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Mr. George Walden (Buckingham): I am sorry to say that what is poison for one constituency is pure honey for another. My constituents will be delighted with this measure. There was a rash of applications for landfill sites a few years ago. When I looked into the detail, I found to
my horror that, for various historical and geological reasons, Britain is covered with quarries and disused gravel pits--most of them in my constituency. I then discovered that we were turning our country into a place where other countries were attracted to dump their rubbish. I learned that, for geological reasons and because of the availability of sites here, the costs were horrifyingly low. Other countries also offer more incentives to incinerate.
I pride myself in a small constituency way on having given a little push to this tax. I am glad to see Treasury Ministers, of all people, improving their environmental credentials by introducing the tax.
I have written to the Minister about the fact that my constituents in Pitstone and Ivinghoe are threatened by a massive landfill site that will badly damage local amenities in an area of outstanding natural beauty. I should be pleased to hear more details, as soon as my hon. Friend has them, about the Government's exact intentions in respect of the tax.
The last thing I want is that the tax should impede business in any way. I was interested to hear hon. Members raise objections in that regard. I was glad to hear the Minister imply that there might be some solution to those objections. I have in my hand a letter from Shell UK to the Minister for Industry and Energy about the Manchester ship canal. Those who, like me, have had a small hand in pushing this idea forward do not want to inhibit our industries in any way.
In any event, I congratulate the Minister on introducing the measure.
Mr. Malcolm Bruce (Gordon):
This is an important measure. It is interesting to note how widely the principle behind it is accepted as a desirable method of dealing with the problems. I agree with the hon. Member for Buckingham (Mr. Walden) that pressure on many sites in rural and suburban areas has become intense. To the extent that the tax will concentrate people's minds on finding other ways of disposing of waste, it must be highly desirable.
It is also true that the measure will pose difficulties for some industries. Some of the paper mills in my constituency produce inert waste that is not easily disposed of. Nevertheless, we all accept that the nettle must be grasped if we are to tackle these environmental problems.
Hon. Members have already mentioned the difficulties from the local authority point of view. There are also concerns as to how quickly they will be able to adjust. My hon. Friend the Member for Cheltenham (Mr. Jones) tells me that Gloucestershire county council reckons the measure will cost it £740,000 in the first year. Multiplied across the country, it becomes clear that local authorities, which are already squeezed, will face difficulties--although I am sure they will use their ingenuity to implement the measure.
I want to refer, secondly, to the point of principle in amendment No. 5. The Government, and all political parties that believe in environmental taxation, must make it clear to the public that measures such as these are not just another wheeze for getting money out of people, but represent a genuine desire to shift habits. The money that is raised should be repaid immediately in tax cuts
elsewhere. I am therefore slightly worried about the Government implementing the tax this year while making a great song about benefits that will not accrue until next year.
I might also point out that there will have been a general election in the interval, so the Government might not be in a position to deliver on their promise--leaving them exposed to the charge that they are more interested in introducing a tax than in providing the offsetting benefits.
That partly explains why my party voted against the Government's proposals to extend VAT to fuel, which was claimed afterwards to be an environmental move, but the revenue generated was used only to boost the Exchequer. An important matter of principle is at stake, and the Opposition amendment neatly encapsulated it. I suspect that that is why we shall vote together to ensure that our point is well made.
Ms Primarolo:
The Government have not answered a number of points to do with clause 36, which deals with the charge to tax and the date for the national insurance contributions rebate. We debated the latter fully earlier this afternoon. Local authorities and landfill site operators will be greatly disadvantaged by the six-month delay that the Government have introduced--despite the undertakings given by the Chancellor in 1994 and 1995.
I want to make a few clear points about our objections, which are not to the existence of the tax but to the way in which the Government propose to implement it. It is crucial to encourage the development of alternative waste management options if we are to achieve the full potential of the tax.
We have heard about the Manchester ship canal and British Sugar, and my hon. Friend the Member for Great Grimsby (Mr. Mitchell) spoke about Tioxide UK, which will be penalised. Although that company takes highly toxic waste and puts it through an environmental process, recycling a great deal of it, there remains inert waste which it will have to pay to landfill. Presumably, one of its options is to put all its toxic waste into landfill and simply pay a slightly higher charge. It is vital that we have support systems in place to develop alternatives.
Despite the assurances that were given by the Paymaster General today--frankly, he is on a wing and a prayer--it is clear that he does not understand the cost of recycling or the investment that is necessary to introduce such processes. Changing people's behaviour is vital. He did not deal with the likely encouragement of disposal by less environmentally desirable options than landfill. He certainly did not say how we will ensure that fly tipping is not the by-product of the tax, which would defeat the very purpose of introducing it. He did not explain the interim measures that will ensure that waste producers are not able to avoid payment. He did not deal with current illegal sites, which will remain outside the landfill tax. Finally, he did not say how local authorities that are already under severe financial containment by the Government will be able to deal with new strategies to encourage recycling when they do not have the financial resources. The landfill tax will increase their costs for the disposal of waste.
Mr. Heathcoat-Amory:
The clause is an important element in the introduction of a landfill tax, about which we have consulted widely. I am grateful for the expressions of support for the principle of the tax from hon. Members on both sides of the House. It will encourage good environmental practice. By taxing landfill, we will encourage the development of alternative ways of dealing with waste. Indeed, it will lead to less waste being produced in the first place.
That justification for the tax is valid even if the landfill site is well engineered, as obviously is the case in the example described by the hon. Member for Wigan(Mr. Stott). My hon. Friend the Member for Buckingham (Mr. Walden) put the other side of the argument and showed that, even if a landfill site is well run and managed, there are still substantial nuisance problems to surrounding residents--smell, noise, litter, dust and traffic movements, for example. It is right, therefore, to try to capture those external costs and attribute them to the producers and handlers of waste.
The revenue raised from the tax will be some£450 million in a full year, and rather more than that--some £500 million in a full year--will be used to cut further the main rate of national insurance contributions to 10 per cent. The UK is leading the way in lightening the burden of employment taxation. That is one reason why our employment record is better than that of any other major economy in Europe.
Bafflingly, the Opposition now say that they will vote against the clause. Having supported the landfill tax, and having failed to indicate anything in the clause with which they disagree, they will, for reasons best known to themselves, vote against a key clause in bringing into effect the landfill tax. My right hon. and hon. Friends know better. I urge them and as many other hon. Members as possible to vote for the clause.
Question put, That the clause stand part of the Bill:--
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