Proposed Public Expenditure Cuts

Charlie Elphicke Excerpts

Monday 13th September 2010 Commons Chamber

[Mr Osborne]

I respect the fact that the hon. Lady is the Chair of the Select Committee on Work and Pensions, but I must tell her that the number of working-age people who claim disability living allowance has risen by more than 40% in the last decade, which is a substantial increase. When I considered reforms to the allowance, I saw that it would be possible to introduce such reforms as means-testing, but I rejected those. I said that it would be fairer to introduce an up-to-date assessment to help people to receive the benefit and ensure that they were eligible for it in future. I think that that is the fair way in which to proceed with this particular benefit, because I well understand that those who receive it are some of the most vulnerable members of our society.

[Charlie Elphicke (Dover) (Con)]

Can the Chancellor tell us whether, having bankrupted the country, the last Government left any detailed financial restraint, according to Treasury officials? This reminds me of the kids—the yobs—who smash the bus shelter and then throw stones at the people who are trying to clean up the mess. It is a disgrace.

[Mr Osborne]

The last Government left nothing except a letter from their Chief Secretary saying “I am sorry, but there is no money left”.

PAYE Contributions

Charlie Elphicke Excerpts

Wednesday 8th September 2010 Commons Chamber

[Mr Gauke]

That is an operational matter that HMRC will need to consider, but I will discuss it with senior management. As far as staffing is concerned, there will be a spending review announcement on 20 October, and any announcements on HMRC’s budgets will be made at that time.

[Charlie Elphicke (Dover) (Con)]

The size of the problem, the number of people affected and the amount of money involved make it a real tragedy for this country. Some 2,000 of my constituents, and the constituents of each and every one of us, will have to stump up more money that is not planned for at a time when money is tight for everyone. May I urge Ministers to have compassion for those who find themselves in a difficult spot, and a review of HMRC, particularly its difficulties in operating computers?

[Mr Gauke]

Again, I confirm that HMRC will consider the matter sympathetically and will have flexibility to spread payments over up to three years.

Office of Tax Simplification

Charlie Elphicke Excerpts

Tuesday 20th July 2010 Commons Chamber

[Mr Gauke]

All policy decisions will be for the House and Ministers. The hon. Lady makes the fair point that one cannot take politics entirely out of the tax system, but there are times when it is simply a question of complexity versus simplicity. There is scope for improvement, which is what I hope the OTS will be able to deliver.

[Charlie Elphicke (Dover) (Con)]

Will the Minister make a special effort to simplify tax legislation so that it is understandable for ordinary people? As a former tax lawyer—a poacher turned gamekeeper—I know that too often, the best advice is the preserve of the richest. That is not fair.

[Mr Gauke]

My hon. Friend, too, makes a good point. On the day of the Budget we published our document “Tax policy making: a new approach”, which set out a more consultative and deliberative approach to tax law, ensuring that draft legislation is properly examined. We think that that is to the advantage of all people; greater clarity in tax law is clearly helpful.

Finance Bill

Charlie Elphicke Excerpts

Tuesday 20th July 2010 Commons Chamber

[Mary Creagh]

I will not, because we have only one hour left, and eight Members wish to speak. The Front-Bench spokesmen took their time, and I intend to take my time.

The labour economist David Blanchflower, a former member of the Monetary Policy Committee, has said that the Government’s prediction on jobs is wildly over-optimistic, given that the Labour Government created only 1.6 million jobs between 2000 and 2008, when the economy was, by consensus, booming.

The VAT increase for which the House voted will raise £12.1 billion in 2011-12, but will reduce the amount of goods and services that people can buy. It will depress demand and delay the recovery. It will increase prices permanently by 1%, thereby permanently reducing the value of future earnings and—one of the hot topics in the Bill—future pensions. It will also disadvantage the poorest, who spend the biggest proportion of their income.

Let me say something about the social impact of the Bill. It was difficult to hear the details of that as the Minister raced through his speech. We have heard from the Prime Minister that children need warmth, not wealth, and they will certainly miss out on the wealth part as a result of this Bill. Poor families in Wakefield will lose up to £1,200 as a result of changes in working families tax credit. From April 2011 the Sure Start maternity grant will be available only for the first child in a family. That means a £500 cut for low-income pregnant mothers who already have a child.

[Charlie Elphicke (Dover) (Con)]

Will the hon. Lady give way?

[Mary Creagh]

No. I am going to take my time. As I have said, I am not going to take interventions.

Nappies, prams, babygros, bottles, dummies and high chairs will all be more expensive for families in our constituencies as a result of the VAT increase, but the grants to help the poorest women in our society to afford them will be cut. When I asked the Secretary of State for Work and Pensions how he expected families to cope, he said that he wanted them to recycle prams, but if someone has a child one year younger than another child, where is the second baby supposed to sleep? In the same cot? The parent of a second child will still need to buy a new car seat and a double buggy. It will be more difficult for low-income families to buy all those items. We are losing the baby element of child tax credit, and we are losing Labour’s proposed toddler tax credit, which would have meant another £208—

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[Charlie Elphicke]

I just point out to the hon. Lady that child poverty has risen by 300,000 since 2004, whereas under this Budget it will be frozen for two years. Does she not welcome that very positive fact?

[Mary Creagh]

Interestingly, when the Red Book refers to the effects on child poverty it talks about the next couple of years but does not mention 2013 and 2014. Thanks to the work being done by my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper), the shadow Secretary of State for Work and Pensions, we are finding that this Budget’s impact on women—in particular on poor women, low-paid women and public sector worker women, and therefore on their children—is likely to hit disproportionately hard. I leave the hon. Gentleman with that thought.

What is absent from the Budget and the Finance Bill is any mention of the poor. The changes to the disability living allowance gateway are to save £1 billion by 2014, but we need clarity about which groups of disabled people are going to be affected. The housing benefit move to the 30th percentile of average housing will have an impact on families across the country. Stringent changes are being made to the housing benefit rules to say that anyone who has been on jobseeker’s allowance for more than a year will automatically lose 10% of their housing benefit.

If that is done to people, there are three possible outcomes. The first is that the people involved find jobs—and good luck to them. I am sure that that is the stated aim of the Government’s policy. The second possible outcome is that those people cannot find jobs because a further 1.3 million people are on the dole as the public sector and private sector job losses kick in, so they are forced to borrow the money. However, we are talking about people with a low income or no income, so they will, in effect, be forced into the arms of loan sharks and will fall into debt. The third possible outcome is that these people will spend £10 a week less feeding their children, so their children will be pushed back into poverty. The arguments being made about child poverty will not wash with Labour Members, because both the second and the third possible outcomes will tip those families back into poverty.

[Mary Creagh]

The beauty of the child trust fund is that both those things happened; this involved people who would never have thought of opening a trust fund. I count myself among them, because I had no idea what a trust fund was until I was “given it by the Government” when my son was born, but now that I understand what it is and I understand the secrets of how people save for their children in a tax-efficient way, it has enabled me to think carefully about how I plan for my children’s future. It enables families to do both those things.

Most families are using the child trust funds to put a little bit extra by. The parents who scrimp and save to put into the child trust fund will not let their children waste the money. The straw man that has been held up is that they will blow it all on their 18th birthday party, on buying fast cars and all the other things that 18-year-olds do—[Interruption.] That is certainly what has been stated by some Government Members as a reason for cutting the child trust fund; they have said, “You can’t give it to 18-year-olds because they won’t know what to do with it.” When their parents have paid into the fund they will make absolutely sure that that money, which for them is a life-changing sum, will be used wisely by their children.

[Charlie Elphicke]

rose—

[Mary Creagh]

I have taken one intervention from the hon. Gentleman, and I am aware that other hon. Members wish to speak.

The VAT rise in the Finance Bill will cost the NHS an extra £250 million each year, and it will be very bad for public health, too. Recent research by David Stuckler and his colleagues published in the British Medical Journal shows that social spending—housing benefit, disability living allowance and other such benefits—has more impact on tackling health inequalities than spending on the NHS. They studied 20 European countries over two decades, finding that mortality rates increased when social spending was cut. So the public health impact of cutting the housing, disability and incapacity benefit budgets will be felt by the poorest in our society in the reduction in their life expectancy.

In concluding, I wish to discuss what has happened in the past 10 weeks and the political impact that voting for this Budget will have on the Liberal Democrats. The past 10 weeks have been like a very dark episode of Doctor Who, with the Conservatives as the evil Cybermen. The Cybermen were originally a wholly organic species of humanoids that implanted more and more artificial parts into their bodies as a means of self-preservation. This led to the race becoming coldly logical and calculating, with every emotion all but deleted from their minds. They use human pawns and seek to further their number by conversion. The Liberal Democrats are the Conservatives’ hapless victims. The Cybermen have to assimilate their victims in order to drain their energy and live, but we all know that when the Cybermen have assimilated, they have only one further aim: they say to their victims, “You will be deleted.”

These are not progressive cuts. There is nothing progressive about slashing the extension of free school meals to the children of the working poor and thrusting 50,000 children back into poverty. There is nothing progressive about freezing the pay of dinner ladies, hospital cleaners and nursery workers. Why should low-paid women pay for the fiscal hysteria of markets and central banks, which presided over such colossal market failure? Why is corporation tax being cut by 1% a year for the banks when everyone in Wakefield is seeing their VAT increasing by 2.5%? Why is the annual exempt amount for capital gains tax rising each year with the retail prices index when housing benefit and occupational pensions in Wakefield will increase only by the consumer prices index?

Those are political choices. They are the wrong choices for my constituents and for those of other hon. Members. Economically, this is a deflationary Budget. It is wrong for Britain, wrong for families, wrong for pensioners and wrong for the poor. Politically, supporting this Budget will be the wrong thing for the Liberal Democrats. I urge all Liberal Democrat Members to think before they vote tonight, and before they throw away 120 years of Liberal tradition as the Tories’ new poodles. You are being assimilated. You will be deleted.

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[Charlie Elphicke (Dover) (Con)]

I shall keep my remarks brief and discuss clause 1 in relation to corporation tax.

There are many pockets of deprivation in Dover and Deal, and the rise in child poverty during the previous Parliament was a serious concern, as was the widening of the gap between the richest and the least well-off. The abolition of the 10p rate hurt and upset many of my constituents, so the rise in income tax personal allowance is extremely welcome, but what we need to do, as has been much discussed today, is to increase the nation’s trend growth rate.

On that point, I particularly welcome the reduction in corporation tax to what will be 24p by the end of this Parliament. That is incredibly important, because business, particularly international business, is very mobile and can set up anywhere. WPP, for example, has gone off to Dublin, and that should concern every Member, because the Exchequer is going to lose about £240 million in corporation tax receipts every year.

If we are to compete with centres in the European time zone, it is important also that we consider how to build in a participation exemption, as the Netherlands and Luxembourg have, and as Ireland and Switzerland have in effective forms. We need to draw international business into the UK, because that is a critical path towards expanding the amount of jobs and money that we have.

I make one brief plea. Reducing the corporation tax rate to 24p by the end of the Parliament is welcome, but, if we are to make a step change, reducing it to 19p would, in my respectful submission, be transformational. It would draw in international business and, ironically, raise corporation tax revenues. That is the international evidence, and that is the short and simple case that I put to the Treasury team—to consider going further, harder and deeper in future.

Equitable Life

Charlie Elphicke Excerpts

Tuesday 20th July 2010 Westminster Hall

[Nicola Blackwood]

I believe that those issues were raised on 17 March and that there might have been a subsequent commitment. However, hearing the Minister’s confirmation would be helpful.

Two issues are at stake in the process. The first is purely financial.

[Charlie Elphicke (Dover) (Con)]

With respect, I add that Equitable Life victims in Dover are deeply concerned. I congratulate my hon. Friend on securing the debate and on her excellent argument.

[Nicola Blackwood]

The first of the two issues at stake is purely financial—the technical problems of designing a scheme that is fair, transparent, swift and simple. The second issue, which is almost more challenging, is ethical—the admission of responsibility by the Government for regulatory failures and the acknowledgement of what that failure has meant to Equitable Life members.

By failing to admit the full extent of the losses, we will fail on the latter issue, ethically, even if we succeed on the former, financially. I do not see any reason why we need to go down that route. All parties have consistently stated that final payments will have to be balanced against other calls on the public purse. The High Court stated that, as the Government were not required to create a compensation scheme, any legal objections to the nature of such a scheme were bound to fail, so there seems to be no legal barrier.

In my dealings with EMAG, representatives have clearly stated that they understand that full payment may well not be possible, but they want an acknowledgement, at least, from the Government of the full cost that they have shouldered.

Oral Answers to Questions

Charlie Elphicke Excerpts

Tuesday 13th July 2010 Commons Chamber

[Justine Greening]

Many people would consider that a bit rich coming from a member of the last Government, given that manufacturing declined at a steeper rate under them than under the previous Conservative Government. We aim to support manufacturing and, indeed, companies throughout our country through a robust and ambitious corporation tax package, through progress on national insurance, and through largely getting rid of the jobs tax that the last Government would have introduced. What we would like to hear from the Opposition is more constructive discussion about how to improve our exports.

[Charlie Elphicke (Dover) (Con)]

In relation to export growth and other forecasting, will Ministers consider establishing a dynamic tax unit in the Treasury?

[Justine Greening]

One of the reasons why we set up the Office for Budget Responsibility was to ensure far more independent and transparent forecasting in relation to not just exports but all economic indicators. I am sure that over time the OBR will continue to develop that forecasting to make it even more effective. Let us make no mistake: setting up the OBR was a huge step forward in terms not just of transparency, but of robust data on which the public can really rely.

Finance Bill

Charlie Elphicke Excerpts

Tuesday 6th July 2010 Commons Chamber

[Ian Lucas (Wrexham) (Lab)]

rose—

[Charlie Elphicke (Dover) (Con)]

Will the Chief Secretary give way?

[Danny Alexander]

I am going to make progress for a few moments, or the former Chief Secretary will never get a chance to have his say.

Clause 4 takes further action to tackle the deficit by increasing the standard rate of insurance premium tax from 5% to 6%. The higher rate of insurance premium tax will increase from 17.5% to 20% from 4 January 2011, to bring it into line with the new VAT rate. The increases are both fair and sustainable.

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[Mr Byrne]

My hon. Friend is right. One reason the British supply chain is now so worried about the Government’s intentions is that it has seen these knee-jerk reactions, such as yesterday’s decision, of which the Chief Secretary was so proud he did not dare come to the House to say a word about it.

I want to make a point that follows on from what my hon. Friends have said. Rather than balancing spending over the economic cycle, we now have, in the Budget, a plan to eliminate in just five years the structural deficit. However, the Finance Bill ignores the question of what happens if growth is weaker than expected. It is worth for a moment the House exploring the economic consequences of this Chancellor’s proposals. If growth fails, the structural deficit as a percentage of our economy goes up, yet the timetable for its elimination remains unchanged, so the Chancellor’s only course of action is to cut deeper and deeper. If growth falters or the economy shrinks, the Chancellor cannot stimulate the economy, but can only respond with cuts. It is not a plan to manage the economic cycle; it is a plan for an economic death spiral. Like some kind of self-flagellating penitent who believes borrowing is so morally wrong, he responds to any new urges with another bout of whipping. He might feel it gets him to heaven a little faster, but I am afraid it is no way to run an economy.

[Charlie Elphicke]

I enjoy the right hon. Gentleman’s thirst for talking down the economy, but how many independent economic forecasters are predicting the double-dip recession that the Labour party seems to constantly hope and pray for?

[Mr Byrne]

I note that the hon. Gentleman was so eager to participate in this debate that he missed the beginning of it. The words I used were not my words, but the words from a wide section of the British business community. [Hon. Members: “Who?”] Well, Goldman Sachs, the Chartered Institute of Purchasing and Supply, and the judgment of the stock market. This is not a perspective held by a narrow corner of the business community. The judgment on this Budget is widely shared across this country.

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[Mr Byrne]

Quite right. Sir John Major told us:

“If it isn’t hurting, it isn’t working”.

This Bill, and this Budget, will hurt all right—hurt the recovery; hurt families; hurt pensioners; and it will not work, as it will put people out of work.

[Charlie Elphicke]

Perhaps I am just confused, but I am looking at the OBR table C.2 and it seems that ILO unemployment and the claimant count will be falling over the course of this Parliament. Will the right hon. Gentleman confirm if I have misread the table?

[Mr Byrne]

In preparation for this debate, the hon. Gentleman will have compared those employment forecasts with those in the March Budget and will have noticed, like the rest of the world, that they are now 100,000 lower.

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[Mr Meacher]

I regret that the Labour Government did not succeed in narrowing the gap between rich and poor. However, they did something quite remarkable in reducing the number of children in poverty by 600,000. No, it was not enough, and we fell below our target. I can tell the hon. Lady why the gap widened, however. To cite a phrase that was used early on in the Labour Government, new Labour took the attitude that it was fairly unconcerned about people becoming filthy rich. That was a serious mistake, and the increase in the wealth of the tiny top segment of the population has been enormous. That is the reason that the gap increased.

[Charlie Elphicke]

I am interested to hear the right hon. Gentleman raise the issue of child poverty. Can he explain why in the last Parliament it went up by 300,000 on every single measure?

[Mr Meacher]

Indeed. The hon. Gentleman is wrong on the figure; the last figure available for when Labour were still in government suggested an increase of about 100,000. That, of course, was the result of a recession caused by the bankers. The Labour party protected the poor and the unemployed to a significant degree, as those groups are about to find out from the very different treatment meted out to them by this Government.

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[Mr Lammy]

My hon. Friend is absolutely right. In the midst of a growth in unemployment, which has been predicted by the OBR, there is a VAT rise that will affect the poorest families.

In debating the Budget, we have to defend the hope and prospect that there is a different economic way. That is articulated not just by the usual suspects—economists such as David Blanchflower have been mentioned in the debate—but Martin Wolf in the Financial Times, Samuel Brittan and George Joseph Stigler. A number of economists are saying that this is the time for fiscal stimulus, for an FDR-type new deal, for an LBJ-type offer. This is the time for that big society that they dreamed about.

When this country lay in rubble after the second world war, we did not shrink back. The Attlee Government invested. We built the NHS, we built housing, we built schools. That is the example that we should be following. Instead we get this false smoke-and-mirrors game.

[Charlie Elphicke]

rose—

[Mr Lammy]

I will not give way at this moment.

Politically one has to applaud, in some senses, the Government for the way in which they have changed the debate that was about fiscal stimulus, support, opportunity and hope, despite these difficult times. The country had a focus on the banking sector in this country, in particular, but that has been turned into solely a debate about deficits; that is the only discussion taking place. I say, as a Labour Member who is proud of my party’s tradition, that the discussion had not solely been about the recovery; it had also been about what had led us to this position. That was a discussion about materialism, consumerism and excess, but all we hear now is this emphasis on cuts, cuts, cuts and deficits. The Government are wrong, as was made clear in the G20 meeting and the letter that President Obama wrote shortly before it. They have taken the wrong position for ideological reasons, which will have grave social consequences.

The Government have said that this Budget is unavoidable, but of course it is not, for the reasons that I have set out. It is not unavoidable, because the previous Budget, in March, made it clear that we intended to cut the deficit over the next Parliament in a measured way. This Budget is not progressive. How can one describe a Budget that means that unemployment will rise and growth will shrink as “progressive”? This is a total twisting of the word “progressive”. We have a dictionary on the table in front of the Economic Secretary, so I invite her to pick it up and look at what “progressive” means. It certainly does not mean what is in this Budget. This Budget is not fair to many people beyond this place.

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[Charlie Elphicke (Dover) (Con)]

I, too, congratulate the hon. Member for Scunthorpe (Nic Dakin) and my hon. Friends the Members for North East Cambridgeshire (Stephen Barclay), for Ipswich (Ben Gummer), and for Weaver Vale (Graham Evans) on their excellent speeches. I also congratulate the hon. Member for North Durham (Mr Jones), who has just departed, who spoke with such eloquence about the need for parliamentary reform. His passion brings a tear to the eye of the Leader of the House; of that I have no doubt whatever.

I am saddened by the need for clause 3, on VAT, to be included in the Bill. It is a great shame that it is necessary to take difficult action in relation to taxes because of the extreme black hole left in the public finances. We now find ourselves in a position where debt is 62% of GDP this year—higher than the 54% in 1976, when the International Monetary Fund was last called in. That is the level of seriousness of the debt that we have. The ratio of debt to GDP is predicted to go to 70% in the next three years, even with the tough action taken by the Government.

I for one am relieved, however, particularly because taxes could have been a lot higher. The black hole could have been filled in other ways. We have taken the difficult decisions on public spending, but we on the Government Benches know that if there had not been a change in government, we would have seen not only a rise in VAT but a possible £20 billion tax increase, with income tax perhaps going to 25p in the pound. That is the size of the black hole that we have been looking at.

I congratulate my right hon. and hon. Friends on the Treasury Bench on taking the firm action required, because I worry about the least well-off. I worry that the rich-poor divide has widened since 1996-97. I worry that since 2004-05 households in child poverty has risen by 300,000. I welcome the fact that it will be frozen for the next two years. I am concerned that the number of children in overcrowded homes has risen from 980,000 in 2006 to 1,080,000 in 2008, according to Communities and Local Government figures. I am concerned that the housing waiting list has risen from 1 million in 2001 to 1.8 million in 2009, according to CLG figures. I am also concerned that disposable income rose by only 1% a year between 2004-05 and 2008—and that was before the current difficulties hit home.

I, for one, welcome the difficult decisions taken on capital gains tax in clause 2. Personally, I think that that is the right thing to do. I have always taken a more Lawsonian approach. A difficult decision has been made, but it is essential that everyone pays their fair share of tax. I regret that we are not keeping a more ameliorated position for those who own business assets, but I think that those who own country estates, oil paintings or buy-to-let empires should pay a fair share of tax.

We know that that is the right approach to take, because the figures from the past few years show that the level of private rented sector property rose from 10% of housing stock in 2000 to 14% in 2008. Meanwhile, the total social housing stock fell from 4.25 million properties to just 4 million in 2009, according to CLG figures. The level of owner occupation fell from 71% in 2003 to 68% in 2008, according to CLG figures. I regard that with concern, because where people need assistance we should have affordable housing there for them. The number of new affordable houses built also fell under the previous Government. Where people have the requisite funds to buy their own home they should be encouraged and helped to do so. So I commend this Budget to the House.

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

If the hon. Gentleman is so concerned about housing, how does he feel about his Government’s decision to cut the Homes and Communities Agency by £60 million? Some £4.5 million of that cut will have an impact on new homes that were supposed to be built in my constituency. How does he feel about the most recent announcements on housing allowance, which mean that people in my constituency are having to make up a shortfall of £50 a month?

[Charlie Elphicke]

I point out to the hon. Lady that the number of affordable houses built in 1995-96 was 74,530, whereas the average for the previous Government’s entire tenure was just 40,000 affordable homes built each year. Why was that? Last year’s figure was 20,000 below what was achieved under the outgoing Conservative Government. As I said, we built 74,000-odd a year, whereas last year the previous Government built 55,000, so I do not think that they have any record to stand on when it comes to affordable housing, except that of a roll of shame. Their record is an absolute disgrace.

What we need is for the UK to grow faster, because the best cure for deprivation is a job. Too many jobs were taken away by the previous Government’s galactic economic incompetence, and we need to have change, so I want to make the case for that. Will the UK grow faster with a larger public sector? Will the UK grow faster with even higher taxes, as were planned by the previous Government? Will the UK grow faster with ever more debt, or would that result only in ever-higher interest rates, a weaker currency, an increased country risk and our country’s credit rating at risk? I think that the right decisions have been taken, because the UK will grow faster with a lower jobs tax.

[Chris Leslie]

I wonder whether the hon. Gentleman recalls what the so-called “independent” Office for Budget Responsibility said about the downgrading of growth forecasts as a direct result of these Budget measures. What was the OBR’s finding? Did it say that growth would increase or decrease as a result of the measures in the Budget?

[Charlie Elphicke]

The hon. Gentleman will know that the OBR itself said that that was misleading. He will also know that the OBR ruled that the figures set out in the March Budget were a total work of fiction and a disgrace, and it downgraded them. The true downgrade was that of GDP growth by 0.5% to 1% by the OBR when it put right the fiction that had been produced previously, and the misleading about the economics of our nation. The hon. Gentleman does not have a leg to stand on.

This country will grow faster with a lower jobs tax, with lower borrowing and with a low rate of corporation tax, as set out in clause 1. The key point that I want to make is that the fall should be faster, because I want to see a corporation tax rate of just 19% in this nation by the end of this Parliament; that would give us a real revolution. I would like us to have a participation exemption, as exists in the Netherlands, Ireland and other places, to make our nation a European headquarters company of the European time zone. I think that capital gains tax is necessary, but business assets should be taxed lower. That was one of the few things that the former Prime Minister got absolutely right, and it is a great shame that we do not have a differential level, or a higher entrepreneur’s relief. Ideally, that would be extended, because we need to encourage more jobs and growth, and an expansion of the private sector.

I particularly welcome the new business national insurance relief, which is extraordinarily important. Obviously, as a representative of Dover, I would say that ideally it should be extended across the nation, especially in deprived areas of the south-east that have benefited from social structural European funds—not just Dover but other parts of east Kent and the south-east. We need to clear away the deprivation and the benefits culture that has grown up in recent years so that we can unlock the potential, the hope and the chances in each and every citizen of our nation. If we get them off benefits and back into work and break the cycle of poverty, we bring hope and unlock that potential. That to me is the most important thing—to give everyone in this country a real crack at opportunity in life. In this Budget and this Finance Bill, difficult and bold decisions have been taken, but they are the right decisions, and I support the Bill.

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[Charlie Elphicke]

May I ask the hon. Lady to which clause in the Bill she is referring?

[Ms Eagle]

Mr Deputy Speaker, it looks like someone is applying for your job. Every clause in the Bill hinges on the forecasts made by the Office for Budget Responsibility that appear in the Red Book. In fact, those forecasts run through every part of this Budget debate like the words in a stick of Blackpool rock. So the hon. Gentleman cannot, in all honesty, however late the hour, try to claim that the points I am making have nothing to do with the Bill before us.

Could it be that Sir Alan has decided to sling his hook because he was forced to become a kind of extension of the Conservative party spin machine last week, when he brought forward that highly contentious explanation—coincidentally just an hour ahead of Prime Minister’s Question Time—of the likely effects of the Budget on jobs? We can only speculate about whether that was the case, but I would be interested to hear whether the Exchequer Secretary is able to shed any light on this matter, in the interest of transparency, when he winds up the debate.

Office for Budget Responsibility

Charlie Elphicke Excerpts

Monday 14th June 2010 Commons Chamber

[Mr Osborne]

For the first time, the OBR has published five-year projections of unemployment and employment. The projection for the coming year, for example, is that employment will fall and unemployment will rise—based, of course, on the pre-Budget measures.

[Charlie Elphicke (Dover) (Con)]

In Dover and Deal, people tell me time and again that they want more jobs, more money and more economic growth, so it is a real shock to come to the House and see the table in today’s report showing that economic growth has been revised downwards, by between 0.5% and 1%. How can that have happened in the three short months since the Budget? Were the Budget numbers fiddled? What has been going on?

Oral Answers to Questions

Charlie Elphicke Excerpts

Tuesday 8th June 2010 Commons Chamber

[Justine Greening]

The previous Government managed to raise a number of children who were just below the poverty line just above it, without tackling the fundamental causes of why they were in that position in the first place. What is particularly depressing is that it is as if nothing has been learned from the experiment of the past 13 years. Clearly, we need to look more broadly, rather than just at giving households in poverty money. We need to help them to get back into work. It has to be wrong that in this country, the marginal tax rates for those in low-income families who are going back to work can be in the 90th percentile range. We would never dream of taxing people who are rich that much, but we tax people who are poor at those rates.

[Charlie Elphicke (Dover) (Con)]

10. What recent assessment he has made of the level of growth in the UK economy compared with those of other OECD countries.

[The Chief Secretary to the Treasury (Danny Alexander)]

The independent Office for Budget Responsibility will publish forecasts for growth in the UK ahead of the emergency Budget.

[Charlie Elphicke]

There is too much deprivation in Dover and Deal. We need more jobs and money locally. What action will the Government take to increase the trend growth rate of this nation, so that the people of Dover and Deal get more jobs and money, and Britain does better?

Economic Affairs and Work and Pensions

Charlie Elphicke Excerpts

Tuesday 8th June 2010 Commons Chamber

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

rose—

[Charlie Elphicke (Dover) (Con)]

rose—

[Richard Harrington (Watford) (Con)]

rose—

--- Later in debate ---

[Mr Darling]

I think it is necessary for anyone charged with responsibility for the British economy to take a measured approach. If things are difficult, they have a duty to speak out, even when that causes them some problems, as I found out myself a couple of years ago. I think it is better that we do that, than not. Equally, however, it does no good to go running around saying the situation is absolutely terrible and dire, because sooner or later we may find that the markets call our bluff; we may find that one day they say, “Whatever you do, it isn’t enough.” I believe that that approach is as irresponsible as saying nothing about a difficult situation.

We must discuss these matters in a reasoned and rational manner, because while it is important that we identify the things that need to be put right, equally we must not give an impression counter to the fact that, fundamentally we have an economy that is coming through this period, that we can get through it and ensure that we have growth, which is absolutely critical in the future. Running around scaremongering and raising all sorts of fears could have the perverse effects of turning market sentiment against us, which we do not need, and of dampening consumer and investor confidence, which is simply not necessary.

[Charlie Elphicke]

The shadow Chancellor says that Government Members are scaremongering by pointing out that the Budget deficit is 13%. We are not scaremongering; we are scared, as the position is extremely serious. The recession was so deep in the first place because the right hon. Gentleman’s colleague, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown)—who has not been seen of late—ran things so badly that the money ran out, which meant that we were more exposed before the recession. The shadow Chancellor should therefore be apologising to the House for the mess that his right hon. Friend and the previous Government have left behind.