Capital Gains Tax (Rates)

Michael Connarty Excerpts

Monday 28th June 2010 Commons Chamber

[Danny Alexander]

I shall press on. I have already given way.

In response to the points raised by my hon. Friend the Member for St Ives (Andrew George), I can say that we have already demonstrated our commitment to transparency by publishing data on the distributional impact of the Budget measures, which has never been done before. We are committed to continuing with that level of transparency in future fiscal events, and we will continue to look at whether we can further improve the breadth of information provided. Parliament will, of course, as my hon. Friend requested, continue to have full scrutiny of the Government’s decisions, and I hope that the information that we have already provided, and will provide in future, will facilitate that debate.

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

Will the right hon. Gentleman give way?

[Danny Alexander]

No, I want to press on.

Thirdly, this is a Budget for fairness. Fairness underpins this Budget, and fairness runs throughout this Budget. This is the first Budget to include an analysis of the distributional impact of its measures. It shows that overall the richest will contribute most to deficit reduction, and it will have no measurable impact on child poverty by 2012-13. That is a good start, and of course we will take further action to underpin fairness on future occasions and in future Budgets. It is important to stress to the House the fact that the principles that have shaped the Budget will also shape the decisions that we make in the spending review, too.

As my right hon. Friend the Chancellor said, this is a progressive Budget. It is a Budget that takes almost 1 million of the lowest-earning income taxpayers out of income tax altogether—that is progressive. It is a Budget that locks in an annual increase in the state pension in line with earnings, prices or 2.5%, whichever is highest, to the benefit of 11 million pensioners. That is progressive, too. It is a Budget that increases capital gains tax rates by 10% for higher rate taxpayers, but keeps it the same for basic rate taxpayers. That is progressive. It includes a radical programme of welfare reform to focus support on those most in need. The welfare bill has ballooned from £132 billion 10 years ago to £192 billion today. If we ignore the economic and social pressures caused by this system, we will only put the whole country and the front-line services on which we rely under even greater financial pressure in future. The Government will tackle that situation head on, including through the reforms in the Budget to the disability living allowance, housing benefits, and the uprating of benefits. As my right hon. Friend the Secretary of State for Work and Pensions said, these reforms will ensure that help is targeted on those most in need.