Examination of Witnesses (Questions 694-699)
RT HON PAUL BOATENG AND MR CLIVE MAXWELL
WEDNESDAY 6 MARCH 2002
694. Good afternoon, Minister. May I ask you to identify yourself for the record?
(Mr Boateng) Good afternoon, Mrs Dunwoody. I am Paul Boateng, Financial Secretary for the Treasury, and I am accompanied by Mr Clive Maxwell who is Head of the Environment and Transport Taxes Team in the Treasury.
695. The Committee are deeply honoured with the arrival of any Treasury Minister, so perhaps I should ask you if you have something you wish to say.
(Mr Boateng) Only how glad I am, Mrs Dunwoody, to have this opportunity to give evidence before the Committee on my specific responsibilities in the Treasury for tax.
696. How very interesting. You say that tax cannot affect the affordability of road transport, particularly in relation to lower-income households. If affordability for lower-income households is important, would it not be better to hold motoring costs constant and subsidise public transport like buses?
(Mr Boateng) My responsibility, Mrs Dunwoody, is to ensure that in terms of the taxation of transport and the use of transport, the various issues around the environment, around social inclusion, revenue raisingall thoseare balanced, in order that a judgement can be arrived at as to how best to secure a policy objective. In relation to the Transport Plan, environmental considerations, considerations of social inclusion, considerations of revenue raising, all influence and impact on the successful implementation of the Plan.
697. Good. So you know that the 10 Year Plan makes it very clear that the more you travel, the more tax you are going to pay, so do you not think that possibly the Plan has produced a rather odd outcome?
(Mr Boateng) No, because what the Transport Plan envisages is a situation in which there is a degree of investment in the transport system, considerable investment, public investment in excess of £140 billion, which is designed to address certain objectives.
698. Yes, it makes it very clear the further you travel the more you will pay.
(Mr Boateng) Those objectives relate to congestion, those objectives relate to the environment, those objectives also relate to social inclusion. So if you take, for instance, the issue of road haulage, which is a specific responsibility that I have and the consultation document that we have put forward in relation to that, that is designed to address issues of congestion, it is designed to address issues of fairness in terms of revenue-raising, so that external road haulage companies from outside the United Kingdom have to operate on a level playing field with our own road haulage companies, and it is also designed to address environmental considerations. The concern that Government has is to make sure we arrive at an outcome in relation to that consultation that balances those various interests.
699. The Commission for Integrated Transport has shown that overall our motor taxes are about average for the European Union. Do you agree with that?
(Mr Boateng) Mr Donohoe, at the moment in terms of the levels of taxation we are I think eighth in the European Union, so we are about in the middle. What we have to be concerned to do in relation to taxation is to make sure that we achieve a balance of the objectives I have sought to outline for the Committee. It is the achievement of that balance rather than a particular position in a league table which has to be the objective.