Amendment of the Law

Part of Budget Resolutions and Economic Situation – in the House of Commons at 5:30 pm on 10th March 1992.

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Photo of Mr Roy Hughes Mr Roy Hughes , Newport East 5:30 pm, 10th March 1992

I could have cited other quotations to reveal the Prime Minister's earlier attitude and the fact that the Budget proposals are a complete contradiction of it.

The cuts in tax which have been announced will not help the unemployed of whom there are no fewer than 2,600,000—the total is continually rising. The tax cuts will not help the homeless. What is needed is a boost for housing. The capital receipts held by local authorities from the sale of council houses should be released on a phased basis. Besides giving ordinary people the homes that they need, such a measure would provide badly needed employment to the construction industry. The cuts will not help people on hospital waiting lists or reduce exorbitant prescription charges. They will not help children in inadequate schools, which have no text books. The Chancellor is borrowing to bribe. As my right hon. Friend the Leader of the Opposition clearly pointed out, that can only mean future tax increases. The Opposition believe that the reversal of Britain's economic decline and the elimination of social squalor are the main priorities.

I want to be fair to the Chancellor about the reduction of the special car tax. I agree with that reduction and I am glad to note that my right hon. Friend the Leader of the Opposition also agreed. I am sympathetic to that proposal because it is justified. The car industry is vital to the economy. It has taken some bad knocks recently. Sales have plummeted, output has been cut and workers have been laid off.

The ripples from the car industry go far and wide in Wales. We do not have a car assembly plant, but we are very reliant on car component industries for employment. For example, we have an important Ford car engine plant at Bridgend and another Ford plant at Swansea. Bosch—the major German company—is now well-established in the vale of Glamorgan and employs hundreds of people. Lucas Girling, the brake manufacturer, is a major employer in Gwent. There are many other examples.

More importantly, the steel industry in Wales relies greatly on the motor industry to take up much of its output. In employment terms alone, the car industry is vital and we ill-treat it at our peril. That is borne out by Germany and Japan, which have encouraged and fostered their car industries. They are the two most successful trading nations.

I know that we are all green now. It is one thing to prevail on our motor manufacturers to step up research to curb the effects of fuel emissions. However, we should bear in mind that ordinary people are attached to their motor cars. Private transport was once the prerogative of the rich. Now people use their cars to travel to work, many housewives find them indispensable for shopping at the local supermarket and many families find their cars indispensable for leisure purposes. We should step up investment in rail and other forms of public transport, but we should realise how reliant we are on road transport. No magic wand can be waved to change the position overnight.

Training provision is also important. As far as I am aware, the Chancellor made no mention of that vital subject. Surely the disastrous cuts made in the training budget in 1991 and 1992 should be restored. What sense was there in cutting training in a period of heavy unemployment? I believe that we should increase the number of training opportunities for the long-term unemployed, and give all young people a guaranteed entitlement to quality training. That would constitute real investment in Britain's future prosperity.

Then there is the matter of help for small businesses. Here again, I support my right hon. Friend the Leader of the Opposition, who welcomed the proposals concerned. Of course small businesses need help—but that help is long overdue. Only yesterday, I received a telephone call from a constituent whose husband was in a small-business partnership. The company had run into difficulties, and a leading firm of merchant bankers—in pursuit of its pound of flesh, so to speak—is threatening to take over the family home. That personal tragedy is only one example of what is currently happening.

Essentially, the current recession is a product of the Government's own policies. When he was Chancellor, the right hon. Member for Blaby (Mr. Lawson) allowed a free-for-all, with easy money and easy credit; now, we are reaping the whirlwind. The Prime Minister and the Chancellor are apparently on record as saying that unemployment is "a price worth paying". I certainly do not agree with that contention, or with their attempt to blame the so-called world recession for our current troubles. Comparisons are said to be odious, but let us take Japan. It was said that Japan was in recession in 1991. Some recession! In that year, its output grew by 4 per cent., while ours fell by 4 per cent.

This is the Chancellor's second Budget. He is not a Welshman, and it is extremely unlikely that he will have a third try. Today is his date with destiny. If things go wrong on 9 April, he will book himself a one-way ticket to the pet-food canneries at Melton Mowbray; how can he escape the dogs and the tin opener? Let me make it clear that that inelegant language is not my own. It is taken from the authentic voice of the Conservative party—last Friday's Daily Telegraph. On page 19, Christopher Fildes went on to point out that, in the Tory party, the pack instinct … is one of its nastiest qualities". I am sure that the right hon. Member for Finchley (Mrs. Thatcher) would bear out that observation.

There is little doubt that the Chancellor's head is on the block. Let us be fair: he has faced a difficult task, given that more than 2·6 million of the working population are unemployed, the figure has risen consistently over the past 22 months and the trend is likely to continue unabated. Bankruptcies are at a record level, with 200 businesses going bankrupt every day. Home repossessions and mortgage arrears are also at record levels: there were 75,000 repossessions in 1991, with all the misery and unhappiness that that involves.

After 13 years of the present Government, business confidence is at an all-time low. Leading Government figures, such as the Secretary of State for the Environment and the Chief Secretary to the Treasury, have tried to cover up the catalogue of disaster with bluster coupled with music-hall humour. I can only say that that is not going to work. The game is up; "you can fool some of the people some of the time …" Conservative Members will know the rest of the quotation. I believe that, on 9 April, the people of Britain will elect a Labour Government.