Amendment of the Law

Frank Dobson Excerpts

Monday 23rd March 2015 Commons Chamber

[Frank Dobson (Holborn and St Pancras) (Lab)]

Having been a Member of this House for 36 years, I suspect that I have listened to about 45 Budget statements, but I must say that I cannot remember one that was so self-congratulatory—the Chancellor of the Exchequer delivered it almost like a lap of honour. I must concede that he can claim one great success: he has been very effective in getting across the idea that the worldwide recession was created by the Labour party, not by the stupidities of the banking system worldwide, and that the British economy was in decline when this Government took over. The fact is that the economy was actually growing when they took over. It then went into decline and is only now creeping out. If we are now seeing a bigger than usual increase in output and growth, that is because we had fallen so low and are growing our way out of a very deep pit.

One of the things that the Tories promised before the previous general election was that there would be no rise in VAT, but their first Budget did just that.

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

Will the right hon. Gentleman give way?

[Frank Dobson]

No, because that would take up other Members’ time.

The Tories also promised to clear the deficit. The right hon. and learned Member for Rushcliffe (Mr Clarke) said that nobody can forecast that. Well, perhaps they cannot forecast it, but they did make that promise and they have not kept it; they have reduced the deficit by a third. They promised to reduce the national debt but, as my right hon. Friend the Member for Edinburgh South West (Mr Darling) pointed out, they have managed to reduce it by a fraction only by fiddling the books—that is as good a way of describing it as any. They said that they would rebalance the economy, but they have no more done that than the Liverpool captain rebalanced the membership of his team the other night. Then there is the claim that we are all in it together. Well, a lot of people have been dropped in it together, and they are not the rich people.

I would like to deal with something that, in a sense, has nothing directly to do with the Budget: taxation. The fact of the matter is that the House of Commons has had a pathetic record over the past 50 or 60 years when it comes to determining what the levels of taxation should be and how they should be applied. Time and again we have come up with a system that helps tax evasion and avoidance and lets people get away with late payment. It is no good simply blaming the civil service, because there has been a failure to deliver what every Government have said about people avoiding tax.

The problem is that the details of all taxation are formulated in secret with Treasury officials plus some experts, many of whom return to their day jobs in the private sector afterwards to pursue what they call “tax efficiency”. In other words, they exploit the loopholes in the taxation system that they helped formulate a year or two before. Years ago our predecessors decided to do away with secret treaties. I think that we now need to do away with secretly formulated taxation. I believe that in future the House of Commons should decide on the principle of a particular tax and then a Committee of the House should summon all the experts before it and decide on the detailed implementation so that we do not have the hole-and-corner fiddling and special pleading that has left us open to so much tax evasion and avoidance and late payment that people have been allowed to get away with.

If the House of Commons is to restore its reputation, we need to take our duty to check on the raising of taxation much more seriously than we have done. If we fail to do that, our reputation will continue to be low, because people expect that when Parliament passes a law, that law will work and it will do what Ministers said it would do. When we pass laws that do not do what Ministers said they would do, that undermines all of us, not just those Ministers. I think that the House of Commons has to take its duties in relation to taxation far more seriously in future, and I hope that it will.