Shadow Chancellor - Budget Response
The Shadow Chancellor bounds on to a small stage; he is surrounded by Conservative Party activists, who are holding placards in their hands: each placard is double sided, with a white side and a green side. There are two variations as follows:
Douglas shakes the hands of some of the audience and then removes his suit jacket, revealing a crisp white shirt. He is not wearing a tie, and has rolled up his sleeves: he looks almost as if he is in election campaigning mode, and his enthusiasm shows through his grinning expression.
“Well, comrades - the government have presented their budget. And I’ll be honest, it’s not what I expected.
After a year of rampant spending and blossoming deficit, Labour and the Liberal Democrats have this year decided to enact cuts faster than we ourselves are proposing.
Calvin Ward has produced a budget which seems to be all things to all people. But in truth, it is anything but.
Before I talk about the government’s budget, I want to talk about my alternative - the Conservative alternative.
We are committed to eliminating the deficit within five years and balancing expenditure with income in the long term to ensure future fiscal sustainability.
We are also committed, in the long term, to make British corporation tax the lowest in the G20 - making our economy more competitive and making the United Kingdom the best place in the world to do business.
This year, we would cut the basic rate of income tax to 15% - saving the average earner £800 a year. We would abolish capital gains tax, encouraging investment and entrepreneurship for the future, and we would cut the rate of corporation tax for small businesses by 4%. We would cut the beer duty by 4 pence in the pound, supporting the pub industry, and commit in the long run to abolishing national insurance contributions. We would freeze the vast majority of taxes, and under the Conservatives, the tax burden would begin to decline to a historic low. Businesses and individuals would be liberated on an unprecedented level from the taxman, and our economy would become ever more open, more competitive and more fair. Indeed, our proposals would mean that for the average working individual, life would be far easier.
For the servicemen and women of our armed forces, the Conservatives proposed a 5% pay increase - a vast improvement on what the government is offering. Our proposals included radical new investment in military equipment, aircraft and in the surface fleet, in stark contrast to the government’s plan of managed decline in the face of resurgent Russian aggression.
For the NHS, the Conservative plan is a significant funding boost worth several billion, whilst in education we would continue to ensure that universities are properly funded. We would scrap HS2 and Crossrail, funnelling transport investment towards areas traditionally neglected by the Westminster government. Over five years, we would abolish prescription charges - ending a tax on sickness - and our new proposals to bring an end to traditional prudential regulation, replacing it with tough capital standards, would reform the banking sector and make it safer for all our futures.
£800 in your pocket, the lowest rate of income tax in modern history, no more capital gains tax, a cut to the beer duty, the lowest corporation tax in the G20, unprecedented investment in our National Health Service and a renewed focus on sharing the wealth with the whole of the United Kingdom: that is the Conservative offer. It is an offer which pays our military personnel what they deserve and gives them the tools to do the job; it is an offer which invests in Britain’s future without profligacy, responsibly managing our finances to ensure long-term sustainability. The crisis of 2007/8 can never be repeated, and the Conservatives would make sure it is not. £800 a year extra in the back pocket of the average worker: that is a proposal of which we, as Conservatives, can be proud.
But when asked if he would endorse our plans, the Chancellor of the Exchequer gave Parliament an answer in a single word: ‘no.’ He refused to engage on the substance of the shadow budget, and instead put forward his own lacklustre proposal which leaves all of us wanting.
The Chancellor’s flawed logic and poor grasp of mathematics has been revealed to all the world in his farcical claim that his budget will save the average taxpayer £1,000. The only tax cut I can find, having scoured his proposals, is a £1,000 rise in the personal allowance: but for the average worker, that represents a pay rise of £200 - not a thousand. There’s an £800 deficit in Labour’s maths, and that should be sincerely worrying for us all.
And even as the government gives with one hand, it proposes now to take with the other. All duties will rise this year. Insurance Premium Tax will rise. Employer’s national insurance contributions - a tax on jobs - will rise. The bank levy will rise. Even as the Chancellor criticises the Conservatives for proposing to remove the VAT exemption on gambling, he whacks the betting duty up by 10%.
After all the noise and fury from the Labour Party about defence cuts, the government proposes to slash the defence budget by £3 billion, even as the Conservatives propose to nearly double investment in the surface fleet, make £1 billion available for weapons procurement and dramatically boost funding for land and air equipment.
At a cost of nearly £1 billion, the government slashes university tuition fees again - making up the shortfall by charging working class taxpayers who never went to university, but whom the government sees fit to use in order to subsidise wealthier young people who do enter higher education.
So let’s be very clear about the differences between the Government’s budget offer and the Conservative alternative. The Labour plan gives with one hand and claws back with the other, raising indirect taxes to pay for a nominal rise in the personal allowance which will, at its very best, mean a £200 pay rise for the average worker. The Conservative plan cuts taxes across the board, abolishing capital gains tax, slashing corporation tax and bringing the basic rate of income tax down to just 15%. Our plan is to deliver an £800 pay increase for the average worker, whilst bringing business rates down and bringing many taxes down to historic lows even as we cut the deficit.
The government’s offer is to underfund and neglect our defence; the Conservative plan is to invest in our services and service personnel, delivering a generous pay rise for the bravest of the brave and upholding our international commitments in an age of increasing uncertainty.
The government’s offer is to make good on a £13 billion misdirected spending splurge last year with a huge cut to the deficit this year. But their approach remains inconsistent and uncertain: the Conservative plan is so steadily cut the deficit and eliminate it totally within five years, balancing expenditure with tax receipts on the long run to ensure strategic fiscal sustainability.
The government’s offer is to raise the beer duty, the tax on insurance premiums and national insurance, whilst the Conservative plan is to support our pub industry with a big beer duty cut, to abolish national insurance contributions in the long term and to bring into the fore a programme of managed tax burden and deficit reduction.
The government’s offer is one of old order socialism, tempered by a Liberal Democrat obsession with ineffective capital investment splurges. The Conservative offer is to reform our economy, making it the most open, flexible and competitive on Earth: delivering one nation which works for everyone, and safeguarding Britain’s future as the powerhouse of Opportunity in the western world.
Ours is the Opportunity Agenda, and I truly believe that when the British people compare the Conservative record with the government’s, and compare our future programme with theirs, they will make the judgement that it is the Conservatives who are the natural party of government and the right party to lead Britain forwards.
Let me finish by paying tribute to Dylan Macmillan, who has led us now for a long while and whose efforts have finally been rewarded with a phenomenal opinion polling boost. Of course, the only poll that matters is the poll of 2019: that poll we can, and we must, win - and it is by spelling out our clear alternative, the Conservative vision, that we can begin to do so.