Mr Jack Diamond: The forecasts published in the Financial Statement and Budget Report 1970–71 contain estimates of expenditure, imports and gross domestic product at 1963 prices; forecasts of earnings and employment have never been provided.
Mr Jack Diamond: My right hon. Friend took all these matters into account in his judgment, and he also took into account three years ago that it would be helpful to the House if it had the kind of information which the hon. Gentleman's Government never provided. He therefore provided that information, and I am sure that it has been very interesting and helpful to the House.
Mr Jack Diamond: Actual total tax revenue in 1963–64 was £6,649 million. The comparable estimated figure for 1970–71 at constant prices is £10,379 million. The estimated total revenue for 1970–71 at current prices is £15,582 million.
Mr Jack Diamond: I should like to help the hon. Gentleman as much as I can with his figures. The rise in the burden of taxation, that is, in the proportion the rise in taxation bears to the rise in gross domestic product, is 4 per cent. per annum. The increase in taxation is devoted largely to increases in social services and to assistance to employment and industry. I am sure that the hon. Gentleman would...
Mr Jack Diamond: The percentage for 1968 has now been revised to 37·7 per cent. and the percentage for 1969 is 40·6 per cent. These figures cover central government direct and indirect taxation and local authority rates.
Mr Jack Diamond: The policy of the Government, in contrast with the policy of the party opposite, is to devote a pro- portion of national resources to social services and public expenditure of one kind or another. We have just had four days of debate on the state of the nation's economy. I have heard many proposals for increased public expenditure, including some from the right hon. Member for Enfield, West...
Mr Jack Diamond: It is not possible to quantify the difference in invisible earnings likely to arise from the different method of financing overseas direct investment resulting from the controls imposed since 1964. All I can say is that such investment is at present running at about twice the rate it was in 1963 and 1964.
Mr Jack Diamond: I am sure that the hon. Gentleman could not have heard my reply. I am saying that, compared with 1963 and 1964, investment of this kind is running at about twice the rate.
Mr Jack Diamond: The hon. Gentleman is now talking about portfolio investment which has produced, as a result of the 25 per cent. surrender scheme, an annual benefit to the reserves of the order of 200 million dollars to 250 million dollars a year. That is very substantial assistance to the balance of payments which must cause hon. Gentlemen opposite to rejoice, as we have all observed. I recognise that ...
Mr Jack Diamond: The same principle, namely the effect of the installation on rental value, already applies in both cases.
Mr Jack Diamond: What is taken into consideration, and what always has been taken into consideration, is everything that affects the rental value of the house. That has always been the case and it continues to be the case.
Mr Jack Diamond: There is no question of fining a householder. My hon. Friend will recognise that if he is in the market for a house and is offered two identical houses, one with central heating and the other without, he will be prepared to pay more for the one with central heating.
Mr Jack Diamond: No, Sir.
Mr Jack Diamond: My hon. Friend will be aware of the arrangements made for tax purposes with regard to entertainment expenses incurred in the course of business. As to reducing expenditure and getting priorities right, I am sure that he will agree that our priorities have been right in two respects. First, we have reduced to something under 5 per cent. of g.n.p. the cost of defence as compared with the 7 per...
Mr Jack Diamond: I would refer my hon. Friend to the assessments of the balancing item which have been published in recent issues of Economic Trends.
Mr Jack Diamond: I could not accept what my hon. Friend says about his own lack of competence, because he is drawing my attention to a very important figure and enabling me to explain that the figure is not small in relation to the figure with which it should be compared, which is the total turnover on current account, which in 1969 was £22,000 million.
Mr Jack Diamond: I can explain it by inviting the hon. Gentleman to do what I have already done and look at the full explanation in Economic Trends. He has assumed that there is one element only, but at least four elements enter into the build up. The hon. Gentleman says that this is the biggest adjustment, but neither he nor I could substantiate this view.
Mr Jack Diamond: No, Sir.
Mr Jack Diamond: No, Sir. I do not agree with my hon. Friend. He knows the Government's attitude about negotiations, which has been stated many times. My right hon. Friends the Prime Minister and the Secretary of State for Foreign Affairs have stated precisely our view on this topic, and, as my hon. Friend knows, we do not intend to introduce the value-added tax except in the special circumstance of entering...
Mr Jack Diamond: May I draw to the attention of the hon. Gentleman the recent report which has been issued under the name of one Professor Reddaway who makes the severe criticism that, far from there being adequate coverage of the tax, there should also be coverage of self-employed persons.