Jeremy Browne speaks for the Liberal Democrats at second reading debate on the Finance Bill

Discussing the Finance Bill, Jeremy Browne, Liberal Democrat Shadow Chief Secretary to the Treasury, criticised Labour’s lack of moral compass in doubling the 10p tax rate, and accused the Conservatives of being exactly the same as Labour.

Jeremy Browne began his speech by saying: “There are two main ways in which a Member of this House can judge a Finance Bill, a Budget or, for that matter, a Government. The first is to ask whether the measure has a vision, a sense of purpose and a direction. The second is to ask whether it has what the Prime Minister calls a moral compass. That is the issue that has occupied us to the greatest extent so far today, and the one to which I will devote the largest part of my speech. It is the specific issue of the doubling of the 10p tax rate that is causing the greatest amount of grief and unhappiness among my constituents and among people right across the country.”

Mr Browne criticised the Conservatives for initially failing to notice Gordon Brown’s tax con:

“I remember that, on 21 March 2007, the Labour Benches were awash with a sense of euphoria that the then Chancellor had paved the way to Downing Street with no contest, as no one would stand against him. The leader of the Conservative party rose to his feet - we have to remember, of course, that my constituents pay more in their taxes for the salary of the right hon. Member for Witney (Mr. Cameron) than they do for any other Opposition MP, so we are entitled to think that he will stand head and shoulders above us all in respect of his ability to analyse the Budget - but unfortunately, he did not notice the doubling of the 10p rate. In fact, in the first line of his speech, the leader of the Conservative party said the following words on behalf of the 5.3 million people who were losers in the Budget:

“Well, the Chancellor has finally given us a tax cut.” - [Official Report, 21 March 2007; Vol. 458, c. 829.]

“That was his analysis.”

Mr Browne noted that the Liberal Democrats had been the first to highlight the doubling of the 10p tax rate:

“Let us go back to 21 March 2007. Labour MPs, who were hugging themselves with joy because their re-election had been confirmed on the backs of more than 5 million people who were losing out, rushed off to the Tea Room to gossip excitedly about what had just been announced. As a matter of courtesy, as well as of self-preservation, they would have been well advised to stay and listen to the leader of the Liberal Democrats. Of course, the London media commentators in the Gallery all rushed off as well, back to their computers. As a result, the warnings that the Liberal Democrats gave on Budget day, within minutes of the Chancellor sitting down, were not heeded by those Labour MPs, media commentators and others.

“The media continue to describe those who are losing out under the March 2007 proposals, which are just being implemented, as low earners. Low earners are affected, but not just low earners. In many communities around the country and in constituencies such as the one I represent, a salary of up to £18,000 does not constitute low earning, although it may sound like low earning to some in the London media commentating classes. Such wages are typical in places such as Taunton, in Somerset and right across the country. Right across my constituency, people such as farm labourers, hotel receptionists and those who work in service industries are adversely affected by the proposals that are being introduced.

“People in the House and elsewhere should not delude themselves that we are talking about just a small number of people who are marginally oppressed. We are talking about millions of people who are contributing to the community in every constituency represented here.”

He turned to the Conservatives, who he accused of not really being interested in helping the low paid:

“The Conservatives have two criticisms of the Labour Government: the first is that they tax too much, spend too much and waste too much, and the second is that they have not done what the Conservatives would do, which is exactly the same. The Conservative party and the Labour party have morphed into a single entity. Every time the Conservatives criticise Labour tax rises, we should remember that they must have a secret extra tax rise in mind to make up for the one that they are criticising.

“The Conservatives feign concern about those who will be harmed by the doubling of the 10p rate, but at the Conservative party conference last autumn, what was the party’s main priority for helping those who were struggling with their tax burden? Was it helping the people on the lowest incomes - the people whom I mentioned earlier, the farm labourers, hotel receptionists and hospital porters cited by the hon. Member for Runnymede and Weybridge (Mr. Hammond)? Was it single people under the age of 25 on modest incomes? No; they were completely ignored by the Conservatives. Was it pensioners between the ages of 60 and 64, who will be adversely affected by the Government’s proposals? No, it was not them either. The group singled out for special assistance by the Conservative shadow Chancellor ? were people who owned houses worth around £990,000 to £995,000 and had paid off their mortgages. Those people were considered to be a more deserving target for the largesse of the Conservative party than people, in my constituency and elsewhere, on incomes of £11,000, £12,000 or £13,000 a year.”

Jeremy Browne concluded by questioning what the purpose of today’s Labour Party was:

“Like the Budget, this Finance Bill fails all the tests of leadership. It has no great purpose, it has no great vision, and it flunks all the big challenges. Worst of all, the proposals that we will scrutinise in depth in the months ahead have no soul. It is now impossible to work out what the Labour party exists to achieve. The abolition, or doubling, of the 10p rate sends out the signal that the end of the empty hologram that was new Labour has finally arrived. It was Harold Wilson, who won four out of five elections while leading his party - four more than will be won by the current Prime Minister - who said that the Labour party

“is a moral crusade or it is nothing”.

“Many Labour Members seem finally, but far too late, to have realised that with the doubling of the 10p rate their party is now nothing.”

The Bill was passed, with 298 for and 223 against
The Liberal Democrats voted against the Bill
Click here to read Jeremy Browne’s speech in full