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Baroness Miller of Chilthorne Domer: My Lords, it is all very well to have cash machines for taking money out, but does the Minister accept that, for many rural businessmen, paying money in is very important? They do not want to have to drive around the countryside with their takings. Does the Minister further accept that the Government's delay in acting on the White Paper is inducing a scattergun approach to a very important question of infrastructure?

Lord Whitty: My Lords, we accept the substance of what the noble Baroness said. I do not accept her criticism of the Government. In the White Paper on the Post Office, we indicated our intention to publish access criteria which the regulator and the Post Office Users National Council will have to follow in terms of the provision of financial services by the Post Office. This should ensure that in most rural areas there will be continued access to a post office. At the same time, the Post Office will be able to provide a wider range of financial facilities than at present.

Lord Clinton-Davis: My Lords, does the Minister agree with the attitude displayed by Mr Chris Mullin in relation to the programme of closures announced by Barclays Bank Limited?

Lord Whitty: My Lords, I support the position taken a week ago by Chris Mullin in another place. As I said in reply to an earlier question, he indicated that it is of course always open to customers of Barclays who are disgruntled by what seems to be its cavalier disregard of rural interests to change their bankers. That is what my honourable friend said, and that is all that he said. It is true that one of our national newspapers reported that as a call for a boycott. It is not. It is an indication that consumers within rural areas have a choice, and that they should exercise that choice.

Baroness Byford: My Lords, does the Minister accept that it will help in one way if cash machines are installed in post offices, but not in a second way? Some 40 per cent of a post office's income arises through the receiving and handing-out of benefits and welfare payments. If those benefit payments are not made, post offices will not be profitable; therefore there will not be a post office for people to go to.

Lord Whitty: My Lords, I accept that a substantial part of the transactions currently carried out by post offices involve the benefits system. We are making

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choice available to benefit recipients, as we are to other consumers. We believe that a significant number of benefit recipients will continue to use post office services. The point we are making is that by more extensive and sophisticated arrangements with the banks, the Post Office will be able to introduce a wider range of facilities to all consumers, within both rural and urban areas. In the future, the Post Office will take on and provide a much more widespread network of financial services than is currently available from even the largest clearing banks.

Income Tax: New Payers

2.59 p.m.

Lord Hardy of Wath asked Her Majesty's Government:

    What is their estimate of the number of people who entered employment during the last two financial years and have become payers of income tax.

Lord McIntosh of Haringey: My Lords, the number of people in jobs is already at a record level--up by 800,000 since the election. The Government's long-term ambition is that by the end of the decade there will be a higher percentage of people in employment than ever before. Overall, in the year following spring 1998, 3.7 million people are estimated to have entered employment, compared with 3.5 million in the previous year. Whether they were income tax payers would have depended on their individual circumstances.

Lord Hardy of Wath: My Lords, I am grateful to my noble friend for that reply. But does he agree that there is continuing and sharp criticism about the levels and yield of national taxation and complete disdain for the point which his Answer demonstrates--that very large numbers of people who were entirely dependent on public resource are now contributing to it by way of income taxation and are therefore contributing to the prudent and wise improvement in services which we all need? Is it not time that the criticism I referred to ended and that there was greater applause for the taxation policies currently pursued?

Lord McIntosh of Haringey: My Lords, I hope we would all agree that more people in work is a good thing and more people getting pay is a good thing. If, as a result of that, despite lower rates of taxation and lower rates of marginal taxation, more people are paying tax, is that a bad thing?

Baroness Hogg: My Lords, as the Minister has the numbers at his fingertips, can he tell us by how much the total amount paid to the Inland Revenue by income tax payers has gone up over that period?

Lord McIntosh of Haringey: No, my Lords, I have no further information other than that which was

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published in the pre-Budget report, which is available to the noble Baroness and to all Members of the House.

Lord Taverne: My Lords, does the noble Lord agree that far more people would have been exempted from tax if the Government had concentrated on increasing personal allowances instead of introducing the 10p band? Does he not agree with the Institute of Fiscal Studies that that would also have been much more progressive in its effects?

Lord McIntosh of Haringey: No, my Lords, I completely disagree with that. The 10p rate halves the marginal rate of tax for 2.3 million people, of whom 1.9 million are low paid. If instead of that we had increased allowances, we would have been saving more money for those better off. In social justice terms, the 10p rate is more efficient.

Lord Stoddart of Swindon: My Lords, how many of those 800,000 jobs were created in manufacturing industry?

Lord McIntosh of Haringey: My Lords, I do not have the answer to that question but I can write to my noble friend. Clearly, jobs are being created and are disappearing both in manufacturing and in service industries. The balance between them can only be seen in aggregate rather than trying to convert from these 800,000 jobs alone.

Baroness Sharp of Guildford: My Lords, is the Minister aware that in spite of the prosperity of the South East there is a very high incidence of joblessness in inner London boroughs? Is he further aware that 19 out of 21 New Deal areas in London have the worst employment outcomes of anywhere in Britain? Nineteen per cent of these young people are not only not paying any income tax but they are not even claiming benefit because they are not eligible for benefit. Does the Minister agree that there is currently a real shortage of jobs in London and that the New Deal is not working in London as it should be but is actually adding to the incidence of social exclusion and pushing young people off the employment register?

Lord McIntosh of Haringey: My Lords, I certainly agree that a number of London boroughs are particularly badly off in employment terms. I live in one of them. But I do not draw the conclusion that the noble Baroness does about the effect of the New Deal. Youth unemployment is down by 40 per cent since the election. That applies in all parts of the country. The package of measures that we have introduced, which includes the working families' tax credit, the reforms to national insurance contributions, the 10p marginal rate of taxation and the national minimum wage, contributes to benefits which are felt in London boroughs--even hard-pressed London boroughs--as well as in other parts of the country.

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Lord Northbourne: My Lords, can the Minister say how many of the 3.7 million people who entered employment in 1999 were men and how many were women?

Lord McIntosh of Haringey: My Lords, I could if I had at my fingertips the full tables from the Labour Force Survey, but I do not. Certainly, it is the case that in recent years a considerable part of the increase in employment has been the increased employment rate among women. But I shall gladly give the noble Lord the figure from the Labour Force Survey.

Lord Pearson of Rannoch: My Lords, does the noble Lord agree that the Government are to be congratulated on the 800,000 jobs that have been created in this country since the election? Does he further agree that not a single new job has been created in the European Union? Will he finally agree that, if the Government had been constrained by not being able to manage the interest rate and otherwise generally by the conditions of economic and monetary union, their performance might not have been quite so brilliant?

Lord McIntosh of Haringey: My Lords, I have learnt to listen to the end of the noble Lord's questions. He always starts off in friendly vein and always finds some way of bringing it round to Europe and to an attack not on this Government but on Europe. We and the many countries of the European Union have been on a different economic cycle over the period that we have been talking about. There were indeed job losses in Europe in earlier days. I am glad to say that those job losses have been cut and even eliminated and that employment is rising at the moment in many European countries.

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