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1995 - PMQT 16th May 1995

Below is the text of Prime Minister's Question Time from 16th May 1995.

PRIME MINISTER:

Engagements

Q1. Mr. Nigel Griffiths: To ask the Prime Minister if he will list his official engagements for Tuesday 16 May.

The Prime Minister (Mr. John Major): This morning, I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.

Mr. Griffiths: As the vast majority of the British public want to see the accounts of political parties open to maximum public scrutiny, will the Prime Minister join Labour in calling for the Nolan committee to examine all aspects of party political funding? Or what has he got to hide?

The Prime Minister: As the whole House knows, within the past 18 months the Home Affairs Select Committee conducted a full inquiry into these matters. Subsequent to that inquiry, the Conservative party has implemented in full the code of practice drawn up by the Committee. The Labour party has refused to do so.

Mr. Lamont: Will the Prime Minister take an early opportunity to point out to the public that almost every country in Europe has had to put up taxes to deal with the effect on deficits of the recession? Will he also point out that, even after recent tax increases, the tax burden in this country in the 1990s will be lower than it was in the 1980s, just as it was lower in the 1980s than in the 1970s, including deficits? Will my right hon. Friend also point out that, thanks to Conservative Governments, this country has by a long way one of the lowest tax burdens in Europe?

The Prime Minister rose -- [Interruption.] My right hon. Friend is entirely right-- [Interruption.]

Madam Speaker: Order.

The Prime Minister: I commend to hon. Members opposite the excellent speech that my right hon. Friend made on this matter on Friday last week. As a result of the recovery, and despite the tax changes that we were compelled by the recession to make, households will actually be about £250 a year better off on average after tax and inflation this year.

Mr. Blair: Given the latest pay and perks scandal in the utilities at the weekend and today's massive rise in electricity profits, does the Prime Minister recognise that the utilities have degenerated into an unseemly racket and that the sooner he orders a thorough overhaul of their system of regulation the better? [Interruption.]

Madam Speaker: Order. I will have no more barracking from sedentary positions by individual Back Benchers. They will be named the next time.

The Prime Minister: Everyone wishes to see consumers protected. That is precisely why we have regulators to control prices and why, when necessary, the regulators have acted to control prices. Utility prices have fallen during the period of privatisation.

Although I have not yet had the opportunity to consider in detail the proposals of the shadow Secretary of State for Trade and Industry, I have to say that artificial plans to control profits smack very much of old Labour, not new Labour. The determination of what the Opposition call "reasonable profits" seems to me to be impossible. Who determines their level? Who says what is reasonable? What happens when profits bounce back after a period in which there have been losses? Do they apply just to the utilities or to other industries? These are the sort of questions that we would have asked of the Labour party in the 1970s; now we discover that we must ask them of the Labour party in the 1990s as well.

Mr. Blair: Will the Prime Minister confirm the following? Electricity prices in real terms for domestic households have risen since privatisation, as the House of Commons Library confirmed this morning; water charges have risen by more than 40 per cent. since privatisation; gas complaints are up by 150 per cent. in the past year-- [Interruption.] He can cap rail fares only by promising an open-ended subsidy from the taxpayer to privatised operators. Why does he always stick up for the excess profits and the managers who make themselves into millionaires rather than the hard-pressed consumer, who is forced to use such monopoly services and is fed up with the way they are being run?

The Prime Minister: That was very well prepared, but almost entirely inaccurate. The reality is that the nationalised industries once cost the taxpayer £50 million a week and the privatised industries now yield £50 million a week. The average price of domestic electricity to households has fallen by 8.5 per cent. in real terms over the past two years; the price of gas has fallen by more than 20 per cent. in real terms since privatisation; BT's main prices have fallen by more than 35 per cent. in real terms since privatisation; Britain's water is now among the cleanest in Europe-- [Interruption.] When those industries were all nationalised, prices went up year after year after year. The Opposition would like to control and regulate from the centre; they are determined to go back to when prices went up and not down year after year after year.

Dr. Spink: Will my right hon. Friend join me in welcoming yesterday's vote by the police, which showed that they do not wish routinely to carry arms? Does he feel, like me, that the best way in which to protect the police from those who carry arms is to increase the sentences that we can inflict on such people, and will he consider bringing back the death penalty for the murder of police officers?

The Prime Minister: I certainly very strongly support the decision not to carry firearms taken by the police in their ballot yesterday. That is wholly in tradition with policing in this country. I believe that it is the right decision and I warmly congratulate the police on having reached it. In recent years, we have increased the penalties for a large number of offences. I shall not retail them all at this moment, but I will willingly set them out in a parliamentary answer if my hon. Friend wishes me to do so. As my hon. Friend knows, I personally do not favour the return of capital punishment.

Mr. Ashdown: If the Conservative party has put its house in order on the question of funding, why will the Prime Minister not allow Lord Nolan to look into it? Does not the question of funding of all political parties go to the heart of the public's concern about trust in our political system? Does the Prime Minister not realise that, while he got high marks for establishing the Nolan committee, he will get no marks if he now seeks to turn what he told us was to be the public's bloodhound into the Prime Minister's poodle?

The Prime Minister: I do not think that anyone who has studied the membership of the Nolan committee or knows any of its members would remotely recognise the right hon. Gentleman's description of it. As he knows, there are only two ways of funding political parties in a free democracy. One is by subscription or donation freely given, and it is right in an open society that donors, if they wish, should preserve anonymity. [Interruption.] The other way is to fund political parties out of taxpayers' money. I do not favour that way and I hope that we shall not go in that direction. What is wrong about funding of political parties is when the funding of a party actually buys influence over its policy. [Interruption.] That is what is happening with the Opposition, where trade unions have 70 per cent. of the votes in Labour policy-making bodies, and even the proposal for dramatic reform would only diminish that to 50 per cent.

Mr. Duncan Smith: Does my right hon. Friend agree that, although the nuclear non-proliferation treaty has been signed there remains a serious threat of proliferation, and that the possession of a nuclear weapon is a measure of deterrence against those who would possess nuclear devices? Does he not find it absurd that Labour Front-Bench spokesmen say that they would hold Trident but would never use it? Does he think that that would deter anybody?

The Prime Minister: I suppose that there is a logical case for saying that one would scrap Trident--although I passionately disagree with that case, as I believe that Trident is necessary as a deterrent--but it is absolutely intellectually unsustainable to say that one would have Trident as a deterrent, but to tell those whom it is there to deter that one would never use it. If that is their position, the Opposition might as well take the money and pour it down the nearest drain.


Q2. Mr. Win Griffiths: To ask the Prime Minister if he will list his official engagements for Tuesday 16 May.

The Prime Minister: I refer the hon. Gentleman to the reply I gave some moments ago.

Mr. Griffiths: Can the Prime Minister confirm that there are now an extra 500,000 people, notably those on low incomes, paying tax, principally because of the cuts in the married person's allowance last month, and that, after 16 years of Tory government, there are a record 26.2 million people paying income tax? Is the message not clear: "Tory Governments damage your wallet"?

The Prime Minister: First I must tell the hon. Gentleman that, if we had retained the Labour tax regime, there would have been an extra 1 million people in tax today. As for his specific questions, there are two substantive reasons why more people are paying tax this year. One is wage drift upwards. The second is the number of people who were unemployed but who are now in work and paying taxes. I should have thought that the hon. Gentleman would welcome that drop in unemployment.


Q3. Mr. Jenkin: To ask the Prime Minister if he will list his official engagements for Tuesday 16 May.

The Prime Minister: I refer my hon. Friend to the reply I gave some moments ago.

Mr. Jenkin: Further to the notice that I have given my right hon. Friend, as we approach the 1996 intergovernmental conference in Europe, and more particularly as we approach the 'reflections' group meeting in the summer, will he undertake to publish the Government's contribution to that group? Is it not essential that the IGC should address not stories about square strawberries and straight bananas, but the real public anxieties about growing European Union power--anxieties which the Leader of the Opposition apparently does not share, as he would give away the veto? Like one of his predecessors, the right hon. Gentleman may be fit to become a European Commissioner one day, but he is unfit to lead this nation.

The Prime Minister: I am grateful to my hon. Friend for giving me notice of the matter that he proposed to raise. I certainly agree that the European Union needs to be more responsive to the views of its people, with less interference and less red tape. We shall enter the IGC with a positive agenda, providing for more intergovernmental co-operation in a Europe of nation states, including co-operation in foreign policy, in defence and in the international battle against crime.

I believe that the European Union, both at the IGC and beyond, should give more consideration to Europe's place in the world rather than to the internal politics of the nations currently within it. We shall also press for more subsidiarity, more action against fraud and mismanagement, and a strengthened role for national parliaments. We shall not surrender our veto or our opt-outs from the social chapter and the single currency. I will consider my hon. Friend's request that we should publish our paper.


Q4. Mr. Wicks: To ask the Prime Minister if he will list his official engagements for Tuesday 16 May.

The Prime Minister: I refer the hon. Gentleman to the reply I gave some moments ago.

Mr. Wicks: Does the Prime Minister agree with the statement of his Health Minister, Baroness Cumberlege, speaking to the Royal College of Nursing, that

"community care clearly isn't working"

and, if so, what does he intend to do about it?

The Prime Minister: I understand from my hon. and noble Friend--who is more familiar with the quotation than I am--that the hon. Gentleman has quoted the remark out of context.


Q5. Mr. Bill Walker: To ask the Prime Minister if he will list his official engagements for Tuesday 16 May.

The Prime Minister: I refer my hon. Friend to the answer I gave some moments ago.

Mr. Walker: Does my right hon. Friend agree that a tax-raising legislative assembly in Edinburgh which fails to address the West Lothian question and the number of Members from Scotland in this House is bound to be unworkable and will be merely a stepping stone to separation?

The Prime Minister: I agree with my hon. Friend. It would be unworkable because some questions about it are unanswered and unanswerable. No one has yet explained why Scottish Members should be able to vote on English matters while English Members would not be able to vote on Scottish matters. There is silence from the Opposition on that. No one has yet explained why people who live in Scotland should pay more tax simply for the pleasure of being in Scotland. Again, there is silence from the Opposition. If the Opposition were serious about the constitution of Scotland, they would long ago have been able to answer a range of questions on the matter. Yet they still cannot answer them. Their policy is bad for Scotland, bad for the economy and bad for the United Kingdom.