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Thank you, Mr Speaker.
On Government help for local businesses, during the height of the recession, I attended a meeting of more than 100 people from businesses in my constituency. That was when the then Business Secretary, Lord Mandelson, was parading all over the place to tell us about all the schemes he was introducing to help local businesses. When I asked those business people whether a single one of them had been able to access any of the funds that Lord Mandelson was talking about, two hands went up in a room of more than 100 people. Both those people had tried to access the funds, but found the process too complicated and gave up. The reality is that businesses were not helped by the previous Government. I am pleased that in the Budget the Government propose a lower corporation tax rate, simplifying the tax system, reducing red tape and getting credit flowing.
I am delighted that the main rate of corporation tax will be reduced from 28% to 24% over four years, which will end up being the lowest rate among the G7 countries. Local communities, businesses and business organisations in my constituency have told me that they are delighted that the small companies rate will go to 20% instead of the planned increase to 22%, as proposed by the previous Government. On the jobs tax, which was talked about during the election and which universally businesses were not happy about, I am delighted that under the Budget the negative effect of the employers' rate rise in national insurance will largely be reversed by increasing the threshold for employer NI contributions by £21 a week above indexation. That means that the number of employees for whom employers will pay no national insurance will rise by 650,000.
We will see a simplification of the tax system. As the Budget Red Book makes clear, tax competitiveness is not just about rates and incidence of tax; predictability, stability and simplicity are also important. Like many Government Members, I look forward to the details of the proposed independent office of tax simplification. The key point is that local businesses want time to get on and do business, and not to get bogged down by red tape. I am delighted, therefore, that the Government have said that they understand that the volume and complexity of regulation can damage UK competitiveness. I am pleased, therefore, that we will have a one in, one out system for new regulations as well as the imposition of sunset clauses.
A number of small businesses in my constituency that I have talked to are keen to get a share of the Government's pie when it comes to spending. Again, therefore, I am pleased that under the Budget the Government plan to promote small business procurement by publishing central Government tenders online from the end of the year. The final thing that many businesses want is credit to start flowing again, and I am pleased to see that recognised in the Chancellor's speech and reflected in the Budget documentation. The Government recognise the need for banks to promote lending, especially to small and medium-sized enterprises. I am delighted that there is going to be an increase in the enterprise finance guarantee and the creation of the growth capital fund, which will help fast growing small and medium-sized businesses.
Several Members have also touched on the banking sector. It is important that the Government want to ensure that the banking system and the financial markets meet the longer-term needs of the economy, and I look forward, therefore, to the publication of the Green Paper on business finance before the summer recess. This is a tough but fair Budget. We have had to make so many difficult choices because of the legacy left to us by the previous Government. I am pleased that, as part of the Budget, the Chancellor has made every effort to protect the most vulnerable people, including pensioners. That is so important and the hallmark of a fair society. The Budget will focus on returning stability to our economy, on getting the country back on its feet and, over the coming years, on delivering strong growth to the economy.
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