Amendment of the Law

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

Alert me about debates like this

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

I have just given the answer.

We have been treated for months with teases about the Budget. We have been treated to the sight of the Chancellor of the Exchequer and other members of the Treasury team saying that they could not disclose anything. I think that, in the name of reasonability, they could at least give us another six days to produce our own statement in opposition to, an alternative to, what we have heard this afternoon.

It has not just been the Chancellor and the Prime Minister who have been cursing Governments for spending more than they were prepared to raise honestly from taxation",—[Official Report 20 March 1990; Vol. 169, c. 1016.] It is only weeks since the chairman of the Conservative party called borrowing "deferred taxation". The right hon. Gentleman probably regrets that now. He and the rest of his colleagues have to go into a general election with a promise to make tax cuts that are funded by borrowing, and that means that they will have to go into that general election campaign guaranteeing that they will make their children and everyone else's children pay the cost of their electioneering. But it is worse than that, because borrowing for tax cuts for this generation leaves the next generation with debts and nothing else.

Borrowing for tax cuts does not provide the next generation with the means of generating wealth or with any extra ways of producing revenues to repay the borrowing. Borrowing for tax cuts leaves no extra advantages, only extra burdens. The difference between borrowing for investment in the future and borrowing for immediate consumption is the difference between borrowing to put an extension on one's house and borrowing to go away for a day at the races. That is what the Government aim to do, just a few weeks at the races before they come second.

Perhaps the Chancellor will tell us whether he thinks that it is all right to compromise our children's future and to burden rising generations with the cost of our generation's tax cuts because he believes that the reduction in taxes now is the best way to stimulate the economy into recovery. If he believes that, the Chancellor is wrong—even about that. The burden of personal and company debt in Britain is so big that some of the borrowed giveaway would doubtless be used to reduce that record burden and not to generate fresh economic activity.