Finance (No. 2) Bill

Part of the debate – in the House of Commons at 9:07 pm on 8 May 1980.

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We are constantly told by Ministers that the defeat of inflation is the Government's main priority. If that is so, the Government have failed lamentably over their first year in office, because in that year inflation has doubled. But the truth is that over their first year in office, whenever the need to keep down prices has come into conflict with the prejudices, the dogmas and the ill-thought-out theories of the Conservative Party, the need to keep down prices has had to take second place. The Government came into power with a naive belief that our economic problems could be solved somehow by cutting income tax, but when it was shown that that was very difficult to do without raising indirect taxes, they put up prices. The RPI was put up by 4 per cent. in order to cut income tax. Therefore, the need to keep down prices was made one of secondary importance to the Government's wrong belief that somehow cutting taxes for the rich would solve the problems of the British economy.