Amendment of the Law

Part of the debate – in the House of Commons at 4:30 pm on 12 March 2008.

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Photo of Stewart Hosie Stewart Hosie Shadow Chief Whip (Commons), Shadow Spokesperson (Treasury) 4:30, 12 March 2008

A specific issue exists when a land border exists between one duty regime and another. The hon. Gentleman knows his constituency and the Province far better than I do, but I believe that he is making a valid point. It was no surprise, when I last pressed amendments on similar matters to a vote here, that they were supported by the Northern Irish parties, by Plaid Cymru and by my own party. They also received sympathy—although no supporting votes—from members of other parties whose constituencies were remote from the economic centres, and whose hauliers were probably telling them precisely what mine are telling me.

Fuel price inflation now stands at 19.5 per cent., and food price inflation is now 6.5 per cent. According to the Alliance Trust, that has forced up real inflation for the over-75s—and, indeed, the under-30s—to 25 per cent. higher than the official published figures. Although we see average inflation figures for different groups in society, the marginal rates are always different. At a time of rising prices, I would have thought that the Government would do what they could for the very oldest and the very youngest.

It is interesting to note the measures that the Government have announced today. I support their determination to lift children out of poverty. I know that the Scottish Government are actively involved in measures to do exactly the same thing. However, the UK Government announced today that child benefit for the first child would rise to £20 in two years. That might have had a slightly different gloss if they had announced a 70p rise for the first child and a 45p rise for subsequent children. Those figures would not have had quite the same hit as the £20 figure that the Chancellor announced earlier.

The commitment to pensioners is for an increase of 2.5 per cent. or the rate of inflation, whichever is the highest. The basic pension rise will therefore be about 2.5 per cent., and there is to be an extra £50 on the winter fuel allowance. However, given the fact that the real rate of inflation for pensioners will outstrip the increase in their basic pension, I wonder how quickly the extra £1 a week will be eaten into, and just how many extra minutes the electric fire will be on before people realise that that bit of generosity is worth very little indeed.

It is worth comparing this UK Budget—with all the fiscal levers that the Chancellor has at his disposal— with the actions being taken in Scotland, particularly in relation to business. We know that businesses are concerned about their cost base, and about rising prices for road fuel, energy and raw materials. We also know that they are struggling due to competitiveness and a shortage of skilled staff, and that they are worried about the tax burden and the complexity of the tax system, and the failure properly to invest in the transport network.