Amendment of the Law

Part of Budget Resolutions and Economic Situation – in the House of Commons at 4:42 pm on 10th March 1992.

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Photo of Mr Neil Kinnock Mr Neil Kinnock Leader of Her Majesty's Official Opposition, Leader of the Labour Party, Member, Labour Party National Executive Committee 4:42 pm, 10th March 1992

What our country needed today was a Budget for strengthening Britain and promoting sustainable recovery out of the recession caused by the Government. What we got was a Budget to try to bribe voters with borrowed money which they will have to repay. The borrowing that the Government are raising to finance tax cuts is not, as the Chancellor would insist, prudent economic strategy: it is a panic-stricken pre-election political sweetener.

For the sake of a few weeks of an election campaign the Government are going to try to saddle the British electors and taxpayers with many years of debt. The borrowing —[Laughter.] When Conservative Members realise that the Government are running a public sector borrowing requirement of £28 billion perhaps they will be a little more silent on the subject—the more so since the PSBR is the result of a combination of long-term failure and recession and short-term fear in the face of the electorate.

The kind of borrowing that the Government propose—the extra borrowing to fund tax cuts—will not provide a single extra school or hospital. It will not provide a single extra place on a training scheme or in a childcare nursery. It will not create a single extra research project or transport improvement, or put an extra policeman on the streets. This debt is just extra Tory dead-weight debt, an extra £2 billion which gives a new meaning to the idea of state funding for political parties.

There are no excuses for this Government. In 13 years of power they have had £100 billion worth of oil revenues, £40 billion worth of income from privatisation and the revenues from the highest tax burden ever imposed on the British people by any Government. At the end of all that, the best that the Chancellor could come here today and forecast in his Budget statement was a paltry 1 per cent. growth, further rises in unemployment, a continuing balance of payments deficit, despite the recession, and a PSBR of £28 billion. That is double this year's PSBR, which the Chancellor acknowledged to be £14 billion. What a terrible confession—