Finance Bill

I am grateful to the hon. Gentleman, who has exposed my utter lack of originality. This position is not uniquely adopted by Opposition Members. Indeed, part of the inspiration for our amendments is the amendment tabled to the Budget resolutions by the hon. Member for St Ives (Andrew George). There is a consensus that, over the years to come, we want the institutions that help to govern our macro-economic policy to be as strong and robust as possible. That is why the shadow Chancellor has welcomed the initiative of the Office for Budget Responsibility, but put on the record our ambition to ensure that it is truly as independent as possible. That is why it is important that there is no question about its conduct, the publication of its reports and the synchronisation of its reports with Prime Minister's Question Time and so on. We want Parliament to take the lead role in appointing the OBR's new leadership, and we want also to ensure that financial, tax and economic policy is conducted as transparently as possible. That was the instinct behind the creation of the code for fiscal stability many years ago, and we need to carry on the work of reform so that we truly strengthen the role of this House in holding economic policy to account. The purpose of clause 6 is to seek to protect a group of people who are very important to all Members—our pensioners and retired citizens. Ultimately, the reason why Labour decided to raise national insurance instead of VAT was a concern for fairness, and we knew in particular that those on fixed incomes, such as pensions, would struggle most when faced with sharply rising prices. Today, I am afraid, we hear that pensioners could face an £8 billion VAT bill during the course of this Parliament. When the Budget was presented, we heard a little about the protections that were already being put in place, but on closer inspection it turns out that pensioners will be hit by different changes each and every year. Amendment 46 would therefore require the Treasury to prepare a report on the impact of the increase in standard rate VAT before any further Finance Bill were brought before the House in the current Session. In that way, right hon. and hon. Members would be able to insist upon proper remedies for pensioners to protect them from VAT. It is worth setting out what the Library has published. The overall effect of the Government's proposed VAT hike is that the revenue raised will increase from between £2.8 billion to £2.9 billion in the current financial year to £12.1 billion, £12.5 billion, £12.9 billion and £13.5 billion over the course of this Parliament. Using the Office for National Statistics' study of pensioners' share of spending, the Library estimates that this year—so, before pensions rise in April—Britain's pensioners will pay £422 million of extra VAT. That figure will then rise to £1.8 billion, £1.9 billion, £2 billion and £2 billion by the end of the Parliament. I think the House will agree that that is a serious hit on pensioners' fixed incomes.