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Finance Bill

I think that latecomers should refrain from making comments that have already been made by hon. Members who have decided to take this rather more seriously. As you rightly reminded us, Sir Michael, it is an extremely serious issue for a very large number of businesses and constituents throughout the country. We have all been impressed by the energy of those who are desperately trying to save their industry and their local pubs. They have been to see us here in the Palace of Westminster, they have been to see Ministers, they have sent a great number of e-mails and personal correspondence, and they have often been to Members' constituency advice surgeries. It well behoves anybody in the House not to try to turn this into some kind of knockabout but to see that it involves big issues about jobs, prices, communities and ways of life that matter a great deal to our constituents. As we have heard—I do not wish to bore the House by repeating it—a point can be reached where an increase in taxation can suddenly tip over into doing far more serious damage. My worry is that we are reaching that point against the background of recession. It may well be that in more normal years there was agreement across the House that there needed to be a certain level of duty, or even an increase in duty, for health or revenue-raising reasons. However, against the background of great pressure on the economy, a squeeze on many people's incomes, a squeeze on company cash flow, and businesses experiencing difficulty in raising from the banks working capital or money for their wider purposes, the Government should pause to reflect on whether this is the appropriate moment to introduce such a tax increase and whether they have done a proper study of what impact it may have on jobs and individual businesses. We have already heard examples of small brewers who could be knocked sideways if demand fell too sharply, and we all know of pubs at risk in our own constituencies and in the wider country. I am also concerned about the impact on prices. It is dangerous to be as cavalier as the Government appear to be about the inflation risk. One of the attractions of the Liberal Democrat amendment is that it is trying to create a pause in the rate of increase of this particular set of prices in our economy. I find it extremely worrying that at a time when output is falling precipitately, and when redundancies and unemployment are soaring, as we are tragically seeing again today, with about a quarter of a million extra unemployed so far this year—an alarming development—we still have price inflation, on the Government's preferred measure, of about 3 per cent. Although there is clearly a lot of deflation in the system, there is still quite a lot of inflation as well, part of which is on imports. That is certainly true in the drinks industry, because wines and so forth are imported from much stronger currency areas and the devaluation, along with the increased duty, is increasing price tensions. However, the price tension is not due to that alone; it is also due to the impact of Government action. The Government have to be very careful about the impact on price inflation of duty hikes and other tax rises, at a time when incomes are not going up at all in many cases, and when some people's incomes are falling because bonus payments have been removed, or because people are doing only three or four days' work a week, or missing one week in four or whatever.