End 'money for nothing' - Osborne
The UK's "money for nothing" culture must come to an end, shadow
chancellor George Osborne has said.
In a speech in Birmingham, Mr Osborne argued that people needed to hear
some "home truths" and must "work hard and save hard" to get out of the
recession.
Generous tax breaks for corporate debt must be ended to wean firms off
their reliance on borrowed cash, he added.
The Conservatives have said Labour has left the UK ill-prepared to deal
with the recession and should apologise.
Mr Osborne said an apology was necessary to show that Labour understood
the current economic problems were home-grown, rather than a result of
the meltdown of the US mortgage market, and had learnt the lessons of
what had happened.
"He [Gordon Brown] won't say sorry for his mistakes because he really
doesn't think he made any," he said.
Labour say the Tories have opposed vital measures to support the economy
such as its VAT cut and fiscal stimulus package.
'Worst excesses'
Mr Osborne linked the regulatory failures which allowed banks to take
unjustified risks to a general culture of excess which encouraged
individuals to build up unsustainable levels of debt.
"Our banking system is not separate from our economy," he told the
Birmingham Chamber of Commerce.
“ The Conservatives are ready to tell people these home truths and the
country is ready to hear them ”
George Osborne
"Our banks hold up a mirror to the worst excesses of society."
He said people need to become more prudent in future and will no longer
be able to rely on the rising value of their home to pay for their
retirement.
"The money for nothing society has to end," he stated.
"The truth is that Britain is going to have to work hard and save hard
to get out of this hole. The Conservatives are ready to tell people
these home truths and the country is ready to hear them."
Mr Osborne called for the "recapitalisation" of the whole of British
business, not just leading banks - a policy which the Conservatives
claim has failed.
He said the tax system, which treats corporate debt "more generously"
than any other major global economy, needed to be reformed to encourage
less risky forms of finance.
More incentives for share ownership and equity investment in business
start-ups and existing firms are needed, he added.
By limiting tax breaks on debt, a future Tory government could commit to
further reductions in the basic rate of corporation tax beyond their
existing pledge to cut it from 28% to 25%.
"The prize could be considerable, " he argued. "A simpler and more
competitive tax system, more jobs and investment and British businesses
that are less dependent on debt."
Earlier Mr Osborne visited carmaker Jaguar, whose workers recently
agreed to accept a shorter working week and a one-year pay freeze to
avoid compulsory job cuts.
Story from BBC NEWS:
http://news. bbc.co.uk/ go/pr/fr/ -/1/hi/uk_ politics/ 7927816.stm
Published: 2009/03/06 13:06:46 GMT
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