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Finance Bill

In the next few months, when the Opposition have had a chance to look carefully at all the implications of the Red Book and come forward with a series of proposals, people will take them and the criticisms that they make more seriously. One of the issues raised by my right hon. Friend the Member for Birkenhead has been reflected in comments from the hon. Member for Twickenham (Dr. Cable) and has found favour in some parts of the Opposition. I refer to the question of whether action should be taken on public sector pensions and, by implication, on public sector pay. My suspicion is that nothing concrete will be forthcoming from either of the major Opposition parties, because they will not want that to be part of any election campaign that may come this year or next. Comments were made earlier about how we fund the deficit. As I mentioned in an intervention, a number of members of the Treasury Committee visited the Debt Management Office today. From what we saw and from the discussion that we had with the senior officials there, it was clear that for various reasons there is an appetite out there in the marketplace for Government debt. Whether that is because there is a flight to safety in risk-free products such as gilts, or because of the need of the pension industry for long-dated gilts, there does not seem to be a single serious forecaster or economic commentator who suggests that although the demands of the Debt Management Office to raise money on behalf of the Government are substantial, there is not a willingness out there in the marketplace to deliver that. Finally in relation to the public finances, we have heard repeatedly from the Opposition that we are building up a 79 or 80 per cent. ratio of debt to GDP. As the hon. Member for Mid-Worcestershire commented, that places us somewhere in the middle of international comparisons. Although that should be taken extremely seriously, we are not some outlier, as has been suggested by some Opposition parties. We are around the average of economies that could be considered both our competitors and our comparators.