Orders of the Day — Finance Bill

Part of the debate – in the House of Commons at 7:47 pm on 30th April 2002.

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Photo of Wayne David Wayne David Labour, Caerphilly 7:47 pm, 30th April 2002

There are two clear themes in this year's Budget: fairness and enterprise. To the Labour side of the House, the fairness of the Budget is self-evident. We have unprecedented investment in the national health service, confirming its principles but at the same time ensuring that modernisation takes place. We have two new tax credits that will help the less well-off: the child tax credit and the working tax credit. Assistance is being provided to the long-term unemployed and single parents to help them secure long-term employment, and there is much else besides.

It is important that, taken as a whole, the Budget is progressive in character. Numerous references have been made to the Treasury Committee's report. It is important to note that the draft report states that the Institute for Fiscal Studies has calculated that, when all the measures are examined in total,

"the effect is a redistribution from the top half to the bottom half of the income distribution."

I think that that makes the Budget an historic one. It is an excellent Budget for that reason and many others.

It is significant that when we refer to the national health service, the Opposition fail to offer any alternative proposals. We have heard about their grand tour of Europe and their various experiences in different European Union member states. We can only hope that that infatuation will lead them to a more genuine appreciation of some of the benefits that the European Union can bring to this country.

If we have had a Budget for fairness, is it a Budget for enterprise? It is true that several employers' organisations have expressed reservations—for example, the CBI is worried that national insurance increases will be unfair on employers and impede job creation. In all fairness, however, we should bear in mind several factors. There is a moral argument in favour of increasing national insurance contributions. As everyone benefits from an improved national health service, it is only right that everyone contributes.

We must recognise the need, in economic parlance, for a healthy labour supply. Many employee absences in British industry are due solely to illness. In 1999 alone, £10 billion was lost as a result of the large number of people away from work because of illness.

We should not forget that in recent times the national insurance system has been reformed, nor that projections show that this country's gross domestic product growth will probably increase from 3 per cent. to 3.5 per cent. in 2002–03. That will lead to greater prosperity and, in turn, more jobs.

The Bill also contains a whole panoply of provisions that will encourage enterprise, including greater support for research and development, simplification of the VAT regime and reduction of red tape. Other measures will help those parts of the United Kingdom that are less prosperous than the south-east of England. It is therefore a shame that no Plaid Cymru Members are taking part in the debate.