Capital Transfer Tax

Part of Budget Resolutions and Economic Situation – in the House of Commons at 12:00 am on 12th November 1974.

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Photo of Mr Cyril Townsend Mr Cyril Townsend , Bexley Bexleyheath 12:00 am, 12th November 1974

Perhaps my main qualification for taking part in the Budget debate is that I am no economist. No one who heard the Chancellor of the Exchequer introduce his two previous Budgets can avoid being astonished at the turn round in his approach today; if the Chancellor is not a new man, he is certainly a wiser man who has learnt from some of his mistakes. Unfortunately, the country has had to learn from those mistakes day by day, and it has been painful for all concerned.

The Chancellor remains a puzzling man to me. From time to time he dons the mantle of the elder statesman, and from time to time he cannot resist making the most outrageous statements. I will mention just two. We remember the charge about conscription prior to the 1970 election. During the recent election we had the nonsense over the 8·4 per cent. It has not been sufficiently emphasised that when the Chancellor made that comment about inflation being at that level it was not after a last drink in a working men's club in the Midlands late at night, having been caught out by a zealous reporter. On the contrary, it was during a carefully stage-managed Press conference at the start of the campaign. I only hope that the Chancellor is tonight regretting that statement because it has undermined his whole position as Chancellor of the Exchequer at a time of national crisis.

For the first half-hour this afternoon many of us thought that we might have been listening to a Conservative Chancellor, until the right hon. Gentleman made a foolish attack on savings income. As Iain Macleod once said, such income has been earned and saved, and often it is the harvest of a good man's lifetime. I can only suspect that it was a sweetener for the Left which, on the whole, must have had a pretty sore afternoon. However, the proposal will be long held against the Chancellor in many small homes in my constituency, which is not a rich one.

One of our major problems this evening is that we are not au fait with the basic facts about the increased prices to be charged by the nationalised industries. It is hard to make rational intelligent comments on the Budget when those key ingredients are missing. I accept that prices charged by the nationalised industries must go up. I regret that the previous Conservative administration allowed the deficits to mount to an irresponsible level. In recent weeks British Rail reported a loss last year of £52 million. There has been a loss of £130 million for coal, £40 million for gas, £128 million for the Post Office and £176 million for electricity. That gives us some idea of the scale of the problem. The charges must not be put up too quickly—