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Mr. Letwin: I have already declared one potential interest in that a pet-food shop might be a client of my bank; I now declare another in case some airline or shipping company is also a client.
We accept that the measure is a corollary of the removal of duty free. In the Standing Committee to which the Paymaster General has already referred, we fully exposed the fact that both the previous Government and the then Opposition were partners in crime in bringing about that sorry state of affairs. Moreover, we have adequately exposed the history of the matter. Notwithstanding the protestations of the hon. Member for Wrexham (Dr. Marek), formerly the shadow Economic Secretary, the present Prime Minister came into office,
believing, for some reason unknown to man or beast, that he could change something that was locked in unanimous cement--why, I cannot imagine. To his great astonishment, and that of the British public, he found that he could not change it in the least. That, of course, represented a major triumph for the getting to the middle of Europe, sitting at the table and then being eaten thesis--why we have to be at the top table and retain our so-called influence.
Leaving that on one side, the devil is in the detail; that came out in our debates in Standing Committee. The provision makes it clear that the Paymaster General inadvertently misled the Committee in explaining the state of the law. It also demonstrates the depth of the mess. Paragraph (4A) of the new clause is the operative item. It tells us that in order to be "a relevant journey", a journey has to begin in the United Kingdom--that is uncontroversial--and has to have an
My hon. Friend the Member for Spelthorne (Mr. Wilshire) brought out the more vexed issue of the Basle problem. Should Basle airport be privatised, I would recommend that hon. Members consider investing in it early, because Basle has the lucky escape, so to speak, of being in two countries--Switzerland and France--at once, or in neither country at any time. As a result, if one wants to travel inside the EU to France and one happens to be clever enough to do it via Basle, one will also be entitled to duty free, even though one will be walking straight out into France.
Those were just two of the very large run of problems that were brought up, and that illustrated the complicated farce that the present proposals will give rise to. The Paymaster General, in an eloquent series of utterances, told the Committee that it was a puffed-up thing and that no one need worry because
Undoubtedly, during the coming weeks and months, clever lawyers, clever airlines and so on will illustrate a heap of other such messes. I am sure that the Paymaster General will then return to the House and say that she never meant any of those things and that she really had quite a different clause in mind. It is just a pity that she has not brought that before the House today.
Mr. Edward Davey:
Does the hon. Gentleman think that people travel for duty free or to get from A to B?
Mr. Letwin:
The hon. Gentleman, unlike many of us in the House, is obviously not a skier. I have to tell him that there are lots of ways to get to Switzerland and lots of ways to get to France, and quite a lot of them end up by getting from A to B; it is just that one can choose to go via C, D or E. He would be very well advised to think of going via Basle in future.
Mr. David Wilshire (Spelthorne):
Thank you for calling me, Mr. Deputy Speaker. I have little doubt that you would rule a general debate about duty free out of order, so I shall confine myself to some specific matters that are raised by new clause 6, which are relevant to duty free in general but more specifically to the financial arrangements.
I am worried about this issue because my constituency is hard up against the boundary fence of Heathrow, which means that either many hundreds, or a 1,000 or so, constituents of mine depend on the duty free trade for their jobs. It also means that a significant number of customs officers who work at Heathrow are my constituents. Perhaps more important still, almost all my constituents--whether they travel for duty free or for other reasons--enjoy duty free, so I am very much involved in the entirety of this debate.
I am worried about new clause 6 because it gives effect to changes that will lead to redundancies in my constituency, and that will put pressure on the decreasing number of customs officers--decreasing because the present Government see fit to reduce the number of customs officers at Heathrow fairly regularly. In case the Paymaster General is tempted to say that new clause 6 will reduce the work load of customs officers, I would respectfully suggest that it will actually increase it because, previously, anyone passing through terminals 1, 2, 3 and 4 bought duty free and away they went, and the Customs and Excise people knew the score. Now, it will be necessary to decide, when a person leaves, for example, from terminal 1, where the heck they are going, or if they are arriving at terminal 1, where they have come from. As a result we shall need more, not fewer, customs officers--or very clear assurances from the Paymaster General that the existing customs officers will not be put upon unreasonably.
The new clause also confirms the Government's failure to prevent something happening that they trumpeted that they would prevent. It is a failure by the Government from
which they cannot hide on this occasion. When the Paymaster General replies, it will not be good enough for her to say, "We have obtained some wonderful concessions." I heard her try that trick last week.
I have had a good, long and hard look at the so-called wonderful concessions, and one of them bears mentioning. We were told that, if a ferry is coming across the English channel and someone happens to get himself into the shop before the vessel enters territorial waters, there is a concession that enables the individual to continue shopping. However, the small print states that, after three months the concession will disappear. So much for the Government's marvellous negotiating skills when they go to Brussels.
There are a number of matters concerning the new clause on which I seek clarification. I begin with the concept that it is founded upon the treating of goods in ships and aircraft as stores. Are we absolutely clear what we mean? The clause states that it is necessary to refer to section 1(4) of the Customs and Excise Management Act 1979. That is where we must turn to find our definitions, and I did that this afternoon.
Section 1 of the 1979 Act amounts to four and a half pages of various definitions. The section goes so far as to draw a distinction between a ship, which is defined, and a British ship, which is also defined. Search as I might, I could find no definition of an aircraft. If we are to be told in the new clause that we must refer to the 1979 Act for a starting point, where is the definition of "aircraft" from which we must work?
The Paymaster General may shake her head and think that I am being pedantic. However, she tells us that we must refer to the 1979 Act for a definition of "ship". I ask her to provide us with one for "aircraft".
Another feature that bothers me about the concept of treating goods as stores is that the new clause refers to "Goods . . . carried." It does not refer to goods loaded. Here, there is a problem. As it is made clear in the definition that we are talking about ships and not British ships, we are talking about any ship that comes into a United Kingdom port carrying goods.
Let us suppose that a Norwegian ship leaves Bergen and calls in at Newcastle. There is no problem because it has come from somewhere outside the European Union. However, it is carrying duty-free stores from Bergen which it will take back to Bergen. If I understand the clause correctly, if that ship returns directly to Bergen, there is no problem. It will not have landed anything but it will have duty-free goods on board. However, if that ship, having sailed from Bergen to Newcastle, calls in at Rotterdam before returning to Bergen, Customs and Excise will have to board it and make a list of every last thing on it and make those concerned pay duty, which they may or may not have paid back when they leave Rotterdam to go to Bergen. That is the nonsensical feature of referring to "Goods . . . carried" and not goods loaded. I shall be most grateful if the Paymaster General will tell us why the particular wording has been used.
I am also concerned about "relevant journey" as a definition. We are told that it equals
The Andorran situation bears closer scrutiny. Last time I was there, huge numbers of French matrons driving Renaults and Citroens were bombing up and down the mountain, going up empty and coming down full, and seemed to be making numerous journeys every day. If they can go on doing that, why cannot we, when we go across the channel?
I am worried about whether the definition of "relevant journey" is accurate. My hon. Friend the Member for West Dorset (Mr. Letwin) referred to the Basle-Mulhouse problem. I shall not detain the House by rehearsing the stupidity of it, but when I was given a list of parts of the EU that are outside the customs union, I got wonderful places in the Caribbean and other bits of France all over the place, but no mention of that lovely little part of France that is occupied by Basle airport.
As the Paymaster General told us in Committee last week, if we travel into Basle airport from Heathrow, we can have all the duty free to which the allowances entitle us, but it is in France, so the information that we were given this afternoon was, I suggest, duff information. It did not include all those parts of the EU that are outside the customs union.
"immediate destination outside the member States."
You were lucky enough to avoid the Standing Committee where two problems arose, Mr. Deputy Speaker; we christened them the Gibraltar problem and the Basle problem. The Gibraltar problem came to light only after the Paymaster General realised, and correctly and helpfully informed the Committee, that Gibraltar was not actually part of the EU. We had previously thought that it was a Casablanca problem. I had thought that, in order to get duty free, one would have to fly to Casablanca and then on to Gibraltar, because Casablanca is--I quote new clause 6(4A)--
"an immediate destination"
outside the EU, but it turned out that actually one only had to fly to Gibraltar. As long as one goes to Spain via Gibraltar, one will be able to collect duty free; if one goes to Spain directly, one will not.
9.15 pm
"Passengers would have to go to Casablanca, get off the plane, go into the airport and then rejoin the plane before take-off."
Then she said rhetorically to the Committee:
"What am I supposed to do about duty-free goods outside the EU?"--[Official Report, Ninth Standing Committee on Delegated Legislation, 1 July 1999; c. 16.]
Unfortunately, today, the Paymaster General produces new clause 6 and subsection (4A), and we find that the relevant item is the "immediate destination". It turns out that there is no need to get off the plane at all; it is quite
sufficient for that place to be the first stop on one's journey. While one is there, or on the way there, the things that one is sold are stores in the technical meaning of the term and therefore may be sold duty free--and hey presto, the mess is not only a mess, but a mess the character of which, it turned out last week, the Paymaster General has not understood.
"an immediate destination outside the member States."
This afternoon, the Paymaster General helpfully gave me a list of those parts of the European Union that are outside the customs union. One of them was Andorra.
Another that has been mentioned is Gibraltar. However, we are told that a relevant journey must take one outside a member state. Gibraltar is not outside a member state. It is part of the European Union, but it is outside the customs union.
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