My Lords, I shall make two or three small but important points and one large and general point. I shall start with the large and general point because it follows on very neatly from my noble friend Lord Haskell’s comments on productivity. It is clear, particularly after some of the statements made in Prime Minister’s Questions yesterday, that whoever forms the next Government, they will have difficulty in raising income in a significant way. I remind the Minister what many of us have been saying over a number of years: that one of the best ways—indeed, the best way—of getting deficits down is through growth. I know the Government will say they are achieving growth, and there is some truth in that, but one of the problems that trouble me is that that growth comes from a low-income use of labour. My noble friend’s comments on immigration are exactly right. Immigration, particularly from eastern Europe, has depressed wages, particularly in the less-skilled areas. Even though these people are often highly skilled, their skills are not recognised here in a way that enables them to get a job. So there is a problem with boosting growth by means other than just increased employment and lower incomes.
The key to addressing the issue is science and technology, as I have mentioned before. In his opening remarks the Minister rightly drew attention to Clauses 27 and 28, which increase the aid provided to small and medium-sized enterprises for research and development. If this country is really to make a success of growth over a long period, science and technology will always have to be at the forefront. We have to do far more to invest in science and technology and, above all, to give small entrepreneurs greater help.
If you look round some of the university cities of this country you will find that many small and medium-sized enterprises have sprung up around those universities. I seem to remember that, many years ago, in the early stages of the Labour Government under Mr Blair, Cambridge did increasingly well with its link between the science departments, the banks and these entrepreneurial people. Somehow or other we have to boost that so that we do not have to rely for our growth on a lower income scale, important as that is. There was a very good article about this in the Guardian the other day. Boosting growth through low-income immigration from other countries might work economically for a while but you will not keep up with what is happening in more advanced technology areas. We have to be at the cutting edge. I would love to see every Budget start with a section on what will be done to give advantage to science and technology. It will also have to be linked to the universities, and the universities will need to be linked to the banks so that the banks will more generously fund and risk-take for the small and medium-sized enterprises.
The argument about immigration needs to be seen in two ways. There is clearly a problem in social terms with the pressure on schools, housing, hospitals or whatever. However, there is also the problem of how the issue feeds into our economy. Overall, immigration has been beneficial to this country—I think that almost everybody recognises that now. However, the question
is how we can produce growth out of this immigration, which is why Members on all sides of this House and people outside it take a very dim view of including the many students who come to this country in the immigration figures. That has done much damage to Britain’s reputation, particularly in India. My message to the Government is that, overall, in a Budget which does not have much in it to criticise—although there are a few good things to say about it, which, to encourage the Minister, I will do in a moment—there is not the necessary emphasis on science and technology and small and medium-sized enterprises.
I will give one example. A company in Cardington, the old RAF base up in Bedfordshire, produces in essence a very large inflatable balloon that carries very heavy goods and has already done a tour of South America. I have talked to the company and seen the balloon. This sort of technology can be very helpful environmentally and also very good for our transport infrastructure in terms of transporting very heavy goods, the need for which is becoming increasingly common. For example, the assembly centre for the Airbus industry is largely in France but many of the parts are made in this country and have to be transported to France. These parts are transported in all sorts of bizarre ways as the aircraft themselves are often not big enough to carry them. We need to be imaginative and push such industries forward.
I am sure the Minister will not be surprised if I mention air passenger duty. There has been a small step in the right direction. He said in his opening comments that he thought that Britain must have the most competitive rate in the world. At the moment, however, our air passenger actually encourages people to fly more. People in this country will take a short hop across the Channel and then take a long-haul flight as it is cheaper there because they have no air passenger duty. I understand that it is very difficult in the current economic climate to change that overnight. However—and I say this to my own party as well—we need to get rid of the air passenger duty tax if we are to compete with other countries, particularly European countries which can offer far better deals to the travelling public, be it for holidays, work or whatever. That is very important.
I welcome the move to make gift aid easier for intermediaries, and also declare an interest as the chairman of a charity. Our charity will not benefit from this provision, however, because the famous statue of Mary Seacole will be unveiled across the river from here in September or October, we hope, as long as I can raise a little more money. If anyone would like to talk to me about that please see me after the debate—because I am getting worried. However, that apart, it is so much easier if intermediaries can do the gift aid bit. I welcome the movement on that. It is very helpful.
I also have a small suggestion on car duty. I have been struck by the growth in the number of electric vehicles but, as the Minister will know, in some areas it is difficult to charge them. I do not know the tax position as regards establishing charging points. However, when there is clearly a long-term and important change in vehicle technology, there should be significant tax relief for establishing charging points. There might be
some relief already—I do not know. I do not think that the relief should be ongoing but while this technological change is taking place it needs to be encouraged. I am sure that as electric vehicles become more and more common, the supply of charging points will increase to meet that demand. In the short-term, however, such investment could be very useful.
Those were my main points. I will end with a plea which is totally different from the other points—it is not about the Budget per se but about Her Majesty’s income and revenue department. I am one of a fast-growing number of people in this country who hold power of attorney for a relative or friend. Going on to the tax website and trying to find a way in which to deal with it is almost impossible. The only good thing that I can say for the department on this is that it is not alone, in that the banks are equally bad. I have been trying to close down a Barclaycard for two months now. There must be a way of typing into the website on tax matters “power of attorney” and being directed to it, because the situation that I have is that there are no paper records at all. I do not know what the tax position is or where to find the information, so I wrote some weeks ago to the tax department asking where I could find it and where to send my authenticated copy of the power of attorney. I still have not had an answer.
A big advantage for Peers and MPs and so on is that they can write to the Minister, but I do not want to do that. Every department nowadays must have some place where you can quickly access information on the current situation regarding power of attorney. The situation currently is almost impossible. When I asked around to other people about this, I found that I am not alone in having this problem. It is a very real problem and it can cause considerable difficulties. I am not saying that I am brilliant at using the internet and the web, but I am certainly not bad; if I can pat myself on the back, I would say that I was better than average. I may be being incredibly stupid on this, but I cannot find anything of assistance on the income tax website. I can find things on power of attorney, but the website does not direct you in the right way—nor is it developed enough—to give the information that I need. But that is a non-Budget point; it is a general point about the Minister's department, and I would be very grateful if he would pass it on and get it sorted out. An awful lot of people in this country now have to manage power of attorney—it is a growing number, as I say—and need this information to be on all major websites of private and public organisations.
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