Capital Gains Tax (Rates)

Part of the debate – in the House of Commons at 9:34 pm on 28 June 2010.

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Photo of Liam Byrne Liam Byrne Shadow Chief Secretary to the Treasury 9:34, 28 June 2010

We can see at whose feet the hon. Gentleman has been training.

Our plan was different from the one the Chancellor presented. Unlike the plan that we heard last week, our plan really did have fairness at its heart. Last Monday night, the Chancellor's spin doctors made fairness his key Budget test, and by Tuesday lunchtime he had failed it. The night before the Budget, we are reliably informed, Lobby journalists were equipped with an analysis of the Budget's impact on different groups of citizens, yet somehow, someone forgot to tell the press that the picture was only fair because it included Labour measures. The Government would not dare to present a Budget to stand and fall on its own merits; they had to borrow ours. It did not take long to hear why.

What was the Budget's impact on pensioners? Age UK says:

"Our research shows that cuts of this scale will be disastrous for older people" and warns that thousands of lives will be lost. What is the impact on children? Save the Children says:

"Freezing child benefit...will hurt the poorest parents most, rather than their richest peers".

A 20% VAT rate means driving some of the poorest parents into the arms of loan sharks. The Child Poverty Action Group said:

"This is a disappointing budget for child poverty...The increase in VAT is a regressive measure which will impact hardest on poorest families."

Perhaps the final word should go to the Institute for Fiscal Studies. In a phrase that will come back to haunt Government Members, it said that the cuts to benefits will

"hit the poorest hardest and keep on hitting them harder year on year".

Six days on from the main event, the Government's progressive credentials already lie in ruins.

The price of keeping down unemployment in the worst global recession for 60 years was a price worth paying. It was the price of a national defence in a global storm. When we left office, unemployment was 500,000 lower than people expected a year ago. Repossessions were half the level of the 1990s, and company insolvencies were just a third of the rate they reached in the recession of the early 1990s. We are proud that we got the country though the recession in one piece and that we have delivered a return to growth.

It is true to say that no Government would have had an easy time in this Parliament, but the difficulty of the task demands that we do not take gratuitous bets with the nation's hard-fought recovery and that we pay down the debt in a way that is fair. The Budget fails both those tests, and we will campaign for a plan that is better in this House and beyond.