Finance Bill

This has largely been a good debate, until the huff and puff from hon. Member for Rayleigh (Mr. Francois) at the end. We have heard nine Back-Bench speeches, including substantial contributions from my hon. Friends the Members for Newcastle upon Tyne, North (Mr. Henderson) and for Wolverhampton, South-West (Rob Marris) and from the right hon. Member for Wokingham (Mr. Redwood). My colleagues and I will relish the detailed debates to come in Committee, in which we will show the strength of our case for the reforms set out in the Budget and the Finance Bill, and the weakness of the Opposition’s alternatives—when, indeed, any alternatives are offered. This is the Second Reading of a Finance Bill designed to build on and reinforce the foundation of economic success and stability in the British economy under this Chancellor. His record has been described by the International Monetary Fund as"““a decade-long record of strong and steady macroeconomic performance?," in which"““growth of real GDP per capita was higher and less volatile than in any other G7 country?." The Bill takes further steps to raise levels of investment and innovation, and reinforces efforts to tackle climate change through incentives to greater fuel and energy efficiency and the use of renewable technologies. It supports hard-working families and helps more people into work with personal tax reforms amounting in total to a reduction in personal taxation of £2.5 billion. It also simplifies business taxation and clamps down harder on schemes or arrangements that lead to unfair tax competition or avoidance. The Opposition’s amendment to the motion leads with assertions that the Bill brings in a more complicated tax system, that it somehow penalises small firms and that it"““fails to equip the UK to compete in the globalised world economy?." I shall deal in some detail with the business tax reforms in a moment and show that the amendment is wrong on each and every point. Let me first deal with the contributions of the many hon. Members who have spoken in the debate. The hon. Member for Chipping Barnet (Mrs. Villiers) professed to be concerned about what she described as the erosion of competitiveness in the UK over the past 10 years. We are unique in all the major economies in avoiding a downturn in the past 10 years. We grew faster last year than all the other major economies. We have taken the national income per head up from seventh to second place in the G7 economies over the past 10 years, and the World Bank now rates our economy sixth in the world for ease of doing business. Those factors are hardly a basis for the concern that she professes to have about a loss of competitiveness over the past 10 years. The hon. Lady went on to make three points. The first was on zero-carbon homes and was echoed by the hon. Member for Rayleigh, as was her second point, on the increased powers for Her Majesty’s Revenue and Customs. Her third point related to concerns about the provisions on managed service companies and it was echoed by the hon. Member for Falmouth and Camborne (Julia Goldsworthy). I shall try to deal with each of those points in turn. On incentives for zero-carbon homes, the hon. Lady’s criticism that the provision is flawed because there is not a large number of such homes is evidently a flawed argument. We would not want to use public taxpayers’ money to incentivise things that are already being done. The new provision is designed precisely to change behaviour and to encourage the widespread building of zero-carbon homes, which is not happening at the moment.