Orders of the Day — Budget Proposals and Economic Survey

Part of the debate – in the House of Commons at 12:00 am on 7th April 1948.

Alert me about debates like this

Photo of Mr Philip Piratin Mr Philip Piratin , Stepney Mile End 12:00 am, 7th April 1948

Surely we have a way of breaking through those enclosures by legal means. There must be some method of doing these things. Surely, the Chancellor is not incapable of devising some method. He has shown himself so ingenious in so many other things.

With regard to the Purchase Tax proposals, many of those I will deal with in Committee when I hope to submit Amendments which, I hope, will receive the sup- port of other hon. Members. There are, however, one or two anomalies which strike the eye of everyone the moment they look at the items. The Chancellor proposes that children's non-utility clothing shall be subject to a Purchase Tax of 33⅓ per cent., whereas formerly it was exempted. He also proposes that silk garments, formerly at 50 per cent., shall be reduced to 33⅓ per cent. Therefore, children's non-utility clothing is now in the same category as silk garments. I think it is true to say that many parents who would like to buy utility clothing for their children cannot find it in the shops, and have to buy non-utility. I do not think that any hon. Member would say that silk is a necessity of life. I see no reason why the tax on it should not go up to 66 per cent. rather than down to 33. Those are some of the anomalies with which we can deal at a later stage.

The economic situation calls for a change in direction of our external economy. It calls for trade relations with the Socialist countries and the Commonwealth. I am sure that hon. Members on this side of the Committee will be pleased if I recall to their minds what the Leader of the Labour Party said in a book which he wrote in 1937. The Prime Minister then said: If the Labour Party were in power in this country, it could, with France and the U.S.S.R. and the smaller States which are largely governed under Socialist inspiration, pursue a policy of international economic operations based upon the utilisation of abundance instead of restriction. The Prime Minister wrote that in 1937 in his book, "The Labour Party in Perspective." I quote from page 225. It may be argued by some that conditions have changed, but principles should not have changed. What endeavour is being made to develop trade with those countries in line with the principles enunciated by the Prime Minister—or Mr. Attlee, as he then was?

What we want is a planned economy in this country. A Budget today should include no additional taxation on the working class, but rather increased taxes on profits. It should include an increased tax on income from investments, and a tax on the disposal of capital shares. There ought to be a reduced rate of interest, and not the higher rate which is now operating. Though this Budget may appear to give some relief in certain directions, the Chancellor himself says we have to see it from an overall point of view, and I would say that from an overall point of view it is disappointing—particularly for the Labour movement, which had been led to believe for the last two months that something was going to be done in the Budget to balance the sacrifices they had been called upon to make. This Budget does not fulfil the promise in Labour's programme.

I would remind the Committee of a further quotation from the Prime Minister's book. On page 130 he says: I have stated that Socialism cannot make capitalism work. The 1929 experiment demonstrated this. No really effective steps could be taken to deal with the economic crisis because any attempt to deal with fundamentals brought opposition from the Liberals. The Conservatives are completely out of the picture naturally. Labour men who saw clearly the need for dealing with causes had to try to deal with results. The amount that could be extracted for the workers from a capitalistic system was limited. When this limit had been reached, failure was bound to ensue I admit that the experiment was not made under fair conditions. The Party was handicapped by the conditions of the time, which demanded drastic measures, and by its leading personnel, who had surrendered their minds to capitalism long before they sold their bodies. I take it that the Committee are clear that I am quoting what the Prime Minister said in his book in 1937. The Prime Minister may not recognise in himself and the Chancellor the description I have just read out. That is how he described Ramsay MacDonald and others. However, the Prime Minister should recognise that he and others among his colleagues are now treading the same path. If he cannot recognise it, I would point out that the working class are beginning to recognise it and that their attitude to the Budget will be shown in no uncertain terms.