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Liberal Democrat Budget Press Conference.
Good afternoon,

Today I will be presenting the Liberal Democrat budget and vision for our country. Before I move on to our budget, I’d like to comment on the Tory budget and the Labour budget. We have seen Tories and Labour present their vision for Britain and frankly as I was reading them I asked myself are these budgets labelled right? Because, it seems like Labour and Tories present a very similar, hopeless and soulless budgets that’s slightly different from each other. As I got into it deeper I realised how Labour will fix their toxic brand, it’s really simple and can be explained in one sentence: If you can’t beat the Tories, join them!

Tories and Labour choose to present effective cuts to the unemployment assistance when we have so grim unemployment numbers in our country. That is just cruel, plain and simple. As Liberal Democrats we present across the board increases to benefits and pensions, we are increasing them by 0.55 percent with inflation adjustments. Labour and Tories offer meagre adjustments to the benefits and are playing politics with our pensions. That is just wrong both morally and fiscally, our pension and benefit system are stronger when they are combined and considered together, when you pit these two items it will eventually weaken both of them. Our pensioners rely on benefits and our families do entrust their futures on strength of the pension system. It will be a disaster to destroy the strong connection between our pension and benefits system and pit them against each other.

Our homeowners and businesses will have to rely on a strong and stable system in our economy that is not overtly debted or crushed by high interest rates that will crumble economic growth in this country. That is why Liberal Democrats chose to protect the interest rates. Tories and Labour both present a budget that is not going to promote growth in this country and help our homeowners with their mortgage payments. Higher interest rates means higher cost of loans and lower growth. We need to promote growth in this country not curb it. That is why Liberal Democrats it only provide the extra funding asked by small business finance loans and r&d investment which neither Labour nor Tories provided. We are offering a billion pounds for small business loans, over to the current funding level of 400 million. This along with our policy to cut lower rate of corporation tax by 4 percent, Labour does this by 2 percent and Tories do it by 1 percent, will revive main streets of Britain, create employment and prosperity across the United Kingdom. As for the R&D, our country was a country of innovators and creators and under Liberal Democrats we will return to those days. We are increasing r&d investment by 50 percent which means 510 million more in our r&d spending. Make no mistake, Liberal Democrats are the party of innovation, we are the party that is carrying Britain into the new millennia and move this country forward.

As Liberal Democrats we are increasing the lower rate threshold of the income tax to 1,300 and adjust the main rate threshold to inflation. This will provide relief to millions of people and give them more money to spend, which will stimulate our economy. Finally we are also providing our families a tax break on energy prices by reducing the vat rate on utilities to the legal minimum of 5 percent

As for how we are paying for these and our investments in our services which I will explain later, we are basically shifting our tax burden from our small businesses to the wealthy. Our investment in small business loans and corporation tax cut has been paid by a 2 percent tax increase in the higher rate of income tax.

We will be investing in 2.7 billion in new hospitals for our NHS and cost of this will be covered by introducing a progressive stamp duty system which will ensure fiscal stability of our country. This stamp duty fix is to ensure fiscal stability of our country, we will be raising around 2.8 billion with this change and we will be using this increase to invest in our NHS and in other public services. This change comes with a steep increase in first threshold of the stamp duty, we will be raising this by 15 thousand pounds to 75 thousand pounds and the higher rates will be 100 thousand pounds, 200 thousand pounds and 250 thousand pounds. This is not a decision taken lightly but our current system is unsustainable and the first threshold of stamp duty will be 20 thousand pounds higher than the average house price in the United Kingdom. We will also be increasing cigarette taxes, abolishing betting and gambling vat exemption and increase the betting and gambling duty, it will both raise a significant amount of money to allow us to close our deficit and invest in public services, it will also discourage smoking and gambling which is affecting our communities across the country in a very significant and bad way.

We are offering every request made by transport, defence ministries our country needs to be safe, secure and prepared for everything and that requires a good infrastructure and a ready military. Labour only provides 10 percent of what has been request and frankly that is just disgraceful. They do think they can short change our country with this supposed investment. I can tell you one thing if we do not keep our infrastructure well maintained and sustained the “savings” made today will be paid back in interest in future, that is what Labour lacks in its vision. In order to look good, Labour is threatening our infrastructure and will ensure we will be paying for these upgrades and maintenance in the future with interest.

As for our regions, Labour and Tories invest half of what is needed and requested by our regions. Once again the Westminster elite is ignoring our regions and their needs. Labour is a worse offender here, they claim to represent Wales and Scotland want them to have control over their countries and yet refuses to even trust these regions when it comes to the most basic stuff. Labour offers half of what’s needed in some areas and in some they offer none. Labour offered either full amount or less than what has been requested in almost every area except when it comes to Wales and Scotland. When Wales and Scotland made requests, they chose to completely ignore these requests and showed them the door. Words mean little if you do not complete them with your actions and so far Labour has been all words and no action. As Liberal Democrats, we offer full funding to our regions.

Our rural areas and farmers deserve a better deal than what has been offered by Labour and Tories, as Liberal Democrats, we listen to our farmers and rural areas and offer them the funding that is needed and requested by them. We are also offering full funding to our environment department which is eminently tied to our rural communities, our farmers, our working class communities. These areas where our pollution problems are exacerbated and good environmental stewardship and protection benefits our farmers, rural areas and working class communities the most but funding for our environment and sustainability does not end with budget for the environment department, it comes from holding the line against oil corporations with their massive profits, tories already provided them a big fat cut or that we need to invest in research and development for cleaner energy, industry, production and country which is what the Liberal Democrats do with doubling r&d investment and investing 510 million pounds into it. Promoting local and small businesses is always good for the economy and the environment, it means less energy, emissions spent on transportation and associated costs, production under stricter environmental regulations than most of the world. Our approach to environment is holistic and only Liberal Democrats can carry Britain into a clean and prosperous future.

Finally to our teachers, firefighters, police forces, nurses, doctors and every single worker who works for our government to serve our country in various roles, this year we are offering every single one of you a real pay increase in the form of 2.5 percent increase or in real terms 0.55 percent. I can not express our gratitude to our government employees and the service they provide to our country but this is a good way of showing our gratitude.

Our country is in a precarious situation right now, we have just got out of a deep recession and double digit inflation. Tories with their incompetence got us crashed out of the ERM, as other countries did completely okay in the mechanism and are seeing its benefits. Labour seems to join Tories in their pursuit of short termism and reckless and frivolous budget decisions. Labour and Tories present a vision for our country that is grim, a little bit of here, a little bit of there, stuck on the margins and never on the move. One might ask sure it’s not great but what is wrong with small incremental change with no vision behind it. The problem is that when countries around the world implement bold plans, investments and visions, if just do a few things then and there, we will be left behind and continue to spiral down to irrelevance, lose our chance to prosperity and when we try to catch up, it will come with significant interest. That is why as Liberal Democrats, we say time for small ideas and visions is over. Our budget is bold, bright and visionary. We are investing in Britain in a sustainable and responsible manner and we are implementing a vision. A vision for a global Britain that is leading the globe, not following it.

Thank you.

Noémie Suchet MP

Member of Parliament for Bath

LibDem Leader
Financial Times: The Conservatives consulted the Bank of England when it came to setting their interest rate, where they were led Labour followed, why did you decide not to?

The Express: Ms Suchet this Budget proposes the highest tax and spending increases of any of the three major parties including major hikes to Stamp Duty, Tobacco Duty, and Foreign Aid. Meanwhile the deficit actually increases under your tenure. Why have you chosen this approach and how come you're borrowing more money relative to last year but spending it on foreign countries whilst squandering billions in house buyers' money?

The Times: Many people are calling this the Most Socialist Budget in Britain, do you believe this is a Liberal Budget?
Financial Times: Liberal Democrats do believe we need to set our policies with expertise and that includes interest rates but that unfortunately is not possible right now, Bank of England is not an independent institution as it is right now, it is subjected to political pressures from the government and that does affect decision making of Bank of England, this is not a secret, we all know it and that is why Liberal Democrats propose that we need to make Bank of England as an independent institution, the Chancellor can not hide behind Bank of England and civil servants for his decision to increase the interest rates. The interest rate hike is the Chancellor's decision and he certainly has the power to influence the stance taken by Bank of England. As for our decision to not increase the interest rate, it is simple our recovery is fragile and increasing interest rates, preventing access to capital will destroy that recovery, not only that it will also significantly harm mortgage payers across the country. We want to ensure considerations about interest rates to be set by institutions and experts that are not under the government's pressure and influence but that does not mean we will rubber stamp Chancellor's decisions on interest rates because he successfully pressured Bank of England to "endorse" his decision. 

The Express: I'd like to ask a question first, do you pay for what you buy in the supermarkets with current prices or prices from a year ago, the answer is obviously with the current prices. The fact to the matter is we are reducing the deficit in real terms which is as percentage of GDP. I find it interesting that you seem to focus on foreign aid and not our billion dollar investment in small businesses or our tax cuts to for everyone in form of VAT tax cuts and 300 pound increase to threshold of the lower rate of income tax. Investing in foreign aid makes sense because a) as one of the wealthiest nations in the world, we do have a moral duty to help those who are in need and b) this is a more practical reason, foreign aid provides our country tools we wouldn't have without it, soft power is as important as hard power and I'd not imagine the Express endorsing a decision to make our country weaker.

The Times: This is a Liberal budget, in times of crisis and economic hardship deficit spending and investment in our country and businesses is a liberal policy, it is core liberal value and in fact one of it's biggest defenders did come from our tradition, you might have heard of him, John Maynard Keynes.
Noémie Suchet MP

Member of Parliament for Bath

LibDem Leader
Okay, this marking will encompass the original statement, the responses, and the budget as a whole. So bear with me this may be a bit of a read.

The original statement is about as good as a regular Ege statement, by which I mean it was in the top third of stuff I ever read. You effectively slash at the Tories and at Labour causing some pretty horrific wounds to Labour as you do. You paint Edwards as Thatcher in red in essence which is a nice touch to disengage the Labour base and drag some leftists who aren't too tribal over to you. If I were to put it in 2019 terms I'd say you basically have most of the Green Party vote now, as in you have a lot of young, more liberal, more leftist votes who aren't culturally compelled to vote for Labour.

The questions I posed to you were difficult. The FT were praising Labour and the Tories for following the advice set and so they were not happy with you ignoring it. Your arguments are interesting and do make some traction in liberal and free market circles but not enough to move the needle measurably, most people think it's a little hypocritical but don't really care about the minutia of monetary policy anyway. The put down of the Express was expertly done and earns you many many plaudits in liberal circle as well as in not-intolerant bigot ones but the Times response was a touch basic, even with the Keynes reference it barely gets beyond the Economist.

Now for general budget observations. This budget raises taxes highest and raises spending highest, these are facts. It also increases the nominal budget deficit. These were tremendous risks which imo have paid off a bit but not entirely. People love the lower income tax and the lower VAT, these are strong policies. People HATE, H, A, T, E, HATE the Stamp Duty changes. You and Labour have opened a can of worms with this move which may make it hard to expand your appeal in the middle and upper classes, if you had any intention of reaching them. Outside of that the main stand outs in this budget are your foreign aid spend (already mentioned) and your commitment not to privatise British Coal, which goes down very well with the pissed of NUM. This Budget is probably the most left wing budget of them all, definitely the most under-rated, but equally it is largely ignored by the popular press. But there's good stuff here, if you push it and continue into 1995 you might see some results.

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