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Mr. Laws: The Paymaster General says that there are long-established conventions, but will she acknowledge
that a category of individual skilled migrants will be worse off as a consequence of the changes being implemented?
Dawn Primarolo: Reliefs can change, as can the tax system. Behind the new tax credits, and the requirements that are not subject to change by me as a Treasury Minister, are the policies that the Government, and previous Governments, have pursued with regard to conditions that are placed on people who have leave—
It being three and a half hours after the commencement of proceedings on the first Ways and Means motion relating to the Bill, Mr. Deputy Speaker, pursuant to Order [this day], put forthwith the Question already proposed from the Chair.
4.15 pm
Mr. Salmond : On a point of order, Mr. Deputy Speaker. On two occasions, first in the Committee of the whole House and now on Report, we have lost a vital amendment that affects my constituents and many others who are concerned about North sea oil exploration and the thousands of jobs that depend on it. As you know, Mr. Deputy Speaker, I am not a paranoid sort of guy, but I am beginning to wonder whether there might be something so powerful in the amendment that the Government are resorting to these underhand and shabby techniques to avoid debating it. If not, is not the whole timetabling of the Finance Bill deficient if important amendments, duly selected, are not being considered?
Your knowledge of Standing Orders is much greater than mine, Mr. Deputy Speaker, so my point of order is this. Is there anything in our Standing Orders to state that if an amendment is selected for the third time it must be debated? Do we have a "three strikes and you're in" policy in the House and, if we do not, should we have such a policy to stop vital amendments being lost in that fashion?
Mr. Deputy Speaker (Sir Michael Lord): I understand the hon. Gentleman's concern, and I am sorry that new clause 9 was not reached this afternoon. However, he will understand that the Chair can do nothing about that; I am purely the servant of the House in such matters and we are only doing what the House has already decided it will do today. I am sure, however, that the hon. Gentleman has put his point firmly on the record.
Mr. Stephen O'Brien: I beg to move amendment No. 3, page 6, line 22, leave out "15" and insert "5".
Mr. Deputy Speaker: With this it will be convenient to discuss the following: amendment No. 1, in page 7, line 8, at end insert
- "less the amount of value added tax paid or payable by the person on those payments".
Mr. O'Brien: If proof were needed that there was no need for the knife to have fallen, the point of order made by the hon. Member for Banff and Buchan (Mr. Salmond) provided it. It is well known that I was deeply opposed to the timetable. Given the progress that we are making, it would have been possible to cover all the new clauses.
The amendments relate to bingo duty. Hon. Members will recall the extended debate on the issue in the Committee of the whole House. We highlighted a number of serious shortcomings and a complete mismatch between the Chancellor's rhetoric in his Budget speech and the Government's actions in the Finance Bill.
Our amendments have a common aim: to put in law the Chancellor's promises to all bingo players in this country. In his Budget speech, the Chancellor said:
- "I turn now to bingo. I will abolish the bingo tax . . . just as I have abolished direct taxes on the pools and on betting on horse racing."
- "The tax on bingo players' stakes and the tax on bingo prizes will be replaced in the same way as the tax on betting and the pools."—[Official Report, 9 April 2003; Vol. 403, c. 278.]
It is with the deepest regret—although, unfortunately, it is no surprise with this Chancellor—that we find that the Chancellor has not lived up to the words in his Budget speech. The Finance Bill made it clear not only that VAT would remain but that it would not be treated as expenditure in the GPT calculation, which will result in double taxation. Faced with that reality, the bingo industry will not be able to meet players' expectations of increased prizes. That deliberate and intended consequence shows that the Chancellor's actions are the opposite of his words.
Amendment No. 1 would remove the double taxation. It would not be necessary if the Government lived up to their promises and introduced an amendment to make participation fees VAT exempt. The House will appreciate that I am not permitted to table such an amendment, but the Government could easily address the matter. I note that the Government have tabled a similar amendment—amendment No. 4—clearly prompted by my call on the Floor of the House on 13 May.
When the Government tabled the amendments and issued the Treasury press release, they claimed all sorts of wonderful things for bingo, but we can show that their words do not match their deeds. Frankly, that would be too much to expect. Indeed, it never happens. No credit whatsoever is given to parliamentary procedure, to accountability or, of course, to Her Majesty's official Opposition, who have pressed the point to the extent that, with deep embarrassment, the Government have had to admit to the fact that they have failed to live up to their promises.
I welcome Government amendment No. 4, and I am delighted that the Economic Secretary has been persuaded by my arguments. If the Government assure me that they will move their amendment, I will be able to seek the leave of the House to withdraw amendment No. 1, but, yet again, I will have to wait to hear whether Ministers can live up to their words. I will have to wait to see whether the Economic Secretary moves that amendment.
I also tabled a second amendment, amendment No. 3, which is tied to the fact that I am not permitted to table an amendment to make participation fees VAT exempt. The reason I am not allowed to do so is plain for all to see: such matters have, in effect, been delegated to the European Union, and we cannot hold the Government to account about them on the Floor of the House.
The Chancellor created an expectation that the bingo industry would be put on a level playing field with the rest of the gaming industry and suffer an effective GPT rate of 15 per cent., with VAT-exempt participation fees. I understand that, as participation fees remain liable to VAT, the net VAT cost to the bingo industry is approximately 10 per cent. Under amendment No. 3, we would reduce the GPT rate to 5 per cent., so the effective rate of tax would be kept at 15 per cent.
Amendment No. 3 is less elegant than simply making participation fees VAT exempt, and I trust that, as with double taxation, the Economic Secretary will be similarly persuaded by my arguments and will agree to make participation fees VAT exempt. That is entirely within his gift; I cannot do it, but I can certainly introduce my amendment, which would have the same effect. Why deal with the issue in a more difficult way when it is in the Government's gift to ensure that things happen in the most appropriate, straightforward and elegant way that would be easily understood by all bingo players throughout the country, as well as the clubs themselves?
Mr. John Greenway (Ryedale): I am grateful to my hon. Friend for the interest that he has shown in this matter. Until yesterday, I was the shadow Minister with responsibility for gambling—I had been for some time—and I can tell him that the bingo industry is deeply annoyed and angry at the way in which the Government have treated it over this issue. However, may I clarify what he is saying? He says that he cannot commit the Conservative party to a VAT exemption, but is he saying that it is our policy to ensure that there would be tax equalisation between bingo and other forms of gambling, because that would certainly be a worthy aim that this country's 7 million bingo players would deeply appreciate?
Mr. O'Brien: I am grateful to my hon. Friend for that intervention, and I know that he takes a tremendous interest in and supports not only the bingo industry, but all the gaming industries, which are so important to constituents throughout the country.
I am sure that my hon. Friend followed the technical position in relation to the Finance Bill: as members of Her Majesty's Opposition, it is not in our terms of reference, or in the Standing Orders, to table amendments that adjust VAT rates, so we have had to look for an alternative. By doing so, we are seeking to ensure that the Chancellor lives up to his promise, which was the bingo industry's incentive to move from GPT to bingo tax, as that may happen with the consent of pools and betting on horse racing, but against the express wishes of the bingo industry. To get those in the bingo industry to agree, they were promised a level playing field.
We have to hold the Chancellor to account for his words. I am waiting for the Government to deliver. It is up to them to find the resources to match their promises with the deeds on taxation that they should have implemented in the first place. If they do the honourable thing and step up to their promises rather than having to be dragged inch by inch in such an appalling way, we will inherit that position after the next general election. We have absolutely no intention of changing that position if the Government live up to their promises.
The Economic Secretary might well argue that the Government's measures deliver benefits to the bingo industry worth £35 million. He might also argue that the bingo industry will always want more, but every industry would. He might argue that the Government must make difficult decisions on the scope and size of tax cuts and draw the line, but that misses the point. The Chancellor's Budget speech raised the expectation of a level playing field with the rest of the gaming industry. Indeed, the expectations of the industry and bingo players were raised before the speech was made. The line was drawn before and during the Budget speech but, as has happened so often during consideration of the Bill, the Government moved the line.
When I moved an amendment to implement my call for the removal of double taxation at a benefit of £10 million per annum, the Treasury issued a press release saying that
- "the tax reforms will now mean around £125 million a year more in prizes or other player benefits".
- "half a million more visits to bingo clubs, and a £30 million increase in the industry's profits in 2007."
The Government claimed that a £10 million boost would deliver £125 million of benefits, but an article written by Susie Mesure, which was published in The Independent on 20 June, said:
- "Sir Peter Fry, the chairman of the Bingo Association, said: 'You don't have to be a mathematical genius to work out that a net saving of £35m won't give £125m in extra prizes yet that is the impression that is being given. There is no way the £125m in extra prizes can be claimed in anything like the near future."
- "While Sir Peter acknowledged that an additional £10m was helpful, he said the Treasury's suggestion that this would create £125m in extra prizes was false. 'This will cause aggravation among bingo members', he said. 'Not to make it clear that the extra £125m would not happen today but was years off happening was rather naughty.'"
It is an absolute outrage that we have had to table an amendment and drag the Government along kicking and screaming—I fear that they will scream rather than kick their proposal into touch and adopt ours, although I would be jolly glad if they did. I do not anticipate that they will do that because they cannot bring themselves to accept that there is some democracy in this country and that there is a purpose of having an official Opposition who can spot when the Government are playing fast and loose. It is time for them to step up to meet their promises.
It is critical that the Government accept the amendments. The mention of bingo in the Budget speech gave the Chancellor his only opportunity to make a joke—it fell completely flat—and he raised expectations. I call on him to live up to his promises and create a level playing field for the bingo industry, rather than playing with numbers and bingo players' expectations, so that this country's bingo players get the fair deal that they deserve, and they can be assured that they would get that from the Conservatives. I urge hon. Members to accept the amendments because it is a matter of honour to meet the expectations created by the Chancellor. Depending on whether we receive a satisfactory response from the Economic Secretary, I hope that hon. Members will join me in the Lobby.
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