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Mr. Tyrie: Most of those representations will explain how the rise in the tax burden is impairing economic performance. Could the Minister, on behalf of the Government, tell us to what level the tax burden will have to rise before the Government believe that a higher tax burden impairs economic performance?
Caroline Flint (Don Valley): Is my right hon. Friend aware that last Friday's Financial Times described the Conservatives' attempts to reduce the tax burden as a mess of which Harry Potter would have been proud? How can the Opposition square what they preach with what they do, when they voted on Tuesday against cuts in national insurance contributions for the self-employed, employers and small firms?
Mr. Smith: My hon. Friend is right: there is a sharp contrast between what the Conservatives say and do now and what they did in office. We remember the 22 tax rises and the VAT increases that they promised not to introduce. This Government have kept every promise that we have made on tax. [Laughter.] We have cut the basic rate of tax and have not raised the upper rate. We have introduced the 10p rate and cut VAT on fuel. Opposition Members will not be laughing when they go to the electorate on the subject of real living standards, because year on year under this Government, take-home pay after direct and indirect tax has been rising--I am allowing for everything--by £400 or more a year, whereas under the Conservative Government it increased by less than £300 a year.
Mr. David Ruffley (Bury St. Edmunds): Is the Chief Secretary aware that many couples whose married couples allowance has been slashed by the Chancellor will not receive the children's tax credit? Will he tell the House how many such married couples will face a higher tax burden as a result of this disgraceful new Labour stealth tax?
Mr. Smith: The hon. Gentleman makes a somewhat uncharacteristic attack on his own Front Bench. It was the now shadow Chancellor who said in office that the allowance was an anomaly. Indeed, it was the Conservative Government who started to cut it. The Government are introducing help through the children's tax credit. As my right hon. the Chancellor has said, we hope to benefit families with children to the tune of £10 a week.
Mr. Michael Connarty (Falkirk, East): Does my right hon. Friend accept that we must consider not only the overall tax burden, although that is important, but timing and distribution? In particular, is he aware of the deep concern in manufacturing industry about the fact that the Government are to pursue the climate change levy? Although the levy is tax neutral--fiscally neutral--it will
Mr. Smith: We strongly support manufacturing industry. Nissan's announcement that it is to bring production of the new Micra to Sunderland has occurred partly because of our energetic efforts. I am sure that my hon. Friend will join me in welcoming that decision, about which we are very pleased. It is evidence of our commitment to success in manufacturing industry. He also mentioned the climate change levy, which has been carried forward in close consultation with industry. We have negotiated agreements on the levy with particularly energy-dependent industries. As my hon. Friend acknowledged, the levy is fiscally neutral, not only as a whole but within each sector. Moreover, we will generate jobs and help manufacturing by reducing national insurance contributions.
The Financial Secretary to the Treasury (Mr. Stephen Timms): Some 325,700 people have joined the new deal for the long-term unemployed, of whom 61,050 have so far found employment. From April, we will be improving and intensifying the programme, applying the lessons learned from the success of the new deal for young people.
Mr. Timms: My hon. Friend is right. Detailed evaluation by the National Institute of Economic and Social Research has shown the success of the new deal for young people. As my hon. Friend says, its success has been achieved by increasing the intensity with which young people look for work and by increasing their employability. The evaluation shows that long-term unemployment among young people is half what it would have been without the new deal. We are including the lessons that we have learned from that in the new deal for the long-term unemployed, for the benefit of my hon. Friend's constituency in Barnsley and others throughout the country.
We will include in the deal access to work-focused training and key work skills programmes. As my hon. Friend said, all those elements make a large contribution to increasing the productive capacity of the economy. It would be a social and economic tragedy if the Conservative party's plans to abolish the new deal were ever effected. The new deal has been a key element in the successful management of the economy in the past four years. It should remain.
Thursday 1 February--Opposition Day [3rd Allotted Day]. Until about 4 o'clock, there will be a debate entitled "The Government's Failure to Run an Efficient and Humane Asylum System". That will be followed by a debate entitled "The Government's Neglect of the Crisis in Agriculture". Both debates will arise on Opposition motions.
The House will wish to be reminded that on Monday 29 January there will be a debate relating to Members of the European Parliament and the Audit of Expenditure by EP Political Groups in European Standing Committee B. Details of the relevant documents will be given in the Official Report.
European Standing Committee B--Relevant European Union documents: (a) 9712/00, Statute for Members of the European Parliament; (b) 9560/00, Audit of expenditure by EP political groups. Relevant European Scrutiny Committee reports: HC 23-xxvii and HC 23-xxix (1999-2000) and HC 28-ii (2000-01).]