Tax Revenue

Oral Answers to Questions — Treasury – in the House of Commons at 12:00 am on 1 March 2001.

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Photo of Simon Hughes Simon Hughes Shadow Spokesperson (Home Affairs) 12:00, 1 March 2001

What his forecast is of the revenue from (a) personal taxation, (b) corporate taxation and (c) VAT for each of the next seven years. [150137]

Photo of Andrew Smith Andrew Smith The Chief Secretary to the Treasury

Forecasts of tax revenues were published in tables B8 and B11 of the pre-Budget report. Updated forecasts will be published in the "Financial Statement and Budget Report" next week.

Photo of Simon Hughes Simon Hughes Shadow Spokesperson (Home Affairs)

I predicted that reply. The projections show that the tax take over the next five years will be constant as a proportion of national income. However, investment in health over the term of this Government is on average lower than it was under the term of the Major Administration, the previous Tory Government. Average investment in education over the Government's term of office is less than it was on average under the Tory Government. On the same basis, investment in pensions is less than it was.

Have Treasury Ministers got the message from the public that they have no desire next week to be bribed with their own money, following a tax-cutting agenda that the Tories are suggesting? The public want real extra investment in public services such as education and health and for groups in the community who need it and deserve it, such as pensioners throughout the United Kingdom?

Photo of Andrew Smith Andrew Smith The Chief Secretary to the Treasury

It is because we made tough choices, which the hon. Gentleman's party opposed, that we have been able to get the national debt down from 44 per cent. of gross domestic product to 33 per cent., and it is due to fall to 30 per cent. That is establishing the strong foundation for the investment that is under way—a doubling of investment across the spending review period, with record increases in health, education, transport and fighting crime, the people's priorities. We can deliver because we took tough choices and built a strong economy, which the hon. Gentleman's party would never do.

Photo of Chris Leslie Chris Leslie Labour, Shipley

Does my right hon. Friend agree that it is important to continue the sensible and prudent planning and forecasting of revenue and expenditure? I urge the Government to ignore and not be tempted by the advice of either the Liberal Democrats, who seem to think that money grows on trees, or the Conservatives, whose sums never seem to add up.

Photo of Andrew Smith Andrew Smith The Chief Secretary to the Treasury

Yes, indeed. I shall take my hon. Friend's comments as a Budget representation. I can assure him that we have no intention of being drawn down the path of irresponsibility proffered by either the Conservative party or the Liberal Democrats.

Photo of Michael Fallon Michael Fallon Conservative, Sevenoaks

If everything is so rosy, why is the European Union worried about the Government's future taxation and spending plans, and why did the International Monetary Fund warn yesterday of negative consequences for investment and growth"? How can the Government describe that as vindication?

Photo of Andrew Smith Andrew Smith The Chief Secretary to the Treasury

That is a total misreading of what the IMF said. Let me give the hon. Gentleman the quotes. The directors stated that plans to increase public investment in infrastructure and human capital are justified in the light of the evidence". They said: even after taking account of recent spending decisions, the fiscal position remains sound and fully consistent with the authorities' medium-term fiscal framework. The acting chairman, summing up, commended the authorities for the continued strong performance of the United Kingdom economy.