Select Committee on Treasury Minutes of Evidence

Examination of Witness (Questions 560 - 568)



  560. Which takes us back to the experience and coherence of the staff in the Treasury?
  (Mr Troup) Correct.

Mr Davey

  561. Do you not find the Finance Bill process depressingly ineffective and, if you do, how would you reform it?
  (Mr Troup) I am not sure this is a question about the Treasury.

  562. It is parliamentary scrutiny of the Treasury system.
  (Mr Troup) The parliamentary scrutiny, yes, is very depressing. I have to say I think the extent to which there has been the opportunity to consult on the legislation before it was put into the Finance Bill—

  563. Occasionally.
  (Mr Troup) Well, quite a lot actually, an awful lot of the Finance Bill has been put out for consultation. I have to say as a professional and someone who is involved with representative bodies, our view is once it is in the Finance Bill you might as well give up.

  564. We are so bad at our jobs.
  (Mr Troup) Our maximum input is discussing with Revenue and Customs at the consultation stage before the Finance Bill, before hopefully draft legislation is prepared in the first place but then, once draft legislation is prepared, before it actually goes in the Finance Bill, the Finance Bill process in Parliament is such that as a practical matter it is almost impossible for us to have any effect.

  565. Why do you think the Treasury takes no notice of Parliament? Does it not care what we think?
  (Mr Troup) I think to a certain extent it is a reflection of what I have just said about the political imperatives. Once you have launched a Budget, it is very difficult politically for a chancellor of any political persuasion to say "I am sorry I got it wrong".

  566. Most of the things that are in the Finance Bill are technical tax measures which the general public do not care about.
  (Mr Troup) True.

  567. If you look at any Finance Bill, 95 per cent Joe Soap would not care a monkeys about.
  (Mr Troup) I do not think this is an issue for the Treasury, I think this is a political process issue. It is difficult for chancellors to admit, even on the detail of the Finance Bill, they have got it wrong. If you have got the detail wrong you might have got something rather larger wrong. I would greatly prefer the parliamentary process was more effective and, as you say, there was a willingness to say "Look, we are right on the policy . . ."—

  568. How can we do that? How can we make that happen? Are you saying our politicians' psyches need changing?
  (Mr Troup) I think partly it is volume, is it not, I think it is volume and complexity. The Members of the Standing Committee on the Finance Bill are politicians who very rarely come with a detailed knowledge of tax. The Finance Bill is almost incomprehensible except to a few of us sad enough to actually work in tax. To expect any political process to allow for real debate on the content is quite hard to design, which is why I think, although the position is far from satisfactory, putting more out to consultation ahead of time is actually the better result. If the politicians feel that they are being thereby excluded from the detailed debate, it seems to me it is going to be very difficult to rectify that unless they are prepared to really get into the details of tax law. I would have thought it was better for them to be reassured that process has gone on than necessarily to try to amend the drafting as it goes through. There are some other detailed points about the way that Parliamentary Counsel operates independently from the Inland Revenue, and I have the greatest respect for them, but they do sit in a different box and they have their own pride which means that once they have actually produced draft legislation it is very difficult for the Inland Revenue to get them to effectively structurally alter it. Once they have decided they are going to implement their instructions from the Inland Revenue in a particular way and produce their first draft, if the Inland Revenue said "actually, we thought you were going to do it this way", it is bad luck, they very rarely rewrite something completely because the Revenue thought they should do it in a different way. There are a number of examples on the statute book where that has happened. There are all sorts of things wrong with tax policy making in this country and I am certainly not laying them all at the door of the Treasury. The way the Revenue and Parliamentary Counsel work is a separate, relatively minor topic which ought to be addressed.

  Chairman: Thank you very much indeed, Mr Troup, we are most grateful to you.

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