---

Welsh Affairs

I am not going to look backwards at hypothetical questions, because I have had to listen to nearly an hour of hypothetical rubbish from the Secretary of State. Most of the rubbish that he was spouting about what may or may not happen, and what Tory policy is, was from "Fantasy Island". We have already outlined some of the steps we would take. We would freeze public sector pay for all but the lowest paid 1 million and cut the cost of Whitehall by a third. I see no volunteering for cutting at Whitehall from the Labour party. We would cap large public sector pensions. Yes, that would be tough, but Labour has made it tough, and someone has to take some tough decisions to regenerate our economy. We would concentrate benefits spending on the poorest and the most vulnerable, and we would tackle the jobs crisis with a comprehensive plan to help people into work. Hand in hand with this plan are our proposals to support businesses. We would reduce the small company corporation tax rate to 20 per cent. and reduce the headline rate of corporation tax to 25 per cent., reduce the bureaucracy needed to register new companies, remove restrictions on people in social housing from starting up a business, and abolish for a year the tax on the first 10 jobs created by new businesses in the first two years of a Conservative Government. However, if we are to build a strong and successful Welsh economy, we need not only to create an environment in which the private sector can flourish but to make improvements in the public sector.