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12 Feb 2003 : Column 949—continued
Mr. O'Brien: I believe that the Paymaster General had a genuine point when she made it clear that the process of consideration involving a Joint Committee of the House was designed to tap into the vast expertise and experience of individuals who are able to bring their work to the assistance of the House, in supporting that which we as legislators want to achieve: a rewrite in much clearer, user-friendly language of a measure covering the important subject of income tax law as it relates to earnings and pensions.
Although it may seem on the surface that there has been less than the full number of debates that my hon. Friend might have expected, I am satisfied with the process because so much has been done through a number of Committees that have reported to each other. Although it is up to the Paymaster General to give my hon. Friend the reassurance that he seeks to pass on to his constituents, I have taken the trouble to satisfy myself that the process has been well designed and properly adopted.
Mr. Hoban: Has my hon. Friend read the speech that my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) made in the Second Reading Committee about the process that led up to the Bill? He said:
- "It is rather difficult to meet our duty of scrutinising legislation when these Bills come here after so much consultation, which usually leads to the full-blooded support of every professional body for the work that is produced."—[Official Report, Second Reading Committee, 16 December 2002; c. 10.]
Dawn Primarolo: I am sure that the hon. Member for Fareham (Mr. Hoban) is not seriously suggesting that the Government should not make every effort to ensure that legislation is properly drafted before it reaches the House, simply so that outside bodies can give Opposition Members something to say in debate? Surely the Government should be applauded for undertaking so much consultation and ensuring that legislation before the House is of the highest possible standard.
Mr. O'Brien: The Paymaster General almost takes the words out of my mouth. It is wholly proper and
appropriate that, in addition to the genuine tribute that I have paid to the Paymaster General, the House should record its gratitude to a number of the prime movers. The tax law rewrite project was established in December 1996 by the then Chancellor of the Exchequer, my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke), who gave it the authority and impetus that has led to the overall project's success so far. My right hon. and learned Friend would like to have been with us today but is unavoidably detained.I pay tribute to my right hon. Friend the Member for Fylde (Mr. Jack), who is elsewhere on Select Committee business. These ghastly hours mean that we all have to be in too many places at once. I pay tribute also to the hon. Member for Warwick and Leamington (Mr. Plaskitt), who has dedicated himself with great assiduity to the Bill. [Hon. Members: "Where is he?"] He is not in the Chamber, but that is forgivable, given the absence of my right hon. and learned Friend.
Mr. Forth: As ever, my hon. Friend is a true gentleman in seeking to exonerate the other right hon. and hon. Members whom he mentions. However, if the Bill is as important as the Paymaster General suggested—and as important as my hon. Friend suggests by giving so much of his time to it—is he puzzled and disappointed that the very people to whom we should have looked for guidance today deem it to be more important to be elsewhere, rather than in the Chamber assisting us with the knowledge and experience that they gained in Committee? My hon. Friend and the Paymaster General apart, are we not left rudderless on the matter as a result?
Mr. O'Brien: I am somewhat disappointed that my right hon. Friend feels that I am not up to the task. The absence of the right hon. and hon. Members is understandable in the circumstances. However tempting it is to make a cheap point by condemning hon. Members for not being present in the Chamber, I shall not do so. It is encouraging, however, that so many of my right hon. and hon. Friends have felt it necessary to ensure that the Bill is given proper scrutiny on Third Reading. The Bill is the result of a long and rigorous process and I therefore hope that my right hon. Friend will gain some comfort from the knowledge that proper scrutiny has been granted to it. During the debate, he will have many opportunities to assure himself that that is the case.
Mr. Greg Knight: May I reassure my hon. Friend that we make no criticism of his handling of the matter? He is a powerful advocate. However, can he reassure me that nothing in the Bill alters the ruling in the well-known revenue case of Hochstrasser v. Mayes?
Mr. O'Brien: My right hon. Friend has obviously had the opportunity to read the explanatory notes. If not, paragraph 17 on page 5 explains everything that he needs to know about Hochstrasser v. Mayes (1959) 38 TC 673, [1960] AC 376. We should pay tribute to the hard work that has gone into the explanatory notes that support the Bill. As is so often the case on other Bills, they are exceptionally helpful to Members. On this
occasion, my right hon. Friend will find all the answers that he needs, and it would be tiresome and unnecessary to read out the paragraph concerned.
Mr. Cameron : My hon. Friend's wet towel exercise—as we shall now have to call it—of looking through the Bill was obviously complete. Did he consider clause 700, which deals with the taxation of share options? Does he share my concern that the proposed law may differ from the existing law, because the Bill mentions taxing an option the moment that it is assigned, instead of the moment that it is exercised? In that case, the person holding the option would not have made a profit out of it, but would be taxed on the nominal value of its assignation.
Mr. O'Brien: Accountability for the content of the Bill lies ultimately with the Government, but if it is of assistance to my hon. Friend in seeking further assurance from the Paymaster General, I can tell him that the annexe to the Bill contains a list of 183 changes, which are classified as minor.
Mr. O'Brien: My right hon. Friend will no doubt be interested to learn how those changes are classified and how the House may be assured that they are not a cause for concern. He will then have to decide whether he is satisfied with the explanation.
If my hon. Friend looks at the schedule 183 changes, he may well find that the change in clause 700 is classified as minor. I shall look it up if he needs further clarification, but his challenge is appropriate in this debate. He mentioned the wet towel. I assure him that it was very wet, but I am satisfied that the change is in line with the original intent not to inflict unnecessary burdens on users of the Bill.
Mr. Bercow: Will my hon. Friend allow me to intervene?
Mr. O'Brien: This must be the last intervention, as I need to get to page 2 of my speech.
Mr. Bercow: My hon. Friend is typically generous. My right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) said in his Budget speech in November 1996 that the project was as ambitious as an attempt to translate "War and Peace" into lucid Swahili. He and other senior and influential Members are too busy to be here today, but does my hon. Friend think that they would approve of clause 130 on the notional price of an accessory?
Mr. O'Brien: I was born in Tanzania and my father speaks fluent Swahili. The Bill is more difficult than the translation suggested by my right hon. and learned Friend the Member for Rushcliffe. I suggest that my hon. Friend looks at the definitions of any terms contained in inverted commas. That is always useful in tax matters. He can then decide whether "notional price" amounts to correct English usage. It is helpful to wear an anorak when comparing and contrasting this Bill with the wording in the original legislation.
I want to make progress. The Paymaster General was exceptionally generous in giving way to interventions, and I do not want to be less so. However, Labour and Liberal Democrat Members seem unwilling to intervene.
As I was saying, I pay great tribute to my right hon. and learned Friend the Member for Rushcliffe, but also to my right hon. Friend the Member for Fylde and to the hon. Member for Warwick and Leamington, both of whom served with great dedication on the steering committee overseeing the project. I salute all the steering committee members, under the indefatigable, focused, charming and determined chairmanship of my noble Friend Lord Howe of Aberavon, which has been patently effective.
Mr. George Osborne: Will my hon. Friend give way?
Mr. O'Brien: I should like to make progress, but I appreciate that my hon. Friend wants to make a relevant point.
Mr. Osborne: We are praising the work of the Joint Committee and approving the project, but the regulatory impact assessment states that the costs of the rewrite project are almost impossible to quantify in advance, and that it is impossible to arrive at an objective measure of the benefits. Does my hon. Friend and constituency neighbour agree that it is surprising to be considering a Bill whose costs and benefits remain unknown to us? I hope that the Paymaster General will at least say something about the costs.
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