Major cornered by Smith on tax rises: Gatt leaves Skinner unimpressed - French accused of censorship - Lords aim to give girls 'more of the cake'

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Indy Politics
Despite a week of favourable economic statistics and praise for his courage on Northern Ireland, John Major's last Question Time before the Christmas break turned into a testy affair as he had to concede that this year's Budgets have raised taxes by the equivalent of 7p in the pound on income tax.

The Prime Minister was cornered by words to this effect from his own Chancellor of the Exchequer, Kenneth Clarke, on Wednesday in evidence to the Treasury select committee.

Asked by John Smith, the Labour leader, if he agreed with the Chancellor, Mr Major put a different gloss on it. 'What the Chancellor said was that the aggregate sum of money raised after three years would amount to the crude equivalent of 7p.'

But the attempt at obfuscation only made Labour MPs jeer louder. 'As Mr Smith knows, that takes no account of growth in the economy and many other matters,' a rattled Prime Minister said above the din.

Mr Smith said the Chancellor told the committee that the increases would amount to between pounds 15bn and pounds 17bn. 'Is there anything more crude than promising no tax increases before an election and putting them up by pounds 15bn after?'

Mr Major said the Labour leader had taken the cost of Budget measures over the next three years. 'Clearly he is deficient in understanding and has come up with an entirely spurious one-off tax increase.'

He attempted to wound Mr Smith with a quote from the 'acting general-secretary of the Fabian Society', suggesting the Opposition should be 'in therapy', but whoever this revered office holder is, Labour backbenchers were unimpressed and jeered the more.

Tory MPs returned the treatment as Mr Smith came back a third time to ask if the Prime Minister denied 'that before the last election the Conservative Party promised not to increase taxes?' There was, of course, no answer. Mr Major challenged the Labour leader to deny he proposed taxes on tourism, payrolls, windfall profits, pollution, on businesses and for education. 'The man does nothing but propose new taxes day after day,' the Prime Minister said, knowing full well that the conventions of Question Time prevented Mr Smith from getting to his feet again.

Donald Dewar, Labour's social security spokesman, returned to the Chancellor's admission as the Government pushed through the Bill to increase employees' National Insurance contributions by 1 per cent - due to raise pounds 1.9bn in the first year. 'I would have thought that (7p on the standard rate) was a pretty staggering figure for Conservative MPs, particularly those with unusually long memories and remember what they said during the general election campaign,' Mr Dewar observed.

Minor quibbles and Dennis Skinner apart, it was good cheer all round as Mr Major went on to make a belated statement on the Gatt world trade deal. The Bolsover MP said there were bound to be losers. 'Britain is going to be Gatted.'

But Mr Major said the left- winger was talking 'copper-bottomed, gold-plated rubbish'. Britain could expect an extra 400,000 jobs over a decade from the deal. And together with changes to the Common Agricultural Policy it could lead to 20p off a pound of beef and 6p off a pound of butter. French farmers would get 'not a penny' in compensation.

Mr Smith wanted an assurance that the new Multilateral Trade Organisation would cover environmental protection and employment standards. 'Steps should also be taken to strengthen the International Labour Organisation to encourage enforcement of its conventions on fair labour standards and especially to help stamp out child labour.' Mr Major did not share his affection for the ILO but maintained child labour would be dealt with through 'anti-dumping' provisions.

No one seriously imagined the environment was going to be a problem, the Prime Minister said. 'There is no question that development will be at the expense of the environment.' Whether this is literally what he meant, Paddy Ashdown, the Liberal Democrat leader, took him at his word and argued that the MTO should take account of environmental costs.

MPs complained at the resistance of the United States to free trade in financial services and one Tory backbencher, Phillip Oppenheim, accused the French of 'censorship and protectionism' over the decision to take audio-visual matters out of the deal. 'If French films are so good, surely people will flock to see them without protection from the state?'

The Lords took a small step to greater equality yesterday when they agreed to ask the Queen for permission to debate a Bill that would end the right of an eldest son to inherit a hereditary peerage.

Lord Diamond, a former Labour Treasury minister and one-time leader of the SDP peers, plans to introduce the measure early next year. Explaining that the request to the Queen was an essential preliminary, he said the Bill would not affect existing male heirs.

Hereditary baron, Lord Elton, a former Tory minister, commented: 'This is a measure to further the trend of girls taking more of the cake - proving that Diamonds are still their best friend.'

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