---

Budget Resolutions and Economic Situation

As I rise to challenge the received wisdom that we are living in a land of milk and honey, I confess that I am gatecrashing the Chancellor’s glee club on the other side of the Chamber. I have unashamedly looked at the Budget through the prism of the way in which it will affect my constituents and my constituency. There is a chasm between the Chancellor’s rhetoric and the situation in the real world for business and the public services, which I shall touch on later in my speech. Such rhetoric includes:"““Britain is better placed than ever to be the global economy’s success story””" and"““Preparing Britain for 21st Century—Challenge of Globalisation””." I find it hard to reconcile those comments with a Chancellor who is imposing a social market model on this country and squandering the golden economic legacy that was left by my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke). People have eschewed facts today, but facts are important, so let us consider the statistics. The tax take this year is £490 billion. Public expenditure is up by £207 billion since 1997. If one adds tax credits, as de facto welfare payments, into expenditure, 39 per cent. of our GDP is going on public expenditure. There will be £73 billion of public borrowing over the next two years, and tax will be up to 41 per cent. of GDP by 2011, or the equivalent of more than £7,000 a family. Businesses have been much lauded by the Chancellor, but business investment is at its lowest for 41 years in cash terms. This country is 5 per cent. worse off for capital equipment than Germany and the United States. Output per worker has gone up by just 1.6 per cent. in the past nine years, which is well behind the figure for the United States of America. We know that the Chancellor has had to downgrade his growth forecast constantly, but we should also remember that he has got the tax-take projections wrong in the last six financial years. As my right hon. and learned Friend the Member for Rushcliffe pointed out, growth per output since 1995 has, according to the university of Groningen, fallen behind France and Germany. We are something like fourth or fifth in the list of output and productivity in the G7. The Budget is also marked by a sleight of hand. We have heard nothing about the private finance initiative and the £60 billion that is off-balance-sheet debt. As my right hon. Friend the Member for North-West Hampshire (Sir George Young) said, we have heard nothing about the council tax bribe of £200—an urgent issue in 2005 before the general election, which is suddenly less urgent this year. We are constantly told by Labour Members that this is a Budget for the future that tackles the big issues, yet we have heard nothing about the Turner report or the structural reform of pensions. We have heard nothing except briefing in a turf war by the Treasury against Lord Turner and others. Let me give one simple example of how the Government have done nothing for the most needy people in our society. The Alzheimer’s Society has written that carers save the Exchequer £57 billion, but there is nothing for them except a slap in the face. They have been ignored.