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Mrs. Ann Winterton: I refer my hon. Friend to another valid argument. British Sugar is no longer allowed to dispose of waste soil at the site from which it was taken originally. That was the usual practice until it was restricted by the Ministry of Agriculture, Fisheries and

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Food in an attempt to stop the spread of rhizomania. Will my hon. Friend and his Department examine the problem and perhaps advance some helpful proposals?

Mr. Heathcoat-Amory: My hon. Friend has told the Committee about rhizomania and the restrictions placed on British Sugar about returning the soil to the areas where sugar beet is grown. Those restrictions do not prevent the soil from being used for landscaping, and it can be returned to agricultural use for pasture. The restrictions are important for the suppression and prevention of rhizomania.

The case for an exemption has not been made, but I wish to be helpful to my hon. Friends and other hon. Members who have raised the issue. I will ensure that the Ministry of Agriculture, Fisheries and Food discusses the matter further with British Sugar to see whether the agreement to prevent rhizomania can be relaxed or adapted to permit British Sugar to dispose of surplus soil in ways that are impossible at present.

Furthermore, I will ensure that Customs and Excise, for which I am responsible, continues its fruitful discussions with British Sugar. Those two organisations could define the problem exactly, and examine the possibility of allowing the company to set some of the soil aside in storage, temporarily and without paying the tax, pending the return of the soil or its sale to markets. The continuing discussions will assist the company concerned and other root and vegetable processors in trying to ameliorate the impact of the tax. One of the aims of the tax is to give an incentive to do what the company is already doing--to seek other markets and other ways to dispose of the soil.

Mr. Tipping: I am grateful for the interest that the Minister has shown in the subject and for the discussions that are to take place between British Sugar and Customs and Excise. In those discussions, will the excise be mindful that British Sugar disposes of the waste itself? The waste goes to its own sites and it bears the costs. In effect, the whole operation is financially neutral and that may be an area for fruitful discussion.

Mr. Heathcoat-Amory: I am aware of that point, and I will emphasise it to the officials.

Amendment No. 2 deals with dredgings, and the case for exempting them. I am aware of that case because, during the extensive consultation that took place, it was made repeatedly by those who own and operate ports and waterways. Dredgings are currently within the scope of the tax, because they are controlled wastes under Department of the Environment regulations. Therefore, disposal of that material to landfill is taxable. However, that illustrates the point that such material that is not landfilled--in other words, disposed of at sea, on the bank of a canal or on land in other ways--is not taxable. So, much of such material does not fall within the tax. However, some of it does have to go to landfill and will fall to be taxed.

I wish to emphasise the point, which was made by my hon. Friend the Member for Davyhulme (Mr. Churchill), that such material is only dry waste. He made light of that point, but some of those who are complaining about the impact of tax have mildly exaggerated its effect by including all the water that may be mixed up with the materials that will be landfilled. A conversion factor will

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be applied, and we are seeking to tax only dry weight. However, I accept the point that some dredgings must be landfilled and will fall to be taxed.

My hon. Friend the Member for Davyhulme made several powerful points, as did the hon. Member for Ellesmere Port and Neston and other hon. Members who are familiar with that important canal and waterway. The distinction that can fairly be drawn in this case is that the waste that operators are disposing of exists only through natural forces. I accept that point. The soil and the silt that they are dredging are being returned to dry land. As has been pointed out, dredging has the beneficial result of keeping waterways clear for navigation and preventing floods.

Dredgings form a relatively definable category of waste that it was not the intention of my right hon. and learned Friend the Chancellor to tax when he announced his proposals to the House more than a year ago. I cannot accept amendment No. 2, because it would amend the wrong part of the Bill, and we need to define further exactly how an exemption would operate. I hope that the Committee will accept that I wish to find a way of exempting dredgings. With that assurance, I hope that the amendment will be withdrawn.

Sir Donald Thompson (Calder Valley): Will my hon. Friend give way?

Mr. Heathcoat-Amory: My hon. Friend is just in time.

6.45 pm

Sir Donald Thompson: Would it not be paradoxical if some canals were to attract derelict land grant for clearing and restoration, as they do now, and were simultaneously taxed?

Mr. Heathcoat-Amory: Life is full of paradoxes, but we can probably do without that one. In the spirit of what I have announced, I hope that my hon. Friend the Member for Davyhulme will withdraw the amendment.

The Second Deputy Chairman: Order. The hon. Member for Davyhulme does not need to do so, because amendment No. 2 has not been moved.

Mr. Churchill: I wish to express my appreciation to my hon. Friend the Minister, to the Chancellor and to the Government for accepting the clear-cut case that those of us who have spoken to the amendment feel exists for exempting canal and port dredgings from the ambit of the tax. I am most grateful to my hon. Friend for his comments, and I am delighted to accept his assurance that a suitably drafted amendment will be introduced later during the passage of the Bill. On that basis, I am more than happy not to press amendment No. 2.

Mr. Miller: My hon. Friend the Member for Manchester, Withington (Mr. Bradley) and I have listened to the Minister's response about the Manchester ship canal. Given the powerful arguments that have been advanced, will the Minister assure us that, before a new amendment is introduced, he will urgently consult those companies and their representatives from that river basin? This is an important issue.

Mr. Heathcoat-Amory: This subject has been characterised throughout by a willingness to consult, and

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we will continue that. We hope to exempt dredgings in a precise way that does not give rise to any ambiguity, and we shall consult on the wording.

Amendment negatived.

Question proposed, That the clause stand part of the Bill.

Mr. Roger Stott (Wigan): May I first apologise to the Minister? I had to leave the Chamber when he was replying to the remarks that were made on amendment No. 5. I wish to say what I would have said had I remained in the Chamber at that time.

The right hon. Member for Lagan Valley (Sir J. Molyneaux) said earlier that the polluter must pay. I have no problem whatever with that, but I have a problem with clause 36.

The hon. Member for Davyhulme (Mr. Churchill), who is just leaving the Chamber, and my hon. Friend the Member for Manchester, Withington (Mr. Bradley) will be aware that the metropolitan authorities in the old Greater Manchester area joined together to become their own waste disposal authority. My local authority, the metropolitan borough of Wigan, which has a population of almost 250,000, decided some years ago to pull out of the Greater Manchester waste disposal authority. As a former mining area, Wigan can dispose of its waste considerably more cheaply alone than if it remains part of the authority. This arrangement has applied for the past five or six years.

I want to stress that what we are putting in the landfill sites in my constituency and in three or four others in old mining areas is domestic waste. We are not putting in industrial waste. I have visited the landfill site on many occasions, and I am convinced that it is extremely well managed. The methane is extracted safely, and there are special precautions to prevent leaching into the water courses. The tip is sprayed and covered each evening. The Minister talked about the nuisance created by seagulls. My local authority, which owns the tip, has engaged a falconer who comes along with his falcon and scares away the seagulls.

Even disregarding the employers' national insurance contributions, this tax will mean that council tax payers in the metropolitan borough of Wigan will have an additional burden placed on them. My authority is already rate-capped. It owns the landfill site, it manages it properly and it then reclaims the land for community purposes. The tax will amount to a wheelie bin tax on the council tax payers of Wigan.

I have no problem with making polluters pay for their waste, stored in landfill sites or elsewhere, but I hope that my hon. Friends will press again in Committee the point that the tax penalises my local authority for putting domestic waste in a landfill site that we own and manage. Even taking into account the money that will come back to the local authority in the shape of national insurance contributions, we shall be about £750,000 worse off as a consequence. That cost will fall directly on my constituents and on the rest of the metropolitan borough. It is therefore not a good idea, and I hope that something will be done about it at a later stage of the Committee's proceedings.


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