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Budget Resolutions and Economic Situation

I am grateful for the opportunity to remind the House that, since 1997, women’s wages have increased twice as fast as men’s wages. I recognise that there is still a gap between the two, but we are narrowing that gap, and that is a record of which we can rightly be proud. A number of Conservative Members have alleged that the tax burden is now the highest in history. That is of course dependent on the most spurious of all calculations of the tax burden, and it is completely wrong. The tax burden is actually lower now than it was for the entire period between 1981 and 1988 under Margaret Thatcher, and well below the peak tax burden in 1984. According to the experts at the Organisation for Economic Co-operation and Development, the net tax burden on the average working family is half what it was when we came to power. As a result of all the tax and benefit changes that we have introduced, the average household will, from next month, be £950 a year better off in real terms than it was in 1997. According to Ernst and Young, the effective rate of corporation tax on British businesses is well below historic highs, down from 14 per cent. in 1997 to below 10 per cent. today. Of course, the amount of tax collected rises fastest when the economy is doing well—when business, the City, the housing market and retailers are doing well, and when there are more people in work, paying tax and moving up the earnings scale. The lowest tax burden of the past 30 years was in 1993–94, when the economy was barely growing, unemployment was above 3 million, millions of families faced negative equity and wage settlements were at a 25-year low. This Budget illustrates the gap between the Government’s responsible preparation for global change and the instincts of the Conservative party, which would leave us all woefully unprepared for the future.