Finance Bill

My Lords, regrettably, I did not watch the ““Andrew Marr Show”” and did not hear Alistair Darling’s precise words. Therefore, I will not comment on them. Before the election, the Liberal Democrats warned that the Conservatives would raise VAT. Nick Clegg said, ““Our plans do not require a rise in VAT, the Tory plans do. Their tax promises on marriage and jobs may sound appealing, but they come with a secret VAT bombshell””. In fact, their election campaign was based on it. During the campaign, the Conservatives repeatedly denied they had plans to raise VAT. "““We have no plans to increase VAT””," said George Osborne in the Times on 10 April 2010. VAT rises are unfair and regressive, as both David Cameron and Nick Clegg know. David Cameron has made an absolute promise that VAT is regressive and hits the poorest hardest. Nick Clegg shares this view that raising VAT would be regressive and penalise the poor. I touch upon an area that is difficult given our Budget and expenditure structure. I commend the Government and the OBR for the comprehensive analysis in both the Red Book and subsequent documents that have been released, although some of it is based on assumptions I do not find particularly credible. However, this Budget will change the shape of our society, and we will not see that change until the spending review in the autumn, although we can be sure that it will be significant. The Budget anticipates £83 billion less public expenditure in 2014-15, which is more than £1,000 for every man, woman and child. Some of this will come from efficiency, as Alistair Darling’s Budget assumed. Some will be payments by cash transfer, and they are analysed in the Budget documentation. Yet a most important part will come from the non-cash value that we as citizens get out of society. That is what is so weak about the Budget process; the value that is withdrawn by these non-cash items is undoubtedly regressive. The non-cash items pay for education—everything from Home-Start to universities and research. Cuts in these areas will hit poor people who have to go through state education and use things such as Home-Start. They will come from policing and justice. Yes, some efficiency will be available, but there will also be less policing and fewer justice facilities. They will come from social services such as home helps and respite care—the things that support lonely older and poorer people. They will come from programmes to protect the environment and from the arts, culture and sport. They will come from transport, which needs revenue support to maintain services to all our citizens and specialist support for the bus pass scheme so valued by our older citizens. This Budget and its consequences in spending cuts will make our nation less secure. It will hit the poor and weakest most. It will leave society as a whole poorer and more fractured. It will leave it a less happy society, attacking those things that cause society to be at peace with itself. History tells us that, once the Tories start cutting, they will not stop. Sadly, these damaging measures may not achieve the Tories’ ultimate goal of tax cuts for the better-off because that depends on an economic recovery. This Budget and Finance Bill make recovery less likely. Without sustained recovery, no significant group of citizens in the country can achieve significant improvement in their material well-being. That is how this Finance Bill should be judged.