Conservative leader Iain Duncan Smith's speech to the British Chamber of Commerce in full.

"This year's Budget has been picked over more than most in recent times. For once it is not so much the fine print in the Red Book - where the money is coming from - that people are looking at.

The tax increases are blatant enough.

It is the finer detail of where the money is going that has brought forward the most comment since Gordon Brown delivered his statement five days ago.

In fact you might be forgiven for thinking that last Wednesday was the first time Gordon Brown had ever raised taxes.

But as British businesses know to their cost, nothing could be further from the truth.

In his first five Budgets, the Chancellor piled on £6 billion a year in extra stealth taxes and another £5 billion a year in regulation on British firms.

Even before last Wednesday, the corporate tax burden on British business was among the highest of our industrial competitors.

Our share of world exports continues to fall. Our productivity growth, which used to be faster than that of the United States, has been slower of the past five years.

What was different about last week was simply that Gordon Brown decided to break cover. The end result was still same - business got clobbered.

The British Chambers of Commerce itself says that Business Competitiveness has taken a step backwards.

The Federation of Small Business estimates that small firms will face a £2 billion bill to cover the Chancellor's increases in National Insurance. They have called the Budget 'a sickener'.

And the CBI says that the cost of doing business will go up by £2.5 billion as a result of his measures.

Increasing National Insurance Contributions is a straightforward tax on the income of workers and an outright tax on jobs for the firms who employ them.

More than that it is a cowardly and insidious way to put up income tax.

It hits employers whatever their size and whatever their profitability. It has a disproportionate impact on labour-intensive businesses particularly the services sector and public services.

The 1 per cent increase in Employers' National Insurance Contributions will dwarf the other measures the Chancellor has announced like the reduction in the small companies corporation tax rate, the simplification of VAT and the research and development credit.

Overall his tax measures will be the equivalent of an increase in Corporation Tax of 3 per cent, only they will bite hardest on those enterprises with little or no profits to tax.

Not only will they have to pay more for their employees, they are likely to have to pay more to them.

From next April people on average earnings will be faced with paying an extra £214 pounds a year in tax from their income, mostly from the increases in workers' National Insurance Contributions. This is bound to influence pay negotiations going forwards.

The rises in National Insurance are likely to eat into the funding increase for the Health Service and put pressure on other public services.The NHS is one of the world's largest employers, I read yesterday that only the Chinese Red Army and WalMart are bigger. Well over half its total costs are staff costs.

A senior nurse will now be more than £300 a year worse off as a result of last week's tax changes. And senior nurses will expect a pay increase to compensate for the extra tax they are about to be hit with.

Replicate this across local government, education and the police and the effect on the total wage bill for the public sector could reach a billion pounds.

No wonder Tony Blair and Gordon Brown got a warmer reception than they had counted on from nurses at the Chelsea and Westminster hospital last week.

Consider the impact of these tax changes on a sector like care homes.

Because of over-regulation, this country has lost nearly 50,000 care beds in the last five years.

Apart from creating misery and adding uncertainty and confusion to lives of some of the most vulnerable people in our society, the closure of care home beds has also resulted in the NHS being unable to discharge patients adding to the backlog for treatment.

Yet last Thursday the Health Secretary announced that local authorities would be held responsible for ensuring that there are an adequate number of care beds in their area.

That job is impossible in the current climate when care homes have been closing because of the costs the Government has imposed on them. But it is going to get even worse after these tax changes.

Around 80 per cent of the costs in care homes are labour costs. The smallest homes now operate on profit margins of less than 5 per cent. Raising employers' NICs by 1 per cent will reduce their profits by almost a fifth.

More and more care home owners will find that they can earn a better living by investing their money in a building society rather than by providing care for the elderly.

Nor do I think we've seen the last of the tax rises.

His planned increases in public spending only take us up to the next Election. To sustain this rate of increase he would ultimately need to raise taxes again, perhaps by as much as £7 billion a year during the next Parliament.

Having broken their promise not to put up income tax within ten months of the last Election, no one should be in any doubt that at the next Election Tony Blair and Gordon Brown will stand on a platform of still higher taxes.

They have staked their reputation and the future of the Government on the success of tax and spend.

It is not a one-off miracle cure. It is a repeat prescription.

But it is one, in my view, that is based on the wrong diagnosis of what is wrong with our Health Service.

Since the Budget Labour ministers have been on a charm offensive to persuade people why tax increases must inevitably lead to a modern health service.

They talk about the extra resources they will put into the NHS. The extra doctors, nurses, GP centres and hospitals we will have.

This is the same thing they've been saying for the last five years. In reality this Government has already increased NHS spending by nearly a third in real terms.

But the quality of the service the public actually receives has deteriorated.

Waiting lists are rising again.

Accident and Emergency waits have grown longer.

We are now confronted with a two-tier Health Service where record numbers of people - a quarter of a million last year - are paying for their own operations, not through insurance but out of their own pockets.

Any businessman would question the underlying soundness of an enterprise that produced these results on that kind of investment.

And yet this is the state of today's Health Service that Gordon Brown is about to pour more money into.

He has closed his mind to the case for change. He commissioned the Wanless Report and set its terms of reference to shut down the debate about how we can best learn from countries with better Health Services than our own.

He is behaving as though Labour have just come into office in the last ten months, when they have been in power for five years.

By the time of the next Election, he will have increased NHS spending by 70 per cent in real terms. By 2007/8 his plans will have almost doubled spending since 1997.

Two years ago Gordon Brown said 'more resources must mean more reform and modernisation'.

Six months ago he said, 'there will not be one penny more until we get changes to let us make reforms'.

Like all the words about change and reform we have heard since last Wednesday, they were just that, 'words'.

The Chancellor has embarked on a great experiment to prove that the only thing lacking in the NHS is money.

And yet we already know that this isn't true. The evidence is on our own doorstep.

Over the next five years Gordon Brown plans to bring average UK health spending into line with what Wales and Northern Ireland spend now. This is the same as France, more than Denmark and Sweden and slightly less than Germany.

But the treatment of patients is nowhere near as good.

Germany has no national waiting lists. In Wales and Northern Ireland they are worse than in England.

Denmark gives people a legal right to treatment within four weeks of seeing their GP.

Stockholm gives patients the choice of doctor and the hospital they go to. No one can do that in the UK without going private.

A proper debate on the future of the NHS would focus on why these European countries get the results they do, how we might replicate them in our own Health Service, how much that would cost and how we raise the money for it.

Gordon Brown appears to want no such debate. That is why he published Derek Wanless's report last Wednesday morning and pre-empted any discussion of it in his Budget six hours later.

The Chancellor's only recipe is to spend more generously and police more rigorously the centralised NHS we already have.

This is the last way to improve quality of care.

The NHS needs to provide the best quality of treatment available regardless of people's ability to pay. But today it is further away from that ideal than ever.

We must have a system based on need, but that need should be determined by patients working with doctors. That means decentralising power and making the Health Service genuinely accountable.

Instead it is to get more targets and more bureaucracy that are likely to restrict clinical freedom and extend the politicisation of the NHS still further.

So we are left with more promises. The Prime Minister says he is happy to be judged on his performance, but the yardstick keeps on changing and Judgement Day is always pushed back beyond the next Election.

Gordon Brown announced nearly £10 billion in tax increases last Wednesday, the lion's share of them National Insurance increases. But £4.8 billion of that £10 billion is to be spent on his new system of tax credits announced on the same day.

In fact if you add these tax credits to our social security spending, as required by the OECD, the total exceeds that spent on the NHS and education.

This from a Government that promised to cut the costs of social failure to invest in public services.

It is now fully five years since Tony Blair promised to save the NHS and just ten months since Gordon Brown rejected as 'smears that I repudiate', the idea that he would raise National Insurance.

For millions of people, perhaps even a number in this room, those two promises went together.

What made New Labour 'new' was their willingness change the Health Service free from ideological hang-ups and without reverting to old-style tax and spend.

Well I think the Chancellor's past record is a guide to his future performance.

He has closed his mind to genuine reform.

He is about to spend a lot of money on a system which is outdated, overly-centralised and incapable of using that money properly.

I think Labour are back to using 1970s medicine to cure a 1940s patient in the hope that it will deliver 21st century standards.

In the process he will damage our competitiveness and make things more difficult for hardworking families.

And he will fail to deliver the quality of healthcare that people in Britain - especially our elderly and our vulnerable - have a right to demand.

The quality of care that the citizens of other countries take for granted.

If this Budget is remembered at all, it will be as an opportunity squandered."