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Mr. Hogg: My hon. Friend says that the Bill is simple, and in one sense it may be. We are being asked to accept that it is but a simplification of existing law. Will my hon. Friend tell the House why he thinks that three sittings were sufficient for the Committee to satisfy itself that a Bill of some 332 pages was but a simplification of existing law?
Mr. Ottaway: I was trying to emphasise that the Bill was not a simplification, but a restatement. I will come in a moment to the question of sittings. I was a minority of one on the Committee who believed that we should have taken more independent external advice.
That was the first time that we had gone through the procedure. We sat as a Joint Committee on Tax Simplification Bills with Members of the other place, but this House had a majority. That was a new procedure, so I want to dwell on it for a moment.
I shall make three points about the operation of the Select Committee on Procedure and the Joint Committee. The Procedure Committee gave the Joint Committee the task of reporting to the House any problems that might arise.
My first point concerns the Joint Committee's composition, which the House debated at length. We became a bit caught up in guerrilla warfare, and its membership was debated in some detail. The other place nominated six of its Members, two of whom were members of the original tax law rewrite committee. Their input was extremely helpful. They have served Parliament and this country with distinction in their parliamentary careers and their integrity is beyond doubt, but I question whether their membership of the Committee was appropriate. As they were members of the original tax law rewrite committee, I am concerned about whether they had a conflict of interest in respect of the Joint Committee. I believe that it is irregular for those who oversaw the original drafting subsequently to be in a position to opine upon its effectiveness. I am not saying that it was improper for members of the original tax law rewrite committee to participate in the Joint Committee proceedings, but I am not at ease with that arrangement.
Secondly, I turn to the point made by my right hon. and learned Friend the Member for Sleaford and North Hykeham (Mr. Hogg) in his intervention. All the witnesses who gave evidence to the Joint Committee had participated in the tax rewrite project. The quality of their answers was flawless; they gave evidence just as the Committee wanted it and they answered every question simply and to the best of their ability--but they were not independent. No independent witness could consider the Bill and the rewrite, and say simply, "Yes, I think that these people have got it right." As virtually the only Opposition Member who served on the Committee, I might have faced the task of sitting down and spending several weeks analysing the Bill against the original law. Indeed, it took a number of officials on the tax rewrite committee several years to rewrite the proposals. I had to make a decision.
Dawn Primarolo: I appreciate the hon. Gentleman's point, but I offered him direct access to officials without ministerial supervision. If he felt that he would require such assistance to consider the Bill and to recognise the issues that it raised, he could have taken that offer up, but he declined it. Similarly, Opposition Front Benchers have direct access to officials without ministerial presence or knowledge for assistance in considering the technical detail of double taxation treaties.
Mr. Ottaway: I must confess that I do not recall that offer, but if the Paymaster General says that it was made, that is fine. However, she is missing the point. The Joint Committee should have had the advice of an independent witness.
Mr. Kenneth Clarke (Rushcliffe) rose--
Mr. Ottaway: I give way first to my right hon. and learned Friend the Member for Rushcliffe.
Mr. Clarke: Does my hon. Friend acknowledge that the Joint Committee would undoubtedly have called and heard any witness that he wanted to appear before it, had he named such a person? Can he name the independent witness from whom he wanted to hear, bearing in mind the five years of consultation and the circulation of exposure drafts to every conceivable professional and representative body? The Bill received the support of those bodies, and we heard no particular dissent from them.
Mr. Ottaway: As my right hon. and learned Friend knows, he and I disagree on that point. I did not propose a name because it was obvious that I was in a minority position, but I suggest that a partner from a leading firm of City solicitors would have made a perfectly adequate witness. If I had believed that my right hon. and learned Friend, as Chairman of the Committee, agreed with such a proposal, I would have dug out a name.
Mr. Hogg: My hon. Friend knows that it is standard for a Select Committee to have advisers who can advise on the subject before it and on the questions to be asked. Did the Committee receive any independent advice about the content of the Bill or the questions to be asked of witnesses?
Mr. Ottaway: I shall answer that question with some care. If I simply said no, that would imply a slur on the witnesses. They gave evidence with absolute integrity, but they were part of the tax rewrite project. No witness was not part of it.
Mr. Hogg: There was no independent advice?
Mr. John Redwood (Wokingham): I am grateful to my hon. Friend for all his efforts. I found it odd that the Joint Committee held only three brief sittings. The minutes record long declarations of interest; I remind hon. Members that I have declared mine in the Register. It appears that no amendment was moved and that none of the 581 clauses or four schedules was believed to be defective. Did the Committee consider all 581 clauses, and was it satisfied that none added to or subtracted from existing law?
Mr. Ottaway: The Committee considered the 60-odd minor changes in sequence. An amendment was moved, but the Committee did not accept it.
Mr. Eric Forth (Bromley and Chislehurst): On page 47 of the minutes of the Joint Committee for 31 January, the Chairman is recorded as saying:
- "can Members of the Committee indicate if they agree that we should make no amendment whatever? (Members indicated by a show of hands)".
Mr. Ottaway: My right hon. Friend should not read lack of diligence into that. The Committee had every
opportunity to consider amendments; it took the changes en bloc and quizzed the witnesses, and an amendment was tabled.The Paymaster General said that the Committee scrutinised the Bill. I would not have used such a phrase. It had an opportunity to scrutinise the Bill, if it chose to do that. However, I have no idea whether the Bill reproduces the sense of the original draft measure. I am reliably informed that it does. I accept the word of those who gave evidence that it did, but unless I had given up several weeks of my time, I would not have had the opportunity to compare the current measure with the original drafting.
Dawn Primarolo: I am disappointed to hear the hon. Gentleman's comments at the Dispatch Box, because he did not make them in Committee. He had every opportunity to scrutinise the Bill. He claims that we did not have independent advisers, yet he did not propose anyone. He said that we did not have the right witnesses, but again, he did not suggest anyone. Now, having agreed to the report, which had unanimous support, he claims that he did not know what he was doing. Perhaps he should think carefully about serving on such a Committee in future.
Mr. Ottaway: The Paymaster General knows that that is a complete distortion of events. At the first sitting of the Joint Committee, I clearly and repeatedly made the point that I have made this evening. The minutes show that.
Mr. David Ruffley (Bury St. Edmunds): Will my hon. Friend give way?
Mr. Ottaway: I shall do so shortly. The Paymaster General should not claim that I am misrepresenting things. If I had believed that she agreed with the proposal that I made, I could have produced the name of a suitable witness in no time.
Dawn Primarolo: The hon. Gentleman did not ask me.
Mr. Ottaway: The Minister says that I did not ask her. The minutes of evidence make it clear what happened, and what debates took place. I am sorry if she was not listening at the time.
Mr. Ruffley: I wish to make a helpful intervention. I think that my hon. Friend said a few moments ago that the Joint Committee agreed minor changes. As we know, the purpose of the Bill is to preserve the effect of existing law, subject to any minor changes that might be desirable. How many minor changes were there, and was the Committee satisfied that they were minor?
Mr. Ottaway: I believe that there were 66. The Committee was advised that they were minor, and it accepted that recommendation. The point that I am making is clear, and I hope that the Procedure Committee will consider the matter.
A further point concerns the scope of the Committee. We took the Bill as it was. However, it was not clear who had decided the format. The Institute of Chartered Accountants of Scotland made the important point that it agreed with the
Bill but recommended that the new legislation should be accompanied by overviews, explanatory notes and signposts. It argued that self-assessment legislation meant that the taxpayer had a right to understand tax law.The institute's report states:
- "As a matter of principle it is our view that tax law should be capable of being understood by an intelligent taxpayer who is prepared to devote a reasonable amount of time to the task. Unfortunately, in many areas of tax law, so timid is the work of rewriting that an intelligent taxpayer would need a long period of study to understand with any degree of certainty what his tax liability is and how particular legislation affects him."
- "We are aware that a Parliamentary working party has considered the format of bills and acts generally and it has reported to, and obtained the approval of both Houses for proposals which reject many of the suggestions of the Project Team, including three-part numbering, cross-references and signposts at the end of sections, a larger typeface and overviews and notes. We recommend that these issues are revisited and we hope that overviews, explanatory notes and signposts will be used."
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