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Mr. Gareth Thomas (Harrow, West): Will my hon. Friend give way?

Miss Johnson: I shall indeed give way to my hon. Friend, who had something to do with clause 249.

Mr. Thomas: I am grateful to my hon. Friend for listening so sympathetically to the anxieties that were raised with her and her officials and with me, as the mover of clause 249. Although full consultation is clearly necessary, I urge her not to draw back from using clause 249 to extend the Bill's insolvency law provisions to industrial and provident societies. In the past, such societies have had to go into liquidation because the measure's sensible powers were not available to them. The last thing we want is to deprive industrial and provident societies of that power.

Miss Johnson: I am grateful to my hon. Friend for his intervention, and for his continuing interest in and support for the clause that he originally tabled in Committee. I am sure that he appreciates that we do not want to take action that is contrary to the interests of any part of the industrial and provident sector. I know that his purpose in tabling the clause was to help parts of that sector in the way he mentioned. We need to maintain his objective and the overall aim of doing nothing to damage the sector; I know that he is sympathetic to that. I simply emphasise that we shall consult and examine the matter and that we will not rush into decisions. We do not want to do anything that is contrary to the sector's interests.

Dr. John Pugh (Southport): If we are to take the assurance of full consultation seriously, and it happened now, interested parties would clearly say, "Accept the Opposition amendment." They have examined and

17 Jun 2002 : Column 80

understood what is before them; they are reasonably good judges of their interests. If full consultation means anything, we should harken to the amendment.

Miss Johnson: I understand the hon. Gentleman's point, but he is not right. As a member of the Committee, he appreciates that clause 249 was included in the Bill relatively late. There has not therefore been the same opportunity for dialogue with the social housing sector and bodies that represent its interests. We believe that further consideration of the issues that the sector raises will give it an opportunity of making its views known at an appropriate time to the appropriate Department. I understand that certain matters may need to be tackled and I accept that we may need to consider that, but the amendments would not ensure that we reached the right answer by the quickest route. I know that the hon. Gentleman wants to achieve that when he urges us to accept the amendment.

In the light of my comments and assurances, I ask the hon. Member for Eastbourne to withdraw the amendment.

Mr. Waterson: I am grateful to the Minister for saying that she appreciates the seriousness that the social housing sector attaches to the issues that we are considering and for her comment that she wants to consult. Given that she appreciates the seriousness of the matter, I hope that we can assume that the consultation will proceed briskly and that action will ensue if the result is the one predicted by the hon. Member for Southport (Dr. Pugh). I am sure that he is right.

The subject is serious, and I do not want to divide the House on it. I simply emphasise the comments of the Council of Mortgage Lenders and the National Housing Federation, which feel strongly about the matter because it could cause them major problems.

Mr. Mark Field: I am sure that my hon. Friend has it in mind that the availability of competitively priced private loan finance is crucial to the sector, especially in central London. I do not say that with purely constituency interests at heart. If we run the risk, there may be further unintended consequences. The Mayor of London has already insisted on a minimum of 50 per cent. social housing in new developments. That will drive developers away from developments in much of London. In the worst-case scenario that my hon. Friend has portrayed, we run a risk of unintended consequences for a sector that will go through some difficult times in the next couple of years—

Madam Deputy Speaker: Order. That intervention is rather lengthy. I call Mr. Waterson.

Mr. Waterson: I get my hon. Friend's drift. If I have not, I am sure that the Minister has. It is possible to square the circle by satisfying the social housing organisations and not undermining the amendment that the hon. Member for Harrow, West (Mr. Thomas) tabled in Committee. That has attractions for the main stream of industrial and provident societies, and he obviously speaks from knowledge. However, a serious problem clearly exists. We are happy to leave it with the Minister and hope that consultation takes place shortly.

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I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 18

Schedule 2A to Insolvency Act 1986

Amendments made: No. 356, in page 287, line 34, after 'a' insert—

'person who is, when the agreement mentioned in section 72B(1) is entered into, a'.
No. 357, in page 287, line 34, after 'individual' insert—

'in relation to a communication'.
No. 358, in page 287, line 37, leave out 'and'.
No. 359, in page 287, line 38, after 'a' insert—

'person who is, when the agreement mentioned in section 72B(1) is entered into, a'.
No. 360, in page 287, line 38, after 'investor' insert—

'in relation to a communication'.
No. 361, in page 287, line 39, at end insert—

', and

( ) a person in a State other than the United Kingdom who under the law of that State is not prohibited from investing in bonds or commercial paper.'.
No. 362, in page 287, line 45, at end insert—

'( ) For the purposes of sub-paragraph (1)—

(a) in applying article 19(5) of the Financial Promotion Order for the purposes of sub-paragraph (1)(a)—

(i) in article 19(5)(b), ignore the words after "exempt person",

(ii) in article 19(5)(c)(i), for the words from "the controlled activity" to the end substitute "a controlled activity", and

(iii) in article 19(5)(e) ignore the words from "where the communication" to the end, and

(b) in applying article 49(2) of that order for the purposes of sub-paragraph (1)(c), ignore article 49(2)(e).'.
No. 363, in page 288, line 2, leave out—

'section 72B and paragraph 1 of'
and insert—

'sections 72B and 72E and'.
No. 364, in page 288, line 18, leave out 'contractual entitlement' and insert 'entitlement under an agreement'.
No. 365, in page 288, line 19, leave out 'contractual responsibility' and insert 'responsibility under an agreement'.
No. 366, in page 288, line 28, leave out 'contractual responsibility' and insert 'responsibility under an agreement'.
No. 367, in page 288, line 31, leave out 'or'.
No. 368, in page 288, line 33, at end insert—

', or

(e) it is the holding company of a company within any of paragraphs (a) to (d).'.
No. 369, in page 288, line 35, after '(d),', insert—

'or is within sub-paragraph (1)(e),'.
No. 370, in page 288, line 36, leave out from 'performs' to end of line 37 and insert—

'a function which is not—

(i) within sub-paragraph (1)(a) to (d),

(ii) related to a function within sub-paragraph (1)(a) to (d), or

(iii) related to the project.'.—[Mr. Pearson.]

17 Jun 2002 : Column 82

7 pm

Madam Deputy Speaker: We now come to amendments Nos. 83 and 84.

Mr. Waterson: I shall try to deal with these amendments fairly briefly, as they were debated in Committee. They relate to the abolition of Crown preference. Lest anyone should accuse me of looking a gift horse in the mouth, let me say that we unreservedly welcome the scrapping of Crown preference. The demands of the Inland Revenue and Customs and Excise have often been a malign factor in the dying days of a business, particularly a small business, and the removal of this preference can only be a good thing. It has been welcomed in all quarters. As I recall, the amount in question is about £80 million, but the measure is welcome none the less, particularly for small businesses.

As I have said before, the Chancellor's fingerprints are all over this Bill, even if it is nominally a DTI measure. He has a habit of giving with one hand and taking away with the other—hence amendments Nos. 83 and 84. Although we are abolishing the Crown's preferential rights to the debts listed in clause 245(1), we are not scrapping the DTI's subrogated preferential rights in respect of salary and wage arrears.

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