Clause 13 — Exercise of Commissioners' Functions by Officers

Commissioners for Revenue and Customs Bill – in the House of Commons am 6:55 pm ar 6 Ebrill 2005.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Lords amendment: No. 1.

Motion made, and Question proposed, That this House agrees with the Lords in the said amendment.—[John Healey.]

Photo of Michael Lord Michael Lord Deputy Speaker (Second Deputy Chairman of Ways and Means)

With this it will be convenient to deal with Lords amendments Nos. 2 to 9.

Photo of Andrew Tyrie Andrew Tyrie Shadow Paymaster General 6:57, 6 Ebrill 2005

I am disappointed that the Minister did not feel that he had anything to say. Some interesting concessions have been made in the other place, where some valuable work has been done by the Earl of Northesk and Baroness Noakes. I am glad that the Government decided not to ignore that, even if they ignored us when we tried to make pretty much the same points in Committee.

It is important to put the amendments into context. Although we did not oppose the Bill on Second Reading, we had a number of major concerns about it. Merging the departments involved is a major change, and we are not convinced that it was given enough consideration by the Government or that its implementation was properly thought through. We are also worried that the measure might prejudice taxpayer confidentiality. Taken together, all those things might put at risk some of the yield.

The Lords amendments go a small way—it is only a very small way—towards assuaging some of those concerns. Lords amendment No. 1 applies to clause 13. It limits the scope for disclosure of information by a Revenue officer. The duty of confidentiality is, of course, extremely important, and it helps to protect the yield. It is why a number of us fought very hard to retain the oath of confidentiality, which the Government had intended to abolish and on which they relented at the last moment in Committee. The amendment provides that Parliament will ensure that commissioners have a measure of control over disclosure, except in very limited circumstances. We will not oppose it, although we would have liked something stronger.

Anybody forming a view on the matter must examine what Lord Goldsmith said about it in another place, where he set out the circumstances in which an officer might feel the need to give specific instructions to disclose information. If that power were to be abused, MPs would hear about it, in which case I hope that they would make a great noise and that we would return to the issue.

Photo of Mr John Burnett Mr John Burnett Shadow Minister, Home Affairs, Shadow Solicitor General, Law Officers (Constitutional Affairs) 7:00, 6 Ebrill 2005

We have had long discussions about taxpayer confidentiality, and the provisions in the Bill contain some useful protections in that regard. We share the desire of Mr. Tyrie and other Conservative Members to see the oath retained.

I have asked Inland Revenue employees about the oath, which not only buttresses taxpayer confidentiality, but strengthens the position of Inland Revenue employees should someone in a superior position ever seek for them to compromise their integrity on taxpayer confidentiality. As the hon. Member for Chichester has said, it is important that we do nothing to erode taxpayer confidence, otherwise the tax yield is surely at risk.

We welcome the limits on disclosure and noted what the Attorney-General said in the House of Lords on 5 April 2005. The case of Pepper v. Hart is instructive, and hon. Members and tax professionals are only too well aware of the protections that the Attorney-General put on the record.

We are happy to welcome the provision, and we hope that the Bill will be a success. We also hope that the Inland Revenue culture will prevail and that Customs, which has been subject to certain criticisms, will become more receptive to taxpayers' interests, fairness and the rule of law, which should be the culture that guides Revenue and Customs once the merger comes into effect.

Photo of John Healey John Healey The Economic Secretary to the Treasury

The hon. Members for Chichester (Mr. Tyrie) and for Torridge and West Devon (Mr. Burnett) have carefully considered aspects of the duty of confidentiality throughout the passage of the Bill.

The duty of confidentiality is a weighty matter for any Revenue department and the officers who work within it. As they know, my right hon. Friend the Paymaster General and I, as well as my right hon. Friend the Attorney-General, have emphasised and re-emphasised that throughout the passage of the Bill. I welcome the comments that both hon. Gentlemen have made on the amendments made in another place. That is in keeping with what has been a full and productive debate on the Bill at every stage in the other place and in this House.

The changes with which the Bill returns to this House from another place amend the provision for disclosure of information in the public interest. They have been made because my right hon. Friend the Attorney-General listened to the arguments in the other place and compiled a package that proved acceptable to all parties there. These amendments place the details of when public interest disclosures will be made in the Bill instead of in regulations in the first instance. They also tighten the circumstances in which commissioners could delegate instructions to make public interest disclosures.

Those changes, together with commitments on matters such as information sharing and governance and changes made by my right hon. Friend the Paymaster General to include the introduction of the declaration to acknowledge the duty of taxpayer confidentiality, make this truly a Bill that has all-party support. The establishment of the new integrated department is a valuable step forward in enhancing revenue and customs administration in this country. Over time, it will produce real benefits for taxpayers and other customers and will improve the effectiveness of the department.

Photo of David Taylor David Taylor Labour/Co-operative, North West Leicestershire

The Minister is talking about the projected effectiveness of the merged department, although it will be somewhat slimmer than the two existing departments. Is he confident that two or three years down the line that new, merged and—as he would say—more effective department will have done more to bridge the tax and revenue gap of around £35 billion that hon. Members on both sides of this Chamber, and indeed people across the whole finance sector, would acknowledge exists? Should not we be doing more on that front, and will the new department be in a better position to do so?

Photo of John Healey John Healey The Economic Secretary to the Treasury

Over the past two or three years, both the existing departments—the Inland Revenue and Customs and Excise—have indeed taken steps to close the revenue gaps that my hon. Friend mentions, and as Customs Minister I have been heavily involved in that. The new integrated department will take further steps to close the gaps that he and I wish to see closed, and in so doing protect revenue that should be coming into the public purse but currently is not.

The Bill creates an independent Revenue and Customs prosecution office. That is an important step that is strongly supported by the hon. Member for Torridge and West Devon in particular, and has been widely welcomed by the legal profession.

When the amendments were tabled by my right hon. Friend the Attorney-General in the other place, they were welcomed by Baroness Noakes and Lord Newby, who speak for the Conservatives and the Liberals. On that basis I commend them to the House.

Photo of Andrew Tyrie Andrew Tyrie Shadow Paymaster General

I want to add only one or two comments. I welcome the Minister's opening remarks—

Photo of Michael Lord Michael Lord Deputy Speaker (Second Deputy Chairman of Ways and Means)

Order. The hon. Gentleman is allowed to speak only once on this particular amendment: it is not his to introduce.

Lords amendment agreed to.

Photo of Michael Lord Michael Lord Deputy Speaker (Second Deputy Chairman of Ways and Means)

With the House's agreement I will put Lords amendments Nos. 2 to 9 together. The Question is that this House agrees with the Lords in their amendments Nos. 2 to 9.

Photo of Michael Lord Michael Lord Deputy Speaker (Second Deputy Chairman of Ways and Means)

I asked if the House wanted to take the amendments together. Does the hon. Gentleman want to speak on one of them?

Photo of Andrew Tyrie Andrew Tyrie Shadow Paymaster General

Anybody who looks at these amendments will see that it is very difficult to speak to amendment No. 2 without examining amendments Nos. 3 to 9 at the same time. Frankly, they look to me as if they were originally intended to be grouped together. With your permission, Mr. Deputy Speaker, I will not rise to speak to any of the subsequent amendments—

Photo of Michael Lord Michael Lord Deputy Speaker (Second Deputy Chairman of Ways and Means)

Order. I trust that the hon. Gentleman's comments will be brief. I should explain that we have already dealt with the entire group of amendments. When we first dealt with them, we debated them as Lords amendment No. 1 plus Lords amendments Nos. 2 to 9. So we have debated them, and having completed the debate we should now be putting them formally only. As the hon. Gentleman has started, I shall let him complete his remarks.

Photo of Andrew Tyrie Andrew Tyrie Shadow Paymaster General

I am very grateful to you, Mr. Deputy Speaker, for allowing me to make pertinent remarks on the remaining clauses. Perhaps I can also get in some more general remarks that might reasonably be made in response to the Minister's points.

The most important element of the remaining clauses was the almost untrammelled power given to the Treasury to make regulations under the original Bill. Their lordships have rightly argued that such power should be circumscribed more tightly. The Conservatives in the Lords proposed that any change to the power of disclosure be subject to what is known as the super-affirmative resolution procedure, which was originally laid down for use in respect of the Identity Cards Bill. Under that procedure, regulations can be amended—in other words, more tightly drawn—which is what is desired in this case.

Of course, that proposal has been around for a long time—the royal commission on House of Lords reform came up with it some time ago—but the Government, having flirted with it, decided that they did not like it. They have rejected that approach in this Bill and have included something else instead, and that is what we are debating now and have to examine. They have established in a reasonably detailed way the conditions that have to be satisfied in order for disclosure to be permissible. Those who are following this debate carefully can look at proposed new subsection (8), where they will find a list of those conditions. As I said a moment ago, they cannot be considered independently of the surrounding clauses.

Having listened to the Minister and, more particularly, having read the Hansard account of the Lords debate on this issue, I worry about the differences and misunderstandings that could develop in the merger of these two cultures. Much of the debate in the other place was at cross purposes. Some peers focused all their arguments on trying to protect taxpayer confidentiality, while others tried to ensure that powers were retained to enable the catching of criminals at the border. It was like two cultures passing in the night: one worry was an Inland Revenue worry, and the other was primarily a Customs worry. In addition to the threat to revenue that we briefly alluded to, a major concern remains about the risk associated with merging these cultures. These amendments and our discussion of them reflect that risk. I note that Lord Goldsmith conceded some ground on this very point in the Lords. The amendments are a step forward, but only a very modest one.

A moment ago, the Minister welcomed our comments on confidentiality. That was a great change in tone compared with the beginning of the debate on this Bill, when we had to struggle to convince the Government to keep the oath. I am very pleased that there has been a change of tune in that regard.

Photo of Michael Lord Michael Lord Deputy Speaker (Second Deputy Chairman of Ways and Means)

Order. The hon. Member seems to be making a Second Reading debate speech. There are specific Lords amendments before us and I have already given him some leeway. He should have dealt with these matters in the initial debate. He must now deal precisely with Lords amendments Nos. 1 to 9—and he must do so briefly.

Photo of Andrew Tyrie Andrew Tyrie Shadow Paymaster General 7:15, 6 Ebrill 2005

I shall end by making one more point, Mr. Deputy Speaker. I am sure that you will permit me that. In response to an intervention by David Taylor a few moments ago, the Minister made a number of assertions about the increased efficiency that will result from the Bill.

Photo of Peter Bottomley Peter Bottomley Ceidwadwyr, Worthing West

I take my hon. Friend's remarks seriously. The merged Departments have picked the name for their building as No. 1 Parliament street, but this House has had a No. 1 Parliament street address on the other side all the—

Photo of Michael Lord Michael Lord Deputy Speaker (Second Deputy Chairman of Ways and Means)

Order. That intervention and any response to it would be quite out of order. I hope that the hon. Member will bring his remarks to a close.

Photo of Andrew Tyrie Andrew Tyrie Shadow Paymaster General

I obey your ruling in every particular, Mr. Deputy Speaker. I end by referring to the intervention of the hon. Member for North-West Leicestershire, who spoke of the need to close the tax gap. The Economic Secretary responded, but the problem is that he adduced no evidence that there will be any reduction of that gap and provided no evidence whatever that savings might come from the merger. There may be costs, which is why the Conservatives have been so concerned to put down markers to register our concern about the Bill.

Question put and agreed to.

Lords amendments Nos. 2 to 9 agreed to.