I agree, Mr. Deputy Speaker, and I regret that I did not recognise that the hon. Member for the Cities of London and Westminster (Mr. Tugendhat) was making a personal inquiry of Mr. Deputy Speaker rather than of me when he made his interjection.
The plain fact is that the whole of the Chancellor's tax policy belongs to what is now a bygone age in the history of the Conservative Government, the age of confrontation. The whole of the Chancellor's tax policy is pulling in the opposite direction from his new economic strategy. The imputation tax is intended to encourage the distribution of dividends while at the same time the counter-inflation policy is trying to discourage their distribution. VAT will increase the cost of living while the counter-inflation policy is trying to hold it down. The tax reliefs of the new unified system at current rates will create gross injustice at a time when the Chancellor must try to persuade people that his policy is fair.
I believe that the Government are right to abandon the market economy approach. I believe that they must protect the public and the State against the blind brutality of the so-called laws of supply and demand. But I warn the Government that if they decide to adopt Socialist methods for controlling the economy they will find that they cannot stop just where they would like to stop. A twentieth century economic machine cannot be run smoothly with Selsdon Man in the driving seat. That way lies not a Socialist society but the corporate state of Hitler and Mussolini.
If the Government want to get consent for their new policy, if they want to make their counter-inflation policy work without force, they must learn to understand the needs and aspirations of ordinary men and women, and this has been their great defect through all their tergiversations in the technical economic field. Consent will not be achieved by this or any other Government unless Socialist economic techniques are allied to Socialist moral values.
The Budget represents a reversal to the Neanderthal period in the history of the Government. The Chancellor is giving £300 million mainly to the rich, while the poor are being asked to pay £500 million to £600 million in tax which they should not have to pay. Relief is given on lollipops and candy floss, but school milk is cut—[interruption.] Hon. Gentlemen on the Government side should try to understand how ordinary people feel about this issue. If they cannot understand it, they should go down to a picket line at a hospital and see ordinary men and women who have a great sense of public duty goaded beyond endurance by the Government's failure to understand their problems.
While the Government are wrecking their economic strategy by sticking to a social attitude long outdated, the fundamental problems of the economy are being left over until they can make up their minds and pluck up the courage to do what is necessary. The last two days have made fairly obvious the Prime Minister's "game plan". He is treating this as a mini-Budget and plans to have the real Budget in the summer or in the autumn after a Cabinet reshuffle so that Ministers do not have to eat their own words.
By throwing away any chance of making his counter-inflation policy work—and that is what he has done—the Chancellor faces the risk of having to introduce a tough Budget perhaps in the middle of the new balance-of-payments crisis predicted by outside observers, and certainly at a moment when all his prices and incomes controls are breaking down and he is compelled, whether he likes it or not, to introduce a much looser phase 3 policy than the tough policy for phase 2.
The way that the Chancellor has handled his responsibilities in this Budget is more than a crime. It is a blunder of the first magnitude, and there will be very few in our land who will not have to pay the price for it.