Finance (No. 4) Bill

Debate between Chris Bryant and Elizabeth Truss

Wednesday 18th April 2012 Commons Chamber

[Elizabeth Truss]

Yes, and perhaps some Opposition Front-Bench Members should move to France, where they might find that such policies are more conducive to their way of thinking.

At this time of increased international competition and great movements of people and capital around the world, and with new economies rising such as in India and China, according to the World Economic Forum Britain is 94th in the world in respect of the effect and extent of our taxation. One factor in that is the top rate of tax under the previous Government, and another is the extremely long tax code, which is a result of their meddling with our tax system over many years.

The UK is 11% less productive than the G7 average, and our skills base is lower than that of the US, France and Germany. If we are to become competitive again and improve our productivity and skills, we need incentives for people in this country to work and to invest in their skills, and we need to rebalance the tax system away from income tax and taxes on work such as national insurance, which the previous Government increased. We also need to reform our education and welfare systems and take the 2 million lowest earners out of tax, in order to give everybody more incentive to work. We must also merge our income tax and national insurance system to make things simpler for employers. We need to get rid of the previous Government’s flagship 50p tax rate as well, as it has done so much damage to people in this country who are seeking to work, to invest and to be part of building our future economy.

The Government have made it clear that we want shareholders to have proper control over executive pay in their companies, and that must happen. People must be rewarded in line with the skills they use, the risks they take and the income they generate. We need incentives for people to set up businesses, and to create and produce more. We also need to look outside Britain and see what the rest of the world is doing. We need to move away from the myopic approach that it does not matter what is going on elsewhere. If our country takes that approach, we will not succeed.

[Chris Bryant]

I had not intended to speak in this debate, but the previous—[Interruption.] I am grateful for all the waves from Government Members. The contribution of the hon. Member for South West Norfolk (Elizabeth Truss) has prompted me to speak, however.

First, I want to talk about what my hon. Friend the Member for Pontypridd (Owen Smith) referred to as the constitutional shenanigans. For many centuries, it has been a convention in this House that only a Minister of the Crown can lay a charge or an amendment to a Finance Bill that increases or changes a charge and thereby adds a duty to the people of this country, but that is a mistake. The myth that we have a Budget needs to be exploded, too. We do not have a Budget. What we have is a speech by the Chancellor of the Exchequer, followed by a Finance Bill and some Ways and Means resolutions. In addition, we have a separate process whereby Supply is granted. That system does not result in our properly evaluating whether we are raising money properly and fairly and whether we are spending it properly. I know many of these processes have existed for a very long time, but they lead to profound confusion in most ordinary voters’ minds about how we in this House conduct our business.

--- Later in debate ---

[Chris Bryant]

I will give way to the hon. Member for South West Norfolk, because I referred to her directly.

[Elizabeth Truss]

The point that the hon. Gentleman makes is a political one. Is not the crucial issue here the economics and what will actually benefit his constituents? Should he not be considering the issues of whether they will have jobs, whether new businesses will flourish and whether people will aspire to work harder? Rather than the political presentation, should he not be considering the economic case?

[Chris Bryant]

I will deal with the economic case, but this is where I fundamentally disagree with the hon. Lady ideologically. I do not think we can put economics and politics into separate boxes; the one drives the other. If we want a happier country, where people prosper because they feel that the whole of society is engaged in the same endeavour, we have to make sure that it feels as if everyone has equally got their—I am going to get my metaphors all mixed up—shoulder to the grindstone. I say to Government Members that in my constituency it does not feel that that is the case at the moment. It feels as if the poor are having a very rough time, and there is very little prospect of changing that. I believe that my hon. Friend the Member for Pontypridd said that 2,700 unemployed people in his constituency were going for 200 jobs. The statistics are even worse just up the road in my constituency. It is not a question of someone getting on their bike and going somewhere else to find a job, which is why the politics matter. I am talking not about party politics, but about the sense of whether we are genuinely all in this together.