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Value Added Tax

I thank the Minister for giving me 100 seconds to respond to a long and complex debate. I shall not say a great deal about his contribution. He got off to a good start by reminding us about the 1997 fiscal framework and suggested to me that chutzpah is a necessary qualification for being a Treasury Minister, which he has now done twice. There were two major contributions to the debate, and I just want to respond to the right hon. Member for Birkenhead (Mr. Field) and the Conservative spokesman, who brought up two major issues. First, of course this is all overshadowed by the banking system and the lack of credit, and that is what we have to focus on. I have spoken about that volubly and at length, so I totally agree with that. The subject of what exactly we should do is more controversial. The Conservative proposal for guaranteed credit may have an important role, but, as I pointed out on Monday, if it is work it effectively means the nationalisation of credit. That, of course, would have major public finance implications that I do not think they have yet thought through. The other major issue is whether we believe that any fiscal stimulus is necessary. I am perfectly willing to entertain the dangerous idea that the hon. Member for Runnymede and Weybridge (Mr. Hammond) and the right hon. Member for Birkenhead may be right and that such a stimulus may not work. If that is so, however, they should be in Washington, not lecturing us here. What is being proposed is just the faintest echo of what is happening throughout the western world, and especially in the US. The American Congress and the new US Administration are preparing a stimulus that is about 30 times as big as the British stimulus, in a context of even weaker public finances than ours. If it does not work, the consequences for the western economies will be catastrophic. As I said— One and a half hours having elapsed since the commencement of proceedings onthe motion, the Deputy Speaker put the Question (Standing Order No. 16(1)). The House divided: Ayes 223, Noes 303.