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Mr. Brady: I have been following the hon. Gentleman's remarks with interest, especially on the subject of the euro. He said that he is keen that we should join the euro, but went on to describe the European central bank as feckless. Does he believe that we should not contemplate joining the euro unless and until the European central bank has been reformed?

Mr. O'Neill: Perhaps I was not making my point clearly enough for the hon. Member for Altrincham and Sale, West (Mr. Brady). The disparity between our currencies is such that early entry is unrealistic. If the euro is undervalued because of the way in which monetary constraints are imposed by the European central bank--which is a fundamental reason for the low value of the euro--one would earnestly hope that, in the medium term, the bank will get its act together over the next 18 months or so.

There could be a general election in the spring and, within nine months--or perhaps even earlier--a referendum Bill might be introduced on which we could vote. Even then, there would be 21 to 30 months before entry. However, it would be dangerous to contemplate having an early referendum when the disparity in values is so wide. It would be difficult to convince the British people about joining, although they can be convinced. I therefore favour a twin-track approach of arguing for the ultimate objective and being realistic enough to understand that people will not associate economic success with joining a currency system whose value is declining, despite the feeble efforts of European central bank. The Government enjoy the privilege of making their own statements. My own view is that we should join the euro quickly, but that is not politically possible or economically attractive in the short term, so long as disparities exist.

The first Labour Government for a long time is in its final stages, and we are confident that we will be returned when there is an election. I believe that the opportunity for that will come in spring. The general assumption is

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that the modesty of the Queen's Speech, which does not contain many measures, means that we will have an election before long. However, that does not mean that we cannot build on our success over the past three and a half years and consolidate a healthy economy in which more people are in employment than ever before. We have conditions that, in the past, might have led to high-level inflation. The labour market is becoming increasingly tight in several parts of the country but, nevertheless, people recognise that it is in everyone's interest to restrain wage demands, keep inflation under control and give industry a chance.

Some of us would like the Government to take account of that, although not necessarily in the legislative programme announced in the House this week. The Finance Bill in March could provide assistance for manufacturing industry after the Budget, to help it through the rough period in which it finds itself. If we do not provide that assistance, we will discover that even more of our manufacturing base will have been eroded and the employment prospects of many of our people will have been lost.

The Queen's Speech is an excellent document, given the purposes for which it was written. It is understandably modest, but when the legislative programme covering finance and industry is introduced after the Budget, the Secretary of State for Trade and Industry will be able to make appropriate representations to the Chancellor so that we can get the backing for manufacturing industry that it deserves and which the country needs.

10.54 am

Mr. Phil Willis (Harrogate and Knaresborough): I rise from our packed Benches to respond on the third day of debate on the Queen's Speech. I apologise for missing part of the speech of the hon. Member for Ochil (Mr. O'Neill), but I agreed with a great deal of what I heard him say, with the exception of his final comment about the modesty of the Queen's Speech. I do not think that anyone could describe it as much more than that.

I have a sense of disappointment. When I came to the House in early May 1997, stood at the Bar of the other place and listened to the programme that outlined the first term of the new Labour Government and contained their aspirations for Parliament, there was a great sense of pride at being part of that. However, when I stood at the Bar this year, there was a sense that there was much that had not been achieved. Indeed, the vision and ambition had virtually gone. The crisis in our public services is not just about the recruitment of teachers, but concerns the recruitment of all public sector workers, including those in our hospitals, in the police and even in London Transport, which suffers from a dearth of people wanting to fill necessary jobs. Urban decay is still evident across the country, and I see it as I move about looking at schools and colleges in different areas. There is a growing divide between urban and rural areas, and the north-south divide has become starker during the Government's period in office. There has been a resurgence of racial and ethnic intolerance, shamefully fuelled by the Conservative party over the past 18 months.

Sir Geoffrey Johnson Smith (Wealden): I do not know on what grounds the hon. Gentleman is casting that slur, criticising the Conservative party and accusing it of encouraging racial crime and hostility towards people of other nations. There are people in my own constituency

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who came to this country illegally, and I saw nothing wrong in criticising the way in which we were dealing with illegal immigrants.

Mr. Willis: I am grateful to the right hon. Gentleman. However, some of us were present at the Romsey by-election. The right hon. Gentleman should have been there and seen the tactics used by his party. It is an honourable party, but it used the race card and the ethnic intolerance card unashamedly to try to win a by-election. However, it lost disastrously, and Romsey was the only seat to change hands in a by-election in the lifetime of this Parliament.

Mr. Peter Bottomley (Worthing, West): I was at the Romsey by-election. No constituent, and no one in the Conservative party with whom I worked, made any suggestion of that nature in response to what the Conservatives did or said. I saw the literature, and I was on the streets and doorsteps, meeting Conservative and Liberal Democrat supporters--although not many Labour supporters, as they were probably voting Liberal Democrat. The hon. Gentleman ought to be careful about what he says, as he has insulted many of us who were involved and are dedicated to good race relations and to trying to bring about a time in this country when the colour of someone's skin is no more important than the colour of their eyes or hair.

Mr. Willis: Again, I am grateful for that intervention. Perhaps the hon. Gentleman should speak to those on his Front Bench. Especially, he should remind the shadow Secretary of State for Health of the comments that he made about Commonwealth doctors and their inability to speak proper English, and consider whether that is a positive addition to the debate. However, I shall leave the Conservative party with its own conscience.

Where in the Queen's Speech is the vision to tackle major initiatives? For many of my constituents, and for me personally, perhaps the biggest disappointment of the speech was the failure to include even a draft Bill on arms export legislation in the Department of Trade and Industry section. Many people listened with admiration to the Foreign Secretary when, in opposition, he dissected the Scott report and exposed the previous Government's hypocrisy on the arms to Iraq scandal. Many say that it was his finest hour. Yet, four years later, we have been given a promise to ratify the Rome statute of the International Criminal Court--a measure that we wholeheartedly support--but there has been no progress on the essential issue of arms exports, other than the quadripartite annual report.

The sense of disappointment is heightened by the bizarre tactics of the Conservative Opposition. For the fourth year in succession, they have attempted to turn the Queen's Speech into a music hall event. It seems that the right hon. Member for Richmond, Yorks (Mr. Hague) has cast himself as a modern-day Nero, providing bawdy enjoyments for his anonymous chums rather than presenting serious policy alternatives for his party and the country.

There is so much that we need the Government to do. We have yet to see the extent of the regulatory reform Bill, but, like the Institute of Directors, we welcome an attack on outdated regulation. It is the absence of needless regulation that will encourage enterprise and wealth creation. The job of Government is to ensure that growth can occur in a framework from which all of us can benefit.

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In a liberal economy, there must be a framework that allows innovation and risk taking and yet protects workers' rights, consumers and the environment in a market-friendly, non-bureaucratic manner.

Let us trust that the Government get the balance right. Removing the requirement to implement the working families tax credit would be a welcome measure. Removing VAT from all credit transactions between VAT-registered traders--a measure that would be permissible within existing EU regulations--would simplify collection arrangements and take a huge burden off small business. Providing for mutual arrangements between Government, business and trade unions could simplify the regulations for implementing the working time directive, which is the subject of much comment and concern for small business. All those changes would be welcomed by the Liberal Democrats, as would measures to compensate business for the burden of being compelled to participate in Government surveys and inquiries. Why not introduce tax relief on imposed bureaucracy? That would certainly reduce the burden.

However, deregulation is but part of the story. The Liberal Democrats would have liked to see in the Queen's Speech a Bill to reform the system of uniform business rates, which is heavily biased against small business. We would have liked a bank regulation Bill, to give power to the recommendations of the Cruickshank report, which argued that the monopoly power confirmed by the bank clearing system was creating £5 billion a year in excess profits for the banks.

Where is the oft-hinted-at consumer protection Bill, to extend and defend the rights of consumers? Why is regulation always applied to soft targets, when it appears that rogue traders, unregulated money lenders and cowboy tradesmen in building, plumbing and car repairs continue with impunity? We hear much about rip-off Britain. Why is no action being taken to stamp it out?

I commenced my speech by expressing a sense of disappointment with the Government's intended programme. The Secretary of State for Education and Employment mounted a brave defence of his Government's record. Unlike the hon. Member for Maidenhead (Mrs. May), I do not seek to belittle his efforts. Few Secretaries of State could have worked harder to try to convey the Government's message. My party's criticism is not based on puerile personal attacks, or on whether the Secretary of State should move to the Home Office. It is directed at a lack not of activity or conviction, but of ambition--a lack that is typified by the legislative programme.

The Secretary of State was right to point out the Government's attempts to resolve the post-16 crisis. Perhaps the most appalling indictment of the previous Conservative Government was that they deliberately created a skills shortage whereby 7 million adults were functionally illiterate and one in four were unable to carry out the simplest numerical calculation. That happened as a result of policy. We have the Learning and Skills Act 2000, but, despite that, what has changed for our learners, for business and for providers?

The chairs on the Titanic have moved. Captain Blunkett now has a £6 billion budget and has assumed almost total control of the sector. Of course, he has become obsessed with targets for the post-16 sector, and the latest scheme is to withdraw benefits from claimants with poor basic skills, which are presumably ascertained by testing them each week in the jobcentre. What nonsense. Sir Claus

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Moser rejected the idea, believing that it would be counterproductive. Any sensible observer would tell the Secretary of State that the fear of learning is still the greatest barrier for many people and that compulsion will not address it. It is to be hoped that the policy will be abandoned.

What is needed are not more targets and penalties, but greater entitlements for learners. If we are to address the issue so graphically portrayed by Sir Claus Moser and Chris Humphries in the final skills taskforce report, a Bill to give people proper entitlement to learning must be introduced. As our greatest national skills shortage is at NVQ level 3, A-level or GNVQ advanced equivalent, we must be prepared to back the skills taskforce recommendations by giving all 16 to 25-year-olds a statutory entitlement to that level of training. For those without even a level 2 qualification, of whom there are far too many, we must provide an entitlement that applies throughout their working lives and which is supported by the state. That should be backed by statutory rights for time off for study, access to individual learning accounts, education maintenance allowances and student loans. Such entitlements could transform the learning agenda and build on the foundations laid with the Learning and Skills Council.

It is sad that there is nothing in the proposed legislation--or, indeed, in the Government's thinking--to address the anomaly that tuition fees have created for students in England. Following the Cubie report and the work of the Scottish Executive, Scottish students do not have to pay tuition fees and are entitled to bursaries. The Welsh Assembly plans to introduce exactly the same proposals next year, as does the Northern Ireland Assembly. Within the next two years, English students in England will be singled out as the only students paying tuition fees. That is rather sad.

It is also sad that in their desire to free universities, the Conservatives make the most scurrilous attacks on our new universities. A headline in The Times stated recently, "Tory shadow says that former polys have 'lost their way'". What an insult that is to the work of our new universities. What an insult to Leeds Metropolitan, to which many students in my constituency go. Groundbreaking work is going on in the new universities, but we are still told that they have lost their way. Elitism is creeping back into the university sector.

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