Variation of Stamp Duties Regulations 2001

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Mr. Gibb: The Minister is one of the most articulate Members of Parliament: he has the smooth tongue of an experienced barrister and I listen in amazement and admiration of the way in which he can articulate under the most severe pressure. However, when he responded to my points on the vires of the statutory instrument, he was uncharacteristically fumbling and hesitant. I was not convinced by his statements, especially his assertion that it is quite proper to use the legislation for purposes other than those for which it was intended. I disagree. It is improper to use legislation for purposes other than those for which it was intended. The hon. Member for Welwyn Hatfield, then Economic Secretary to the Treasury, made clear in Hansard that the purpose of the power in schedule 33 to the Finance Act 2000. Its purpose is to close loopholes urgently. That is its only purpose.

The Minister criticises me for criticising civil servants, but I have the greatest respect for British civil servants. We have one of the best civil services in the world, politically neutral and of high calibre. However, legal advice is occasionally less than

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adequate and, on this occasion, I believe that it is unprincipled. If a private law firm had given advice to the Minister under contract, Members on both sides of the House, especially Labour Members, would be up in arms complaining about the quality of the advice and asking what fees had been paid to the firm. I have seen that in other Committees. The Home Secretary is on the record as criticising his civil servants for giving inadequate and wrong legal advice to him and causing him embarrassment in the courts. I make no apology for criticising the legal advice to the Minister.

The Minister is responsible for the statutory instrument and for bringing to the Committee a measure that is ultra vires, but I wonder whether he has read schedule 33. If he says that he has read and studied it, I shall accept that. If he has read it, he will have seen that it is clear; there is no ambiguity. Paragraph 1(2) states:

    ''The power conferred by this paragraph includes, in particular, power to alter the descriptions of document in respect of which an existing stamp duty, or an existing rate or amount of duty, is chargeable.''

As the hon. Member for Kingston and Surbiton said, the power is then specifically excluded under paragraph 3 which states:

    ''The power conferred by paragraph 1 does not . . . include power to vary—

    (a) the . . . rates . . .

    (b) the amount of an existing fixed stamp duty,

    (c) any threshold specified in paragraph 4 of Schedule 13 to the Finance Act 1999''.

That paragraph sets out all the key thresholds at which stamp duty is charged.

The Minister waffled hesitantly and in a way that was difficult to understand saying that the Government were not changing those thresholds, but merely limiting the relief ''by reference to'', which ''works in the same way as'', and so on. If he is right, Ministers could, by order, circumvent any of those powers by simply drafting them in terms of ''by reference to'' or ''is deemed to have been included in'' without actually amending the legislation. That would not stand up in court and it is wrong in principle. It is not the purpose for which the provision was introduced. It is a pity that the Minister will not accept our arguments and withdraw the statutory instrument.

Mr. Edward Davey: On a point of order, Mr. Cummings. I seek your direction and guidance. Is it possible for the Committee to vote on the statutory instrument if it has serious concerns about its legality and whether it is ultra vires?

The Chairman: All we are doing is reporting to the House that we have considered the regulations.

Question put and agreed to.


    That the Committee has considered the Variation of Stamp Duties Regulations 2001.

Committee rose at twenty-five minutes to Six o'clock.

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The following Members attended the Committee:
Cummings, Mr. John (Chairman)
Boateng, Mr.
Caton, Mr.
Davey, Mr. Edward
Flight, Mr.
Gibb, Mr.
Howarth, Mr. Gerald
Iddon, Dr.

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Knight, Jim
Luff, Mr.
Mahon, Mrs.
Sawford, Phil
Sheridan, Jim
Southworth, Helen
Sutcliffe, Mr.
Worthington, Tony

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Prepared 11 December 2001