Orders of the Day — Finance Bill

Part of the debate – in the House of Commons at 6:32 pm on 6th July 1983.

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Photo of Mr Ian Wrigglesworth Mr Ian Wrigglesworth , Stockton South 6:32 pm, 6th July 1983

The point that the Minister makes does not bear upon the main burden of what I am saying, because the main burden of my argument, and that put forward by other Opposition Members, is that a substantial amount of tax relief is being given—money from the Exchequer has been forgone — not to create jobs, more profitable industry or to help the poorest section of the community which is bearing the greatest burden, but to help substantially those who have the greatest means within our community.

We believe that that is the wrong approach. If the Exchequer can afford some reliefs, and can afford to give up funds in that way, they should be given to the most deserving sections of the community.

I agree with what was said by the hon. Member for Erith and Crayford. If we want to have an industrial recovery and to spend money on social services, education and all the other things that we want to spend money on, tax relief should be given to businesses, particularly small businesses, to stimulate growth and create jobs and wealth. My party and I would have preferred the Government to introduce a much greater extension of the business start-up scheme or of the loan guarantee scheme or a zero rating of VAT on the repairs to commercial premises, which would help to stimulate the construction industry and would help businesses considerably. Already that rate is given to building. It seems nonsense that repairs to commercial enterprises should not be zero rated in the same way.

Those reliefs would give rise to the creation of wealth and jobs. The relief scheme for mortgages on the higher rate band in the Finance Bill is misdirected and will not help growth in the economy or the improvement in employment that everyone in the House wants.

I refer briefly now to the overall pattern of the Government's economic policy. I very much disagree with remarks made by the hon. Member for Erith and Crayford. The Government's whole philosophy over the past three years, during the election campaign and since, is the idea that it is wicked and immoral to borrow money to get through a difficult period and to stimulate growth That philosophy is nonsense. We need to tackle that argument, which most British people and most families, when they stop to think about it, realise is nonsense. There is not one family which, when it is on hard times, will not borrow —not beyond its means—and there is not one business which, when it sees prospects of growth ahead and can borrow within its means so that it can grow, will not do so. Few Conservative Members who have been involved in business will not, during their business life, have borrowed money to launch their businesses and allow them to grow and prosper, giving rise to greater profits and wealth.

Therefore, it should not be necessary for my colleagues and I and other hon. Members to urge the Government to borrow, not beyond the country's means, but more than they are prepared to at present, and to increase public spending to get the growth in the economy that is now so vital. We are not suggesting and have never suggested that we should throw money around and have a confetti money expansion of the economy. That would give rise to inflation and the brakes would have to be slammed on. It would damage the growth that we seek to achieve. That is not the way ahead. However, now that the Government have a prospect of four or five years in office, one hopes that over that period they will pursue an economic strategy that gives rise to steady growth in the economy and a steady expansion of public expenditure that would not make inflation roar up again but would allow the growth in employment and wealth that everyone wants.

I appeal to Treasury Ministers to stop pursuing the argument that they have a moral crusade to carry out against borrowing. There is no reason why they should not expand public expenditure modestly to bring about the growth that industry after industry is capable of and very much wants. The capacity is there in those industries and in every region. The facilities are there in the service sector of British industry to support growth.

It is a criminal act against the people to keep the economy squeezed down as it is now and not to allow it to expand. I hope that the Government will think again now that they are settling into a new term of office and allow some expansion so that the millions of people who have no prospect of employment, if the present policies are to continue, are given some hope for the future.