Budget Resolutions and Economic Situation

Part of the debate – in the House of Commons at 12:00 am on 20th April 1970.

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Photo of Mr Douglas Houghton Mr Douglas Houghton , Sowerby 12:00 am, 20th April 1970

This is the difficulty. How far is one going to discriminate, how far is it possible to discriminate, in a system of taxation, if to remove one grievance probably creates some sense of unfairness in other directions? The Chancellor can only use his overall judgment of the situation. I am sure, however, that there are far more people at work being caught by the system I have described than are people who are living on investment income. I have never had any ideological difficulty in relieving some of the middle range of taxation and, indeed, this is being done under my right hon. Friend's proposals.

I have put two matters in particular to the House. First, I want to disabuse the mind of anyone who seems to think that the Chancellor would have adjusted his tax concessions to suit the Inland Revenue. The Inland Revenue itself never thinks that any Chancellor would adjust his fiscal policy to the state of work in the Department. It is untrue that anything like that has happened this time. Secondly, on child poverty, there is something here a little disturbing because the Chancellor who enthusiastically introduced the claw-back scheme in 1968 now seems to have lost affection for it, whereas the right hon. Member for Enfield, West seems to have acquired an affection for it. It seems to me that there may be a basis on which both sides of the House could regard this as a suitable way of giving the maximum additional benefit from family allowances without the waste of resources by paying out further subsidies to the much better off families.