Green Budget: National debate - It's good to talk: Labour replace eleme nt of surprise

The Government launched a new approach to management of the public finances yesterday by promising to consult on all aspects of the budgetary process. The Government promised that the Budget would contain detailed measures to root out tax avoidance and would include reform of capital gains tax.

Budgets have traditionally been characterised by a large element of surprise, with most of their measures on taxation taking immediate effect.

The Chancellor wants to take this speculative element out of the process, so that Budgets are seen more as a rolling programme of evolution and development, with most measures subject to detailed debate before implementation. To this end, a series of consultations were announced yesterday.

The Chancellor said he wanted a national debate on the main economic issues facing Britain as he opened up the Government's thinking on economic policy for public scrutiny and comment before final Budget decisions were made.

In his pre-Budget statement, Gordon Brown insisted: "We are consulting in all areas where it is right to consult, taking action in all those areas where action is needed and putting to the country the choices for debate - choices that can be made only by all of us."

Besides the Treasury's 112-page "Pre-Budget Report" detailing the Government's long-term economic objectives, the Chancellor also published "A Code for Fiscal Stability", intended to encourage transparency and openness in the way the public finances are managed, and a consultation on the proposed abolition of advance corporation tax.

Government proposals for new individual savings accounts, intended to replace PEPs and Tessas and to be introduced from April 1999, are to be published next Tuesday.

Also promised shortly are proposals from the Secretary of State for Education and Employment for "individual learning accounts" and for the University for Industry.

Other consultations under way include anti-tax-avoidance measures, and the taxation of North Sea oil, alcohol, tobacco and charities. Proposals on how the tax system can be made to reflect the Government's environmental objectives are to be published in time for next week's summit in Kyoto, Japan. Longer-term reviews include the future of second-tier pension arrangements and measures for an integrated tax and benefit plan.

Mr Brown said that his pre-Budget report would help "build the foundations of a shared understanding and sense of national economic purpose between government, business and individuals. This is essential if Britain is to succeed in the global market place".

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