Smith's wit delights Labour

THOUGH Labour would hardly complain, Norman Lamont's resignation speech overshadowed the party's set- piece debate accusing the Prime Minister of betraying election promises and calling for new economic policies.

John Smith said it was as effective a speech as Mr Lamont had made in office. Setting the mocking, witty tone that marked his attack on the Government's conduct and delighted his backbenchers, the Labour leader lit on Mr Lamont's criticism of short- term decisions and his wish to distance politicians from monetary policy. 'It did flick across my mind there might have been the odd political influence affecting himself at the time of the 1992 Budget, especially when you compare it with the 1993 Budget. He was no doubt, as he constantly reminded us, acting upon orders.'

Election promises ruling out increases in taxation and cuts in public spending had proved a 'false prospectus', Mr Smith said. Dismissing Tory accusations of 'scaremongering', he said one catastrophe had been piled on another.

'Not even the most inventive and ruthless scaremonger would have had the audacity to allege that any government could be so consistently incompetent, so hopelessly accident prone, so foolishly inept,' he said, citing the billions of pounds lost on Black Wednesday, the 'disastrous' pit closures, the 'shady double-dealing' in the Matrix Churchill affair, the 'hopelessly bungled' saga of school tests and the 'disaster waiting to happen' in rail privatisation.

John Major tried to wound Mr Smith with the criticisms made by John Edmonds, leader of the GMB union, and accused Labour of frightening people. 'In the Labour Party the scare stories come from the top. Behind that moral righteousness is someone who has no scruples whatsoever.'

The Prime Minister drew praise from Sir Peter Tapsell, a senior Tory backbencher, for assertions that the circumstances for Britain's re-entry into the European exchange rate mechanism would not apply 'for some years ahead'.

However it was only Mr Major's response to his former Chancellor that commanded MPs' attention. 'I believe history will look favourably on Mr Lamont's economic and financial skills,' he said - drawing Opposition shouts of 'Why did you sack him then?'

'But a strong government needs political skills as well when leading a democratic society and, in particular, handling a lively House of Commons with a small majority.'

Paddy Ashdown, Leader of the Liberal Democrats, said that what MPs had heard and seen was 'nothing less than the beginning of the end of Mr Major's premiership . . .'

John Biffen, a former Tory Cabinet minister, advocated a tax rise of at least 2p on the standard rate to help reduce the pounds 50bn public sector borrowing requirement.

Winding up the debate, Kenneth Clarke, the new Chancellor, drew a distinction between public statements by ministers and manifesto commitments. 'The manifesto contained no word about VAT or National Insurance contributions,' he said.

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