, Bob

  Blunkett, Rt Hon David

  Campbell-Savours, Dale

  Boateng, Rt Hon Paul

  Cann, Jamie

  Borrow, David

  Casale, Roger

  Bradley, Keith (Withington)

  Cawsey, Ian

  Bradley, Peter (The Wrekin)

  Chaytor, David

  Bradshaw, Ben

  Chidgey, David

  Brake, Tom

  Clapham, Michael

  Brand, Dr Peter

  Clark, Dr Lynda (Edinburgh Pentlands)

  Breed, Colin

  Brinton, Mrs Helen

  Clark, Paul (Gillingham)

  Brown, Rt Hon Gordon (Dunfermline E)

  Clarke, Charles (Norwich S)

  Clarke, Eric (Midlothian)

  Brown, Rt Hon Nick (Newcastle E)

  Clarke, Rt Hon Tom (Coatbridge)

  Brown, Russell (Dumfries)

  Clarke, Tony (Northampton S)

  Browne, Desmond

  Clelland, David

  Bruce, Malcolm (Gordon)

  Clwyd, Ann

  Buck, Ms Karen

  Coaker, Vernon

  Burden, Richard

  Coffey, Ms Ann

  Burgon, Colin

  Cohen, Harry

  Burnett, John

  Coleman, Iain

  137

  Colman, Tony

  Heal, Mrs Sylvia

  Cook, Rt Hon Robin (Livingston)

  Healey, John

  Cooper, Yvette

  Heath, David (Somerton & Frome)

  Corbett, Robin

  Henderson, Doug (Newcastle N)

  Corbyn, Jeremy

  Henderson, Ivan (Harwich)

  Corston, Jean

  Heppell, John

  Cotter, Brian

  Hesford, Stephen

  Cousins, Jim

  Hewitt, Ms Patricia

  Cranston, Ross

  Hill, Keith

  Crausby, David

  Hinchliffe, David

  Cryer, Mrs Ann (Keighley)

  Hodge, Ms Margaret

  Cryer, John (Hornchurch)

  Hoey, Kate

  Cunningham, Rt Hon Dr Jack (Copeland)

  Home Robertson, John

  Hood, Jimmy

  Cunningham, Jim (Cov'try S)

  Hoon, Rt Hon Geoffrey

  Cunningham, Ms Roseanna (Perth)

  Hope, Phil

  Hopkins, Kelvin

  Curtis-Thomas, Mrs Claire

  Howarth, Alan (Newport E)

  Dalyell, Tam

  Howells, Dr Kim

  Darling, Rt Hon Alistair

  Hughes, Ms Beverley (Stretford)

  Darvill, Keith

  Hughes, Kevin (Doncaster N)

  Davey, Edward (Kingston)

  Hughes, Simon (Southwark N)

  Davies, Rt Hon Denzil (Llanelli)

  Humble, Mrs Joan

  Davies, Geraint (Croydon C)

  Hurst, Alan

  Dean, Mrs Janet

  Hutton, John

  Denham, John

  Iddon, Dr Brian

  Dismore, Andrew

  Illsley, Eric

  Dobbin, Jim

  Jackson, Ms Glenda (Hampstead)

  Donohoe, Brian H

  Jackson, Helen (Hillsborough)

  Doran, Frank

  Jenkins, Brian

  Dowd, Jim

  Johnson, Alan (Hull W & Hessle)

  Drew, David

  Johnson, Miss Melanie (Welwyn Hatfield)

  Dunwoody, Mrs Gwyneth

  Eagle, Angela (Wallasey)

  Jones, Rt Hon Barry (Alyn)

  Eagle, Maria (L'pool Garston)

  Jones, Helen (Warrington N)

  Edwards, Huw

  Jones, Ieuan Wyn (Ynys Môn)

  Efford, Clive

  Jones, Ms Jenny (Wolverh'ton SW)

  Ellman, Mrs Louise

  Ennis, Jeff

  Jones, Dr Lynne (Selly Oak)

  Etherington, Bill

  Jowell, Rt Hon Ms Tessa

  Ewing, Mrs Margaret

  Keeble, Ms Sally

  Field, Rt Hon Frank

  Keetch, Paul

  Fisher, Mark

  Kemp, Fraser

  Fitzsimons, Lorna

  Kennedy, Jane (Wavertree)

  Flint, Caroline

  Khabra, Piara S

  Flynn, Paul

  Kidney, David

  Follett, Barbara

  Kilfoyle, Peter

  Foster, Rt Hon Derek

  King, Andy (Rugby & Kenilworth)

  Foster, Don (Bath)

  King, Ms Oona (Bethnal Green)

  Foster, Michael Jabez (Hastings)

  Kirkwood, Archy

  Foster, Michael J (Worcester)

  Ladyman, Dr Stephen

  Fyfe, Maria

  Lepper, David

  Galloway, George

  Leslie, Christopher

  Gapes, Mike

  Levitt, Tom

  Gardiner, Barry

  Lewis, Ivan (Bury S)

  George, Andrew (St Ives)

  Lewis, Terry (Worsley)

  George, Bruce (Walsall S)

  Liddell, Rt Hon Mrs Helen

  Gerrard, Neil

  Linton, Martin

  Gibson, Dr Ian

  Livsey, Richard

  Gilroy, Mrs Linda

  Lloyd, Tony (Manchester C)

  Godman, Dr Norman A

  Llwyd, Elfyn

  Godsiff, Roger

  Lock, David

  Goggins, Paul

  Love, Andrew

  Gordon, Mrs Eileen

  McAvoy, Thomas

  Gorrie, Donald

  McCabe, Steve

  Griffiths, Jane (Reading E)

  McCafferty, Ms Chris

  Griffiths, Nigel (Edinburgh S)

  McCartney, Rt Hon Ian (Makerfield)

  Grocott, Bruce

  Grogan, John

  McDonagh, Siobhain

  Gunnell, John

  Macdonald, Calum

  Hall, Mike (Weaver Vale)

  McDonnell, John

  Hall, Patrick (Bedford)

  McIsaac, Shona

  Hancock, Mike

  McKenna, Mrs Rosemary

  Hanson, David

  Mackinlay, Andrew

  Harman, Rt Hon Ms Harriet

  Maclennan, Rt Hon Robert

  Harris, Dr Evan

  McNamara, Kevin

  138

  McNulty, Tony

  Salter, Martin

  MacShane, Denis

  Sanders, Adrian

  Mactaggart, Fiona

  Sarwar, Mohammad

  McWalter, Tony

  Savidge, Malcolm

  Mahon, Mrs Alice

  Sawford, Phil

  Marsden, Gordon (Blackpool S)

  Sedgemore, Brian

  Marshall, David (Shettleston)

  Sheerman, Barry

  Marshall, Jim (Leicester S)

  Simpson, Alan (Nottingham S)

  Martlew, Eric

  Singh, Marsha

  Skinner, Dennis

  Meacher, Rt Hon Michael

  Smith, Rt Hon Andrew (Oxford E)

  Meale, Alan

  Smith, Angela (Basildon)

  Merron, Gillian

  Smith, Rt Hon Chris (Islington S)

  Michie, Bill (Shef'ld Heeley)

  Smith, Miss Geraldine (Morecambe & Lunesdale)

  Michie, Mrs Ray (Argyll & Bute)

  Milburn, Rt Hon Alan

  Smith, John (Glamorgan)

  Miller, Andrew

  Smith, Llew (Blaenau Gwent)

  Mitchell, Austin

  Smith, Sir Robert (W Ab'd'ns)

  Moffatt, Laura

  Snape, Peter

  Moonie, Dr Lewis

  Soley, Clive

  Moore, Michael

  Southworth, Ms Helen

  Morgan, Alasdair (Galloway)

  Spellar, John

  Morley, Elliot

  Starkey, Dr Phyllis

  Steinberg, Gerry

  Morris, Rt Hon Ms Estelle (B'ham Yardley)

  Stevenson, George

  Stewart, David (Inverness E)

  Morris, Rt Hon Sir John (Aberavon)

  Stewart, Ian (Eccles)

  Stinchcombe, Paul

  Mountford, Kali

  Stoate, Dr Howard

  Mullin, Chris

  Strang, Rt Hon Dr Gavin

  Naysmith, Dr Doug

  Stringer, Graham

  Norris, Dan

  Stuart, Ms Gisela

  Oaten, Mark

  Stunell, Andrew

  O'Brien, Mike (N Warks)

  Sutcliffe, Gerry

  O'Hara, Eddie

  Swinney, John

  O'Neill, Martin

  Taylor, Rt Hon Mrs Ann
  (Dewsbury)

  Palmer, Dr Nick

  Pearson, Ian

  Taylor, Ms Dari (Stockton S)

  Pendry, Tom

  Taylor, David (NW Leics)

  Perham, Ms Linda

  Taylor, Matthew (Truro)

  Pickthall, Colin

  Temple-Morris, Peter

  Plaskitt, James

  Thomas, Gareth (Clwyd W)

  Pollard, Kerry

  Thomas, Gareth R (Harrow W)

  Pond, Chris

  Thomas, Simon (Ceredigion)

  Pope, Greg

  Timms, Stephen

  Powell, Sir Raymond

  Tipping, Paddy

  Todd, Mark

  Prentice, Ms Bridget (Lewisham E)

  Tonge, Dr Jenny

  Prentice, Gordon (Pendle)

  Touhig, Don

  Prescott, Rt Hon John

  Trickett, Jon

  Primarolo, Dawn

  Turner, Dennis (Wolverh'ton SE)

  Prosser, Gwyn

  Turner, Dr Desmond (Kemptown)

  Purchase, Ken

  Turner, Dr George (NW Norfolk)

  Quinn, Lawrie

  Turner, Neil (Wigan)

  Radice, Rt Hon Giles

  Twigg, Derek (Halton)

  Rammell, Bill

  Tyler, Paul

  Raynsford, Nick

  Tynan, Bill

  Reed, Andrew (Loughborough)

  Vis, Dr Rudi

  Reid, Rt Hon Dr John (Hamilton N)

  Wallace, James

  Rendel, David

  Walley, Ms Joan

  Robinson, Geoffrey (Cov'try NW)

  Watts, David Webb Steve

  Rooker, Rt Hon Jeff

  White, Brian

  Rooney, Terry

  Whitehead, Dr Alan

  Ross, Ernie (Dundee W)

  Wicks, Malcolm

  Rowlands, Ted

  Wigley, Rt Hon Dafydd

  Roy, Frank

  Williams, Rt Hon Alan (Swansea W)

  Ruddock, Joan

  Russell, Bob (Colchester)

  Williams, Alan W (E Carmarthen)

  Ryan, Ms Joan

  Williams, Mrs Betty (Conwy)

  Salmond, Alex

  Willis, Phil

  139

  Winnick, David

  Wright, Anthony D (Gt Yarmouth)

  Winterton, Ms Rosie (Doncaster C)

  Wood, Mike

  Woodward, Shaun

  Tellers for the Ayes:

  Worthington, Tony

  Mr. Graham Allen and

  Wray, James

  Mr. David Jamieson.

  NOES

  Beggs, Roy

  Ross, William (E Lond'y)

  Cash, William

  Townend, John

  Donaldson, Jeffrey

  Tellers for the Noes:

  Evans, Nigel

  Rev. Martin Smyth and

  Forth, Rt Hon Eric

  Mr. William Thompson.

  (a) assess an amount equal to the rebate on like oil at the rate in force at the time of the contravention as being excise duty due from any person who used the oil or was liable for the oil being taken into the road vehicle, and

  (b) notify him or his representative accordingly."

  (4) This Resolution shall have effect in relation to liability arising on or after 1st May 2000.
  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

  9. HYDROCARBON OIL (USE OF REBATED HEAVY OIL AS FUEL)
  Resolved,
  That—

  (1) In Schedule 1 to the Hydrocarbon Oil Duties Act 1979, the following provisions shall be omitted—

  (a) paragraph 2(1)(b) and the word "or" immediately preceding it, and

  (b) paragraph 2(4).

  (2) This Resolution has effect in relation to the use of rebated heavy oil as fuel on or after 1st May 2000.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

  10. TOBACCO PRODUCTS (RATES OF DUTY)
  Motion made, and Question put,
  (1) For the Table of rates of duty in Schedule 1 to the Tobacco Products Duty Act 1979 there shall be substituted—
  Question accordingly agreed to.

  11. TOBACCO PRODUCTS DUTY (RETAIL PRICE OF CIGARETTES)
  Resolved,
  That provision may be made amending section 5 of the Tobacco Products Duty Act 1979.

  12. AMUSEMENT MACHINE LICENCE DUTY (RATES OF DUTY)
  Resolved,
  That provision may be made about the rates of amusement machine licence duty.

  13. AMUSEMENT MACHINE LICENCE DUTY (MEANING OF AMUSEMENT MACHINE)
  Resolved,
  That provision may be made amending section 25 of the Betting and Gaming Duties Act 1981.

  14. AIR PASSENGER DUTY
  Motion made, and Question put,
  That provision may be made about air passenger duty.
  The House divided: Ayes 363, Noes 3.

  Division No. 123]

  [10.40 pm

  AYES

  Abbott, Ms Diane

  Blears, Ms Hazel

  Ainger, Nick

  Blizzard, Bob

  Ainsworth, Robert (Cov'try NE)

  Blunkett, Rt Hon David

  Alexander, Douglas

  Boateng, Rt Hon Paul

  Allan, Richard

  Borrow, David

  Allen, Graham

  Bradley, Keith (Withington)

  Anderson, Donald (Swansea E)

  Bradley, Peter (The Wrekin)

  Anderson, Janet (Rossendale)

  Bradshaw, Ben

  Ashdown, Rt Hon Paddy

  Brake, Tom

  Ashton, Joe

  Brand, Dr Peter

  Atherton, Ms Candy

  Breed, Colin

  Atkins, Charlotte

  Brinton, Mrs Helen

  Austin, John

  Brown, Rt Hon Gordon (Dunfermline E)

  Baker, Norman

  Ballard, Jackie

  Brown, Rt Hon Nick (Newcastle E)

  Banks, Tony

  Brown, Russell (Dumfries)

  Barnes, Harry

  Browne, Desmond

  Barron, Kevin

  Bruce, Malcolm (Gordon)

  Battle, John

  Buck, Ms Karen

  Bayley, Hugh

  Burden, Richard

  Beard, Nigel

  Burgon, Colin

  Begg, Miss Anne

  Burnett, John

  Beith, Rt Hon A J

  Burstow, Paul

  Bell, Stuart (Middlesbrough)

  Butler, Mrs Christine

  Benn, Hilary (Leeds C)

  Byers, Rt Hon Stephen

  Benn, Rt Hon Tony (Chesterfield)

  Cable, Dr Vincent

  Bennett, Andrew F

  Campbell, Mrs Anne (C'bridge)

  Benton, Joe

  Campbell, Rt Hon Menzies (NE Fife)

  Berry, Roger

  Betts, Clive

  Campbell-Savours, Dale

  Blackman, Liz

  Cann, Jamie

  140

  Casale, Roger

  Gilroy, Mrs Linda

  Cawsey, Ian

  Godman, Dr Norman A

  Chaytor, David

  Godsiff, Roger

  Chidgey, David

  Goggins, Paul

  Clapham, Michael

  Gordon, Mrs Eileen

  Clark, Dr Lynda (Edinburgh Pentlands)

  Gorrie, Donald

  Griffiths, Jane (Reading E)

  Clark, Paul (Gillingham)

  Griffiths, Nigel (Edinburgh S)

  Clarke, Charles (Norwich S)

  Grocott, Bruce

  Clarke, Rt Hon Tom (Coatbridge)

  Grogan, John

  Clarke, Tony (Northampton S)

  Gunnell, John

  Clelland, David

  Hall, Mike (Weaver Vale)

  Clwyd, Ann

  Hall, Patrick (Bedford)

  Coaker, Vernon

  Hancock, Mike

  Coffey, Ms Ann

  Hanson, David

  Cohen, Harry

  Harman, Rt Hon Ms Harriet

  Coleman, Iain

  Harris, Dr Evan

  Colman, Tony

  Heal, Mrs Sylvia

  Cook, Rt Hon Robin (Livingston)

  Healey, John

  Cooper, Yvette

  Heath, David (Somerton & Frome)

  Corbett, Robin

  Henderson, Doug (Newcastle N)

  Corbyn, Jeremy

  Henderson, Ivan (Harwich)

  Corston, Jean

  Heppell, John

  Cotter, Brian

  Hesford, Stephen

  Cousins, Jim

  Hewitt, Ms Patricia

  Cranston, Ross

  Hill, Keith

  Crausby, David

  Hinchliffe, David

  Cryer, Mrs Ann (Keighley)

  Hodge, Ms Margaret

  Cryer, John (Hornchurch)

  Hoey, Kate

  Cunningham, Rt Hon Dr Jack (Copeland)

  Home Robertson, John

  Hood, Jimmy

  Cunningham, Jim (Cov'try S)

  Hoon, Rt Hon Geoffrey

  Cunningham, Ms Roseanna (Perth)

  Hope, Phil

  Hopkins, Kelvin

  Curtis-Thomas, Mrs Claire

  Howarth, Alan (Newport E)

  Dalyell, Tam

  Howells, Dr Kim

  Darling, Rt Hon Alistair

  Hughes, Ms Beverley (Stretford)

  Darvill, Keith

  Hughes, Simon (Southwark N)

  Davey, Edward (Kingston)

  Humble, Mrs Joan

  Davies, Rt Hon Denzil (Llanelli)

  Hurst, Alan

  Davies, Geraint (Croydon C)

  Hutton, John

  Dean, Mrs Janet

  Iddon, Dr Brian

  Denham, John

  Illsley, Eric

  Dismore, Andrew

  Jackson, Ms Glenda (Hampstead)

  Dobbin, Jim

  Jackson, Helen (Hillsborough)

  Donohoe, Brian H

  Jamieson, David

  Doran, Frank

  Jenkins, Brian

  Dowd, Jim

  Johnson, Alan (Hull W & Hessle)

  Drew, David

  Johnson, Miss Melanie (Welwyn Hatfield)

  Dunwoody, Mrs Gwyneth

  Eagle, Angela (Wallasey)

  Jones, Rt Hon Barry (Alyn)

  Eagle, Maria (L'pool Garston)

  Jones, Helen (Warrington N)

  Edwards, Huw

  Jones, Ieuan Wyn (Ynys Môn)

  Efford, Clive

  Jones, Ms Jenny (Wolverh'ton SW)

  Ellman, Mrs Louise

  Ennis, Jeff

  Jones, Dr Lynne (Selly Oak)

  Etherington, Bill

  Jowell, Rt Hon Ms Tessa

  Ewing, Mrs Margaret

  Keeble, Ms Sally

  Field, Rt Hon Frank

  Keetch, Paul

  Fisher, Mark

  Kemp, Fraser

  Fitzsimons, Lorna

  Kennedy, Jane (Wavertree)

  Flint, Caroline

  Khabra, Piara S

  Flynn, Paul

  Kidney, David

  Follett, Barbara

  Kilfoyle, Peter

  Foster, Rt Hon Derek

  King, Andy (Rugby & Kenilworth)

  Foster, Don (Bath)

  King, Ms Oona (Bethnal Green)

  Foster, Michael Jabez (Hastings)

  Kirkwood, Archy

  Foster, Michael J (Worcester)

  Ladyman, Dr Stephen

  Fyfe, Maria

  Lepper, David

  Galloway, George

  Leslie, Christopher

  Gapes, Mike

  Levitt, Tom

  Gardiner, Barry

  Lewis, Ivan (Bury S)

  George, Andrew (St Ives)

  Lewis, Terry (Worsley)

  George, Bruce (Walsall S)

  Liddell, Rt Hon Mrs Helen

  Gerrard, Neil

  Linton, Martin

  Gibson, Dr Ian

  Livsey, Richard

  141

  Lloyd, Tony (Manchester C)

  Ross, Ernie (Dundee W)

  Llwyd, Elfyn

  Rowlands, Ted

  Lock, David

  Roy, Frank

  Love, Andrew

  Ruddock, Joan

  McAvoy, Thomas

  Russell, Bob (Colchester)

  McCabe, Steve

  Ryan, Ms Joan

  McCafferty, Ms Chris

  Salmond, Alex

  McCartney, Rt Hon Ian (Makerfield)

  Salter, Martin

  Sanders, Adrian

  McDonagh, Siobhain

  Sarwar, Mohammad

  Macdonald, Calum

  Savidge, Malcolm

  McDonnell, John

  Sawford, Phil

  McIsaac, Shona

  Sedgemore, Brian

  McKenna, Mrs Rosemary

  Sheerman, Barry

  Mackinlay, Andrew

  Simpson, Alan (Nottingham S)

  Maclennan, Rt Hon Robert

  Singh, Marsha

  McNamara, Kevin

  Skinner, Dennis

  McNulty, Tony

  Smith, Rt Hon Andrew (Oxford E)

  MacShane, Denis

  Smith, Angela (Basildon)

  Mactaggart, Fiona

  Smith, Rt Hon Chris (Islington S)

  Mc Walter, Tony

  Smith, Miss Geraldine (Morecambe & Lunesdale)

  Mahon, Mrs Alice

  Marsden, Gordon (Blackpool S)

  Smith, John (Glamorgan)

  Marshall, David (Shettleston)

  Smith, Llew (Blaenau Gwent)

  Marshall, Jim (Leicester S)

  Smith, Sir Robert (W Ab'd'ns)

  Martlew, Eric

  Snape, Peter

  Meacher, Rt Hon Michael

  Soley, Clive

  Meale, Alan

  Southworth, Ms Helen

  Merron, Gillian

  Spellar, John

  Michie, Bill (Shef'ld Heeley)

  Starkey, Dr Phyllis

  Michie, Mrs Ray (Argyll & Bute)

  Steinberg, Gerry

  Milburn, Rt Hon Alan

  Stevenson, George

  Miller, Andrew

  Stewart, David (Inverness E)

  Mitchell, Austin

  Stewart, Ian (Eccles)

  Moffatt, Laura

  Stinchcombe, Paul

  Moonie, Dr Lewis

  Stoate, Dr Howard

  Moore, Michael

  Strang, Rt Hon Dr Gavin

  Morgan, Alasdair (Galloway)

  Stringer, Graham

  Morley, Elliot

  Stuart, Ms Gisela

  Morris, Rt Hon Ms Estelle (B'ham Yardley)

  Stunell, Andrew

  Sutcliffe, Gerry

  Morris, Rt Hon Sir John (Aberavon)

  Swinney, John

  Taylor, Rt Hon Mrs Ann (Dewsbury)

  Mountford, Kali

  Mullin, Chris

  Taylor, Ms Dari (Stockton S)

  Naysmith, Dr Doug

  Taylor, David (NW Leics)

  Norris, Dan

  Taylor, Matthew (Truro)

  Oaten, Mark

  Temple-Morris, Peter

  O'Brien, Mike (N Warks)

  Thomas, Gareth (Clwyd W)

  O'Hara, Eddie

  Thomas, Gareth R (Harrow W)

  O'Neill, Martin

  Thomas, Simon (Ceredigion)

  Palmer, Dr Nick

  Timms, Stephen

  Pearson, Ian

  Tipping, Paddy

  Pendry, Tom

  Todd, Mark

  Perham, Ms Linda

  Tonge, Dr Jenny

  Pickthall, Colin

  Touhig, Don

  Plaskitt, James

  Trickett, Jon

  Pollard, Kerry

  Turner, Dennis (Wolverh'ton SE)

  Pond, Chris

  Turner, Dr Desmond (Kemptown)

  Powell, Sir Raymond

  Turner, Dr George (NW Norfolk)

  Prentice, Ms Bridget (Lewisham E)

  Turner, Neil (Wigan)

  Prentice, Gordon (Pendle)

  Twigg, Derek (Halton)

  Prescott, Rt Hon John

  Tyler, Paul

  Primarolo, Dawn

  Tynan, Bill

  Prosser, Gwyn

  Vis, Dr Rudi

  Purchase, Ken

  Wallace, James

  Quinn, Lawrie

  Walley, Ms Joan

  Radice, Rt Hon Giles

  Watts, David

  Rammell, Bill

  Webb, Steve

  Raynsford, Nick

  White, Brian

  Reed, Andrew (Loughborough)

  Whitehead, Dr Alan

  Reid, Rt Hon Dr John (Hamilton N)

  Wicks, Malcolm

  Rendel, David

  Wigley, Rt Hon Dafydd

  Robinson, Geoffrey (Cov'try NW)

  Williams, Rt Hon Alan (Swansea W)

  Rooker, Rt Hon Jeff

  Rooney, Terry

  Williams, Alan W (E Carmarthen)

  142

  Williams, Mrs Betty (Conwy)

  Worthington, Tony

  Willis, Phil

  Wray, James

  Winnick, David

  Wright, Anthony D (Gt Yarmouth)

  Winterton, Ms Rosie (Doncaster C)

  Wise, Audrey

  Tellers for the Ayes:

  Wood, Mike

  Mr. Kevin Hughes and

  Woodward, Shaun

  Mr. Greg Pope.

  NOES

  Beggs, Roy

  Tellers for the Noes:

  Donaldson, Jeffrey

  Rev. Martin Smyth and

  Ross, William (E Lond'y)

  Mr. William Thompson.

  Question accordingly agreed to.

  15. VEHICLE EXCISE DUTY (GENERAL RATE)
  Resolved,
  That—

  (1) In paragraph 1 of Schedule 1 to the Vehicle Excise and Registration Act 1994—

  (a) in sub-paragraph (2), for "£155" there shall be substituted "£160"; and

  (b) in sub-paragraph (2A), for "£100" there shall be substituted "£105".

  (2) This Resolution shall have effect in relation to licences issued on or after 1st March 2001.

  16. VEHICLE EXCISE DUTY (NEW LIGHT PASSENGER OR GOODS VEHICLES)
  Resolved,
  That provision may be made with respect to the vehicle excise duty chargeable in respect of light passenger and light goods vehicles first registered on or after 1st March 2001.

  17. VEHICLE EXCISE DUTY (RATES FOR GOODS VEHICLES ETC.)
  Resolved,
  That Schedule 1 to the Vehicle Excise and Registration Act 1994 be amended as follows-
  (1) For the Table in paragraph 9(1) there shall be substituted—

  Revenue weight of vehicle

  Rate

  (1) Exceeding

  (2) Not Exceeding

  (3) Two axle vehicle

  (4) Three axle vehicle

  (5) Four or more axle vehicle

  kgs

  kgs

  £

  £

  £

  3,500

  7,500

  165

  165

  165

  7,500

  12,000

  300

  300

  300

  12,000

  13,000

  470

  490

  350

  13,000

  14,000

  650

  490

  350

  14,000

  15,000

  840

  490

  350

  15,000

  17,000

  1,320

  490

  350

  17,000

  19,000

  1,600

  850

  350

  19,000

  21,000

  1,600

  1,020

  350

  21,000

  23,000

  1,600

  1,470

  510

  23,000

  25,000

  1,600

  2,230

  830

  25,000

  27,000

  1,600

  2,340

  1,470

  27,000

  29,000

  1,600

  2,340

  2,320

  29,000

  31,000

  1,600

  2,340

  3,360

  31,000

  44,000

  1,600

  2,340

  4,400

  (2) For the Table in paragraph 9B there shall be substituted—

  Revenue weight of vehicle

  Rate

  (1) Exceeding

  (2) Not Exceeding

  (3) Two axle vehicle

  (4) Three axle vehicle

  (5) Four or more axle vehicle

  kgs

  kgs

  £

  £

  £

  3,500

  7,500

  160

  160

  160

  7,500

  12,000

  160

  160

  160

  12,000

  13,000

  160

  160

  160

  13,000

  14,000

  160

  160

  160

  14,000

  15,000

  160

  160

  160

  15,000

  17,000

  320

  160

  160

  17,000

  19,000

  600

  160

  160

  19,000

  21,000

  600

  160

  160

  21,000

  23,000

  600

  470

  160

  23,000

  25,000

  600

  1,230

  160

  25,000

  27,000

  600

  1,340

  470

  27,000

  29,000

  600

  1,340

  1,320

  29,000

  31,000

  600

  1,340

  2,360

  31,000

  44,000

  600

  1,340

  3,400

  (3) For the Table in paragraph 11(1) there shall be substituted—

  Revenue weight of tractive unit

  Rate for tractive unit with two axles

  Rate for tractive unit with three or more axles

  (1) Exceeding

  (2) Not exceeding

  (3) Any no. of semi-trailer axles

  (4) 2 or more semi-trailer axles

  (5) 3 or more semi-trailer axles

  (6) Any no. of semi-trailer axles

  (7) 2 or more semi-trailer axles

  (8) 3 or more semi-trailer axles

  kgs

  kgs

  £

  £

  £

  £

  £

  £

  3,500

  7,500

  165

  165

  165

  165

  165

  165

  7,500

  12,000

  300

  300

  300

  300

  300

  300

  12,000

  16,000

  460

  460

  460

  460

  460

  460

  16,000

  20,000

  520

  460

  460

  460

  460

  460

  20,000

  23,000

  810

  460

  460

  460

  460

  460

  23,000

  26,000

  1,190

  590

  460

  590

  460

  460

  26,000

  28,000

  1,190

  1,130

  460

  1,130

  460

  460

  28,000

  31,000

  1,740

  1,740

  1,090

  1,740

  660

  460

  31,000

  33,000

  2,530

  2,530

  1,740

  2,530

  1,000

  460

  33,000

  34,000

  5,170

  5,170

  1,740

  2,530

  1,470

  570

  34,000

  35,000

  5,170

  5,170

  2,340

  2,530

  2,100

  860

  35,000

  36,000

  6,750

  6,750

  2,340

  2,530

  2,100

  860

  36,000

  38,000

  9,250

  9,250

  2,710

  2,820

  2,820

  1,280

  38,000

  41,000

  9,250

  9,250

  3,950

  3,750

  4,250

  2,500

  41,000

  44,000

  9,250

  9,250

  3,950

  7,250

  7,250

  2,950

  (4) For the Table in paragraph 11B there shall be substituted—

  Revenue weight of tractive unit

  Rate for tractive unit with two axles

  Rate for tractive unit with three or more axles

  (1) Exceeding

  (2) Not exceeding

  (3) Any no. of semi-trailer axles

  (4) 2 or more semi-trailer axles

  (5) 3 or more semi-trailer axles

  (6) Any no. of semi-trailer axles

  (7) 2 or more semi-trailer axles

  (8) 3 or more semi-trailer axles

  kgs

  kgs

  £

  £

  £

  £

  £

  £

  3,500

  7,500

  160

  160

  160

  160

  160

  160

  7,500

  12,000

  160

  160

  160

  160

  160

  160

  12,000

  16,000

  160

  160

  160

  160

  160

  160

  16,000

  20,000

  160

  160

  160

  160

  160

  160

  20,000

  23,000

  160

  160

  160

  160

  160

  160

  23,000

  26,000

  190

  160

  160

  160

  160

  160

  26,000

  28,000

  190

  160

  160

  160

  160

  160

  28,000

  31,000

  740

  740

  160

  740

  160

  160

  31,000

  33,000

  1,530

  1,530

  740

  1,530

  160

  160

  33,000

  34,000

  4,170

  4,170

  740

  1,530

  470

  160

  34,000

  35,000

  4,170

  4,170

  1,340

  1,530

  1,100

  160

  35,000

  36,000

  5,750

  5,750

  1,340

  1,530

  1,100

  160

  36,000

  38,000

  8,250

  8,250

  1,710

  1,820

  1,820

  280

  38,000

  41,000

  8,250

  8,250

  2,950

  2,750

  3,250

  1,500

  41,000

  44,000

  8,250

  8,250

  2,950

  6,250

  6,250

  1,950

  (5) In the following provisions—

  (a) in paragraph 11(1), after "Subject to sub-paragraphs (2) and (3)", and

  (b) in paragraph 11A(2), after "Subject to sub-paragraph (3)",

  there shall be inserted "and paragraph 11C".
  (6) After paragraph 11B there shall be inserted—
  "11C.—(1) This paragraph applies to a tractive unit that—

  (a) has a revenue weight exceeding 41,000 kilograms but not exceeding 44,000 kilograms,

  (b) has 3 or more axles and is used exclusively for the conveyance of semi-trailers with 3 or more axles,

  (c) is of a type that could lawfully be used on a public road immediately before 21st March 2000, and

  (d) complies with the requirements in force immediately before that date for use on a public road.

  (2) The annual rate of vehicle excise duty applicable to a vehicle to which this paragraph applies is—

  (a) in the case of a vehicle with respect to which the reduced pollution requirements are not satisfied, £1,280;

  146

  (b) in the case of a vehicle with respect to which those requirements are satisfied, £280.".

  (7) This resolution applies in relation to licences issued after 21st March 2000.
  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

  18. VALUE ADDED TAX (REDUCED RATE)
  Resolved,
  That—
  (1) Schedule A1 to the Value Added Tax Act 1994 shall have effect with the following amendments.
  (2) In paragraph 1(1), after paragraph (a) insert—

  "(aa) supplies of services of installing List A energy-saving materials in residential accommodation or in a building intended for use solely for a relevant charitable purpose;

  147

  (ab) supplies of List A energy-saving materials by a person who installs those materials in residential accommodation or a building intended for use solely for a relevant charitable purpose;".

  (3) In paragraph 1(1), in each of paragraphs (b) and (c), before "energy-saving materials" insert "List B".
  (4) In paragraph 1(1), after paragraph (c) insert—

  "(d) supplies to a qualifying person of services of connecting, or reconnecting, a mains gas supply to the qualifying person's sole or main residence;

  (e) supplies of goods made to a qualifying person by a person connecting, or reconnecting, a mains gas supply to the qualifying person's sole or main residence, being goods whose installation is necessary for the connection, or reconnection, of the mains gas supply;

  (f) supplies to a qualifying person of services of installing, maintaining or repairing a central heating system in the qualifying person's sole or main residence;

  (g) supplies of goods made to a qualifying person by a person installing, maintaining or repairing a central heating system in the qualifying person's sole or main residence, being goods whose installation is necessary for the installation, maintenance or repair of the central heating system;

  (h) supplies consisting in the leasing of goods that form the whole or part of a central heating system installed in the sole or main residence of a qualifying person;

  (i) supplies of goods that form the whole or part of a central heating system installed in a qualifying person's sole or main residence and that, immediately before being supplied, were goods leased under arrangements such that the consideration for the supplies consisting in the leasing of the goods was, in whole or in part, funded by a grant made under a relevant scheme;

  (j) supplies to a qualifying person of services of installing qualifying security goods in the qualifying person's sole or main residence; and

  (k) supplies of qualifying security goods made to a qualifying person by a person who installs those goods in the qualifying person's sole or main residence."

  (5) For paragraph 1(1A) substitute—
  "(1A) A supply to which any of paragraphs (b) to (k) of sub-paragraph (1) above applies is a supply falling within this paragraph only to the extent that the consideration for it—

  (a) is, or is to be, funded by a grant made under a relevant scheme; or

  (b) in the case of a supply to which paragraph (i) of that sub-paragraph applies—

  (i) is, or is to be, funded by such a grant, or

  (ii) is a payment becoming due only by reason of the termination (whether by the passage of time or otherwise) of the leasing of the goods in question."

  (6) In paragraph 1(1B), for "sub-paragraph (1)(b) or (c)" substitute "any of paragraphs (b) to (k) of sub-paragraph (1)".
  (7) In paragraph 5(3)(c), for "disability working allowance" substitute "disabled person's tax credit".
  (8) In paragraph 5(3)(d), for "family credit" substitute "working families' tax credit".
  (9) In paragraph 5, after sub-paragraph (3) insert—
  "(3A) For the purposes of paragraph 1(1)(aa) and (ab) above "residential accommodation" means—

  (a) a building, or part of a building, that consists of a dwelling or a number of dwellings;

  (b) a building, or part of a building, used for a relevant residential purpose;

  (c) a caravan used as a place of permanent habitation; or

  (d) a houseboat.

  148
  (3B) For the purposes of paragraph 1(1)(aa) and (ab) above "use for a relevant charitable purpose" means use by a charity in either or both of the following ways, namely—

  (a) otherwise than in the course or furtherance of a business;

  (b) as a village hall or similarly in providing social or recreational facilities for a local community."

  (10) In paragraph 5(4), for "For the purposes of paragraph 1(1)(b) and (c) above "energy-saving materials" means" substitute "For the purposes of paragraph 1(1)(aa) and (ab) above "List A energy-saving materials" means".
  (11) In paragraph 5(4)(c), after "central heating system controls" insert "(including thermostatic radiator valves)".
  (12) In paragraph 5(4), after paragraph (d) insert—
  "(e) solar panels."
  (13) In paragraph 5, after sub-paragraph (4) insert—
  "(4A) For the purposes of paragraph 1(1)(b) and (c) above "List B energy-saving materials" means any of the following—

  (a) gas-fired room heaters that are fitted with thermostatic controls;

  (b) electric storage heaters;

  (c) closed solid fuel fire cassettes;

  (d) electric dual immersion water heaters with foam-insulated hot water tanks;

  (e) gas-fired boilers;

  (f) oil-fired boilers;

  (g) radiators.

  (4B) For the purposes of paragraph 1(1)(j) and (k) above, "qualifying security goods" means any of the following—

  (a) locks or bolts for windows;

  (b) locks, bolts or security chains for doors;

  (c) spy holes;

  (d) smoke alarms."

  (14) In paragraph 5(5), for "paragraph 1(1A) and (1B)" substitute "paragraph 1".
  (15) This Resolution applies to supplies made on or after 1st April 2000.
  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

  19. DISPOSALS OF ASSETS FOR WHICH A VAT REPAYMENT IS CLAIMED
  Resolved,
  That—
  (1) In section 3(2) of the Value Added Tax Act 1994, for "Schedules 1 to 3" there shall be substituted "Schedules 1 to 3A".
  (2) In section 67 of that Act—

  (a) in subsection (1)(a), for "or with paragraph 3 or 8(2) of Schedule 3" there shall be substituted ", with paragraph 3 or 8(2) of Schedule 3 or paragraph 3, 4 or 7(2) or (3) of Schedule 3A";

  (b) in subsection (3)(a), for "or paragraph 3 of Schedule 3" there shall be substituted ", paragraph 3 of Schedule 3 or paragraph 3 or 4 of Schedule 3A"; and

  (c) in subsection (3)(b), for "or with sub-paragraph (2) of paragraph 8 of Schedule 3" there shall be substituted ", with sub-paragraph (2) of paragraph 8 of Schedule 3 or with sub-paragraph (2) or (3) of paragraph 7 of Schedule 3A".

  (3) In section 69(1)(a) of that Act, for "or paragraph 5 of Schedule 3" there shall be substituted ", paragraph 5 of Schedule 3 or paragraph 5 of Schedule 3A".
  (4) In section 73(3)(b) of that Act, for "or paragraph 6(2) or (3) of Schedule 3" there shall be substituted ", paragraph 6(2) or (3) of Schedule 3 or paragraph 6(1) or (2) of Schedule 3A".
  (5) In section 74(1)(c) of that Act, for "under paragraph 8 of Schedule 3" there shall be substituted ", under paragraph 8 of Schedule 3 or under paragraph 7 of Schedule 3A".
  (6) In the following provisions of that Act—

  (a) paragraph 1(4)(a) and (5) of Schedule 1; and

  (b) paragraph 1(4) of Schedule 2,

  for "or paragraph 6(3) of Schedule 3" there shall be substituted ", paragraph 6(3) of Schedule 3 or paragraph 6(2) of Schedule 3A".
  (7) In paragraph 1(3) of Schedule 3 to that Act, for "or paragraph 6(2) of Schedule 2" there shall be substituted ", paragraph 6(2) of Schedule 2 or paragraph 6(2) of Schedule 3A".
  (8) After Schedule 3 to that Act there shall be inserted, as Schedule 3A, the following provisions—

  REGISTRATION IN RESPECT OF DISPOSALS OF ASSETS for WHICH A VAT REPAYMENT IS CLAIMED

    Liability to be registered
    1.—(1) A person who is not registered under this Act, and is not liable to be registered under Schedule 1, 2 or 3, becomes liable to be registered under this Schedule at any time—

    (a) if he makes relevant supplies; or

    (b) if there are reasonable grounds for believing that he will make such supplies in the period of 30 days then beginning.

    (2) A person shall be treated as having become liable to be registered under this Schedule at any time when he would have become so liable under sub-paragraph (1) above but for any registration which is subsequently cancelled under paragraph 6(2) below, paragraph 13(3) of Schedule 1, paragraph 6(2) of Schedule 2 or paragraph 6(3) of Schedule 3.
    (3) A person shall not cease to be liable to be registered under this Schedule except in accordance with paragraph 2 below.
    2. A person who has become liable to be registered under this Schedule shall cease to be so liable at any time if the Commissioners are satisfied that he has ceased to make relevant supplies.

    Notification of liability and registration
    3.—(1) A person who becomes liable to be registered by virtue of paragraph 1(1)(a) above shall notify the Commissioners of the liability before the end of the period of 30 days beginning with the day on which the liability arises.
    (2) The Commissioners shall register any such person (whether or not he so notifies them) with effect from the beginning of the day on which the liability arises.
    4.—(1) A person who becomes liable to be registered by virtue of paragraph 1(1)(b) above shall notify the Commissioners of the liability before the end of the period by reference to which the liability arises.
    (2) The Commissioners shall register any such person (whether or not he so notifies them) with effect from the beginning of the period by reference to which the liability arises.

    Notification of end of liability
    5.—(1) Subject to sub-paragraph (2) below, a person registered under paragraph 3 or 4 above who ceases to make or have the intention of making relevant supplies shall notify the Commissioners of that fact within 30 days of the day on which he does so.
    (2) Sub-paragraph (1) above does not apply if the person would, when he so ceases, be otherwise liable or entitled to be registered under this Act if his registration and any enactment preventing a person from being liable to be registered under different provisions at the same time were disregarded.

    Cancellation of registration
    6.—(1) Subject to sub-paragraph (3) below, where the Commissioners are satisfied that a registered person has ceased to be liable to be registered under this Schedule, they may
    150
    cancel his registration with effect from the day on which he so ceased or from such later date as may be agreed between them and him.
    (2) Where the Commissioners are satisfied that on the day on which a registered person was registered he was not registrable, they may cancel his registration with effect from that day.
    (3) The Commissioners shall not under sub-paragraph (1) above cancel a person's registration with effect from any time unless they are satisfied that it is not a time when that person would be subject to a requirement, or entitled, to be registered under this Act.
    (4) In determining for the purposes of sub-paragraph (3) above whether a person would be subject to a requirement, or entitled, to be registered at any time, so much of any provision of this Act as prevents a person from becoming liable or entitled to be registered when he is already registered or when he is so liable under any other provision shall be disregarded.

    Exemption from registration
    7.—(1) Notwithstanding the preceding provisions of this Schedule, where a person who makes or intends to make relevant supplies satisfies the Commissioners that any such supply is zero-rated or would be zero-rated if he were a taxable person, they may, if he so requests and they think fit, exempt him from registration under this Schedule.
    (2) Where there is a material change in the nature of the supplies made by a person exempted under this paragraph from registration under this Schedule, he shall notify the Commissioners of the change—

    (a) within 30 days of the date on which the change occurred; or

    (b) if no particular date is identifiable as the day on which it occurred, within 30 days of the end of the quarter in which it occurred.

    (3) Where there is a material alteration in any quarter in the proportion of relevant supplies of such a person that are zero-rated, he shall notify the Commissioners of the alteration within 30 days of the end of the quarter.
    (4) If it appears to the Commissioners that a request under sub-paragraph (1) above should no longer have been acted upon on or after any day, or has been withdrawn on any day, they shall register the person who made the request with effect from that day.

    Supplementary
    8. Any notification required under this Schedule shall be made in such form and shall contain such particulars as the Commissioners may by regulations prescribe.
    9.—(1) For the purposes of this Schedule a supply of goods is a relevant supply where—

    (a) the supply is a taxable supply;

    (b) the goods are assets of the business in the course or furtherance of which they are supplied; and

    (c) the person by whom they are supplied, or a predecessor of his, has received or claimed, or is intending to claim, a repayment of VAT on the supply to him, or the importation by him, of the goods or of anything comprised in them.

    (2) In relation to any goods, a person is the predecessor of another for the purposes of this paragraph if—

    (a) that other person is a person to whom he has transferred assets of his business by a transfer of that business, or part of it, as a going concern;

    (b) those assets consisted of or included those goods; and

    (c) the transfer of the assets is one falling by virtue of an order under section 5(3) (or under an enactment re-enacted in section 5(3)) to be treated as neither a supply of goods nor a supply of services;

    and the reference in this paragraph to a person's predecessor includes references to the predecessors of his predecessor through any number of transfers.
    (3) The reference in this paragraph to a repayment of VAT is a reference to such a repayment under a scheme embodied in regulations made under section 39."
    (9) In paragraph 5(5) of Schedule 4 to that Act, for the words from "under sections 25 and 26" to the end there shall be substituted—

    "(a) under sections 25 and 26, to credit for the whole or any part of the VAT on the supply, acquisition or importation of those goods or of anything comprised in them; or

    (b) under a scheme embodied in regulations made under section 39, to a repayment of VAT on the supply or importation of those goods or of anything comprised in them."

    (10) Paragraphs (1) to (7) and (9) above have effect in relation to supplies made on or after 21st March 2000; and paragraph (8) above has effect in relation to relevant supplies (within the meaning of Schedule 3A to that Act) made on or after that date.
    And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

  20. CLIMATE CHANGE LEVY
  Motion made, and Question put,
  That provision may be made for charging a tax, to be known as climate change levy, on—

  (a) supplies of electricity; and

  (b) supplies of gas, coal or other commodities capable of being used as fuel.

  The House divided: Ayes 351, Noes 146.

  Division No. 124]

  [10.53 pm

  AYES

  Abbott, Ms Diane

  Brinton, Mrs Helen

  Ainger, Nick

  Brown, Rt Hon Gordon (Dunfermline E)

  Ainsworth, Robert (Cov'try NE)

  Alexander, Douglas

  Brown, Rt Hon Nick (Newcastle E)

  Allan, Richard

  Brown, Russell (Dumfries)

  Allen, Graham

  Browne, Desmond

  Anderson, Donald (Swansea E)

  Bruce, Malcolm (Gordon)

  Anderson, Janet (Rossendale)

  Buck, Ms Karen

  Ashdown, Rt Hon Paddy

  Burden, Richard

  Ashton, Joe

  Burgon, Colin

  Atherton, Ms Candy

  Burstow, Paul

  Atkins, Charlotte

  Butler, Mrs Christine

  Austin, John

  Byers, Rt Hon Stephen

  Baker, Norman

  Cable, Dr Vincent

  Ballard, Jackie

  Campbell, Mrs Anne (C'bridge)

  Banks, Tony

  Campbell, Rt Hon Menzies (NE Fife)

  Barnes, Harry

  Barron, Kevin

  Campbell-Savours, Dale

  Battle, John

  Cann, Jamie

  Bayley, Hugh

  Casale, Roger

  Beard, Nigel

  Cawsey, Ian

  Begg, Miss Anne

  Chaytor, David

  Beith, Rt Hon A J

  Chidgey, David

  Bell, Stuart (Middlesbrough)

  Clapham, Michael

  Benn, Hilary (Leeds C)

  Clark, Dr Lynda (Edinburgh Pentlands)

  Benn, Rt Hon Tony (Chesterfield)

  Bennett, Andrew F

  Clark, Paul (Gillingham)

  Benton, Joe

  Clarke, Charles (Norwich S)

  Berry, Roger

  Clarke, Rt Hon Tom (Coatbridge)

  Betts, Clive

  Clarke, Tony (Northampton S)

  Blackman, Liz

  Clelland, David

  Blears, Ms Hazel

  Clwyd, Ann

  Blizzard, Bob

  Coaker, Vernon

  Boateng, Rt Hon Paul

  Coffey, Ms Ann

  Borrow, David

  Cohen, Harry

  Bradley, Keith (Withington)

  Coleman, Iain

  Bradley, Peter (The Wrekin)

  Colman, Tony

  Bradshaw, Ben

  Cook, Rt Hon Robin (Livingston)

  Brake, Tom

  Cooper, Yvette

  Brand, Dr Peter

  Corbett, Robin

  152

  Corbyn, Jeremy

  Hill, Keith

  Corston, Jean

  Hinchliffe, David

  Cotter, Brian

  Hodge, Ms Margaret

  Cousins, Jim

  Hoey, Kate

  Cranston, Ross

  Home Robertson, John

  Crausby, David

  Hood, Jimmy

  Cryer, Mrs Ann (Keighley)

  Hoon, Rt Hon Geoffrey

  Cryer, John (Hornchurch)

  Hope, Phil

  Cunningham, Rt Hon Dr Jack (Copeland)

  Hopkins, Kelvin

  Howarth, Alan (Newport E)

  Cunningham, Jim (Cov'try S)

  Howells, Dr Kim

  Curtis-Thomas, Mrs Claire

  Hughes, Ms Beverley (Stretford)

  Dalyell, Tam

  Hughes, Simon (Southwark N)

  Darling, Rt Hon Alistair

  Humble, Mrs Joan

  Darvill, Keith

  Hurst, Alan

  Davey, Edward (Kingston)

  Hutton, John

  Davies, Rt Hon Denzil (Llanelli)

  Iddon, Dr Brian

  Davies, Geraint (Croydon C)

  Illsley, Eric

  Dean, Mrs Janet

  Jackson, Ms Glenda (Hampstead)

  Denham, John

  Jackson, Helen (Hillsborough)

  Dismore, Andrew

  Jamieson, David

  Dobbin, Jim

  Jenkins, Brian

  Donohoe, Brian H

  Johnson, Alan (Hull W & Hessle)

  Doran, Frank

  Johnson, Miss Melanie (Welwyn Hatfield)

  Dowd, Jim

  Drew, David

  Jones, Rt Hon Barry (Alyn)

  Dunwoody, Mrs Gwyneth

  Jones, Helen (Warrington N)

  Eagle, Angela (Wallasey)

  Jones, Ms Jenny (Wolverh'ton SW)

  Eagle, Maria (L'pool Garston)

  Edwards, Huw

  Jones, Dr Lynne (Selly Oak)

  Efford, Clive

  Jowell, Rt Hon Ms Tessa

  Ellman, Mrs Louise

  Keeble, Ms Sally

  Ennis, Jeff

  Keetch, Paul

  Etherington, Bill

  Kemp, Fraser

  Field, Rt Hon Frank

  Kennedy, Jane (Wavertree)

  Fisher, Mark

  Khabra, Piara S

  Fitzsimons, Lorna

  Kidney, David

  Flint, Caroline

  Kilfoyle, Peter

  Flynn, Paul

  King, Andy (Rugby & Kenilworth)

  Follett, Barbara

  King, Ms Oona (Bethnal Green)

  Foster, Rt Hon Derek

  Kirkwood, Archy

  Foster, Don (Bath)

  Ladyman, Dr Stephen

  Foster, Michael Jabez (Hastings)

  Lepper, David

  Foster, Michael J (Worcester)

  Leslie, Christopher

  Fyfe, Maria

  Levitt, Tom

  Galloway, George

  Lewis, Ivan (Bury S)

  Gapes, Mike

  Lewis, Terry (Worsley)

  Gardiner, Barry

  Liddell, Rt Hon Mrs Helen

  George, Andrew (St Ives)

  Linton, Martin

  George, Bruce (Walsall S)

  Livsey, Richard

  Gerrard, Neil

  Lloyd, Tony (Manchester C)

  Gibson, Dr Ian

  Lock, David

  Gilroy, Mrs Linda

  Love, Andrew

  Godman, Dr Norman A

  McAvoy, Thomas

  Godsiff, Roger

  McCabe, Steve

  Goggins, Paul

  McCafferty, Ms Chris

  Gordon, Mrs Eileen

  McCartney, Rt Hon Ian (Makerfield)

  Gorrie, Donald

  Griffiths, Jane (Reading E)

  McDonagh, Siobhain

  Griffiths, Nigel (Edinburgh S)

  Macdonald, Calum

  Grocott, Bruce

  McDonnell, John

  Grogan, John

  McIsaac, Shona

  Gunnell, John

  McKenna, Mrs Rosemary

  Hall, Mike (Weaver Vale)

  Mackinlay, Andrew

  Hall, Patrick (Bedford)

  Maclennan, Rt Hon Robert

  Hancock, Mike

  McNamara, Kevin

  Hanson, David

  McNulty, Tony

  Harman, Rt Hon Ms Harriet

  MacShane, Denis

  Harris, Dr Evan

  Mactaggart, Fiona

  Heal, Mrs Sylvia

  McWalter, Tony

  Healey, John

  Mahon, Mrs Alice

  Henderson, Doug (Newcastle N)

  Marsden, Gordon (Blackpool S)

  Henderson, Ivan (Harwich)

  Marshall, David (Shettleston)

  Heppell, John

  Marshall, Jim (Leicester S)

  Hesford, Stephen

  Martlew, Eric

  Hewitt, Ms Patricia

  Meacher, Rt Hon Michael

  153

  Meale, Alan

  Smith, Miss Geraldine (Morecambe & Lunesdale)

  Merron, Gillian

  Michie, Bill (Shef'ld Heeley)

  Smith, John (Glamorgan)

  Michie, Mrs Ray (Argyll & Bute)

  Smith, Llew (Blaenau Gwent)

  Milburn, Rt Hon Alan

  Smith, Sir Robert (W Ab'd'ns)

  Miller, Andrew

  Snape, Peter

  Mitchell, Austin

  Soley, Clive

  Moffatt, Laura

  Southworth, Ms Helen

  Moonie, Dr Lewis

  Spellar, John

  Moore, Michael

  Starkey, Dr Phyllis

  Morley, Elliot

  Steinberg, Gerry

  Morris, Rt Hon Ms Estelle (B'ham Yardley)

  Stevenson, George

  Stewart, David (Inverness E)

  Morris, Rt Hon Sir John (Aberavon)

  Stewart, Ian (Eccles)

  Stinchcombe, Paul

  Mountford, Kali

  Stoate, Dr Howard

  Mullin, Chris

  Strang, Rt Hon Dr Gavin

  Naysmith, Dr Doug

  Stringer, Graham

  Norris, Dan

  Stuart, Ms Gisela

  Oaten, Mark

  Stunell, Andrew

  O'Brien, Mike (N Warks)

  Sutcliffe, Gerry

  O'Hara, Eddie

  Taylor, Rt Hon Mrs Ann (Dewsbury)

  O'Neill, Martin

  Palmer, Dr Nick

  Taylor, Ms Dari (Stockton S)

  Pearson, Ian

  Taylor, David (NW Leics)

  Pendry, Tom

  Taylor, Matthew (Truro)

  Perham, Ms Linda

  Temple-Morris, Peter

  Pickthall, Colin

  Thomas, Gareth (Clwyd W)

  Plaskitt, James

  Thomas, Gareth R (Harrow W)

  Pollard, Kerry

  Thomas, Simon (Ceredigion)

  Pond, Chris

  Timms, Stephen

  Powell, Sir Raymond

  Tipping, Paddy

  Prentice, Ms Bridget (Lewisham E)

  Todd, Mark

  Tonge, Dr Jenny

  Prentice, Gordon (Pendle)

  Touhig, Don

  Prescott, Rt Hon John

  Trickett, Jon

  Primarolo, Dawn

  Turner, Dennis (Wolverh'ton SE)

  Prosser, Gwyn

  Turner, Dr Desmond (Kemptown)

  Purchase, Ken

  Turner, Dr George (NW Norfolk)

  Quinn, Lawrie

  Turner, Neil (Wigan)

  Radice, Rt Hon Giles

  Twigg, Derek (Halton)

  Rammell, Bill

  Tyler, Paul

  Raynsford, Nick

  Tynan, Bill

  Reed, Andrew (Loughborough)

  Vis, Dr Rudi

  Reid, Rt Hon Dr John (Hamilton N)

  Wallace, James

  Rendel, David

  Walley, Ms Joan

  Robinson, Geoffrey (Cov'try NW)

  Watts, David

  Rooker, Rt Hon Jeff

  Webb, Steve

  Rooney, Terry

  White, Brian

  Ross, Ernie (Dundee W)

  Whitehead, Dr Alan

  Rowlands, Ted

  Wicks, Malcolm

  Roy, Frank

  Williams, Rt Hon Alan (Swansea W)

  Ruddock, Joan

  Russell, Bob (Colchester)

  Williams, Alan W (E Carmarthen)

  Ryan, Ms Joan

  Williams, Mrs Betty (Conwy)

  Salter, Martin

  Willis, Phil

  Sanders, Adrian

  Winnick, David

  Sarwar, Mohammad

  Winterton, Ms Rosie (Doncaster C)

  Savidge, Malcolm

  Wise, Audrey

  Sawford, Phil

  Wood, Mike

  Sedgemore, Brian

  Woodward, Shaun

  Sheerman, Barry

  Worthington, Tony

  Simpson, Alan (Nottingham S)

  Wray, James

  Singh, Marsha

  Wright, Anthony D (Gt Yarmouth)

  Skinner, Dennis

  Smith, Rt Hon Andrew (Oxford E)

  Tellers for the Ayes:

  Smith, Angela (Basildon)

  Mr. Kevin Hughes and

  Smith, Rt Hon Chris (Islington S)

  Mr. Greg Pope.

  NOES

  Ainsworth Peter (E Surrey)

  Atkinson, Peter (Hexham)

  Amess, David

  Baldry, Tony

  Ancram, Rt Hon Michael

  Beggs, Roy

  Arbuthnot, Rt Hon James

  Bercow, John

  Atkinson, David (Bour'mth E)

  Beresford, Sir Paul

  154

  Blunt, Crispin

  Loughton, Tim

  Body, Sir Richard

  MacGregor, Rt Hon John

  Boswell, Tim

  McIntosh, Miss Anne

  Bottomley, Peter (Worthing W)

  Maclean, Rt Hon David

  Bottomley, Rt Hon Mrs Virginia

  McLoughlin, Patrick

  Brady, Graham

  Madel, Sir David

  Brazier, Julian

  Major, Rt Hon John

  Browning, Mrs Angela

  Malins, Humfrey

  Burns, Simon

  Maples, John

  Butterfill, John

  Maude, Rt Hon Francis

  Cash, William

  Mawhinney, Rt Hon Sir Brian

  Chapman, Sir Sydney (Chipping Barnet)

  May, Mrs Theresa

  Morgan, Alasdair (Galloway)

  Chope, Christopher

  Moss, Malcolm

  Clark, Dr Michael (Rayleigh)

  Nicholls, Patrick

  Clarke, Rt Hon Kenneth (Rushcliffe)

  Norman, Archie

  O'Brien, Stephen (Eddisbury)

  Collins, Tim

  Ottaway, Richard

  Cran, James

  Page, Richard

  Cunningham, Ms Roseanna (Perth)

  Paice, James

  Paterson, Owen

  Curry, Rt Hon David

  Pickles, Eric

  Davies, Quentin (Grantham)

  Portillo, Rt Hon Michael

  Davis, Rt Hon David (Haltemprice)

  Prior, David

  Day, Stephen

  Randall, John

  Donaldson, Jeffrey

  Redwood, Rt Hon John

  Dorrell, Rt Hon Stephen

  Robathan, Andrew

  Duncan, Alan

  Robertson, Laurence

  Duncan Smith, Iain

  Roe, Mrs Marion (Broxbourne)

  Evans, Nigel

  Ross, William (E Lond'y)

  Ewing, Mrs Margaret

  Ruffley, David

  St Aubyn, Nick

  Faber, David

  Salmond, Alex

  Fabricant, Michael

  Sayeed, Jonathan

  Fallon, Michael

  Shephard, Rt Hon Mrs Gillian

  Flight, Howard

  Shepherd, Richard

  Forth, Rt Hon Eric

  Simpson, Keith (Mid-Norfolk)

  Fox, Dr Liam

  Smyth, Rev Martin (Belfast S)

  Gale, Roger

  Soames, Nicholas

  Garnier, Edward

  Spelman, Mrs Caroline

  Gibb, Nick

  Spicer, Sir Michael

  Gill, Christopher

  Spring, Richard

  Gillan, Mrs Cheryl

  Steen, Anthony

  Gray, James

  Streeter, Gary

  Green, Damian

  Swayne, Desmond

  Greenway, John

  Swinney, John

  Grieve, Dominic

  Syms, Robert

  Hague, Rt Hon William

  Tapsell, Sir Peter

  Hamilton, Rt Hon Sir Archie

  Taylor, Ian (Esher & Walton)

  Hammond, Philip

  Taylor, John M (Solihull)

  Hawkins, Nick

  Thompson, William

  Hayes, John

  Townend, John

  Heald, Oliver

  Tredinnick, David

  Heathcoat-Amory, Rt Hon David

  Tyrie, Andrew

  Hogg, Rt Hon Douglas

  Walter, Robert

  Horam, John

  Wardle, Charles

  Howarth, Gerald (Aldershot)

  Waterson, Nigel

  Hunter, Andrew

  Wells, Bowen

  Jack, Rt Hon Michael

  Whitney, Sir Raymond

  Jackson, Robert (Wantage)

  Whittingdale, John

  Jenkin, Bernard

  Widdecombe, Rt Hon Miss Ann

  Key, Robert

  Wilkinson, John

  King, Rt Hon Tom (Bridgwater)

  Willetts, David

  Laing, Mrs Eleanor

  Wilshire, David

  Lait, Mrs Jacqui

  Winterton, Mrs Ann (Congleton)

  Lansley, Andrew

  Winterton, Nicholas (Macclesfield)

  Leigh, Edward

  Yeo, Tim

  Letwin, Oliver

  Young, Rt Hon Sir George

  Lewis, Dr Julian (New Forest E)

  Lidington, David

  Tellers for the Noes:

  Lilley, Rt Hon Peter

  Mr. Peter Luff and

  Lloyd, Rt Hon Sir Peter (Fareham)

  Mr. Geoffrey Clifton-Brown.

  Question accordingly agreed to.

  21. INCOME TAX (CHARGE AND RATES FOR 2000–01)
  Motion made, and Question put,
  That—
  Income tax shall be charged for the year 2000–01, and for that year—

  (a) the starting rate shall be 10 per cent.;

  (b) the basic rate shall be 22 per cent.; and

  (c) the higher rate shall be 40 per cent.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.
  The House divided: Ayes 311, Noes 48.

  Division No. 125]

  [11.5 pm

  AYES

  Abbott, Ms Diane

  Clelland, David

  Ainger, Nick

  Clwyd, Ann

  Ainsworth, Robert (Cov'try NE)

  Coaker, Vernon

  Alexander, Douglas

  Coffey, Ms Ann

  Allen, Graham

  Cohen, Harry

  Anderson, Donald (Swansea E)

  Coleman, Iain

  Anderson, Janet (Rossendale)

  Colman, Tony

  Ashton, Joe

  Cook, Rt Hon Robin (Livingston)

  Atherton, Ms Candy

  Cooper, Yvette

  Atkins, Charlotte

  Corbett, Robin

  Austin, John

  Corbyn, Jeremy

  Banks, Tony

  Corston, Jean

  Barnes, Harry

  Cousins, Jim

  Barron, Kevin

  Cranston, Ross

  Battle, John

  Crausby, David

  Bayley, Hugh

  Cryer, Mrs Ann (Keighley)

  Beard, Nigel

  Cryer, John (Hornchurch)

  Begg, Miss Anne

  Cunningham, Rt Hon Dr Jack (Copeland)

  Bell, Stuart (Middlesbrough)

  Cunningham, Jim (Cov'try S)

  Benn, Hilary (Leeds C)

  Curtis-Thomas, Mrs Claire

  Benn, Rt Hon Tony (Chesterfield)

  Dalyell, Tam

  Bennett, Andrew F

  Darling, Rt Hon Alistair

  Benton, Joe

  Darvill, Keith

  Berry, Roger

  Davies, Rt Hon Denzil (Llanelli)

  Betts, Clive

  Davies, Geraint (Croydon C)

  Blackman, Liz

  Dean, Mrs Janet

  Blears, Ms Hazel

  Denham, John

  Blizzard, Bob

  Dismore, Andrew

  Boateng, Rt Hon Paul

  Dobbin, Jim

  Borrow, David

  Donohoe, Brian H

  Bradley, Keith (Withington)

  Doran, Frank

  Bradley, Peter (The Wrekin)

  Dowd, Jim

  Bradshaw, Ben

  Drew, David

  Brinton, Mrs Helen

  Dunwoody, Mrs Gwyneth

  Brown, Rt Hon Gordon (Dunfermline E)

  Eagle, Angela (Wallasey)

  Brown, Rt Hon Nick (Newcastle E)

  Eagle, Maria (L'pool Garston)

  Brown, Russell (Dumfries)

  Edwards, Huw

  Browne, Desmond

  Efford, Clive

  Buck, Ms Karen

  Ellman, Mrs Louise

  Burden, Richard

  Ennis, Jeff

  Burgon, Colin

  Etherington, Bill

  Butler, Mrs Christine

  Field, Rt Hon Frank

  Byers, Rt Hon Stephen

  Fisher, Mark

  Campbell, Mrs Anne (C'bridge)

  Fitzsimons, Lorna

  Campbell-Savours, Dale

  Flint, Caroline

  Cann, Jamie

  Flynn, Paul

  Casale, Roger

  Follett, Barbara

  Cawsey, Ian

  Foster, Rt Hon Derek

  Chaytor, David

  Foster, Michael Jabez (Hastings)

  Clapham, Michael

  Foster, Michael J (Worcester)

  Clark, Dr Lynda (Edinburgh Pentlands)

  Fyfe, Maria

  Galloway, George

  Clark, Paul (Gillingham)

  Gapes, Mike

  Clarke, Charles (Norwich S)

  Gardiner, Barry

  Clarke, Rt Hon Tom (Coatbridge)

  George, Bruce (Walsall S)

  Clarke, Tony (Northampton S)

  Gerrard, Neil

  156

  Gibson, Dr Ian

  Macdonald, Calum

  Gilroy, Mrs Linda

  McDonnell, John

  Godman, Dr Norman A

  McIsaac, Shona

  Godsiff, Roger

  McKenna, Mrs Rosemary

  Goggins, Paul

  Mackinlay, Andrew

  Gordon, Mrs Eileen

  McNamara, Kevin

  Griffiths, Jane (Reading E)

  McNulty, Tony

  Griffiths, Nigel (Edinburgh S)

  MacShane, Denis

  Grocott, Bruce

  Mactaggart, Fiona

  Grogan, John

  McWalter, Tony

  Gunnell, John

  Mahon, Mrs Alice

  Hall, Mike (Weaver Vale)

  Marsden, Gordon (Blackpool S)

  Hall, Patrick (Bedford)

  Marshall, David (Shettleston)

  Hanson, David

  Marshall, Jim (Leicester S)

  Harman, Rt Hon Ms Harriet

  Martlew, Eric

  Heal, Mrs Sylvia

  Meacher, Rt Hon Michael

  Healey, John

  Meale, Alan

  Henderson, Doug (Newcastle N)

  Merron, Gillian

  Henderson, Ivan (Harwich)

  Michie, Bill (Shef'ld Heeley)

  Heppell, John

  Milburn, Rt Hon Alan

  Hesford, Stephen

  Miller, Andrew

  Hewitt, Ms Patricia

  Mitchell, Austin

  Hill, Keith

  Moffatt, Laura

  Hinchliffe, David

  Moonie, Dr Lewis

  Hodge, Ms Margaret

  Morley, Elliot

  Hoey, Kate

  Morris, Rt Hon Ms Estelle (B'ham Yardley)

  Home Robertson, John

  Hood, Jimmy

  Morris, Rt Hon Sir John (Aberavon)

  Hoon, Rt Hon Geoffrey

  Hope, Phil

  Mountford, Kali

  Hopkins, Kelvin

  Mullin, Chris

  Howarth, Alan (Newport E)

  Naysmith, Dr Doug

  Howells, Dr Kim

  Norris, Dan

  Hughes, Ms Beverley (Stretford)

  O'Brien, Mike (N Warks)

  Humble, Mrs Joan

  O'Hara, Eddie

  Hurst, Alan

  O'Neill, Martin

  Hutton, John

  Palmer, Dr Nick

  Iddon, Dr Brian

  Pearson, Ian

  Illsley, Eric

  Pendry, Tom

  Jackson, Ms Glenda (Hampstead)

  Perham, Ms Linda

  Jackson, Helen (Hillsborough)

  Pickthall, Colin

  Jamieson, David

  Plaskitt, James

  Jenkins, Brian

  Pollard, Kerry

  Johnson, Alan (Hull W & Hessle)

  Pond, Chris

  Johnson, Miss Melanie (Welwyn Hatfield)

  Powell, Sir Raymond

  Prentice, Ms Bridget (Lewisham E)

  Jones, Rt Hon Barry (Alyn)

  Prentice, Gordon (Pendle)

  Jones, Helen (Warrington N)

  Prescott, Rt Hon John

  Jones, Ms Jenny (Wolverh'ton SW)

  Primarolo, Dawn

  Prosser, Gwyn

  Jones, Dr Lynne (Selly Oak)

  Purchase, Ken

  Jowell, Rt Hon Ms Tessa

  Quinn, Lawrie

  Kemp, Fraser

  Radice, Rt Hon Giles

  Kennedy, Jane (Wavertree)

  Rammell, Bill

  Khabra, Piara S

  Raynsford, Nick

  Kidney, David

  Reed, Andrew (Loughborough)

  Kilfoyle, Peter

  Reid, Rt Hon Dr John (Hamilton N)

  King, Andy (Rugby & Kenilworth)

  Robinson, Geoffrey (Cov'try NW)

  King, Ms Oona (Bethnal Green)

  Rooker, Rt Hon Jeff

  Ladyman, Dr Stephen

  Rooney, Terry

  Lepper, David

  Ross, Ernie (Dundee W)

  Leslie, Christopher

  Rowlands, Ted

  Levitt, Tom

  Roy, Frank

  Lewis, Ivan (Bury S)

  Ruddock, Joan

  Lewis, Terry (Worsley)

  Ryan, Ms Joan

  Liddell, Rt Hon Mrs Helen

  Salter, Martin

  Linton, Martin

  Sarwar, Mohammad

  Lloyd, Tony (Manchester C)

  Savidge, Malcolm

  Lock, David

  Sawford, Phil

  Love, Andrew

  Sedgemore, Brian

  McAvoy, Thomas

  Sheerman, Barry

  McCabe, Steve

  Simpson, Alan (Nottingham S)

  McCafferty, Ms Chris

  Singh, Marsha

  McCartney, Rt Hon Ian (Makerfield)

  Skinner, Dennis

  Smith, Rt Hon Andrew (Oxford E)

  McDonagh, Siobhain

  Smith, Angela (Basildon)

  157

  Smith, Rt Hon Chris (Islington S)

  Touhig, Don

  Smith, Miss Geraldine (Morecambe & Lunesdale)

  Trickett, Jon

  Turner, Dennis (Wolverh'ton SE)

  Smith, John (Glamorgan)

  Turner, Dr Desmond (Kemptown)

  Smith, Llew (Blaenau Gwent)

  Turner, Dr George (NW Norfolk)

  Snape, Peter

  Turner, Neil (Wigan)

  Soley, Clive

  Twigg, Derek (Halton)

  Southworth, Ms Helen

  Tynan, Bill

  Spellar, John

  Vis, Dr Rudi

  Starkey, Dr Phyllis

  Walley, Ms Joan

  Steinberg, Gerry

  Watts, David

  Stevenson, George

  White, Brian

  Stewart, David (Inverness E)

  Whitehead, Dr Alan

  Stewart, Ian (Eccles)

  Wicks, Malcolm

  Stinchcombe, Paul

  Williams, Rt Hon Alan (Swansea W)

  Stoate, Dr Howard

  Strang, Rt Hon Dr Gavin

  Williams, Alan W (E Carmarthen)

  Stringer, Graham

  Williams, Mrs Betty (Conwy)

  Stuart, Ms Gisela

  Winnick, David

  Sutcliffe, Gerry

  Winterton, Ms Rosie (Doncaster C)

  Taylor, Rt Hon Mrs Ann (Dewsbury)

  Wise, Audrey

  Wood, Mike

  Taylor, Ms Dari (Stockton S)

  Woodward, Shaun

  Taylor, David (NW Leics)

  Worthington, Tony

  Temple-Morris, Peter

  Wray, James

  Thomas, Gareth (Clwyd W)

  Wright, Anthony D (Gt Yarmouth)

  Thomas, Gareth R (Harrow W)

  Timms, Stephen

  Tellers for the Ayes:

  Tipping, Paddy

  Mr. Kevin Hughes and

  Todd, Mark

  Mr. Greg Pope.

  NOES

  Allan, Richard

  Jones, Ieuan Wyn (Ynys Môn)

  Ashdown, Rt Hon Paddy

  Keetch, Paul

  Baker, Norman

  Kirkwood, Archy

  Ballard, Jackie

  Livsey, Richard

  Beith, Rt Hon A J

  Llwyd, Elfyn

  Brake, Tom

  Maclennan, Rt Hon Robert

  Brand, Dr Peter

  Michie, Mrs Ray (Argyll & Bute)

  Breed, Colin

  Moore, Michael

  Bruce, Malcolm (Gordon)

  Morgan, Alasdair (Galloway)

  Burnett, John

  Oaten, Mark

  Burstow, Paul

  Rendel, David

  Cable, Dr Vincent

  Russell, Bob (Colchester)

  Campbell, Rt Hon Menzies (NE Fife)

  Salmond, Alex

  Sanders, Adrian

  Chidgey, David

  Smith, Sir Robert (W Ab'd'ns)

  Cotter, Brian

  Taylor, Matthew (Truro)

  Cunningham, Ms Roseanna (Perth)

  Thomas, Simon (Ceredigion)

  Tonge, Dr Jenny

  Davey, Edward (Kingston)

  Tyler, Paul

  Ewing, Mrs Margaret

  Wallace, James

  Foster, Don (Bath)

  Webb, Steve

  George, Andrew (St Ives)

  Wigley, Rt Hon Dafydd

  Gorrie, Donald

  Willis, Phil

  Hancock, Mike

  Harris, Dr Evan

  Tellers for the Noes:

  Heath, David (Somerton & Frome)

  Mr. Andrew Stunell and

  Hughes, Simon (Southwark N)

  Mr. John Swinney.

  Question accordingly agreed to.

  22. INCOME TAX (EXTENSION OF STARTING RATE)
  Resolved,
  That—
  (1) Section 1A of the Income and Corporation Taxes Act 1988 shall be amended as follows.
  (2) In subsection (1)(b), after the words "is not" there shall be inserted "—

  (i) savings income falling within section 1(2)(aa), or

  (ii)".

  (3) After subsection (1) there shall be inserted—
  "(1AA) In subsection (1)(b)(i) 'savings income' means income to which this section applies other than—

  (a) income chargeable under Schedule F, or

  (b) equivalent foreign income falling within subsection (3)(b) below and chargeable under Case V of Schedule D.".

  (4) The preceding paragraphs apply for the year 2000–01 and subsequent years and shall be deemed to have had effect for the year 1999–00.
  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

  23. CORPORATION TAX (CHARGE AND RATE FOR 2001)
  Resolved,
  That, for the financial year 2001, corporation tax shall be charged at the rate of 30 per cent.

  24. CORPORATION TAX (SMALL COMPANIES' RATE FOR 2000)
  Resolved,
  That, for the financial year 2000—

  (a) the small companies' rate shall be 20 per cent., and

  (b) the fraction mentioned in section 13(2) of the Income and Corporation Taxes Act 1988 shall be one fortieth.

  25. GIFT AID PAYMENTS BY INDIVIDUALS
  Resolved,
  That—
  (1) Section 25 of the Finance Act 1990 shall be amended in accordance with paragraphs (2) to (7) below.
  (2) In subsection (1)(c), for "an appropriate certificate" there shall be substituted "an appropriate declaration".
  (3) In subsection (2)—

  (a) paragraphs (c) and (g) shall cease to have effect;

  (b) in paragraph (e), for "two and a half per cent of the amount of the gift" there shall be substituted "the limit imposed by subsection (5A) below"; and

  (c) for paragraph (i) there shall be substituted—

  "(i) either—

  (i) at the time the gift is made, the donor is resident in the United Kingdom or performs duties which by virtue of section 132(4)(a) of the Taxes Act 1988 (Crown employees serving overseas) are treated as being performed in the United Kingdom; or

  (ii) the grossed up amount of the gift would, if in fact made, be payable out of profits or gains brought into charge to income tax or capital gains tax."

  (4) For subsection (3) there shall be substituted—
  "(3) The reference in subsection (1)(c) above to an appropriate declaration is a reference to a declaration which—

  (a) is given in such manner as may be prescribed by regulations made by the Board; and

  (b) contains such information and such statements as may be so prescribed.

  (3A) Regulations made for the purposes of subsection (3) above may—

  (a) provide for declarations to have effect, to cease to have effect or to be deemed never to have had effect in such circumstances and for such purposes as may be prescribed by the regulations;

  (b) require charities to keep records with respect to declarations given to them by donors; and

  (c) make different provision for declarations made in a different manner."

  (5) After subsection (5) there shall be inserted—
  "(5A) The limit imposed by this subsection is—

  159

  (a) where the amount of the gift does not exceed £100,25 per cent of the amount of the gift;

  (b) where the amount of the gift exceeds £100 but does not exceed £1,000, £25;

  (c) where the amount of the gift exceeds £1,000, 2.5 per cent of the amount of the gift.

  (5B) Where a benefit received in consequence of making a gift—

  (a) consists of the right to receive benefits at intervals over a period of less than twelve months;

  (b) relates to a period of less than twelve months; or

  (c) is one of a series of benefits received at intervals in consequence of making a series of gifts at intervals of less than twelve months,

  the value of the benefit shall be adjusted for the purposes of subsection (4) above and the amount of the gift shall be adjusted for the purposes of subsection (5A) above.
  (5C) Where a benefit, other than a benefit which is one of a series of benefits received at intervals, is received in consequence of making a gift which is one of a series of gifts made at intervals of less than twelve months, the amount of the gift shall be adjusted for the purposes of subsection (5A) above.
  (5D) Where the value of a benefit, or the amount of a gift, falls to be adjusted under subsection (5B) or (5C) above, the value or amount shall be multiplied by 365 and the result shall be divided by—

  (a) in a case falling within subsection (5B)(a) or (b) above, the number of days in the period of less than twelve months;

  (b) in a case falling within subsection (5B)(c) or (5C) above, the average number of days in the intervals of less than twelve months;

  and the reference in subsection (5B) above to subsection (4) above is a reference to that subsection as it applies for the purposes of subsection (2)(e) above.
  (5E) In determining whether a gift to a charity falling within subsection (5F) below is a qualifying donation, there shall be disregarded the benefit of any right of admission received in consequence of the making of the gift—

  (a) to view property the preservation of which is the sole or main purpose of the charity; or

  (b) to observe wildlife the conservation of which is the sole or main purpose of the charity;

  but this subsection shall not apply unless the opportunity to make gifts which attract such a right is available to members of the public.
  (5F) A charity falls within this subsection if its sole or main purpose is the preservation of property, or the conservation of wildlife, for the public benefit.
  (5G) In subsection (5E) above "right of admission" refers to admission of the person making the gift (or any member of his family who may be admitted because of the gift) either free of the charges normally payable for admission by members of the public, or on payment of a reduced charge."
  (6) For subsections (6) to (9) there shall be substituted—
  "(6) Where any gift made by the donor in a year of assessment is a qualifying donation, then, for that year—

  (a) the Income Tax Acts and the Taxation of Chargeable Gains Act 1992 shall have effect, in their application to him, as if—

  (i) the gift had been made after deduction of income tax at the basic rate; and

  (ii) the basic rate limit were increased by an amount equal to the grossed up amount of the gift;

  (b) the provisions mentioned in subsection (7) below shall have effect, in their application to him, as if any reference to income tax which he is entitled to charge against any person included a reference to the tax treated as deducted from the gift; and

  160

  (c) to the extent, if any, necessary to ensure that he is charged to an amount of income tax and capital gains tax equal to the tax treated as deducted from the gift, he shall not be entitled to relief under Chapter I of Part VII of the Taxes Act 1988,

  but paragraph (a)(ii) above shall not apply for the purposes of any computation under section 550(2)(a) or (b) of that Act (relief where gain charged at a higher rate).
  (7) The provisions referred to in subsection (6)(b) above are—

  (a) section 289A(5)(e) of the Taxes Act 1988 (relief under enterprise investment scheme);

  (b) section 796(3) of that Act (credit for foreign tax); and

  (c) paragraph 1(6)(f) of Schedule 15B to that Act (venture capital trusts).

  (8) Where the tax treated as deducted from a gift by virtue of subsection (6) above exceeds the amount of income tax and capital gains tax with which the donor is charged for the year of assessment, the donor shall be assessable and chargeable with income tax at the basic rate on so much of the gift as is necessary to recover an amount of tax equal to the excess.
  (9) In determining for the purposes of subsection (8) above the total amount of income tax and capital gains tax with which the donor is charged for the year of assessment, there shall be disregarded—

  (a) any tax charged at the basic rate by virtue of—

  (i) section 348 of the Taxes Act 1988 (read with section 3 of that Act); or

  (ii) section 349 of that Act (read with section 350 of that Act);

  (b) any tax treated as having been paid under—

  (i) section 233(1)(a) of that Act (taxation of certain recipients of distributions);

  (ii) section 249(4)(a) of that Act (stock dividends treated as income); or

  (iii) section 547(5)(a) of that Act (method of charging life policy gain to tax);

  (c) any relief to which section 256(2) of that Act applies (relief by way of income tax reduction);

  (d) any relief under—

  (i) section 347B of that Act (relief for maintenance payments);

  (ii) section 788 of that Act (relief by agreement with other countries); or

  (iii) section 790(1) of that Act (unilateral relief);

  (e) any set off of tax deducted, or treated as deducted, from income other than—

  (i) tax treated as deducted from income by virtue of section 421(1)(a) of that Act (taxation of borrower when loan released etc); or

  (ii) tax treated as deducted from a relevant amount within the meaning of section 699A of that Act (untaxed sums comprised in the income of an estate) except to the extent that the relevant amount is or would be paid in respect of a distribution chargeable under Schedule F; and

  (f) any set off of tax credits.

  (9A) For the purposes of sections 257(5) and 257A(5) of the Taxes Act 1988 (age related allowances), the donor's total income shall be treated as reduced by the aggregate amount of gifts from which tax is treated as deducted by virtue of subsection (6) above."
  (7) In subsection (12), paragraphs (b) and (e) and the word "and" immediately preceding paragraph (e) shall cease to have effect.
  (8) In subsections (1)(b) and (3)(b) of section 257BB of the Income and Corporation Taxes Act 1988, after "section 256(2)(b)" there shall be inserted "(read with section 25(6)(c) of the Finance Act 1990 where applicable)".
  (9) In paragraph 4(1)(b) of Schedule 13B to that Act, after "section 256(2)(b)" there shall be inserted "(read with section 25(6)(c) of the Finance Act 1990 where applicable)".
  (10) This Resolution has effect in relation to—

  161

  (a) gifts made on or after 6th April 2000 which are not covenanted payments; and

  (b) covenanted payments falling to be made on or after that date.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

  26. GIFT AID PAYMENTS BY COMPANIES
  Resolved,
  That—
  (1) Section 339 of the Income and Corporation Taxes Act 1988 shall be amended in accordance with paragraphs (2) to (8) below.
  (2) In subsection (1), for paragraph (a) there shall be substituted—
  "(a) a payment which, by reason of any provision of the Taxes Acts except section 209(4), is to be regarded as a distribution; and".
  (3) Subsections (2), (3), (3A), (3F), (6), (7) and (8) shall cease to have effect.
  (4) In subsection (3B)(b), for "two and a half per cent. of the amount given after deducting tax under section 339(3)" there shall be substituted "the limit imposed by subsection (3DB) below".
  (5) After subsection (3D) there shall be inserted—
  "(3DA) The limit imposed by this subsection is—

  (a) where the amount of the payment does not exceed £100, 25 per cent of the amount of the payment;

  (b) where the amount of the payment exceeds £100 but does not exceed £1,000, £25;

  (c) where the amount of the payment exceeds £1,000, 2.5 per cent of the amount of the payment.

  (3DB) Where a benefit received in consequence of making a payment—

  (a) consists of the right to receive benefits at intervals over a period of less than twelve months;

  (b) relates to a period of less than twelve months; or

  (c) is one of a series of benefits received at intervals in consequence of making a series of payments at intervals of less than twelve months,

  the value of the benefit shall be adjusted for the purposes of subsection (3C) above and the amount of the payment shall be adjusted for the purposes of subsection (3DA) above.
  (3DC) Where a benefit, other than a benefit which is one of a series of benefits received at intervals, is received in consequence of making a payment which is one of a series of payments made at intervals of less than twelve months, the amount of the payment shall be adjusted for the purposes of subsection (3DA) above.
  (3DD) Where the value of a benefit, or the amount of a payment, falls to be adjusted under subsection (3DB) or (3DC) above, the value or amount shall be multiplied by 365 and the result shall be divided by—

  (a) in a case falling within subsection (3DB)(a) or (b) above, the number of days in the period of less than twelve months;

  (b) in a case falling within subsection (3DB)(c) or (3DC) above, the average number of days in the intervals of less than twelve months;

  and the reference in subsection (3DB) to subsection (3C) above is a reference to that subsection as it applies for the purposes of subsection (3B) above."
  (6) For subsection (4) there shall be substituted—
  "(4) Where a company gives a sum of money to a charity, the gift shall in the hands of the charity be treated for the purposes of this Act as if it were an annual payment."
  (7) For subsection (7AA) there shall be substituted—
  "(7AA) Where—

  (a) a qualifying donation to a charity is made by a company which is wholly owned by a charity, and

  162

  (b) the company makes a claim for the donation, or any part of it, to be deemed for the purposes of section 338 to be a charge on income paid in an accounting period falling wholly or partly within the period of nine months ending with the date of the making of the donation,

  the donation or part shall be deemed for those purposes to be a charge on income paid in that accounting period, and not in any later period.
  A claim under this subsection must be made within the period of two years immediately following the accounting period in which the donation is made, or such longer period as the Board may allow."
  (8) In subsection (9), the words "in subsections (1) to (4) above includes" shall cease to have effect.
  (9) In subsection (1) of section 209 of the Income and Corporation Taxes Act 1988, for "section 339(6) and any other express exceptions" there shall be substituted "any express exceptions".
  (10) In subsection (2)(a) of section 338 of that Act, after "company" there shall be inserted "or payments falling within paragraph (b) below".
  (11) This Resolution has effect in relation to payments made on or after 1st April 2000; and—

  (a) so much of an accounting period as falls before that date; and

  (b) so much of it as falls after 31st March 2000,

  shall be treated as separate accounting periods for the purposes of the amendment made by paragraph (5) above.
  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

  27. COVENANTED PAYMENTS TO CHARITIES
  Resolved,
  That—

  (1) In subsection (5)(b) of section 338 of the Income and Corporation Taxes Act 1988, for "a covenanted donation to charity" there shall be substituted "a qualifying donation".

  (2) In section 347A of that Act, subsections (2)(b), (7) and (8) shall cease to have effect.

  (3) In subsection (3) of section 348 of that Act, at the end there shall be inserted "or to any payment which is a qualifying donation for the purposes of section 25 of the Finance Act 1990".

  (4) In subsection (1) of section 349 of that Act, at the end there shall be inserted "or to any payment which is a qualifying donation (within the meaning of section 339) or a qualifying donation for the purposes of section 25 of the Finance Act 1990".

  (5) In subsection (6) of section 505 of that Act, the words "and, for this purpose, all covenanted payments to charity (within the meaning of section 347A(7)) shall be treated as a single item" shall cease to have effect.

  (6) In subsection (9) of section 660A of that Act, for paragraph (b) there shall be substituted—

  "(b) qualifying donations for the purposes of section 25 of the Finance Act 1990."

  (7) Section 59 of the Finance Act 1989 shall cease to have effect.

  (8) Where a deed of covenant executed by an individual before 6th April 2000 provides for the payment of specified amounts, any amount payable under the deed on or after that date shall be determined as if the individual were entitled to deduct tax from that amount at the basic rate.

  (9) This Resolution has effect in relation to covenanted payments—

  (a) falling to be made by individuals on or after 6th April 2000; or

  (b) made by companies on or after 1st April 2000.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

  28. DISPOSALS OF INVESTMENTS TO CHARITIES ETC.
  Resolved,
  That provision may be made about the disposal of shares, securities or other investments to charities or other bodies.

  29. EMPLOYEE SHARE OWNERSHIP PLANS
  Resolved,
  That provision may be made for the purposes of income tax about employee share ownership plans.

  30. PROFIT SHARING SCHEMES (CORPORATION TAX RELIEF)
  Resolved,
  That provision may be made about corporation tax relief for payments to trustees of profit sharing schemes approved under Schedule 9 to the Income and Corporation Taxes Act 1988.

  31. PROFIT SHARING SCHEMES (ARRANGEMENTS FOR LOANS)
  Resolved,
  That—
  (1) In paragraph 2 of Schedule 9 to the Income and Corporation Taxes Act 1988, after sub-paragraph (2) there shall be inserted—
  "(2A) The Board shall not approve a profit sharing scheme unless they are satisfied—

  (a) that the arrangements for the scheme do not make any provision, and are not in any way associated with any provision made, for loans to some or all of the employees of—

  (i) the company that established the scheme, or

  (ii) in the case of a group scheme, any participating company, and

  (b) that the operation of the scheme is not in any way associated with such loans.

  (2B) For the purposes of sub-paragraph (2A) above 'arrangements' includes any scheme, agreement or understanding, whether or not legally enforceable."
  (2) In paragraph 3(2) of that Schedule, before paragraph (d) there shall be inserted—

  "(ca) the Board—

  (i) cease to be satisfied of the matters mentioned in paragraph 2(2A) above, or

  (ii) in the case of a scheme approved before 21st March 2000, are not satisfied of those matters; or".

  (3) This Resolution shall be deemed to have come into force on 21st March 2000.
  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

  32. PROFIT SHARING SCHEMES (RESTRICTIONS ON TYPES OF SHARES)
  Resolved,
  That—
  (1) In paragraph 9(1) of Schedule 9 to the Income and Corporation Taxes Act 1988, after "below" there shall be inserted "(disregarding paragraph 11A)".
  (2) After paragraph 11 of that Schedule there shall be inserted—
  "11A.ߞ(1) In the case of a profit sharing scheme, scheme shares must not be sharesߞ

  (a) in an employer company, or

  (b) in a company thatߞ

  (i) has control of an employer company, and

  164

  (ii) is under the control of a person or persons within sub-paragraph (2)(b)(i) below in relation to an employer company.

  (2) For the purposes of this paragraph a company is "an employer company" if—

  (a) the business carried on by it consists substantially in the provision of the services of the persons employed by it, and

  (b) the majority of those services are provided to—

  (i) a person who has, or two or more persons who together have, control of the company, or

  (ii) a company associated with the company.

  (3) For the purposes of sub-paragraph (2)(b)(ii) above a company shall be treated as associated with another company if both companies are under the control of the same person or persons.
  (4) For the purposes of sub-paragraphs (1) to (3) above—

  (a) references to a person include a partnership, and

  (b) where a partner, alone or together with others, has control of a company, the partnership shall be treated as having like control of that company.

  (5) For the purposes of this paragraph the question whether a person controls a company shall be determined in accordance with section 416(2) to (6)."
  (3) In paragraph 12 of that Schedule—

  (a) in sub-paragraph (1), in paragraph (c) for "other than" to the end of that paragraph there shall be substituted "other than those permitted by sub-paragraph (1A) below.", and

  (b) after sub-paragraph (1) there shall be inserted—

  "(1A) Subject to sub-paragraph (1B) below, scheme shares may be subject to—

  (a) restrictions which attach to all shares of the same class, or

  (b) a restriction authorised by sub-paragraph (2) below.

  (1B) In the case of a profit sharing scheme, scheme shares must not be subject to any restrictions affecting the rights attaching to those shares which relate to—

  (a) dividends, or

  (b) assets on a winding-up of the company,

  other than restrictions which attach to all other ordinary shares in the same company."
  (4) Paragraphs (1) to (3) of this Resolution shall be deemed to have come into force on 21st March 2000.
  (5) Paragraphs (2) and (3) of this Resolution do not have effect in relation to shares acquired before 21st March 2000 by the trustees of a profit sharing scheme approved under Schedule 9 to the Income and Corporation Taxes Act 1988.
  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

  33. PROVISION OF SERVICES THROUGH INTERMEDIARY
  Resolved,
  That provision may be made relating to the provision of services through an intermediary.

  34. RENT-FACTORING
  Resolved,
  That provision may be made for sums received by way of consideration for the transfer of rent, or by way of premium, under rent-factoring agreements to be chargeable to corporation tax or income tax.

  35. GROUPS OF COMPANIES ETC.
  Resolved,
  That provision may be made about groups of companies and consortia for the purposes of corporation tax.

  36. ENTERPRISE INVESTMENT SCHEME
  Resolved,
  That provision may be made amending Chapter III of Part VII of the Income and Corporation Taxes Act 1988.

  37. VENTURE CAPITAL TRUSTS
  Resolved,
  That provision may be made amending Schedule 28B to the Income and Corporation Taxes Act 1988.

  38. RESEARCH AND DEVELOPMENT
  Resolved,
  That provision may be made amending provisions referring to "scientific research".

  39. CAPITAL ALLOWANCES
  Resolved,
  That provision (including retrospective provision) may be made about capital allowances.

  40. RELIEF FOR INTEREST ON LOANS TO Buy ANNUITIES
  Resolved,
  That provision may be made amending sections 353, 365 and 369 of the Income and Corporation Taxes Act 1988.

  41. TAX TREATMENT OF ACQUISITION, DISPOSAL OR REVALUATION OF CERTAIN RIGHTS
  Resolved,
  That provision may be made as to the treatment for tax purposes of amounts relating to the acquisition, disposal or revaluation of—

  (a) certain licences granted under section 1 of the Wireless Telegraphy Act 1949,

  (b) indefeasible rights to use a telecommunications cable system, or

  (c) rights derived, directly or indirectly, from any such right as is mentioned in paragraph (a) or (b).

  42. CHARGEABLE GAINS (GIFTS AND TRUSTS)
  Resolved,
  That provision (including retrospective provision) may be made amending the Taxation of Chargeable Gains Act 1992 with respect to—

  (a) relief under section 165 or 260 of that Act,

  (b) gains accruing to trustees,

  (c) disposals of interests in settled property, and

  (d) transfers of value by trustees.

  43. CHARGEABLE GAINS (COMPANIES)
  Resolved,
  That provision may be made about the treatment of the chargeable gains of companies for the purposes of corporation tax (including provision for the recovery of unpaid tax).

  44. DOUBLE TAXATION RELIEF
  Motion made, and Question put,
  That provision may be made amending—

  (a) Part XVIII of the Income and Corporation Taxes Act 1988; and

  (b) section 278 of the Taxation of Chargeable Gains Act 1992.

  The House divided: Ayes 307, Noes 181

  Division No. 126]

  [11.18 pm

  AYES

  Abbott, Ms Diane

  Cunningham, Jim (Cov'try S)

  Ainger, Nick

  Cunningham, Ms Roseanna (Perth)

  Ainsworth, Robert (Cov'try NE)

  Allen, Graham

  Curtis-Thomas, Mrs Claire

  Anderson, Donald (Swansea E)

  Dalyell, Tam

  Anderson, Janet (Rossendale)

  Darling, Rt Hon Alistair

  Ashton, Joe

  Darvill, Keith

  Atherton, Ms Candy

  Davies, Rt Hon Denzil (Llanelli)

  Atkins, Charlotte

  Davies, Geraint (Croydon C)

  Austin, John

  Dean, Mrs Janet

  Banks, Tony

  Denham, John

  Barnes, Harry

  Dismore, Andrew

  Barren, Kevin

  Dobbin, Jim

  Battle, John

  Donohoe, Brian H

  Bayley, Hugh

  Doran, Frank

  Beard, Nigel

  Dowd, Jim

  Begg, Miss Anne

  Drew, David

  Bell, Stuart (Middlesbrough)

  Eagle, Angela (Wallasey)

  Benn, Hilary (Leeds C)

  Eagle, Maria (L'pool Garston)

  Benn, Rt Hon Tony (Chesterfield)

  Edwards, Huw

  Efford, Clive

  Bennett, Andrew F

  Ellman, Mrs Louise

  Benton, Joe

  Ennis, Jeff

  Berry, Roger

  Etherington, Bill

  Blackman, Liz

  Field, Rt Hon Frank

  Blears, Ms Hazel

  Fisher, Mark

  Blizzard, Bob

  Fitzsimons, Lorna

  Boateng, Rt Hon Paul

  Flint, Caroline

  Borrow, David

  Flynn, Paul

  Bradley, Keith (Withington)

  Follett, Barbara

  Bradley, Peter (The Wrekin)

  Foster, Rt Hon Derek

  Bradshaw, Ben

  Foster, Michael Jabez (Hastings)

  Brown, Rt Hon Gordon(Dunfermline E)

  Foster, Michael J (Worcester)

  Fyfe, Maria

  Brown, Rt Hon Nick (Newcastle E)

  Gapes, Mike

  Brown, Russell (Dumfries)

  Gardiner, Barry

  Browne, Desmond

  George, Bruce (Walsall S)

  Buck, Ms Karen

  Gerrard, Neil

  Burden, Richard

  Gibson, Dr Ian

  Burgon, Colin

  Gilroy, Mrs Linda

  Butler, Mrs Christine

  Godman, Dr Norman A

  Byers, Rt Hon Stephen

  Godsiff, Roger

  Campbell, Mrs Anne (C'bridge)

  Goggins, Paul

  Campbell-Savours, Dale

  Gordon, Mrs Eileen

  Cann, Jamie

  Griffiths, Jane (Reading E)

  Casale, Roger

  Griffiths, Nigel (Edinburgh S)

  Cawsey, Ian

  Grocott, Bruce

  Chaytor, David

  Grogan, John

  Clapham, Michael

  Gunnell, John

  Clark, Dr Lynda (Edinburgh Pentlands)

  Hall, Patrick (Bedford)

  Hanson, David

  Clark, Paul (Gillingham)

  Harman, Rt Hon Ms Harriet

  Clarke, Charles (Norwich S)

  Heal, Mrs Sylvia

  Clarke, Rt Hon Tom (Coatbridge)

  Healey, John

  Henderson, Doug (Newcastle N)

  Clarke, Tony (Northampton S)

  Henderson, Ivan (Harwich)

  Clelland, David

  Heppell, John

  Clwyd, Ann

  Hesford, Stephen

  Coaker, Vernon

  Hill, Keith

  Coffey, Ms Ann

  Hinchliffe, David

  Cohen, Harry

  Hodge, Ms Margaret

  Coleman, Iain

  Hoey, Kate

  Colman, Tony

  Home Robertson, John

  Cook, Rt Hon Robin (Livingston)

  Hood, Jimmy

  Corbyn, Jeremy

  Hoon, Rt Hon Geoffrey

  Corston, Jean

  Hope, Phil

  Cousins, Jim

  Hopkins, Kelvin

  Cranston, Ross

  Howarth, Alan (Newport E)

  Crausby, David

  Howells, Dr Kim

  Cryer, Mrs Ann (Keighley)

  Hughes, Ms Beverley (Stretford)

  Cryer, John (Hornchurch)

  Hughes, Kevin (Doncaster N)

  Cunningham, Rt Hon Dr Jack(Copeland)

  Humble, Mrs Joan

  Hurst, Alan

  167

  Hutton, John

  Pearson, Ian

  Iddon, Dr Brian

  Pendry, Tom

  Illsley, Eric

  Perham, Ms Linda

  Jackson, Ms Glenda (Hampstead)

  Pickthall, Colin

  Jackson, Helen (Hillsborough)

  Plaskitt, James

  Jamieson, David

  Pollard, Kerry

  Jenkins, Brian

  Pond, Chris

  Johnson, Alan (Hull W & Hessle)

  Pope, Greg

  Johnson, Miss Melanie (Welwyn Hatfield)

  Powell, Sir Raymond

  Prentice, Ms Bridget (Lewisham E)

  Jones, Rt Hon Barry (Alyn)

  Prentice, Gordon (Pendle)

  Jones, Helen (Warrington N)

  Primarolo, Dawn

  Jones, Ieuan Wyn (Ynys Môn)

  Prosser, Gwyn

  Jones, Ms Jenny (Wolverh'ton SW)

  Purchase, Ken

  Quinn, Lawrie

  Jones, Dr Lynne (Selly Oak)

  Radice, Rt Hon Giles

  Jowell, Rt Hon Ms Tessa

  Rammell, Bill

  Kennedy, Jane (Wavertree)

  Raynsford, Nick

  Khabra, Piara S

  Reed, Andrew (Loughborough)

  Kidney, David

  Reid, Rt Hon Dr John (Hamilton N)

  Kilfoyle, Peter

  Robinson, Geoffrey (Cov'try NW)

  King, Andy (Rugby & Kenilworth)

  Rooker, Rt Hon Jeff

  King, Ms Oona (Bethnal Green)

  Rooney, Terry

  Ladyman, Dr Stephen

  Ross, Ernie (Dundee W)

  Lepper, David

  Rowlands, Ted

  Leslie, Christopher

  Roy, Frank

  Levitt, Tom

  Ruddock, Joan

  Lewis, Ivan (Bury S)

  Ryan, Ms Joan

  Lewis, Terry (Worsley)

  Salmond, Alex

  Liddell, Rt Hon Mrs Helen

  Sarwar, Mohammad

  Linton, Martin

  Savidge, Malcolm

  Lloyd, Tony (Manchester C)

  Sawford, Phil

  Llwyd, Elfyn

  Sedgemore, Brian

  Lock, David

  Sheerman, Barry

  Love, Andrew

  Simpson, Alan (Nottingham S)

  McAvoy, Thomas

  Singh, Marsha

  McCabe, Steve

  Skinner, Dennis

  McCafferty, Ms Chris

  Smith, Rt Hon Andrew (Oxford E)

  McCartney, Rt Hon Ian (Makerfield)

  Smith, Angela (Basildon)

  Smith, Rt Hon Chris (Islington S)

  McDonagh, Siobhain

  Smith, Miss Geraldine (Morecambe & Lunesdale)

  Macdonald, Calum

  McDonnell, John

  Smith, John (Glamorgan)

  McIsaac, Shona

  Smith, Llew (Blaenau Gwent)

  McKenna, Mrs Rosemary

  Snape, Peter

  Mackinlay, Andrew

  Soley, Clive

  McNamara, Kevin

  Southworth, Ms Helen

  McNulty, Tony

  Spellar, John

  MacShane, Denis

  Starkey, Dr Phyllis

  Mactaggart, Fiona

  Steinberg, Gerry

  McWalter, Tony

  Stevenson, George

  Mahon, Mrs Alice

  Stewart, David (Inverness E)

  Marsden, Gordon (Blackpool S)

  Stewart, Ian (Eccles)

  Marshall, David (Shettleston)

  Stinchcombe, Paul

  Marshall, Jim (Leicester S)

  Stoate, Dr Howard

  Martlew, Eric

  Strang, Rt Hon Dr Gavin

  Meacher, Rt Hon Michael

  Stringer, Graham

  Meale, Alan

  Stuart, Ms Gisela

  Merron, Gillian

  Sutcliffe, Gerry

  Milburn, Rt Hon Alan

  Swinney, John

  Miller, Andrew

  Taylor, Rt Hon Mrs Ann (Dewsbury)

  Mitchell, Austin

  Moffatt, Laura

  Taylor, Ms Dan (Stockton S)

  Moonie, Dr Lewis

  Taylor, David (NW Leics)

  Morgan, Alasdair (Galloway)

  Temple-Morris, Peter

  Morley, Elliot

  Thomas, Gareth (Clwyd W)

  Morris, Rt Hon Sir John (Aberavon)

  Thomas, Gareth R (Harrow W)

  Thomas, Simon (Ceredigion)

  Mountford, Kali

  Timms, Stephen

  Mullin, Chris

  Tipping, Paddy

  Naysmith, Dr Doug

  Todd, Mark

  Norris, Dan

  Touhig, Don

  O'Brien, Mike (N Warks)

  Trickett, Jon

  O'Hara, Eddie

  Turner, Dennis (Wolverh'ton SE)

  O'Neill, Martin

  Turner, Dr Desmond (Kemptown)

  Palmer, Dr Nick

  Turner, Dr George (NW Norfolk)

  168

  Turner, Neil (Wigan)

  Williams, Mrs Betty (Conwy)

  Twigg, Derek (Halton)

  Winnick, David

  Tynan, Bill

  Winterton, Ms Rosie (Doncaster C)

  Vis, Dr Rudi

  Wise, Audrey

  Walley, Ms Joan

  Wood, Mike

  Watts, David

  Woodward, Shaun

  White, Brian

  Worthington, Tony

  Whitehead, Dr Alan

  Wray, James

  Wicks, Malcolm

  Wright, Anthony D (Gt Yarmouth)

  Wigley, Rt Hon Dafydd

  Williams, Rt Hon Alan (Swansea W)

  Tellers for the Ayes:

  Mr. Clive Betts and

  Williams, Alan W (E Carmarthen)

  Mr. Mike Hall.

  NOES

  Ainsworth, Peter (E Surrey)

  Gale, Roger

  Allan, Richard

  Garnier, Edward

  Ancram, Rt Hon Michael

  George, Andrew (St Ives)

  Arbuthnot, Rt Hon James

  Gibb, Nick

  Ashdown, Rt Hon Paddy

  Gill, Christopher

  Atkinson, David (Bour'mth E)

  Gillan, Mrs Cheryl

  Atkinson, Peter (Hexham)

  Gray, James

  Baker, Norman

  Green, Damian

  Baldry, Tony

  Greenway, John

  Ballard, Jackie

  Grieve, Dominic

  Beggs, Roy

  Hague, Rt Hon William

  Beith, Rt Hon A J

  Hamilton, Rt Hon Sir Archie

  Bercow, John

  Hammond, Philip

  Beresford, Sir Paul

  Hancock, Mike

  Blunt, Crispin

  Harris, Dr Evan

  Body, Sir Richard

  Hawkins, Nick

  Boswell, Tim

  Hayes, John

  Bottomley, Peter (Worthing W)

  Heald, Oliver

  Bottomley, Rt Hon Mrs Virginia

  Heath, David (Somerton & Frome)

  Brady, Graham

  Heathcoat-Amory, Rt Hon David

  Brake, Tom

  Hogg, Rt Hon Douglas

  Brand, Dr Peter

  Horam, John

  Brazier, Julian

  Howarth, Gerald (Aldershot)

  Breed, Colin

  Hughes, Simon (Southwark N)

  Browning, Mrs Angela

  Hunter, Andrew

  Bruce, Malcolm (Gordon)

  Jack, Rt Hon Michael

  Burnett, John

  Jackson, Robert (Wantage)

  Burns, Simon

  Jenkin, Bernard

  Burstow, Paul

  Keetch, Paul

  Butterfill, John

  Key, Robert

  Cable, Dr Vincent

  King, Rt Hon Tom (Bridgwater)

  Campbell, Rt Hon Menzies (NE Fife)

  Kirkwood, Archy

  Laing, Mrs Eleanor

  Cash, William

  Lait, Mrs Jacqui

  Chapman, Sir Sydney (Chipping Barnet)

  Lansley, Andrew

  Leigh, Edward

  Chidgey, David

  Letwin, Oliver

  Chope, Christopher

  Lewis, Dr Julian (New Forest E)

  Clark, Dr Michael (Rayleigh)

  Lidington, David

  Clarke, Rt Hon Kenneth (Rushcliffe)

  Lilley, Rt Hon Peter

  Livsey, Richard

  Collins, Tim

  Lloyd, Rt Hon Sir Peter (Fareham)

  Cotter, Brian

  Loughton, Tim

  Cran, James

  MacGregor, Rt Hon John

  Curry, Rt Hon David

  McIntosh, Miss Anne

  Davey, Edward (Kingston)

  Maclean, Rt Hon David

  Davies, Quentin (Grantham)

  Maclennan, Rt Hon Robert

  Davis, Rt Hon David (Haltemprice)

  McLoughlin, Patrick

  Day, Stephen

  Madel, Sir David

  Donaldson, Jeffrey

  Major, Rt Hon John

  Dorrell, Rt Hon Stephen

  Malins, Humfrey

  Duncan, Alan

  Maples, John

  Duncan Smith, Iain

  Maude, Rt Hon Francis

  Evans, Nigel

  Mawhinney, Rt Hon Sir Brian

  Faber, David

  May, Mrs Theresa

  Fabricant, Michael

  Michie, Mrs Ray (Argyll & Bute)

  Fallon, Michael

  Moore, Michael

  Flight, Howard

  Moss, Malcolm

  Forth, Rt Hon Eric

  Nicholls, Patrick

  Foster, Don (Bath)

  Norman, Archie

  Fox. Dr Liam

  Oaten, Mark

  169

  O'Brien, Stephen (Eddisbury)

  Swayne, Desmond

  Ottaway, Richard

  Syms, Robert

  Page, Richard

  Tapsell, Sir Peter

  Paice, James

  Taylor, Ian (Esher & Walton)

  Paterson, Owen

  Taylor, John M (Solihull)

  Pickles, Eric

  Taylor, Matthew (Truro)

  Portillo, Rt Hon Michael

  Thompson, William

  Prior, David

  Tonge, Dr Jenny

  Randall, John

  Townend, John

  Redwood, Rt Hon John

  Tredinnick, David

  Rendel, David

  Tyler, Paul

  Robathan, Andrew

  Tyrie, Andrew

  Robertson, Laurence

  Wallace, James

  Roe, Mrs Marion (Broxbourne)

  Walter, Robert

  Ross, William (E Lond'y)

  Wardle, Charles

  Ruffley, David

  Waterson, Nigel

  Russell, Bob (Colchester)

  Webb, Steve

  St Aubyn, Nick

  Wells, Bowen

  Sanders, Adrian

  Whitney, Sir Raymond

  Sayeed, Jonathan

  Whittingdale, John

  Shephard, Rt Hon Mrs Gillian

  Widdecombe, Rt Hon Miss Ann

  Shepherd, Richard

  Wilkinson, John

  Simpson, Keith (Mid-Norfolk)

  Willetts, David

  Smith, Sir Robert (W Ab'd'ns)

  Willis, Phil

  Smyth, Rev Martin (Belfast S)

  Wilshire, David

  Soames, Nicholas

  Winterton, Mrs Ann (Congleton)

  Spelman, Mrs Caroline

  Winterton, Nicholas (Macclesfield)

  Spicer, Sir Michael

  Yeo, Tim

  Spring, Richard

  Young, Rt Hon Sir George

  Steen, Anthony

  Tellers for the Noes:

  Streeter, Gary

  Mr. Peter Luff and

  Stunell, Andrew

  Mr. Geoffrey Clifton-Brown.

  Question accordingly agreed to.

  45. CONTROLLED FOREIGN COMPANIES
  Resolved,
  That provision (including provision having retrospective effect) may be made amending Chapter IV of Part XVII of the Income and Corporation Taxes Act 1988.

  46. USE OF STERLING AND OTHER CURRENCIES
  Resolved,
  That provision may be made amending sections 92 to 95 of the Finance Act 1993 and Chapter II of Part II of that Act.

  47. INSURANCE
  Resolved,
  That provision may be made—

  (a) about the reserves and reinsurance contracts of certain companies and other persons carrying on general insurance business; and

  (b) amending sections 431D and 432ZA to 432C of the Income and Corporation Taxes Act 1988 and Schedule 11 to the Finance Act 1996.

  48. PETROLEUM REVENUE TAX
  Resolved,
  That provision may be made with respect to cases where operating expenditure is incurred by participators during chargeable periods to which section 9(1) of the Oil Taxation Act 1975 applies.

  49. PAYMENTS UNDER DEDUCTION OF TAX
  Resolved,
  That provision may be made about payments under deduction of tax.

  50. FILM PRODUCTION ETC.
  Resolved,
  That provision may be made about expenditure on the production or acquisition of films or sound recordings.

  51. STAMP DUTY ON CONVEYANCE OR TRANSFER ON SALE (RATES)
  Motion made, and Question put,
  That the following provisions shall have effect for the period beginning 28th March 2000 and ending 31 days after the earliest of the dates mentioned in section 50(2) of the Finance Act 1973—
  (1) In Part I of Schedule 13 to the Finance Act 1999, in the third column of the table in paragraph 4—

  (a) in the third entry, for "2.5%" there shall be substituted "3%"; and

  (b) in the fourth entry, for "3.5%" there shall be substituted "4%".

  (2) This Resolution applies to instruments executed on or after 28th March 2000.
  (3) But this Resolution does not apply to an instrument giving effect to a contract made on or before 21st March 2000, unless—

  (a) the instrument is made in consequence of the exercise after that date of any option, right of pre-emption or similar right; or

  (b) the instrument transfers the property in question to, or vests it in, a person other than the purchaser under the contract, because of an assignment (or, in Scotland, assignation) or further contract made after that date.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of section 50 of the Finance Act 1973.
  The House divided: Ayes 303, Noes 178.

  Division No. 127]

  [11.30 pm

  AYES

  Abbott, Ms Diane

  Browne, Desmond

  Ainger, Nick

  Buck, Ms Karen

  Ainsworth, Robert (Cov'try NE)

  Burden, Richard

  Allen, Graham

  Burgon, Colin

  Anderson, Donald (Swansea E)

  Butler, Mrs Christine

  Anderson, Janet (Rossendale)

  Byers, Rt Hon Stephen

  Ashton, Joe

  Campbell, Mrs Anne (C'bridge)

  Atherton, Ms Candy

  Campbell-Savours, Dale

  Atkins, Charlotte

  Cann, Jamie

  Austin, John

  Casale, Roger

  Banks, Tony

  Cawsey, Ian

  Barnes, Harry

  Chaytor, David

  Barron, Kevin

  Clapham, Michael

  Battle, John

  Clark, Dr Lynda (Edinburgh Pentlands)

  Bayley, Hugh

  Beard, Nigel

  Clark, Paul (Gillingham)

  Begg, Miss Anne

  Clarke, Charles (Norwich S)

  Bell, Stuart (Middlesbrough)

  Clarke, Rt Hon Tom (Coatbridge)

  Benn, Hilary (Leeds C)

  Clarke, Tony (Northampton S)

  Benn, Rt Hon Tony (Chesterfield)

  Clelland, David

  Bennett, Andrew F

  Clwyd, Ann

  Benton, Joe

  Coaker, Vernon

  Berry, Roger

  Coffey, Ms Ann

  Blackman, Liz

  Cohen, Harry

  Blears, Ms Hazel

  Coleman, Iain

  Blizzard, Bob

  Colman, Tony

  Boateng, Rt Hon Paul

  Corbyn, Jeremy

  Borrow, David

  Corston, Jean

  Bradley, Keith (Withington)

  Cousins, Jim

  Bradley, Peter (The Wrekin)

  Cranston, Ross

  Bradshaw, Ben

  Crausby, David

  Brown, Rt Hon Gordon (Dunfermline E)

  Cryer, Mrs Ann (Keighley)

  Cryer, John (Hornchurch)

  Brown, Rt Hon Nick (Newcastle E)

  Cunningham, Rt Hon Dr Jack (Copeland)

  Brown, Russell (Dumfries)

  171

  Cunningham, Jim (Cov'try S)

  Jackson, Helen (Hillsborough)

  Cunningham, Ms Roseanna (Perth)

  Jamieson, David

  Jenkins, Brian

  Curtis-Thomas, Mrs Claire

  Johnson, Alan (Hull W & Hessle)

  Dalyell, Tam

  Johnson, Miss Melanie (Welwyn Hatfield)

  Darling, Rt Hon Alistair

  Darvill, Keith

  Jones, Rt Hon Barry (Alyn)

  Davies, Rt Hon Denzil (Llanelli)

  Jones, Helen (Warrington N)

  Davies, Geraint (Croydon C)

  Jones, Ieuan Wyn (Ynys Môn)

  Dean, Mrs Janet

  Jones, Ms Jenny (Wolverh'ton SW)

  Denham, John

  Dismore, Andrew

  Jones, Dr Lynne (Selly Oak)

  Dobbin, Jim

  Jowell, Rt Hon Ms Tessa

  Donohoe, Brian H

  Kemp, Fraser

  Doran, Frank

  Kennedy, Jane (Wavertree)

  Dowd, Jim

  Khabra, Piara S

  Drew, David

  Kidney, David

  Eagle, Angela (Wallasey)

  Kilfoyle, Peter

  Eagle, Maria (L'pool Garston)

  King, Andy (Rugby & Kenilworth)

  Edwards, Huw

  King, Ms Oona (Bethnal
  Green)

  Efford, Clive

  Ladyman, Dr Stephen

  Ellman, Mrs Louise

  Lepper, David

  Ennis, Jeff

  Leslie, Christopher

  Etherington, Bill

  Levitt, Tom

  Field, Rt Hon Frank

  Lewis, Ivan (Bury S)

  Fisher, Mark

  Lewis, Terry (Worsley)

  Fitzsimons, Lorna

  Liddell, Rt Hon Mrs Helen

  Flint, Caroline

  Linton, Martin

  Flynn, Paul

  Lloyd, Tony (Manchester C)

  Follett, Barbara

  Llwyd, Elfyn

  Foster, Rt Hon Derek

  Lock, David

  Foster, Michael Jabez (Hastings)

  Love, Andrew

  Foster, Michael J (Worcester)

  McAvoy, Thomas

  Fyfe, Maria

  McCabe, Steve

  Gapes, Mike

  McCafferty, Ms Chris

  Gardiner, Barry

  McCartney, Rt Hon Ian (Makerfield)

  George, Bruce (Walsall S)

  Gerrard, Neil

  Macdonald, Calum

  Gibson, Dr Ian

  McDonnell, John

  Gilroy, Mrs Linda

  McIsaac, Shona

  Godman, Dr Norman A

  McKenna, Mrs Rosemary

  Godsiff, Roger

  Mackinlay, Andrew

  Goggins, Paul

  McNamara, Kevin

  Gordon, Mrs Eileen

  McNulty, Tony

  Griffiths, Jane (Reading E)

  Mactaggart, Fiona

  Griffiths, Nigel (Edinburgh S)

  McWalter, Tony

  Grocott, Bruce

  Mahon, Mrs Alice

  Grogan, John

  Marsden, Gordon (Blackpool S)

  Hall, Patrick (Bedford)

  Marshall, David (Shettleston)

  Hanson, David

  Marshall, Jim (Leicester S)

  Harman, Rt Hon Ms Harriet

  Martlew, Eric

  Heal, Mrs Sylvia

  Meacher, Rt Hon Michael

  Healey, John

  Meale, Alan

  Henderson, Doug (Newcastle N)

  Merron, Gillian

  Henderson, Ivan (Harwich)

  Michie, Bill (Shef'ld Heeley)

  Heppell, John

  Milburn, Rt Hon Alan

  Hesford, Stephen

  Miller, Andrew

  Hill, Keith

  Mitchell, Austin

  Hinchliffe, David

  Moonie, Dr Lewis

  Hodge, Ms Margaret

  Morgan, Alasdair (Galloway)

  Hoey, Kate

  Morley, Elliot

  Home Robertson, John

  Morris, Rt Hon Sir John (Aberavon)

  Hood, Jimmy

  Hoon, Rt Hon Geoffrey

  Mountford, Kali

  Hope, Phil

  Mullin, Chris

  Hopkins, Kelvin

  Naysmith, Dr Doug

  Howarth, Alan (Newport E)

  Norris, Dan

  Howells, Dr Kim

  O'Brien, Mike (N Warks)

  Hughes, Ms Beverley (Stretford)

  O'Hara, Eddie

  Hughes, Kevin (Doncaster N)

  O'Neill, Martin

  Humble, Mrs. Joan

  Palmer, Dr Nick

  Hurst, Alan

  Pearson, Ian

  Hutton, John

  Pendry, Tom

  Iddon, Dr Brian

  Perham, Ms Linda

  Illsley, Eric

  Pickthall, Colin

  Jackson, Ms Glenda(Hampstead)

  Plaskitt, James

  172

  Pollard, Kerry

  Stoate, Dr Howard

  Pond, Chris

  Strang, Rt Hon Dr Gavin

  Pope, Greg

  Stringer, Graham

  Powell, Sir Raymond

  Stuart, Ms Gisela

  Prentice, Ms Bridget (Lewisham E)

  Sutcliffe, Gerry

  Prentice, Gordon (Pendle)

  Swinney, John

  Primarolo, Dawn

  Taylor, Rt Hon Mrs Ann (Dewsbury)

  Prosser, Gwyn

  Purchase, Ken

  Taylor, Ms Dari (Stockton S)

  Quinn, Lawrie

  Taylor, David (NW Leics)

  Radice, Rt Hon Giles

  Temple-Morris, Peter

  Rammell, Bill

  Thomas, Gareth (Clwyd W)

  Raynsford, Nick

  Thomas, Gareth R (Harrow W)

  Reed, Andrew (Loughborough)

  Thomas, Simon (Ceredigion)

  Reid, Rt Hon Dr John (Hamilton N)

  Timms, Stephen

  Robinson, Geoffrey (Cov'try NW)

  Tipping, Paddy

  Rooker, Rt Hon Jeff

  Todd, Mark

  Rooney, Terry

  Touhig, Don

  Ross, Ernie (Dundee W)

  Trickett, Jon

  Rowlands, Ted

  Turner, Dennis (Wolverh'ton SE)

  Roy, Frank

  Turner, Dr Desmond (Kemptown)

  Ruddock, Joan

  Turner, Dr George (NW Norfolk)

  Ryan, Ms Joan

  Turner, Neil (Wigan)

  Salmond, Alex

  Twigg, Derek (Halton)

  Sarwar, Mohammad

  Tynan, Bill

  Savidge, Malcolm

  Vis, Dr Rudi

  Sawford, Phil

  Walley, Ms Joan

  Sedgemore, Brian

  Watts, David

  Sheerman, Barry

  White, Brian

  Simpson, Alan (Nottingham S)

  Whitehead, Dr Alan

  Singh, Marsha

  Wicks, Malcolm

  Skinner, Dennis

  Wigley, Rt Hon Dafydd

  Smith, Rt Hon Andrew (Oxford E)

  Williams, Rt Hon Alan (Swansea W)

  Smith, Angela (Basildon)

  Smith, Rt Hon Chris (Islington S)

  Williams, Alan W (E Carmarthen)

  Smith, Miss Geraldine (Morecambe & Lunesdale)

  Williams, Mrs Betty (Conwy)

  Winnick, David

  Smith, John (Glamorgan)

  Winterton, Ms Rosie (Doncaster C)

  Smith, Llew (Blaenau Gwent)

  Wise, Audrey

  Snape, Peter

  Wood, Mike

  Soley, Clive

  Woodward, Shaun

  Southworth, Ms Helen

  Worthington, Tony

  Spellar, John

  Wray, James

  Starkey, Dr Phyllis

  Wright, Anthony D (Gt
  Yarmouth)

  Steinberg, Gerry

  Stevenson, George

  Tellers for the Ayes:

  Stewart, David (Inverness E)

  Mr. Clive Betts and

  Stewart, Ian (Eccles)

  Mr. Mike Hall.

  NOES

  Ainsworth, Peter (E Surrey)

  Burns, Simon

  Allan, Richard

  Burstow, Paul

  Amess, David

  Butterfill, John

  Ancram, Rt Hon Michael

  Cable, Dr Vincent

  Arbuthnot, Rt Hon James

  Campbell, Rt Hon Menzies (NE Fife)

  Ashdown, Rt Hon Paddy

  Atkinson, David (Bour'mth E)

  Cash, William

  Baker, Norman

  Chapman, Sir Sydney (Chipping Barnet)

  Ballard, Jackie

  Beggs, Roy

  Chidgey, David

  Beith, Rt Hon A J

  Chope, Christopher

  Bercow, John

  Clark, Dr Michael (Rayleigh)

  Beresford, Sir Paul

  Clarke, Rt Hon Kenneth (Rushcliffe)

  Blunt, Crispin

  Body, Sir Richard

  Collins, Tim

  Boswell, Tim

  Cotter, Brian

  Bottomley, Peter (Worthing W)

  Cran, James

  Bottomley, Rt Hon Mrs Virginia

  Curry, Rt Hon David

  Brady, Graham

  Davey, Edward (Kingston)

  Brake, Tom

  Davies, Quentin (Grantham)

  Brand, Dr Peter

  Davis, Rt Hon David (Haltemprice)

  Brazier, Julian

  Day, Stephen

  Breed, Colin

  Donaldson, Jeffrey

  Browning, Mrs Angela

  Dorrell, Rt Hon Stephen

  Bruce, Malcolm (Gordon)

  Duncan, Alan

  Burnett, John

  Duncan Smith, Iain

  173

  Evans, Nigel

  Nicholls, Patrick

  Faber, David

  Norman, Archie

  Fabricant, Michael

  Oaten, Mark

  Fallon, Michael

  O'Brien, Stephen (Eddisbury)

  Flight, Howard

  Ottaway, Richard

  Forth, Rt Hon Eric

  Page, Richard

  Foster, Don (Bath)

  Paice, James

  Fox, Dr Liam

  Paterson, Owen

  Gale, Roger

  Pickles, Eric

  Garnier, Edward

  Portillo, Rt Hon Michael

  George, Andrew (St Ives)

  Prior, David

  Gibb, Nick

  Randall, John

  Gill, Christopher

  Redwood, Rt Hon John

  Gillan, Mrs Cheryl

  Rendel, David

  Gray, James

  Robathan, Andrew

  Green, Damian

  Robertson, Laurence

  Greenway, John

  Roe, Mrs Marion (Broxbourne)

  Grieve, Dominic

  Ruffley, David

  Hague, Rt Hon William

  Russell, Bob (Colchester)

  Hamilton, Rt Hon Sir Archie

  St Aubyn, Nick

  Hammond, Philip

  Sanders, Adrian

  Hancock, Mike

  Sayeed, Jonathan

  Harris, Dr Evan

  Shephard, Rt Hon Mrs Gillian

  Hawkins, Nick

  Shepherd, Richard

  Hayes, John

  Simpson, Keith (Mid-Norfolk)

  Heald, Oliver

  Smith, Sir Robert (W Ab'd'ns)

  Heath, David (Somerton & Frome)

  Smyth, Rev Martin (Belfast S)

  Heathcoat-Amory, Rt Hon David

  Soames, Nicholas

  Hogg, Rt Hon Douglas

  Spelman, Mrs Caroline

  Horam, John

  Spicer, Sir Michael

  Howarth, Gerald (Aldershot)

  Spring, Richard

  Hughes, Simon (Southwark N)

  Steen, Anthony

  Hunter, Andrew

  Streeter, Gary

  Jack, Rt Hon Michael

  Stunell, Andrew

  Jackson, Robert (Wantage)

  Swayne, Desmond

  Jenkin, Bernard

  Syms, Robert

  Keetch, Paul

  Tapsell, Sir Peter

  Key, Robert

  Taylor, Ian (Esher & Walton)

  King, Rt Hon Tom (Bridgwater)

  Taylor, John M (Solihull)

  Kirkwood, Archy

  Taylor, Matthew (Truro)

  Laing, Mrs Eleanor

  Thompson, William

  Lait, Mrs Jacqui

  Tonge, Dr Jenny

  Lansley, Andrew

  Townend, John

  Leigh, Edward

  Tredinnick, David

  Letwin, Oliver

  Tyler, Paul

  Lewis, Dr Julian (New Forest E)

  Tyrie, Andrew

  Lidington, David

  Wallace, James

  Lilley, Rt Hon Peter

  Walter, Robert

  Livsey, Richard

  Wardle, Charles

  Lloyd, Rt Hon Sir Peter (Fareham)

  Waterson, Nigel

  Loughton, Tim

  Webb, Steve

  Luff, Peter

  Wells, Bowen

  MacGregor, Rt Hon John

  Whitney, Sir Raymond

  McIntosh, Miss Anne

  Whittingdale, John

  Maclean, Rt Hon David

  Widdecombe, Rt Hon Miss Ann

  Maclennan, Rt Hon Robert

  Wilkinson, John

  McLoughlin, Patrick

  Willetts, David

  Madel, Sir David

  Willis, Phil

  Malins, Humfrey

  Wilshire, David

  Maples, John

  Winterton, Mrs Ann (Congleton)

  Maude, Rt Hon Francis

  Winterton, Nicholas (Macclesfield)

  Mawhinney, Rt Hon Sir Brian

  Yeo, Tim

  May, Mrs Theresa

  Young, Rt Hon Sir George

  Michie, Mrs Ray (Argyll & Bute)

  Tellers for the Noes:

  Moore, Michael

  Mr. Peter Atkinson and

  Moss, Malcolm

  Mr. Geoffrey Clifton-Brown.

  Question accordingly agreed to.

  52. STAMP DUTY ON LEASES (RENT)
  Resolved,
  That the following provisions shall have effect for the period beginning 28th March 2000 and ending 31 days after the earliest of the dates mentioned in section 50(2) of the Finance Act 1973—
  (1) In Part II of Schedule 13 to the Finance Act 1999—

  (a) in paragraph 11, in paragraph 1 of the table, and

  (b) in paragraph 12(3), in paragraphs 1(a) and (b) of the table,

  for "£500" there shall be substituted "£5,000".
  (2) This Resolution has effect in relation to instruments executed on or after 28th March 2000.
  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of section 50 of the Finance Act 1973.

  53. STAMP DUTY (SEVEN YEAR LEASES)
  Resolved,
  That the following provisions shall have effect for the period beginning 28th March 2000 and ending 31 days after the earliest of the dates mentioned in section 50(2) of the Finance Act 1973—
  (1) In paragraph 12(3) of Schedule 13 to the Finance Act 1999, in paragraph 1 of the Table, for "less than 7 years" substitute "not more than 7 years".
  (2) Subject to paragraphs (4) to (13), paragraph (1) applies to instruments executed on or after 1st October 1999.
  (3) Paragraphs (4) to (13) apply to—

  (a) leases of land for a term of seven years, and

  (b) agreements for leases of land for a term of seven years,

  executed on or after 1st October 1999 and before the commencement date.
  (4) An instrument to which this paragraph applies which is stamped with the appropriate amount of duty is duly stamped, whenever it was executed.
  (5) An instrument to which this paragraph applies which—

  (a) immediately before the commencement date was duly stamped, but

  (b) was stamped with less than the appropriate amount of duty,

  ceases to be duly stamped on the commencement date.
  (6) Paragraph (5) applies even if the instrument has been stamped in accordance with section 12(5) of the Stamp Act 1891 with a stamp denoting that it is duly stamped.
  (7) If an instrument ceases to be duly stamped on the commencement date as a result of paragraph (5)—

  (a) section 12(6) of the Stamp Act 1891 does not apply to it at any time when it is not duly stamped, and

  (b) section 14(1) of that Act does not apply to it at any time when it is not duly stamped, unless the unpaid duty and any interest or penalty is paid in accordance with that subsection.

  (8) Section 12A(1) of the Stamp Act 1891 does not prevent an instrument to which this paragraph applies which is stamped with less than the appropriate amount of duty from being stamped with additional duty.
  (9) Section 14(4) of the Stamp Act 1891 applies in relation to an instrument to which this paragraph applies as if, as respects any time on or after the commencement date, the reference to the law in force at the time when it was executed were to the law in force on the commencement date.
  (10) Paragraphs (12) and (13) apply for the purpose of applying sections 12 to 13B and 15 to 15B of the Stamp Act 1891 in relation to any additional duty chargeable on an instrument to which this paragraph applies.
  (11) Those sections continue to apply without modification as respects any other stamp duty chargeable on the instrument.
  (12) Those sections have effect as respects the additional duty as if—

  (a) the additional duty were the only stamp duty chargeable on the instrument;

  (b) the instrument had been executed on the commencement date; and

  175

  (c) in the case of an instrument executed outside the United Kingdom and first received in the United Kingdom before the commencement date, the instrument had been first received in the United Kingdom on the commencement date.

  (13) Accordingly, those sections apply as respects additional duty as if—

  (a) references to duty were to additional duty;

  (b) references to stamping were to stamping with additional duty;

  (c) references to an instrument's being stamped were to its being stamped with additional duty;

  (d) references to an instrument's being duly stamped were to its being stamped with all the additional duty chargeable on it;

  (e) references to an instrument's being unstamped were to its not being stamped with any additional duty;

  (f) references to an instrument's being insufficiently stamped were to its being stamped with insufficient additional duty;

  (g) references to adjudication, or an appeal, under any of those sections were to adjudication or an appeal under the section in question as it has effect as respects additional duty; and

  (h) references to the maximum penalty were to the maximum penalty as respects additional duty.

  (14) In this Resolution—
  "additional duty", in relation to an instrument, means additional stamp duty chargeable on the instrument as a result of paragraph (1);
  "the appropriate amount of duty", in relation to an instrument, means the stamp duty that would have been chargeable on the instrument if paragraph (1) had had statutory effect when it was executed; and
  "the commencement date" means 28th March 2000.
  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of section 50 of the Finance Act 1973.

  54. STAMP DUTY (VARIATION BY REGULATIONS)
  Resolved,
  That provision may be made authorising the variation of existing stamp duties by regulations.

  55. STAMP DUTY (LAND TRANSFERRED ETC. FOR OTHER PROPERTY)
  Resolved,
  That the following provisions shall have effect for the period beginning 28th March 2000 and ending 31 days after the earliest of the dates mentioned in section 50(2) of the Finance Act 1973—
  (1) Paragraph (2) applies where—

  (a) an instrument transferring or vesting an estate or interest in land would not, apart from this Resolution, be or fall to be treated as a conveyance or transfer on sale for the purposes of stamp duty; but

  (b) the transfer or vesting of the estate or interest is for consideration; and

  (c) the consideration is or includes any property ("the other property").

  (2) For the purposes of Part I of Schedule 13 to the Finance Act 1999, the instrument transferring or vesting the estate or interest shall be taken to be a transfer on sale of the estate or interest.
  (3) If—

  (a) the other property is or includes one or more estates or interests in land, and

  (b) ad valorem duty is chargeable on the conveyance or transfer of all or any of those estates or interests,

  176
  the amount of duty that would (apart from this paragraph) be chargeable in consequence of paragraph (2) on the transfer on sale there mentioned shall be reduced (but not below nil) by the total of the ad valorem duty chargeable as mentioned in paragraph (b).
  (4) If, for the purposes of Part I of Schedule 13 to the Finance Act 1999, the amount or value of the consideration for the transfer on sale mentioned in paragraph (2) would (apart from this paragraph) exceed the market value of the estate or interest immediately before the execution of the instrument transferring or vesting it, the amount or value of the consideration shall be taken for those purposes to be equal to that market value.
  (5) For the purposes of this Resolution, the market value of property at any time is the price which that property might reasonably be expected to fetch on a sale at that time in the open market.
  (6) Paragraph (2) has effect even though—

  (a) the transfer or vesting of the estate or interest is the whole or part of the consideration for a sale of the other property; or

  (b) the transaction is by way of exchange.

  (7) Paragraph (2) does not affect any charge to stamp duty in respect of the same or any other instrument so far as it relates to the transfer of the other property.
  (8) This Resolution is subject to paragraph (5) of the Resolution of the House (Stamp duty (transfer of land to connected company)) of 27th March 2000.
  (9) This Resolution shall be construed as one with the Stamp Act 1891.
  (10) This Resolution applies to instruments executed on or after 28th March 2000.
  (11) But this Resolution does not apply to an instrument giving effect to a contract made on or before 21st March 2000, unless—

  (a) the instrument is made in consequence of the exercise after that date of any option, right of pre-emption or similar right; or

  (b) the instrument transfers the property in question to, or vests it in, a person other than the purchaser under the contract, because of an assignment (or, in Scotland, assignation) or further contract made after that date.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of section 50 of the Finance Act 1973.

  56. STAMP DUTY (TRANSFER OF LAND TO CONNECTED COMPANY)
  Resolved,
  That the following provisions shall have effect for the period beginning 28th March 2000 and ending 31 days after the earliest of the dates mentioned in section 50(2) of the Finance Act 1973—
  (1) This Resolution applies where an estate or interest in land is transferred to or vested in a company ("A") and—

  (a) the person transferring or vesting the estate or interest ("B") is connected with A; or

  (b) some or all of the consideration for the transfer or vesting consists of the issue or transfer of shares in a company with which B is connected.

  (2) For the purposes of Part I of Schedule 13 to the Finance Act 1999, an instrument transferring or vesting the estate or interest shall he taken to be a transfer on sale of the estate or interest.
  (3) If for those purposes the amount or value of the consideration for the transfer on sale of the estate or interest would, apart from this paragraph, be less than the value determined under paragraph (4), the consideration shall be taken for those purposes to be the value determined under paragraph (4).
  (4) That value is—

  (a) the market value of the estate or interest immediately before the execution of the instrument transferring or vesting it; but

  177

  (b) reduced by the value of so much of any actual consideration as does not consist of property.

  (5) Where—

  (a) apart from this Resolution, an instrument would be chargeable to stamp duty in accordance with the Resolution of the House (Stamp duty: land transferred etc for other property) of 27th March 2000, and

  (b) apart from that Resolution, the instrument would be chargeable to stamp duty in accordance with this Resolution,

  the stamp duty chargeable on the instrument shall be determined in accordance with this Resolution (instead of that Resolution).
  (6) This Resolution applies only if, in consequence of its application, the instrument transferring or vesting the estate or interest is chargeable with a greater amount of stamp duty than it would be apart from this Resolution and that Resolution.
  (7) For the purposes of this Resolution, the market value of property at any time is the price which that property might reasonably be expected to fetch on a sale at that time in the open market.
  (8) In this Resolution—
  "company" means any body corporate;
  "shares" includes stock and the reference to shares in a company includes a reference to securities issued by a company.
  (9) For the purposes of this Resolution, the question whether any person is connected with another shall be determined in accordance with the provisions of section 839 of the Income and Corporation Taxes Act 1988.
  (10) This Resolution shall be construed as one with the Stamp Act 1891.
  (11) This Resolution applies to instruments executed on or after 28th March 2000.
  (12) But this Resolution does not apply to an instrument giving effect to a contract made on or before 21st March 2000, unless—

  (a) the instrument is made in consequence of the exercise after that date of any option, right of pre-emption or similar right; or

  (b) the instrument transfers the property in question to, or vests it in, a person other than the purchaser under the contract, because of an assignment (or, in Scotland, assignation) or further contract made after that date.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of section 50 of the Finance Act 1973.

  57. STAMP DUTY (GRANT OF LEASE TO CONNECTED COMPANY)
  Resolved,
  That the following provisions shall have effect for the period beginning 28th March 2000 and ending 31 days after the earliest of the dates mentioned in section 50(2) of the Finance Act 1973—
  (1) This Resolution applies where a lease is granted to a company ("A") and—

  (a) the person granting the lease ("B") is connected with A; or

  (b) some or all of the consideration for the grant of the lease consists of the issue or transfer of shares in a company with which B is connected.

  (2) Paragraph (3) has effect for the purposes of stamp duty chargeable under Part II of Schedule 13 to the Finance Act 1999 by reference to Part I of that Schedule.
  (3) If, apart from this paragraph, the amount or value of the consideration for the grant would be less than the value determined under paragraph (4), the consideration shall be taken to be the value determined under paragraph (4).
  (4) That value is—
  178

  (a) the market value, immediately before the instrument granting the lease is executed, of the lease granted; but

  (b) reduced by the value of so much of any actual consideration as does not consist of property.

  (5) This Resolution applies only if, in consequence of its application, the lease is chargeable with a greater amount of stamp duty than it would be apart from this Resolution.
  (6) For the purposes of this Resolution, the market value of property at any time is the price which that property might reasonably be expected to fetch on a sale at that time in the open market.
  (7) In this Resolution—
  "company" means any body corporate;
  "shares" includes stock and the reference to shares in a company includes a reference to securities issued by a company.
  (8) For the purposes of this Resolution, the question whether any person is connected with another shall be determined in accordance with the provisions of section 839 of the Income and Corporation Taxes Act 1988.
  (9) This Resolution shall be construed as one with the Stamp Act 1891.
  (10) This Resolution applies to instruments executed on or after 28th March 2000.
  (11) But this Resolution does not apply to an instrument giving effect to a contract made on or before 21st March 2000, unless—

  (a) the instrument is made in consequence of the exercise after that date of any option, right of pre-emption or similar right; or

  (b) the instrument transfers the property in question to, or vests it in, a person other than the purchaser under the contract, because of an assignment (or, in Scotland, assignation) or further contract made after that date.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of section 50 of the Finance Act 1973.

  58. STAMP DUTY (MARKETABLE SECURITIES TRANSFERRED ETC. FOR EXEMPT PROPERTY)
  Resolved,
  That the following provisions shall have effect for the period beginning 28th March 2000 and ending 31 days after the earliest of the dates mentioned in section 50(2) of the Finance Act 1973—
  (1) Paragraph (2) applies where—
  (a) an instrument transferring marketable securities would not, apart from this Resolution, be or fall to be treated as a transfer on sale for the purposes of stamp duty; but (b) the transfer of the marketable securities is for consideration; and (c) the consideration is or includes any qualifying property ("the other property").
  (2) For the purposes of Part I of Schedule 13 to the Finance Act 1999, the instrument transferring the marketable securities shall be taken to be a transfer on sale of those securities.
  (3) If the amount or value of the consideration for that transfer on sale would (apart from this paragraph) exceed the market value of the marketable securities immediately before the execution of the instrument transferring them, the amount or value of the consideration shall be taken to be equal to that market value.
  For this purpose the market value of property at any time is the price which that property might reasonably be expected to fetch on a sale at that time in the open market.
  (4) Paragraph (2) has effect even though—

  (a) the transfer of the marketable securities is the whole or part of the consideration for a sale of the other property; or

  (b) the transaction is by way of exchange.

  (5) Paragraph (2) does not affect any charge to stamp duty in respect of the same or any other instrument so far as it relates to the transfer of the other property.
  (6) In this Resolution "qualifying property" means any debt due, stock or securities, to the extent that the debt, stock or securities are not chargeable securities, within the meaning of Part IV of the Finance Act 1986.
  (7) This Resolution shall be construed as one with the Stamp Act 1891.
  (8) This Resolution applies to instruments executed on or after 28th March 2000.
  (9) But this Resolution does not apply to an instrument giving effect to a contract made on or before 21st March 2000, unless—

  (a) the instrument is made in consequence of the exercise after that date of any option, right of pre-emption or similar right; or

  (b) the instrument transfers the property in question to, or vests it in, a person other than the purchaser under the contract, because of an assignment (or, in Scotland, assignation) or further contract made after that date.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of section 50 of the Finance Act 1973.

  59. STAMP DUTY (MISCELLANEOUS)
  Resolved,
  That provision may be made—

  (a) amending section 55 of the Stamp Act 1891, section 42 of the Finance Act 1930, section 11 of the Finance Act (Northern Ireland) 1954, sections 75 and 76 of the Finance Act 1986 and section 151 of the Finance Act 1995; and

  (b) about stamp duty on documents relating to the surrender or renunciation of leases.

  60. STAMP DUTY (INTELLECTUAL PROPERTY)
  Resolved,
  That the following provisions shall have effect for the period beginning 28th March 2000 and ending 31 days after the earliest of the dates mentioned in section 50(2) of the Finance Act 1973—
  (1) No stamp duty is chargeable on an instrument for the sale, transfer or other disposition of intellectual property.
  (2) Where stamp duty under Part I of Schedule 13 to the Finance Act 1999 is chargeable on an instrument and part of the property concerned consists of intellectual property—

  (a) the consideration in respect of which duty would otherwise be charged shall be apportioned, on such basis as is just and reasonable, as between the part of the property which consists of intellectual property and the part which does not, and

  (b) the instrument shall be charged only in respect of the consideration attributed to such of the property as is not intellectual property.

  (3) Where part of the property referred to in section 58(1) of the Stamp Act 1891 consists of intellectual property, that provision shall have effect as if "the parties think fit" read "is just and reasonable".
  (4) Where—

  (a) part of the property referred to in section 58(2) of the Stamp Act 1891 consists of intellectual property, and

  (b) both or (as the case may be) all the relevant persons are connected with one another,

  that provision shall have effect as if the words from "for distinct parts of the consideration" to the end of the subsection read ", the consideration is to be apportioned in such manner as is just and reasonable, so that a distinct consideration for each separate part or parcel is set forth in the conveyance relating thereto, and such conveyance is to be charged with ad valorem duty in respect of such distinct consideration.".
  (5) In a case where paragraph (3) or (4) applies and the consideration is apportioned in a manner that is not just and reasonable, the enactments relating to stamp duty shall have effect as if—

  (a) the consideration had been apportioned in a manner that is just and reasonable, and

  (b) the amount of any distinct consideration set forth in any conveyance relating to a separate part or parcel of property were such amount as is found by a just and reasonable apportionment (and not the amount actually set forth).

  "The enactments relating to stamp duty" means the Stamp Act 1891 and any enactment amending or which is to be construed as one with that Act.
  (6) For the purposes of paragraph (4)—

  (a) a person is a relevant person if he is a person by or for whom the property is contracted to be purchased;

  (b) the question whether persons are connected with one another shall be determined in accordance with section 839 of the Income and Corporation Taxes Act 1988.

  (7) Intellectual property shall be disregarded for the purposes of paragraph 6 of Schedule 13 to the Finance Act 1999.
  (8) Any statement as mentioned in paragraph 6(1) of that Schedule shall be construed as leaving out of account any matter which is to be so disregarded.
  (9) Section 12 of the Finance Act 1895 does not require any person who is authorised to purchase any property as mentioned in that section after 27th March 2000 to include any intellectual property in the instrument of conveyance required by that section to be produced to the Commissioners.
  (10) If the property consists wholly of intellectual property no instrument of conveyance need be produced to the Commissioners under that section.
  (11) Subject to paragraph (12), the preceding paragraphs of this Resolution apply to instruments executed on or after 28th March 2000.
  (12) Paragraphs (9) and (10) apply where the Act mentioned in section 12 of the Finance Act 1895, and by virtue of which property is vested or a person is authorised to purchase property, is passed after 27th March 2000.
  (13) In this Resolution "intellectual property" means—

  (a) any patent, trade mark, registered design, copyright or design right,

  (b) any plant breeders' rights and rights under section 7 of the Plant Varieties Act 1997,

  (c) any licence or other right in respect of anything within paragraph (a) or (b), or

  (d) any rights under the law of a country outside the United Kingdom that correspond or are similar to those within paragraph (a), (b) or (c).

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of section 50 of the Finance Act 1973.

  61. STAMP DUTY (NORTHERN IRELAND ASSEMBLY COMMISSION)
  Resolved,
  That the following provisions shall have effect for the period beginning 28th March 2000 and ending 31 days after the earliest of the dates mentioned in section 50(2) of the Finance Act 1973—
  (1) Section 55 of the Finance Act 1987 shall be amended as follows.
  (2) In subsection (1)—

  (a) after "agreed to be made" there shall be inserted "(a)";

  (b) after "Minister of the Crown or" there shall be inserted "(b)"; and

  (c) after "Treasury, or" there shall be inserted "(c)".

  (3) In subsection (1), after "National Assembly for Wales," there shall be inserted "or
  (d) to the Northern Ireland Assembly Commission,".
  (4) Paragraph (3) has effect in relation to instruments executed on or after 28th March 2000.
  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of section 50 of the Finance Act 1973.

  62. LANDFILL TAX (RATE)
  Motion made, and Question put,
  That—

  (1) In section 42 of the Finance Act 1996, in subsections (1)(a) and (2) for "£10" there shall be substituted "£11".

  (2) This Resolution has effect in relation to taxable disposals made, or treated as made, on or after 1st April 2000.

  And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.
  The House divided: Ayes 334, Noes 136.

  Division No. 128]

  [11.42 pm

  AYES

  Abbott, Ms Diane

  Burstow, Paul

  Ainger, Nick

  Butler, Mrs Christine

  Ainsworth, Robert (Cov'try NE)

  Byers, Rt Hon Stephen

  Allan, Richard

  Cable, Dr Vincent

  Allen, Graham

  Campbell, Mrs Anne (C'bridge)

  Anderson, Donald (Swansea E)

  Campbell, Rt Hon Menzies(NE Fife)

  Anderson, Janet (Rossendale)

  Ashdown, Rt Hon Paddy

  Campbell-Savours, Dale

  Ashton, Joe

  Cann, Jamie

  Atherton, Ms Candy

  Casale, Roger

  Atkins, Charlotte

  Cawsey, Ian

  Austin, John

  Chaytor, David

  Baker, Norman

  Chidgey, David

  Ballard, Jackie

  Clapham, Michael

  Banks, Tony

  Clark, Dr Lynda (Edinburgh Pentlands)

  Barnes, Harry

  Barton, Kevin

  Clark, Paul (Gillingham)

  Battle, John

  Clarke, Charles (Norwich S)

  Bayley, Hugh

  Clarke, Rt Hon Tom (Coatbridge)

  Beard, Nigel

  Clarke, Tony (Northampton S)

  Begg, Miss Anne

  Clelland, David

  Beith, Rt Hon A J

  Clwyd, Ann

  Bell, Stuart (Middlesbrough)

  Coaker, Vernon

  Benn, Hilary (Leeds C)

  Coffey, Ms Ann

  Benn, Rt Hon Tony (Chesterfield)

  Cohen, Harry

  Bennett, Andrew F

  Coleman, Iain

  Benton, Joe

  Colman, Tony

  Berry, Roger

  Corbyn, Jeremy

  Blackman, Liz

  Corston, Jean

  Blears, Ms Hazel

  Cotter, Brian

  Blizzard, Bob

  Cousins, Jim

  Boateng, Rt Hon Paul

  Cranston, Ross

  Borrow, David

  Crausby, David

  Bradley, Keith (Withington)

  Cryer, Mrs Ann (Keighley)

  Bradley, Peter (The Wrekin)

  Cryer, John (Hornchurch)

  Bradshaw, Ben

  Cunningham, Rt Hon Dr Jack (Copeland)

  Brake, Tom

  Brand, Dr Peter

  Cunningham, Jim (Cov'try S)

  Brown, Rt Hon Gordon (Dunfermline E)

  Cunningham, Ms Roseanna (Perth)

  Brown, Rt Hon Nick (Newcastle E)

  Curtis-Thomas, Mrs Claire

  Brown, Russell (Dumfries)

  Dalyell, Tam

  Browne, Desmond

  Darling, Rt Hon Alistair

  Bruce, Malcolm (Gordon)

  Darvill, Keith

  Buck, Ms Karen

  Davey, Edward (Kingston)

  Burden, Richard

  Davies, Rt Hon Denzil (Llanelli)

  Burgon, Colin

  Davies, Geraint (Croydon C)

  182

  Dean, Mrs Janet

  Johnson, Miss Melanie (Welwyn Hatfield)

  Denham, John

  Dismore, Andrew

  Jones, Rt Hon Barry (Alyn)

  Dobbin, Jim

  Jones, Helen (Warrington N)

  Donohoe, Brian H

  Jones, Ieuan Wyn (Ynys Môn)

  Doran, Frank

  Jones, Ms Jenny (Wolverh'ton SW)

  Dowd, Jim

  Drew, David

  Keetch, Paul

  Eagle, Angela (Wallasey)

  Kemp, Fraser

  Eagle, Maria (L'pool Garston)

  Kennedy, Jane (Wavertree)

  Edwards, Huw

  Khabra, Piara S

  Efford, Clive

  Kidney, David

  Ellman, Mrs Louise

  Kilfoyle, Peter

  Ennis, Jeff

  King, Andy (Rugby & Kenilworth)

  Etherington, Bill

  King, Ms Oona (Bethnal Green)

  Field, Rt Hon Frank

  Kirkwood, Archy

  Fisher, Mark

  Ladyman, Dr Stephen

  Fitzsimons, Lorna

  Lepper, David

  Flint, Caroline

  Leslie, Christopher

  Flynn, Paul

  Lewis, Ivan (Bury S)

  Follett, Barbara

  Lewis, Terry (Worsley)

  Foster, Rt Hon Derek

  Liddell, Rt Hon Mrs Helen

  Foster, Don (Bath)

  Linton, Martin

  Foster, Michael Jabez (Hastings)

  Lloyd, Tony (Manchester C)

  Foster, Michael J (Worcester)

  Llwyd, Elfyn

  Fyfe, Maria

  Lock, David

  Gapes, Mike

  Love, Andrew

  Gardiner, Barry

  McAvoy, Thomas

  George, Andrew (St Ives)

  McCabe, Steve

  George, Bruce (Walsall S)

  McCafferty, Ms Chris

  Gerrard, Neil

  McCartney, Rt Hon Ian (Makerfield)

  Gibson, Dr Ian

  Gilroy, Mrs Linda

  Macdonald, Calum

  Godman, Dr Norman A

  McDonnell, John

  Godsiff, Roger

  McIsaac, Shona

  Goggins, Paul

  McKenna, Mrs Rosemary

  Gordon, Mrs Eileen

  Mackinlay, Andrew

  Griffiths, Jane (Reading E)

  Maclennan, Rt Hon Robert

  Griffiths, Nigel (Edinburgh S)

  McNamara, Kevin

  Grocott, Bruce

  McNulty, Tony

  Grogan, John

  Mactaggart, Fiona

  Hall, Patrick (Bedford)

  McWalter, Tony

  Hancock, Mike

  Mahon, Mrs Alice

  Hanson, David

  Marsden, Gordon (Blackpool S)

  Harman, Rt Hon Ms Harriet

  Marshall, David (Shettleston)

  Harris, Dr Evan

  Marshall, Jim (Leicester S)

  Heal, Mrs Sylvia

  Martlew, Eric

  Healey, John

  Meacher, Rt Hon Michael

  Heath, David (Somerton & Frome)

  Meale, Alan

  Henderson, Doug (Newcastle N)

  Merron, Gillian

  Henderson, Ivan (Harwich)

  Michie, Bill (Shef'ld Heeley)

  Heppell, John

  Michie, Mrs Ray (Argyll & Bute)

  Hesford, Stephen

  Milburn, Rt Hon Alan

  Hill, Keith

  Miller, Andrew

  Hinchliffe, David

  Mitchell, Austin

  Hoey, Kate

  Moonie, Dr Lewis

  Home Robertson, John

  Moore, Michael

  Hood, Jimmy

  Morgan, Alasdair (Galloway)

  Hoon, Rt Hon Geoffrey

  Morley, Elliot

  Hope, Phil

  Morris, Rt Hon Sir John (Aberavon)

  Hopkins, Kelvin

  Howarth, Alan (Newport E)

  Mountford, Kali

  Howells, Dr Kim

  Mullin, Chris

  Hughes, Ms Beverley (Stretford)

  Naysmith, Dr Doug

  Hughes, Kevin (Doncaster N)

  Norris, Dan

  Hughes, Simon (Southwark N)

  Oaten, Mark

  Humble, Mrs Joan

  O'Brien, Mike (N Warks)

  Hurst, Alan

  O'Hara, Eddie

  Hutton, John

  O'Neill, Martin

  Iddon, Dr Brian

  Palmer, Dr Nick

  Illsley, Eric

  Pearson, Ian

  Jackson, Ms Glenda (Hampstead)

  Pendry, Tom

  Jackson, Helen (Hillsborough)

  Perham, Ms Linda

  Jamieson, David

  Pickthall, Colin

  Jenkins, Brian

  Plaskitt, James

  Johnson, Alan (Hull W & Hessle)

  Pollard, Kerry

  183

  Pond, Chris

  Strang, Rt Hon Dr Gavin

  Pope, Greg

  Stringer, Graham

  Powell, Sir Raymond

  Stunell, Andrew

  Prentice, Ms Bridget (Lewisham E)

  Sutcliffe, Gerry

  Prentice, Gordon (Pendle)

  Swinney, John

  Primarolo, Dawn

  Taylor, Rt Hon Mrs Ann (Dewsbury)

  Prosser, Gwyn

  Purchase, Ken

  Taylor, Ms Dari (Stockton S)

  Quinn, Lawrie

  Taylor, David (NW Leics)

  Radice, Rt Hon Giles

  Taylor, Matthew (Truro)

  Rammell, Bill

  Temple-Morris, Peter

  Raynsford, Nick

  Thomas, Gareth (Clwyd W)

  Reed, Andrew (Loughborough)

  Thomas, Gareth R (Harrow W)

  Reid, Rt Hon Dr John (Hamilton N)

  Thomas, Simon (Ceredigion)

  Rendel, David

  Timms, Stephen

  Robinson, Geoffrey (Cov'try NW)

  Tipping, Paddy

  Rooker, Rt Hon Jeff

  Todd, Mark

  Rooney, Terry

  Tonge, Dr Jenny

  Ross, Ernie (Dundee W)

  Touhig, Don

  Rowlands, Ted

  Trickett, Jon

  Roy, Frank

  Turner, Dennis (Wolverh'ton SE)

  Ruddock, Joan

  Turner, Dr Desmond (Kemptown)

  Russell, Bob (Colchester)

  Turner, Dr George (NW Norfolk)

  Ryan, Ms Joan

  Turner, Neil (Wigan)

  Salmond, Alex

  Tyler, Paul

  Sanders, Adrian

  Tynan, Bill

  Sarwar, Mohammad

  Vis, Dr Rudi

  Savidge, Malcolm

  Wallace, James

  Sawford, Phil

  Walley, Ms Joan

  Sedgemore, Brian

  Watts, David

  Sheerman, Barry

  Webb, Steve

  Simpson, Alan (Nottingham S)

  White, Brian

  Singh, Marsha

  Whitehead, Dr Alan

  Skinner, Dennis

  Wicks, Malcolm

  Smith, Rt Hon Andrew (Oxford E)

  Wigley, Rt Hon Dafydd

  Smith, Angela (Basildon)

  Williams, Rt Hon Alan (Swansea W)

  Smith, Rt Hon Chris (Islington S)

  Smith, Miss Geraldine (Morecambe & Lunesdale)

  Williams, Alan W (E Carmarthen)

  Williams, Mrs Betty (Conwy)

  Smith, John (Glamorgan)

  Willis, Phil

  Smith, Llew (Blaenau Gwent)

  Winnick, David

  Smith, Sir Robert (W Ab'd'ns)

  Winterton, Ms Rosie (Doncaster C)

  Snape, Peter

  Wise, Audrey

  Soley, Clive

  Wood, Mike

  Southworth, Ms Helen

  Woodward, Shaun

  Spellar, John

  Worthington, Tony

  Starkey, Dr Phyllis

  Wray, James

  Steinberg, Gerry

  Wright, Anthony D (Gt Yarmouth)

  Stevenson, George

  Stewart, David (Inverness E)

  Tellers for the Ayes:

  Stewart, Ian (Eccles)

  Mr. Clive Betts and

  Stoate, Dr Howard

  Mr. Mike Hall.

  NOES

  Ainsworth, Peter (E Surrey)

  Clarke, Rt Hon Kenneth (Rushcliffe)

  Amess, David

  Arbuthnot, Rt Hon James

  Collins, Tim

  Atkinson, David (Bour'mth E)

  Cran, James

  Atkinson, Peter (Hexham)

  Curry, Rt Hon David

  Beggs, Roy

  Davies, Quentin (Grantham)

  Beresford, Sir Paul

  Davis, Rt Hon David (Haltemprice)

  Blunt, Crispin

  Day, Stephen

  Body, Sir Richard

  Donaldson, Jeffrey

  Boswell, Tim

  Dorrell, Rt Hon Stephen

  Bottomley, Peter (Worthing W)

  Duncan, Alan

  Bottomley, Rt Hon Mrs Virginia

  Duncan Smith, Iain

  Brady, Graham

  Evans, Nigel

  Brazier, Julian

  Faber, David

  Browning, Mrs Angela

  Fabricant, Michael

  Burns, Simon

  Fallon, Michael

  Butterfill, John

  Flight, Howard

  Cash, William

  Forth, Rt Hon Eric

  Chapman, Sir Sydney (Chipping Barnet)

  Fox, Dr Liam

  Gale, Roger

  Chope, Christopher

  Garnier, Edward

  Clark, Dr Michael (Rayleigh)

  Gibb, Nick

  184

  Gill, Christopher

  Pickles, Eric

  Gillan, Mrs Cheryl

  Portillo, Rt Hon Michael

  Gray, James

  Prior, David

  Green, Damian

  Randall, John

  Greenway, John

  Redwood, Rt Hon John

  Grieve, Dominic

  Robathan, Andrew

  Hamilton, Rt Hon Sir Archie

  Robertson, Laurence

  Hammond, Philip

  Roe, Mrs Marion (Broxbourne)

  Hawkins, Nick

  Ross, William (E Lond'y)

  Hayes, John

  Ruffley, David

  Heald, Oliver

  St Aubyn, Nick

  Heathcoat-Amory, Rt Hon David

  Sayeed, Jonathan

  Hogg, Rt Hon Douglas

  Shephard, Rt Hon Mrs Gillian

  Horam, John

  Shepherd, Richard

  Howarth, Gerald (Aldershot)

  Simpson, Keith (Mid-Norfolk)

  Hunter, Andrew

  Smyth, Rev Martin (Belfast S)

  Jack, Rt Hon Michael

  Soames, Nicholas

  Jackson, Robert (Wantage)

  Spelman, Mrs Caroline

  Jenkin, Bernard

  Spicer, Sir Michael

  Key, Robert

  Spring, Richard

  King, Rt Hon Tom (Bridgwater)

  Steen, Anthony

  Laing, Mrs Eleanor

  Streeter, Gary

  Lait, Mrs Jacqui

  Swayne, Desmond

  Lansley, Andrew

  Syms, Robert

  Leigh, Edward

  Tapsell, Sir Peter

  Letwin, Oliver

  Taylor, Ian (Esher & Walton)

  Lewis, Dr Julian (New Forest E)

  Taylor, John M (Solihull)

  Lidington, David

  Thompson, William

  Lilley, Rt Hon Peter

  Townend, John

  Lloyd, Rt Hon Sir Peter (Fareham)

  Tredinnick, David

  Loughton, Tim

  Tyrie, Andrew

  MacGregor, Rt Hon John

  Walter, Robert

  McIntosh, Miss Anne

  Wardle, Charles

  Maclean, Rt Hon David

  Waterson, Nigel

  McLoughlin, Patrick

  Wells, Bowen

  Madel, Sir David

  Whitney, Sir Raymond

  Malins, Humfrey

  Whittingdale, John

  Maples, John

  Widdecombe, Rt Hon Miss Ann

  Maude, Rt Hon Francis

  Wilkinson, John

  Mawhinney, Rt Hon Sir Brian

  Willetts, David

  May, Mrs Theresa

  Wilshire, David

  Moss, Malcolm

  Winterton, Mrs Ann (Congleton)

  Nicholls, Patrick

  Winterton, Nicholas (Macclesfield)

  Norman, Archie

  Yeo, Tim

  O'Brien, Stephen (Eddisbury)

  Young, Rt Hon Sir George

  Ottaway, Richard

  Page, Richard

  Tellers for the Noes:

  Paice, James

  Mr. Peter Luff and

  Paterson, Owen

  Mr. Geoffrey Clifton-Brown.

  Question accordingly agreed to.

  63. LANDFILL TAX (RECOVERY)
  Resolved,
  That provision may be made about the recovery of landfill tax from persons other than landfill site operators.

  64. RELIEF FROM TAX (INCIDENTAL AND CONSEQUENTIAL CHARGES)
  Resolved,
  That it is expedient to authorise any incidental or consequential charges to any duty or tax (including charges having retrospective effect) which may arise from provisions designed in general to afford relief from taxation.

  PROCEDURE (MUTUAL SECURING OF EXCISE DUTIES)
  Resolved,
  That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may contain provision about security for excise duties charged in other Member States of the European Community.

  PROCEDURE (DONATIONS TO CHARITY)
  Resolved,
  That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may contain provision for the payment by the Commissioners of Inland Revenue of supplements on sums falling to be paid to charities and other bodies in accordance with schemes approved under section 202 of the Income and Corporation Taxes Act 1988.

  PROCEDURE (R&D TAX CREDITS)
  Resolved,
  That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may contain provision for allowing R&D tax credits to be paid to companies.

  PROCEDURE (MUTUAL EXCHANGE OF INFORMATION)
  Resolved,
  That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may contain provision for giving effect to arrangements made with the government of any territory outside the United Kingdom with a view to the exchange of information necessary for carrying out—

  (a) the domestic laws of the United Kingdom concerning income tax, capital gains tax, corporation tax in respect of income and chargeable gains and inheritance tax; and

  (b) the laws of the territory to which the arrangements relate concerning any taxes imposed by the laws of that territory which are of a similar character to those taxes, or are chargeable on or by reference to death or gifts inter vivos.

  PROCEDURE (FUTURE TAXATION)
  Resolved,
  That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may contain the following provisions taking effect in a future year—

  (a) provision about air passenger duty;

  (b) provision for charging climate change levy;

  (c) provision about children's tax credit;

  (d) provision for corporation tax to be charged for the financial year 2001;

  (e) provision about the income tax charge on cars available for private use;

  (f) provision relating to profit sharing schemes approved under Schedule 9 to the Income and Corporation Taxes Act 1988, including provision relating to individuals to whom shares are appropriated under such schemes and provision about corporation tax relief for payments to trustees of such schemes;

  (g) provision about relief under section 229 of the Taxation of Chargeable Gains Act 1992;

  186

  (h) provision relating to retirement benefits schemes, within the meaning of Chapter I of Part XIV of the Income and Corporation Taxes Act 1988;

  (i) provision relating to personal pension schemes, within the meaning of Chapter IV of Part XIV of the Income and Corporation Taxes Act 1988;

  (j) provision amending section 660A of the Income and Corporation Taxes Act 1988; and

  (k) provision about payments under deduction of tax and about returns and other information.

  FINANCE [Money]
  Queen's Recommendation having been signified—
  Resolved,
  That, for the purposes of any Act resulting from the Finance Bill, it is expedient to authorise—

  (a) the payment out of money provided by Parliament of sums payable by the Secretary of State by virtue of provisions of that Act relating to vehicle excise and registration;

  (b) the payment out of money provided by Parliament of such amounts as are required by the Commissioners of Inland Revenue to make payments under provisions of that Act relating to charities;

  (c) the deduction of sums from the gross revenues of the department of the Commissioners of Inland Revenue for the purpose of the payment of R&D tax credits; and

  (d) the payment out of money provided by Parliament of sums payable by virtue of provisions of that Act relating to incentives to use electronic communications—

  (i) for the purposes mentioned in section 132(1) of the Finance Act 1999, and

  (ii) for any other communications with the tax authorities or in connection with taxation matters.

  Bill ordered to be brought in upon the foregoing resolutions: And that the Chairman of Ways and Means, Mr. Chancellor of the Exchequer, Mr. Secretary Prescott, Mr. Secretary Straw, Mr. Secretary Blunkett, Mr. Secretary Milburn, Mr. Secretary Darling, Mr. Secretary Byers, Mr. Andrew Smith, Dawn Primarolo, Miss Melanie Johnson and Mr. Stephen Timms do prepare and bring it in.

  FINANCE BILL
  Mr. Stephen Timms accordingly presented a Bill to grant certain duties, to alter other duties, and to amend the law relating to the National Debt and the Public Revenue, and to make further provision in connection with Finance: And the same was read the First time; and ordered to be read a Second time tomorrow, and to be printed [Bill 97].
  11.55 pm
  Mr. St. Aubyn: On a point of order, Mr. Deputy Speaker. Tonight, the Chief Secretary to the Treasury portrayed Mr. Peter Wyman as a personal tax adviser to a former Member, Mr. Neil Hamilton. Given that all that Mr. Wyman ever did was to give public, unpaid service to a Government deregulation task force when

  187
  Mr. Hamilton was a Minister, has the Chief Secretary approached the Chair to correct a pernicious insinuation against a leading accountant in this country?
  Mr. Deputy Speaker (Mr. Michael Lord): That is not a point of order for the Chair.
  Mr. Stephen O'Brien: On a point of order, Mr. Deputy Speaker. It is a separate point of order. Was it in order tonight for the Chief Secretary to traduce Mr. Peter Wyman's evidence to the Treasury last Friday?
  Mr. Deputy Speaker: That matter was dealt with in an earlier debate. It is not a matter for the Chair now.
  Mr. St. Aubyn: Further to that point of order, Mr. Deputy Speaker.
  Mr. Deputy Speaker: No. It is not a matter for the Chair now.

  DELEGATED LEGISLATION
  Mr. Deputy Speaker: With the leave of the House, I will put motions 3 to 9 together.
  Hon. Members: Object.
  Mr. Deputy Speaker: In that case, we will do them one by one.
  Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

  FINANCIAL SERVICES
  That the draft Official Listing of Securities (Change of Competent Authority) Regulations 2000, which were laid before this House on 1st March, be approved.—[Mr. Greg Pope.]
  Question agreed to.
  Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

  INDUSTRIAL DEVELOPMENT
  That the draft Financial Assistance for Industry (Increase of Limit) Order 2000, which was laid before this House on 1st March, be approved.—[Mr. Greg Pope.]
  Question agreed to.
  Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

  CONTRACTING OUT
  That the draft Contracting Out (Functions relating to Social Security) Order 2000, which was laid before this House on 1st March, be approved.—[Mr. Greg Pope.]
  Question agreed to.
  Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

  SOCIAL SECURITY
  That the draft Social Security (Work-focused Interviews) Regulations 2000, which were laid before this House on 1st March, be approved.—[Mr. Greg Pope.]
  Question agreed to.
  Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

  LOCAL GOVERNMENT FINANCE
  That the Local Government Finance (England) Special Grant Report (No. 53) on rural bus subsidy grants for 2000–01 (HC 302), which was laid before this House on 3rd March, be approved.—[Mr. Greg Pope.]
  Question agreed to.
  Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

  LOCAL GOVERNMENT FINANCE
  That the Local Government Finance (England) Special Grant Report (No. 54) on Rural Bus subsidy grants for 1999(HC 303),which was laid before this House on 3rd March, be approved.—[Mr. Greg Pope.]
  The House divided: Ayes 275, Noes 44.

  Division No. 129]

  [11.57 pm

  AYES

  Abbott, Ms Diane

  Clapham, Michael

  Ainger, Nick

  Clark, Dr Lynda (Edinburgh Pentlands)

  Allen, Graham

  Anderson, Donald (Swansea E)

  Clark, Paul (Gillingham)

  Anderson, Janet (Rossendale)

  Clarke, Charles (Norwich S)

  Ashton, Joe

  Clarke, Rt Hon Tom (Coatbridge)

  Atherton, Ms Candy

  Clarke, Tony (Northampton S)

  Atkins, Charlotte

  Clelland, David

  Austin, John

  Clwyd, Ann

  Banks, Tony

  Coaker, Vernon

  Barnes, Harry

  Coffey, Ms Ann

  Barron, Kevin

  Cohen, Harry

  Battle, John

  Coleman, Iain

  Bayley, Hugh

  Colman, Tony

  Begg, Miss Anne

  Corbyn, Jeremy

  Benn, Hilary (Leeds C)

  Corston, Jean

  Benn, Rt Hon Tony (Chesterfield)

  Cousins, Jim

  Bennett, Andrew F

  Cranston, Ross

  Benton, Joe

  Crausby, David

  Berry, Roger

  Cryer, Mrs Ann (Keighley)

  Betts, Clive

  Cryer, John (Hornchurch)

  Blackman, Liz

  Cunningham, Rt Hon Dr Jack (Copeland)

  Blears, Ms Hazel

  Blizzard, Bob

  Cunningham, Jim (Cov'try S)

  Boateng, Rt Hon Paul

  Curtis-Thomas, Mrs Claire

  Borrow, David

  Dalyell, Tam

  Bradley, Keith (Withington)

  Darvill, Keith

  Bradley, Peter (The Wrekin)

  Davies, Rt Hon Denzil (Llanelli)

  Bradshaw, Ben

  Davies, Geraint (Croydon C)

  Brown, Rt Hon Gordon (Dunfermline E)

  Dean, Mrs Janet

  Denham, John

  Brown, Rt Hon Nick (Newcastle E)

  Dismore, Andrew

  Brown, Russell (Dumfries)

  Dobbin, Jim

  Browne, Desmond

  Donohoe, Brian H

  Buck, Ms Karen

  Doran, Frank

  Burden, Richard

  Dowd, Jim

  Burgon, Colin

  Drew, David

  Butler, Mrs Christine

  Eagle, Angela (Wallasey)

  Campbell, Mrs Anne (C'bridge)

  Eagle, Maria (L'pool Garston)

  Campbell-Savours, Dale

  Edwards, Huw

  Casale, Roger

  Efford, Clive

  Cawsey, Ian

  Ellman, Mrs Louise

  Chaytor, David

  Ennis, Jeff

  189

  Etherington, Bill

  Lewis, Terry (Worsley)

  Field, Rt Hon Frank

  Linton, Martin

  Fisher, Mark

  Lloyd, Tony (Manchester C)

  Fitzsimons, Lorna

  Lock, David

  Flint, Caroline

  Love, Andrew

  Flynn, Paul

  McAvoy, Thomas

  Foster, Michael Jabez (Hastings)

  McCabe, Steve

  Foster, Michael J (Worcester)

  McCafferty, Ms Chris

  Fyfe, Maria

  McCartney, Rt Hon Ian (Makerfield)

  Gapes, Mike

  Gardiner, Barry

  Macdonald, Calum

  George, Bruce (Walsall S)

  McDonnell, John

  Gerrard, Neil

  McIsaac, Shona

  Gibson, Dr Ian

  McKenna, Mrs Rosemary

  Gilroy, Mrs Linda

  Mackinlay, Andrew

  Godman, Dr Norman A

  McNamara, Kevin

  Goggins, Paul

  McNulty, Tony

  Gordon, Mrs Eileen

  Mactaggart, Fiona

  Griffiths, Jane (Reading E)

  McWalter, Tony

  Griffiths, Nigel (Edinburgh S)

  Mahon, Mrs Alice

  Grocott, Bruce

  Marsden, Gordon (Blackpool S)

  Grogan, John

  Marshall, David (Shettleston)

  Hall, Mike (Weaver Vale)

  Marshall, Jim (Leicester S)

  Hall, Patrick (Bedford)

  Martlew, Eric

  Hanson, David

  Meacher, Rt Hon Michael

  Harman, Rt Hon Ms Harriet

  Meale, Alan

  Heal, Mrs Sylvia

  Merron, Gillian

  Healey, John

  Michie, Bill (Shef'ld Heeley)

  Henderson, Doug (Newcastle N)

  Milburn, Rt Hon Alan

  Henderson, Ivan (Harwich)

  Miller, Andrew

  Heppell, John

  Mitchell, Austin

  Hesford, Stephen

  Moonie, Dr Lewis

  Hill, Keith

  Morley, Elliot

  Hinchliffe, David

  Mountford, Kali

  Hoey, Kate

  Mullin, Chris

  Home Robertson, John

  Naysmith, Dr Doug

  Hood, Jimmy

  Norris, Dan

  Hoon, Rt Hon Geoffrey

  O'Brien, Mike (N Warks)

  Hope, Phil

  O'Hara, Eddie

  Hopkins, Kelvin

  O'Neill, Martin

  Howarth, Alan (Newport E)

  Palmer, Dr Nick

  Howells, Dr Kim

  Pearson, Ian

  Hughes, Ms Beverley (Stretford)

  Pendry, Tom

  Hughes, Kevin (Doncaster N)

  Perham, Ms Linda

  Humble, Mrs Joan

  Pickthall, Colin

  Hurst, Alan

  Plaskitt, James

  Hutton, John

  Pollard, Kerry

  Iddon, Dr Brian

  Pond, Chris

  Illsley, Eric

  Pope, Greg

  Jackson, Helen (Hillsborough)

  Prentice, Ms Bridget (Lewisham E)

  Jamieson, David

  Prentice, Gordon (Pendle)

  Jenkins, Brian

  Primarolo, Dawn

  Johnson, Alan (Hull W & Hessle)

  Prosser, Gwyn

  Johnson, Miss Melanie (Welwyn Hatfield)

  Purchase, Ken

  Quinn, Lawrie

  Jones, Rt Hon Barry (Alyn)

  Radice, Rt Hon Giles

  Jones, Helen (Warrington N)

  Rammell, Bill

  Jones, Ms Jenny (Wolverh'ton SW)

  Raynsford, Nick

  Reed, Andrew (Loughborough)

  Kemp, Fraser

  Reid, Rt Hon Dr John (Hamilton N)

  Kennedy, Jane (Wavertree)

  Robinson, Geoffrey (Cov'try NW)

  Kidney, David

  Rooker, Rt Hon Jeff

  Kilfoyle, Peter

  Rooney, Terry

  King, Andy (Rugby & Kenilworth)

  Ross, Ernie (Dundee W)

  King, Ms Oona (Bethnal Green)

  Rowlands, Ted

  Ladyman, Dr Stephen

  Roy, Frank

  Lepper, David

  Ruddock, Joan

  Leslie, Christopher

  Ryan, Ms Joan

  Lewis, Ivan (Bury S)

  Sarwar, Mohammad

  190

  Savidge, Malcolm

  Thomas, Gareth (Clwyd W)

  Sawford, Phil

  Thomas, Gareth R (Harrow W)

  Sedgemore, Brian

  Timms, Stephen

  Sheerman, Barry

  Tipping, Paddy

  Simpson, Alan (Nottingham S)

  Todd, Mark

  Singh, Marsha

  Trickett, Jon

  Skinner, Dennis

  Turner, Dennis (Wolverh'ton SE)

  Smith, Rt Hon Andrew (Oxford E)

  Turner, Dr Desmond (Kemptown)

  Smith, Angela (Basildon)

  Turner, Dr George (NW Norfolk)

  Smith, Rt Hon Chris (Islington S)

  Tynan, Bill

  Smith, Miss Geraldine (Morecambe & Lunesdale)

  Vis, Dr Rudi

  Walley, Ms Joan

  Smith, John (Glamorgan)

  Watts, David

  Smith, Llew (Blaenau Gwent)

  White, Brian

  Snape, Peter

  Whitehead, Dr Alan

  Soley, Clive

  Wicks, Malcolm

  Southworth, Ms Helen

  Williams, Rt Hon Alan (Swansea W)

  Spellar, John

  Starkey, Dr Phyllis

  Williams, Alan W (E Carmarthen)

  Steinberg, Gerry

  Williams, Mrs Betty (Conwy)

  Stevenson, George

  Winnick, David

  Stewart, David (Inverness E)

  Winterton, Ms Rosie (Doncaster C)

  Stewart, Ian (Eccles)

  Wise, Audrey

  Stoate, Dr Howard

  Wood, Mike

  Strang, Rt Hon Dr Gavin

  Woodward, Shaun

  Stringer, Graham

  Worthington, Tony

  Sutcliffe, Gerry

  Wray, James

  Taylor, Rt Hon Mrs Ann (Dewsbury)

  Wright, Anthony D (Gt Yarmouth)

  Taylor, Ms Dari (Stockton S)

  Tellers for the Ayes:

  Taylor, David (NW Leics)

  Mr. Don Touhig and

  Temple-Morris, Peter

  Mr. Robert Ainsworth.

  NOES

  Allan, Richard

  Keetch, Paul

  Ashdown, Rt Hon Paddy

  Kirkwood, Archy

  Baker, Norman

  Livsey, Richard

  Ballard, Jackie

  Llwyd, Elfyn

  Beith, Rt Hon A J

  Maclennan, Rt Hon Robert

  Brake, Tom

  Michie, Mrs Ray (Argyll & Bute)

  Brand, Dr Peter

  Moore, Michael

  Breed, Colin

  Morgan, Alasdair (Galloway)

  Bruce, Malcolm (Gordon)

  Oaten, Mark

  Burnett, John

  Rendel, David

  Burstow, Paul

  Russell, Bob (Colchester)

  Cable, Dr Vincent

  Salmond, Alex

  Campbell, Rt Hon Menzies (NE Fife)

  Sanders, Adrian

  Swinney, John

  Chidgey, David

  Taylor, Matthew (Truro)

  Cotter, Brian

  Thomas, Simon (Ceredigion)

  Cunningham, Ms Roseanna (Perth)

  Tonge, Dr Jenny

  Tyler, Paul

  Davey, Edward (Kingston)

  Webb, Steve

  Foster, Don (Bath)

  Wigley, Rt Hon Dafydd

  George, Andrew (St Ives)

  Willis, Phil

  Hancock, Mike

  Harris, Dr Evan

  Tellers for the Noes:

  Heath, David (Somerton & Frome)

  Sir Robert Smith and

  Hughes, Simon (Southwark N)

  Mr. Andrew Stunell.

  Question accordingly agreed to.
  Resolved,
  That the Local Government Finance (England) Special Grant Report (No. 55), on 1999–2000 Special Grant for Asylum Seekers' Support (Adults and Families of Asylum Seekers) (HC 304), which was laid before this House on 6th March, be approved.

  Graffiti and Vandalism
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. McNulty.]
  12.7 am
  Dr. Vincent Cable: For the benefit of the small number of night owls or masochists who have chosen to remain for this debate, I want to raise an issue that causes great concern, anger and frustration to many of our constituents. In many respects, it is a local problem dealt with through local agencies, but the Minister has a strategic role in looking at best practice and pulling the various threads together, so I think that it is an appropriate issue to throw at him.
  Why is graffiti a big issue and of such concern to many of us? First, in the areas in which it is a serious problem—and mine is one—it creates an atmosphere of neglect and disorder and fear of crime, particularly among vulnerable elderly people, who see it as evidence of the authorities' inability to maintain the fabric of local society and, rightly or wrongly, associate that with crime. Demoralisation flows from that.
  Secondly, graffiti is often associated with criminality. I had a long discussion before the debate with some of the youth workers in my constituency and with the local police, who know many of the perpetrators. Typically, in an area such as mine, which has 100,000 people, there are probably 20 youths seriously involved in graffiti. Many of them are also involved in theft. They probably stole the aerosols and may be at the beginning of involvement with substance abuse. Some of the aerosol sprays are intoxicating—apparently they give an adrenaline buzz to the kids who use them. Unless there is proper intervention by the courts, the police, the youth workers and others, many of those adolescents will find themselves on a slippery slope that will lead quickly to a young offenders institution and prison.
  The final reason why this is an issue of concern is the cost, which can be considerable. My local authority is severely stretched financially. That is one of the reasons for the last of the Divisions that we have just had, on a totally separate issue. The authority has a budget of £100,000 a year for a hotline on graffiti, but it has had to double the number of people involved because of rising demand.
  I have had correspondence with London United Buses, which is in despair about the enormous cost of cleaning buses and shelters. A study carried out five years ago on the London underground suggested that about £2 million a year had to be spent on the removal and clearing up of graffiti. That is a substantial cost for utilities, local councils and, indirectly, for all of us.
  I want to focus on areas of action and policy initiatives that the Minister can take forward. The first issue is policing. Clearly, the police are in the front line. My local police are positive about the issue, and they apply an effective zero-tolerance policy. They work closely with the police consultative group in the area, and give the matter appropriate priority.
  For the Metropolitan police as a whole, graffiti and associated vandalism is not a high-priority offence; perhaps it should be, and I am interested in the Minister's reactions to that. Clearly, this is also linked to the numbers of police officers. As the Minister knows—we will not
  192
  rehearse the party political arguments—there is a problem with the decline in police numbers in London. That has been particularly serious in suburban areas which are assumed to be less prone to crime, and which therefore have borne the brunt of the cuts.
  It is evident in the areas which have seen a decline in policing that graffiti and associated vandalism have blossomed. On Sunday afternoon, I went round an area which has just had a beat police officer withdrawn for reasons of economy. It is now one of the worst-affected areas. Cause and effect is difficult to prove, but that is certainly highly suggestive.
  Where police officers are not available, closed circuit television is important. I note here the positive initiatives of some of the train operators. South West Trains, whatever its other deficiencies, has seen the value of properly monitored CCTV. I hope that I have persuaded the company to accelerate the installation in some of the worst-affected stations. Clearly, that is an important part of the picture.
  The second line of defence is the courts, and I attended a meeting of the local police consultative group last week where there was consternation at the fact that, in the local magistrates court, one of the worst offenders had been up on 50 counts and had been given no more than a supervision order. I think it is now recognised that there is a wide range of possible offences. It will be interesting to hear from the Minister the results of the field surveys that have been done in 10 boroughs, from which are emerging the most promising lines of action through the courts.
  Perhaps we could draw on international experience. In Holland, widespread use was made of what could be called reparation provisions, insisting that graffiti offenders clear up the mess that they had created through community service orders. That would seem to be a promising route, and it would be interesting to hear the Minister's reaction to that.
  The third line of argument—it is perhaps a little different from the conventional way of pursuing the matter—is what we might call the supply-side problem. If we were talking about drugs, we would be talking about the supply of drugs. In terms of graffiti, far too little attention is paid to the issue of how aerosol sprays and other instruments get into the hands of potential young offenders. There is an issue here for the retail sector and for the manufacturers.
  I noticed in one of the local discount stores this weekend that aerosol sprays are being sold at a heavy discount—six for £1. The owners of the stores must know what the aerosols are being used for. Graffiti is now almost certainly the major market for a lot of aerosol sprays, and there is a complete absence of social responsibility. This seems to be an area where public education, led at ministerial level, might be useful.
  Similarly, the manufacturers know what they are producing; they know what these things are for, and there must be a heightened sense of social responsibility among them. The paint industry is giving a lot of thought to the matter. The Paint Research Association is based in my constituency, and has helpfully sent me some of its academic journals on new coverings which, were they used extensively by householders and utilities, would substantially diminish the adhesive potential of graffiti paint. I am not sure how widely that has been promoted

  193
  or how much support the Government and local authorities have given it. The industry has some responsibility. Has the Minister discussed the possible remedies with it?
  At present, there is a clean-up hotline in many boroughs and the council can paint over the damage, but it needs the permission of the property owner, which is frequently not forthcoming. Owners are sometimes difficult to find and many businesses do not want to pay the small charge that is asked of them. There is a particular problem with utilities, which will not allow authorities to touch their heavily marked equipment.
  Would it be useful for local authorities to have the additional power to compel clean-up, without the approval of property owners? I am not sure what the legislative problems might be. Secondary legislation might be needed. Something that allowed a more co-ordinated and tougher response would be appreciated.
  Dr. Julian Lewis: The hon. Gentleman has put his finger on the pulse of the problem. Is not the whole point of graffiti tags for one artist to advertise his handiwork to others, and is it not the case that, with a hotline such as that operated by New Forest district council, which leads to the graffiti being obliterated within 48 hours, not only is the vandals' objective defeated but policing is made much easier if they keep returning to the site to reinstate their efforts?
  Dr. Cable: The hon. Gentleman is right: speed is of the essence. That is why the local authority needs not only the resources but the legal powers to respond rapidly. I noticed that he used the word "artist". I try to avoid that expression. There may be occasional cases in which graffiti are artistic or even witty, but they are infrequent. Graffiti seriously disfigure public space.
  I am not asking for a heavy-handed intervention from the Home Office. The Minister is aware of good practice both here and abroad, in the courts and in local initiatives. Some bold schemes have been tried. I believe that in Los Angeles and Chicago, attempts were made to ban the sale of aerosol sprays to under-age children. It would be useful to have some reflection on that experience. What is good practice? Does the Home Office have a view, and is it disseminating it? How does it propose to bring the various threads together?
  There is a role for Ministers to bring together the various agencies. Even if the Minister does not legislate specifically, he could bring together the utilities, which are very variable in their response to the problem, and the private sector—not necessarily to coerce them but to improve their sense of public responsibility.
  12.19 am
  Mr. Edward Davey: I am grateful to my hon. Friend the Member for Twickenham (Dr. Cable) for allowing me to borrow a few minutes of his time, and I echo many of his comments.
  There is an epidemic of graffiti in my constituency. In New Malden, Chessington, Tolworth and Surbiton there is not a road sign, telephone box or bus shelter without some ugly scrawl or tag defacing it. It is not a coincidence that the rise in graffiti has accompanied the fall in the
  194
  number of police officers, and especially beat officers, in our community. There has been a cull of nearly a quarter of the Kingston police division in the past five years.
  The Minister may say that the Government have put more resources into the Metropolitan police and that the numbers are being turned around, but we have yet to see any evidence of that in Kingston. We have had the recent announcement that we will not get the cuts that we expected next year. I welcome that, but until we start rebuilding the local police force and get more police on the beat we will not turn the tide of vandalism and graffiti, which is sometimes called low-level crime.
  I have a few specific questions for the Minister. Will he ask his officials to review the problems faced by the police in getting evidence to convict vandals of graffiti offences? For example, is there any way for police to challenge and search youngsters who they suspect are carrying spray cans in their bags with intent to deface a property, or who they believe have come from defacing a property? At the moment, the law does not allow that.
  Will the Minister assure me that his Department will monitor the use of the new reparation orders to punish graffiti vandals? Will he make sure that the courts use the orders as Parliament intended—as an appropriate and common-sense punishment for offences of this type? Will he try to support the probation service and youth offender teams as they use the new punishments? Will he ensure that they are carried out properly?
  Will the Minister ensure that the effect of the reparation orders with regard to reducing graffiti is properly studied? Following what my hon. Friend the Member for Twickenham said, will he also review the policy with regard to age limits on the sale of spray paints? I received an e-mail today from a constituent, who said that he and his neighbours in New Malden believed that that solution would help. Similar arguments are used to support the limits on sales to minors of other products, and they apply equally to the sale of spray cans.
  Will the Minister consider issuing new Home Office guidelines to manufacturers and retailers of spray paints, to encourage them to play their part in combating the graffiti menace? Could not the guidelines offer advice on the storage and display of the paints, with a view to minimising the pilfering of spray paint cans?
  Finally, would the Minister be prepared to organise an anti-graffiti summit? The paint manufacturers could take part, as could public service organisations such as transport operators, telecoms providers, cable television suppliers and local authorities. That would be a way to generate new ideas, spread best practice and develop new partnerships to tackle the problem.
  In my gallop through these issues, I have not touched on clean-up, a part of the solution mentioned by my hon. Friend the Member for Twickenham. It is very important that graffiti are cleaned up as soon as possible, as that will discourage vandals.
  Government and local councils must give a lead on the matter. I hope that the Minister will join me in condemning those Conservative councillors who wanted to cut Kingston's graffiti clean-up budget. They talk tough in the local papers about graffiti, but they fail to provide the finances needed to clean up. Will the Minister join me in congratulating Liberal Democrat and Labour councillors in Kingston, who worked together to prevent the cuts in the clean-up budget?

  195
  We should not tolerate graffiti in our communities. I hope that the Government will build on the good measures, such as reparation orders, that they have taken and the previous Conservative Government did not. I hope that they will go much, much further.
  12.23 am
  The Minister of State, Home Office (Mr. Charles Clarke): First, I congratulate the hon. Member for Twickenham (Dr. Cable) on securing this Adjournment debate. I also congratulate the hon. Members for Kingston and Surbiton (Mr. Davey) and for New Forest, East (Dr. Lewis) on their interventions.
  Initially, I was tempted to draw some association between Liberal Democrats and graffiti, but then I thought that that would be unworthy. I shall therefore take the subject at its face value.
  Mr. Bob Russell: The writing is on the wall.
  Mr. Charles Clarke: I hear what the hon. Gentleman says, but I was in his constituency last Friday, and I must say that I felt that the writing would be on the wall for him at the next general election.
  I can understand why, in the light of all the most recent pronouncements on crime and disorder, members of the public believe that offences such as vehicle crime, burglary and violent crime take a higher priority than quality-of-life issues such as vandalism and graffiti. However, the points made by the hon. Member for Twickenham are warranted, and we should take them very seriously.
  The Government recognise the damaging effect of vandalism and graffiti on neighbourhoods and how people feel about living where there are substantial amounts of criminal damage. We are concerned to tackle those issues with energy and enthusiasm; I shall set out the ways in which we plan to do so.
  It may be helpful to the House to understand the scale of the problem. According to the recorded crime statistics bulletin for the 12 months ending in September 1999, there were more than 900,000 offences of criminal damage. That included damage against vehicles, dwellings and buildings other than dwellings, such as bus shelters and post boxes—a wide range.
  That is not the whole picture. In 1998, the British crime survey, which measures reported and unreported crime, stated that, in 1997, there were more than 2,900,000 acts of vandalism against private property. It noted that vandalism was under-reported by 26 per cent.
  One of the reasons for that under-reporting was that those interviewed felt the offence too trivial to warrant troubling the police. It is important that we feel comfortable in reporting all crimes. I am sure Members on both sides of the House would join me in urging everyone to report crimes of that type, however trivial
  196
  they may seem. Without an understanding of the problem, we shall all struggle to tackle such issues in a measured and effective manner.
  It is important to recognise that the police need to set priorities for their time and money. It is not always possible for the police to be around when offences such as vandalism and graffiti are being committed. They look to members of the public to play their part in reporting offences.
  In the light of the comments made by the hon. Members for Twickenham and for Kingston and Surbiton, I remind them that, in our debate on the police grant, I committed myself to examine the issue of police numbers in suburban areas of London. Several Opposition and Government Members made powerful points about the need for such issues to be addressed properly. Indeed, my Parliamentary Private Secretary, my hon. Friend the Member for Harrow, West (Mr. Thomas), exerts immense pressure over such matters, and they are being set in hand.
  A range of groups, such as neighbourhood watch and community organisations, can actively contribute and help the police in developing and strengthening the quality of life of their communities.
  Many of the crime and disorder reduction partnerships across the country have identified graffiti and criminal damage as important issues for the community. According to our latest figures, 227 of the 363 strategies seen by the Home Office have given priority to criminal damage. More than 90 per cent. of the audits referred to graffiti and criminal damage. The problem is not limited only to the Liberal elements of south-west London; it exists throughout the country, as I am happy to acknowledge.
  Much of the work to tackle criminal damage will be undertaken locally, taking into account the most appropriate form of action for each neighbourhood. That was reflected in the speeches we heard this evening. Several local authorities have decided that the way to tackle the matter is through eternal vigilance—comments have been made about that. For example, Stevenage has a graffiti busters service, which acts rapidly on all reported incidences of graffiti. Part of Richmond's strategy is to highlight the fact that it has a graffiti removal service. Those are only isolated examples; across the country, authorities have developed strategies to address the matter effectively.
  The use of CCTV was mentioned by the hon. Member for Twickenham. It might have been gracious of him to acknowledge that the Government have made a major investment in CCTV, which has resulted in its being much more widespread. There has been an active commitment by local authorities and crime reduction partnerships around the country to introduce CCTV. That has the knock-on result of giving additional effective support to policing.
  Education campaigns—especially those aimed at schoolchildren—and improvement of the local environment can all play a part in reducing the incidence of criminal damage and in making people feel better about their surroundings.
  I have already mentioned crime and disorder reduction partnerships. The Crime and Disorder Act 1998 includes provision for orders aimed at confronting young people

  197
  with their behaviour, as well as tackling the circumstances that provide them with the opportunity to commit crimes. The reparation order requires the young offender to make specific reparation to his or her victim, or to the community. The hon. Member for Kingston and Surbiton asked me for an assurance that the Home Office is closely monitoring the use of the orders, to see whether courts use them as an appropriate and common-sense punishment for graffiti vandals. We support the probation service and youth offending teams to make sure that such punishments are properly carried out. My experience of the operation of the reparation schemes in various parts of the country is extremely positive. By forcing people to confront the consequences of their actions, they are an effective way of dealing with the issue at an early stage.
  Parenting orders are another device under the crime and disorder reduction partnerships and are intended to help and support parents to control their children's behaviour. That is an important element of the partnerships.
  I emphasise our commitment to the development of neighbourhood and community warden schemes, which are an additional resource that can help to develop the eyes and ears of the community above and beyond the police and neighbourhood watch schemes. In my city of Norwich, as in many areas, the neighbourhood warden scheme in the parks of the city has been an effective operation that has inhibited certain types of behaviour. Such schemes are an important development that should be generally welcomed.
  Spray paints and marker pens have been mentioned. In response to the specific point put to me, I have not discussed them with manufacturers thus far and I have not had discussions generally about the issue. Although the idea of restricting the sale of spray paints and marker pens is initially attractive, to do so would penalise young people who have genuine and legitimate reasons for their purchase. Marker pens in particular are widely used by young people in a variety of different ways and not for graffiti. Simply to say that someone cannot have one because he is a young person might be taking a sledgehammer to crack a nut.
  We believe that such a ban is unlikely to prevent the determined graffiti "artists"—like the hon. Member for Twickenham, I was entertained by the use of that word—from obtaining aerosol paint and continuing their criminal activity. I hope that retailers will, as a matter of course, consider who they are selling such products to. It is important to emphasise that, under the Intoxicating Substances (Supply) Act 1985, it is a matter for individual retailers to reserve the right to prohibit the sale of solvents to young people who appear not to have a legitimate reason for buying them. The Act provides some powers that retailers are able to use.
  The police already have the power to arrest anyone who they reasonably suspect has committed or is about to commit the offence of criminal damage. Where vandals are found in possession of a paint spray can with the intention of damaging property or after already having done so, the criminal law can be brought to bear.
  The hon. Member for Kingston and Surbiton referred to the problems that the police have in obtaining evidence to convict vandals of graffiti offences. The short answer
  198
  to his question is that we keep matters under constant review, but that we think that the police have significant powers in this area.
  It will interest the hon. Member for Twickenham—he represents a London constituency—to learn that the Department of the Environment, Transport and the Regions has advised me that section 12 of the London Local Authorities Act 1995 gives councils the power to serve a notice on an occupier of premises where a surface of those premises has on it a "sign". That includes any writing or picture—for example, graffiti—that a council feels is detrimental to the amenity of the area. Not all London councils have adopted the provisions in the Act—I do not know what the position is in the hon. Gentleman's constituency—but the power is there for London councils to use if they wish.
  The surface on which the graffiti exists must, according to the Act, be readily visible from a place to which the public have access. Once any council notice has been served, the owner or occupier has 14 days to remove the offending graffiti. The owner or occupier has the right to appeal to a magistrates court within the 14 days. If no appeal is made, and after 14 days the graffiti has not been removed, the council may do the work itself, incurring the clean-up costs. It would then have to go to court to recover the costs and would have to prove that the area's amenity had suffered detrimentally.
  Section 13 of the same Act provides additional leeway to the British Railways Board, Railtrack, London Regional Transport and any of their subsidiaries, such as London Underground. Those bodies are called protected parties. If graffiti exists on any of their property, the 14-day notice period is increased to 28 days and the protected party can serve a counter-notice on the council. The counter-notice lets it impose its own reasonable conditions on any cleaning-up work.
  As I said, I have been advised on that by DETR. It is important to note that what I have said is only the Department's interpretation, and matters of fine interpretation are for the courts. However, I am prepared to look further at how that Act has operated and to consider whether it might appropriately be extended to other local authorities or changed in certain respects.
  More fundamentally, with the Youth Justice Board, the Department for Education and Employment and DETR, we are funding a series of youth inclusion programmes, targeting young people in neighbourhoods most in need of support. Although those will concentrate on setting up family link centres and skills centres, environmental work will play an important part.
  I add that the social exclusion unit's policy action teams are considering a variety of issues that impact on vandalism and graffiti. I have mentioned neighbourhood wardens, and a range of other schemes are intended to focus on anti-social behaviour such as vandalism and graffiti. I agree with the hon. Member for Twickenham that developing a stronger approach on good practice is an important way to proceed, and we shall certainly consider ways in which we can do that and make progress.

  199
  I have already answered the points made by the hon. Member for Kingston and Surbiton about evidence and reparation orders. He asked me whether I could use what influence I have with the Crown Prosecution Service. I simply say to him that, as he knows, those are matters for the CPS, not for Ministers.
  I have responded to the question of reviewing policy on age limits for the sale of spray paints, and the case would have to be well made before we considered making such a draconian intervention. However, as I said, individual retailers have powers in these cases. I was asked whether I would consider issuing new Home Office
  200
  guidelines to spray paint manufacturers and retailers. At this stage we are not considering such guidelines, but we will of course consider what has been said in this debate.
  Finally, I respond to the suggestion of an anti-graffiti summit—I think that hon. Members were perhaps over-influenced by the European Union summit in Lisbon—which would involve everybody concerned. I have to confess with humility and shame that although we have a string of tsars, we do not yet plan to introduce an anti-graffiti summit that will shake the world, but we are certainly prepared to consider that.
  Question put and agreed to.
  Adjourned accordingly at twenty-three minutes to One o'clock.