General regulation making power for excise duty purposes etc

Part of Taxation (Cross-border Trade) Bill – in a Public Bill Committee am 2:45 pm ar 1 Chwefror 2018.

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Photo of Jonathan Reynolds Jonathan Reynolds Shadow Economic Secretary (Treasury) 2:45, 1 Chwefror 2018

The Member’s explanatory statement for amendment 85 states:

“This amendment, together with Amendment 86, limits the duration of certain delegated powers under Clause 45 to periods aligned with other proposed limitations relating to withdrawal from the EU and to customs unions” in parallel legislation. In many ways, it continues the conversation we had during debate on the last group.

Effectively, the amendment would introduce a sunset clause to clause 45: a measure to prevent the indefinite extension of delegated powers by HMRC commissioners where they relate to excise duty. We have discussed many times—in some ways, we have discussed it in every debate—the democratic implications of the Bill. The addition of sunset clauses has been proposed by many partners as a solution to the need to safeguard against potential abuses of the powers in the Bill. As has been said many times, the House of Lords Delegated Powers and Regulatory Reform Committee, in its report, said clearly that the Bill transfers substantial powers to the Executive—that is not in doubt on any side of this Committee. The question is whether they are proportionate and whether appropriate safeguards are in place.

I listened carefully to the Minister during discussion of the last set of amendments about the differences between the European Union (Withdrawal) Bill and this Bill, but I must say that I am not convinced that the differences are substantial enough to envisage a completely different set of amendments’ appropriateness in terms of the use of sunset clauses. As the Lords Committee said,

“the Treasury’s delegated powers memorandum acknowledges that the Bill has been drafted to cater for various contingencies that might never materialise, for example, if the UK leaves the EU without a negotiated agreement.”

I do not agree that the European Union (Withdrawal) Bill and this Bill represent such wildly different circumstances that one set of amendments is appropriate for the other Bill but not for this one. The Opposition are firmly in agreement with the Lords Committee that a sunset clause is an appropriate manoeuvre to redress the balance of power. We must bear in mind that the use of delegated powers carries a risk of abuse by the Executive, which is not something the Opposition could ever support. Rather, it is our duty at this stage to check the powers of the Executive and ensure that we are not giving them carte blanche to change the balance of power permanently in their favour.

I also stress that the amendments offer generous provision in terms of timing. It varies for each item, with sunset clause terms of either two years or five years from EU exit day for the powers in question. That should give the Government ample opportunity to adapt, even if we face the nightmare “no deal” scenario. It makes little sense to the Opposition that such provisions are included in the European Union (Withdrawal) Bill, but that there are no corresponding provisions in this Bill. Adding these provisions to the Bill would be an important step in providing a much-needed check to delegated powers.

Amendments 135 and 136 relate to the subsequent regulations relating to changing excise duty, and would make them subject to the affirmative procedure. The rationale is to add a necessary layer of democratic scrutiny to the extensive powers being granted to HMRC. I fear that Government and Opposition Members will never reach agreement on that point, and that we will perhaps have to return to it. However, we believe that that has been a consistent problem with the Bill, and we are duty bound to raise it.

Together, this group of amendments would make small but highly significant changes to help promote greater democracy, transparency, certainty and accountability in the Bill. Our intention is not to hamstring the Executive, but to ensure that checks and balances are maintained for those in power. As we decide on our new post-Brexit customs framework, we must guarantee a system that is constitutionally robust enough to deliver the democratic control that those who voted to leave the European Union sought.