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Mr. Davies: The hon. Lady makes footling points. It makes no difference to the substance whether the provisions come into effect from April or July, and she must know that. There is no reference in our new clause to the 1934 Act, and I do not know where she got that from. Will she address the main point that I raised? Her proposed new clause takes us back to the uncertainties of the pre-1987 regime, whereas our new clause creates an explicit new class of assets which will qualify for CGT roll-over relief. The essential difference between our new clauses is the unambiguity and greater certainty of the one, and the ambiguity and lesser certainty of the other. I hope that the hon. Lady will not run away from this important issue.
Mrs. Roche: I regret that the hon. Gentleman has taken the same approach as he has taken throughout the debate, in contrast with other hon. Members who have contributed to a positive discussion about the state of the industry. I do not regard technical deficiencies in a new clause as a footling matter. I shall deal with his points if he will allow me to proceed.
When drafting our new clause, we carefully considered whether we needed to introduce a new class of assets for United Kingdom oil licences into the list of classes of assets already eligible for roll-over relief. We concluded that a new class of assets was not necessary, and that the only change required to ensure that companies can claim roll-over relief on oil licences was to repeal section 193 of the Taxation of Chargeable Gains Act 1992.
Since 1987, the Inland Revenue has accepted--the hon. Gentleman will know this if he has done his homework--that UK oil licences are an interest in land as defined in class 1A of section 155 of the 1992 Act. It has recently obtained advice from its solicitors confirming that. Its acceptance of that point is made clear in its published manual on the corporation tax rules that apply to North sea oil companies. As a result, when section 193 is repealed by new clause 17, the only barrier to oil companies claiming roll-over relief on UK oil licences will be removed. I assure the House that, as UK oil licences are interests in land, new clause 17 will allow companies to claim roll-over relief on the disposal of UK oil licences.
This has been a good debate. I should like to congratulate all hon. Members who took part. I also want to thank my hon. Friend the Minister for Energy and Industry, who chairs the task force on this issue, and the industry for all the constructive discussions we have had. I commend the Government's new clauses, and urge the House to reject the Opposition's new clause.
Question put and agreed to.
Clause read a Second time, and added to the Bill.
Brought up, read the First and Second time, and added to the Bill.
Brought up, read the First and Second time, and added to the Bill.
Brought up, and read the First time.
The Economic Secretary to the Treasury (Ms Patricia Hewitt):
I beg to move, That the clause be read a Second time.
New clause 8 allows any cash balances held at the close of business in the bank accounts of the two Revenue departments at the Bank of England to be lent overnight to the National Loans Fund, which will repay what it borrows by close of business on the following business day. That will help the Debt Management Office to manage the Government's cash requirements efficiently when it takes on that role. The DMO will be able to rely on these Revenue department balances being available to help to balance the daily cash flows into and out of the National Loans Fund. That will decrease uncertainty for the DMO, and will, most importantly, prevent it from having to pay to raise cash in the market when there is already cash available within Government.
Mr. Howard Flight (Arundel and South Downs):
This certainly sounds like a sensible piece of corporate management: the corporate treasurer approach making the
It would be valuable to know the balances that go through Customs and Excise during the year, whether its overall budgeting has hitherto taken account of interest earned and whether that level will change.
The new clause implies that the sums may be lent at the volition of the commissioners of Customs and Excise and the Inland Revenue. Surely the intention is that it will be at the direction of the Treasury, whether the commissioners want it to happen or not.
I ask myself why, at this stage of the Bill, the Government have suddenly had a conversion to corporate efficiency. Why was this measure not introduced long ago? It has been slipped in quietly at the end of the Bill. Surely this is what the Bank of England, as the Government's banker, has done, in that the different organs of Government have had positive and negative balances. The Government own the Bank of England, so why do they need to step back from the Bank and allow the National Loans Fund to manage cash flows? Does it, by any chance, have anything to do with European Union obligations, and the fact that the Government will not be able to borrow from the Bank of England? It would be undesirable for one Government account and the National Loans Fund to be overdrawn at the Bank of England as a result of a temporary cash flow problem. Perhaps the pooling of these cash flows into the National Loans Fund is designed to avoid that.
'.--(1) In paragraph 3 of Schedule 19 to the Finance Act 1982 (months in which instalments may be withheld)--
(a) in sub-paragraph (1), at the beginning there shall be inserted "Subject to sub-paragraph (1A) below," and after "month" there shall be inserted "(the relevant month)"; and
(b) after that sub-paragraph there shall be inserted the following sub-paragraph--
"(1A) Sub-paragraph (1) above does not apply if the relevant month is a month in which any consideration (whether in the nature of income or capital) is received or receivable by the participator in respect of any such matter as is mentioned in paragraph (a) or (b) of section 6(2) of the Oil Taxation Act 1983 (chargeable tariff receipts)."
(2) Subsection (1) above applies for the purpose of determining whether instalments are payable in respect of chargeable periods ending on or after 31st December 1999.'.--[Mrs. Roche.]
'.--(1) Section 193 of the Taxation of Chargeable Gains Act 1992 (roll-over relief not available for gains on oil licences) shall cease to have effect.
(2) This section has effect in relation to--
(a) a disposal of a licence or an interest in a licence which occurs on or after 1st July 1999;
(b) an acquisition of a licence or an interest in a licence which occurs on or after 1st July 1999.'.--[Mrs. Roche.]
'.--(1) Where, at the close of business on any day, a sum stands to the credit of--
(a) the General Account of the Commissioners of Customs and Excise, or
(b) the General Account of the Commissioners of Inland Revenue,
that sum may be lent to the National Loans Fund on that day.
(2) Subsection (1) above does not apply to any sum to the extent that it is required to be paid, on the day in question, in accordance with section 10 of the Exchequer and Audit Departments Act 1866.
(3) A loan made by virtue of subsection (1) above shall be repaid before the close of business on the day after the loan is made or, where that day is not a business day, before the close of business on the next business day.
(4) Subject to subsection (3) above, a loan made by virtue of subsection (1) above shall be made in such circumstances, and on such terms and conditions, as the Treasury may from time to time direct.
(5) In this section "business day" means any day other than--
(a) a Saturday or Sunday;
(b) Good Friday or Christmas Day;
(c) a day which, in England and Wales, is a bank holiday under the Banking and Financial Dealings Act 1971;
(d) a day specified in an order under section 2(1) of that Act (days on which financial dealings are suspended) and declared by that order to be a non-business day for the purposes of this paragraph; or
(e) a day appointed by Royal proclamation as a public fast or thanksgiving day.'.--[Ms Hewitt.]
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