Fiscal Responsibility Bill

The right hon. Gentleman has made a very good observation, which is, in fact, true of government through the ages. Even in mediaeval times, kings and Parliament in its then form were subject to the ability to raise money on what were then the international money markets. Something interesting has happened in this country's politics. We used to regard Budget day, and pre-Budget report day, as the moment when the Chancellor, whoever it was, would come from on high and hand out the goodies. We were all supposed to be incredibly grateful, and then the Chancellor would disappear for another six months. Of course, things are very different now. The House of Commons is subject to the economic pressures imposed on it by, in part, the bond market. I recently read an interview with the Swedish Prime Minister of the 1990s, Göran Persson, who said that no Prime Minister wanted to find himself in the situation in which he had found himself. He was spending more time in the City of London giving presentations to young bond market traders than talking to the Swedish people about the fiscal problems the country faced. The House should take very seriously the fact that the world's largest bond investor said today that next year it would sell gilts rather than buy them, the fact that all the credit ratings agencies have put the United Kingdom on a warning and will decide later in the year whether it should face a credit downgrade, and the fact that our gilt yields are rising at twice the rate of Germany's. Even if the Prime Minister is in complete denial about the economic situation and the fiscal problems that the country faces, I do not think that that is an excuse for the rest of us to ignore those problems. I agree with the right hon. Member for Birkenhead (Mr. Field) about the discipline of the bond market, but I believe that an independent office for budget responsibility would help Members of Parliament to hold Chancellors and Prime Ministers to account for their promises, and would give Members proper information on Budget day so that they could challenge what the Chancellor and the Prime Minister of the day were saying. It would also discipline the Government internally, and would help Chancellors to achieve their and the Government's stated goals. Our proposal has been welcomed by many different people, including independent economists. The Institute for Fiscal Studies has said that a new independent body of the kind that the Conservatives propose""could help keep the interest rates at which the government is able to borrow low"," because it would enhance the confidence of the bond markets in the Government's ability to deliver on their objectives. It has been supported by the CBI and many other organisations. That is why we have published our legislation in draft today. It means proper accountability, a real set of national accounts, lower interest rates, economic stability, and the restoration of Britain's credibility in the world markets. That is what a Conservative Government will bring to this country as we consign this Government and this nonsense of a Bill to the dustbin of history.