Clause 34 - Annual exempt amount

Part of Finance Bill – in a Public Bill Committee am 9:15 am ar 14 Mehefin 2012.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Ian Swales Ian Swales Democratiaid Rhyddfrydol, Redcar 9:15, 14 Mehefin 2012

It is a pleasure to serve under your chairmanship, Mr Sheridan. It is also a pleasure to follow a fellow son of Leeds in speaking in this debate.

I want to make a small input on the use of CPI and RPI. Those of us who have to defend our Government to our constituents do so with a certain amount of passion, obviously, when we need to do, but our efforts are stretched in this area because of the lack of consistency. The only thing that seems consistent is that we seem to apply CPI to everything that costs the Government money and RPI to everything where the opposite is the case. If members of the Committee do not believe me, they only need to look at annex A, “Indexation in the public finance forecast baseline”. One can see support for what I am saying in that list, with a huge range of things now having CPI applied, but the last 12 items on it still have RPI applied, including landfill tax, climate change levy, air passenger duty, tobacco duties, fuel duties, business rates, gaming duty and so on. Will the Minister give us a coherent statement on the use of inflation in public finances so that we can justify what the Government are doing and, in particular, try to kill the idea that fiscal drag, with CPI applied to items that cost money and RPI applied to items that bring in money, is a hidden policy underneath what we are doing?