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Hague: a new direction for Scotland and Britain

Speech by the Rt Hon William Hague MP, Leader of the Conservative Party, to the CBI Global Scotland Conference.

It is a great pleasure for me to be here at your conference, Global Scotland, today. And, given the current controversies, I was delighted that in addition to my invitation from Hugh Currie, I have just received through the post a letter that when I opened it told me that I'd passed my Religious Education Higher with a grade A.

Great opportunities lie ahead for business in Scotland and across the United Kingdom as a whole.

In Scotland the devolution arguments are in the past. The Scottish people have clearly spoken. So let me assure you of this. It is the settled will of the Conservative Party that devolution must, and will, succeed and we will do everything in our power to ensure that happens.

As an integral part of the United Kingdom economy the decisions taken at Westminster will continue to have a major impact on Scotland's economic performance. Together we face the challenge of how to build a dynamic British economy that is able lead the new global economy. But, as things stand I don't believe that we are taking full advantage of the opportunities we have.

So, as you have asked me to speak for ten minutes, I will give you ten things that are essential if we are to improve our economic performance, each of which will take about a minute to explain.

One, we need to cut regulations on business and not just talk about it. In an age when business is mobile, and locate anywhere Governments that fail to create the right business environment will be punished. Despite their pledges not to allow regulation to stifle business and enterprise this Government has now imposed an extra £5 billion a year of suffocating red tape on business.

That is why the next Conservative Government will establish, through an independent audit, the total cost of regulation to the economy and then set declining regulatory budgets for each Government Department. This will bring the cost of regulation down year on year. Our aim can be simply stated - not just to stem the rising tide of regulations but to be the first Government in history actually to cut them.

Two, we need to establish Britain as the technology capital of Europe. And we can do it. The next Conservative Government will reduce the burdens that our holding back our IT industries. In the new economy, companies and individuals should be left alone by Government, not be crippled by measures such as IR 35 - Labour's tax on entrepreneurs.

We will reform IR 35. And we will ask the Competition Commission to review BT's market power in local internet connections and look at ways of reducing costs to business and consumers of accessing the internet. We will speed up the DTI's procedures for granting licences to new telecoms operators and radically deregulate the telecoms industry.

Three, we need to make serious improvements to our secondary education. Too much central interference and badly devised regulations are damaging standards. In Scotland, hard working pupils and teachers have been badly let down by the administrative chaos of the exams fiasco.

Our policies will be based on freedom, choice and discipline. In England we will make every school a Free School, simplify the national curriculum and abolish bureaucratic targets and form filling. Scottish Conservatives will transfer the management of schools from local councils to school boards directly funded by the Executive.

And I agree with David McLetchie that it is essential for Sam Galbraith now to do the right thing and make way for a Minister who can restore confidence and credibility into Scottish Education.

Four, we need to make serious improvements to higher education too. Our universities used to be renowned as the best in the world but too much red tape, government control and too little financial freedom, mean that many of them are struggling excel. We need to set our universities free.

The next Conservative Government will progressively endow universities for the future so that they are no longer dependent on Government funding. We will look at ways of directing future Government receipts from, for example, auctions of radio spectrum, towards creating endowment funds that will give them a secure base from which to build a world role. And we shall ensure that Scottish Universities get their fair share of this money.

Five, we urgently need to reform and reduce business taxation. You at the CBI have put the total cost of Labour's stealth taxes on business at over £5 billion a year, including the iniquitous Climate Change Levy. Business in Britain is seeing its competitive edge blunted by a Government that doesn't understand in the modern world it is only the low tax economies that will prosper and attract new investment.

Low taxes are an absolute necessity. They are economically right and they are morally right. So the next Conservative Government will be a tax cutting government. In all normal circumstances we will reduce the burden of taxation. Under the Conservatives it will be less tax not stealth tax.

Six, we need the courage to reform welfare. Despite its promises, welfare reform has been one of the Government's most conspicuous failures. The next Conservative Government will reform welfare to create a system that that encourages saving and independence, supports the family and marriage, gets people off dependence on welfare, is more straightforward and reduces the costs of welfare for future generations.

We will implement our Can Work, Must Work Guarantee and replace the failed New Deal. We will restore the recognition of marriage in the tax and benefits system and pay the Working Families Tax Credit as a benefit, so that companies can create more jobs and fill in fewer forms. And we will launch an unprecedented and sustained attack on the scandalous scale of social security fraud.

Seven, we need to create a savings and investment culture. The next Conservative Government will ensure that today's pensioners are better off by consolidating the Government's gimmicks and redirecting other savings into the basic state pension. That, and by adjusting tax allowances and income support levels, will give pensioners the dignity of a higher regular weekly income.

And for future pensioners we shall enable young people to build up a funded alternative to the basic state pension, while ensuring that the basic state pension remains available to those who want it. That is the best way of achieving higher pensions and greater security, without placing unacceptable burdens on the state

Eight, we need a transport policy that gets Britain moving again. The Government's fuel taxes have given Britain the most expensive petrol in Europe and undermined our haulage industry. Scotland, where transport is the life-blood of the economy, has been hit particularly hard.

It's no use encouraging business to locate here, and then make it impossible for businesses to transport their goods. And there's no point in taxing motorists off the road when there are no decent public transport alternatives. We oppose yet more Labour stealth taxes such as city entry tolls and workplace parking taxes. We will introduce the BRITdisc scheme to protect the competitiveness of our haulage industry.

Nine, we need free trade and competition both in the European Union and outside. We can either go down the current route of a European superstate, or the Conservative route of a flexible Europe of nations states, co-operating in different combinations, for different purposes and to a different extent - a network Europe.

The next Conservative Government will support reforms to ensure that the EU works better. We will campaign for a EU/North Atlantic free trade agreement and then global free trade by 2020. At the same time we will resolutely defend the freedom and independence of Britain to govern itself. In doing so we will be reflecting the wishes of the great mainstream majority in this country who want Britain to be in Europe, not run by Europe.

Ten, we need to maintain our economic flexibility by keeping the pound. That will be Conservative policy at the next election. All the Parties except the Conservatives are committed to scrapping the pound and joining the euro at the earliest opportunity. This is without ever having seen how it works in good times and in bad, or assessing the impact it might have on our continuing ability to govern ourselves.

The Conservative Party believes Britain's ability to compete on a global basis is best served by keeping control of our own currency and of our monetary and fiscal policy. Only that will enable the British Government to continue to set interest rates to suit British economic conditions. So at the next election, only the Conservatives are pledged to keep the pound.

Ten things that need to be done - and ten things that I believe need to be done urgently.

Britain today is at a crossroads. There are two choices. We can either drift along and be overtaken by our competitors, or we can start to build a dynamic economy. We can tax and regulate ourselves into yesterday or we can set business free to lead the next phase of the enterprise revolution.

Conservatives believe that Scotland and Britain can be the best. The best place to do business. And the best place in the world to live. But Labour are throwing away that chance.

Britain needs a Government that gets the politicians off the backs of businessmen. A Government that deregulates, that keeps taxes low, that maintains our flexibility, a Government that keeps our currency and retains our freedom to govern ourselves.

Britain urgently needs a new direction. And it needs to take that direction now.

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