Previous SectionIndexHome Page

Mr. Bercow rose—

Mr. Prisk rose—

Mr. Boateng: I shall now give way to the hon. Member for Hertford and Stortford.

Mr. Prisk: I am grateful to the Chief Secretary for finally giving way. He mentioned 95 per cent. of estates, but may I return to stamp duty? In the light of his impending house move, will he confirm that in the borough of Brent only 4 per cent. of first-time buyers will benefit from the measures, so 96 per cent. will not?

Mr. Boateng: I do not have the figures for Brent, but I fancy that they will be available to my hon. Friend the Financial Secretary by the end of the debate. I am sure that he will provide a characteristically robust response to the hon. Gentleman's point.

Mr. Bercow: Will the Chief Secretary give way?

Mr. Boateng: No, not at the moment. I intend to make a little more headway before giving way to the hon. Gentleman.

It is important that we protect and support our older citizens, which is why clause 9 is specifically designed to help to reduce pensioner poverty. It will increase age-related personal allowances for those aged over 65 in line with earnings and ensure that more than half of pensioners do not have to pay income tax. In practice, that will mean that for those aged 65 to 74, the allowance will be increased to £7,090. The allowance for those aged 75 and over will be increased to £7,220.

In the Finance Act 2004 we legislated for a radical simplification of the tax rules for pensions. From April 2006, the numerous existing regimes, each with its own set of rules, will be replaced by a single, universal regime for tax-privileged pensions savings. It is important to remember that clause 101 introduces a package of
6 Apr 2005 : Column 1438
supplementary measures to refine the 2004 Act. The measures will provide additional flexibility for schemes and individuals and allow a smoother transition from the current regime to the new one.

Mr. Tyrie: rose—

Mr. Boateng: I shall give way first to the hon. Member for Buckingham and then, of course, to the Opposition Front-Bench spokesman.

Mr. Bercow: It is always a pleasure to listen to the Chief Secretary's mellifluous tones—this might be the last time on which we have the opportunity to do so. However, although this might be his last appearance before the House, I would still like to be reassured that he is master of his subject. Given that he glossed rather superficially and inappropriately over clauses 20 to 22, and thus broke his promise to deal with my specific inquiry, will he now tell me why clause 21(8), on research institution spin-out companies, is not subject to the affirmative procedure of the House? That is a straightforward question and I want a straightforward answer.

Mr. Prisk: Why not write to my hon. Friend?

Mr. Boateng: I do not need much temptation to go into detail, but I understood that my brief for this afternoon was to resist temptation. I find the blandishments of the hon. Member for Buckingham absolutely irresistible. What concerns me is why he would favour the affirmative resolution procedure—[Interruption.] Let me finish my point. What concerns me is why he prefers the affirmative resolution procedure to the procedure that we have adopted, which enables us to have this debate. It meets the concerns and the substantive points made to us by academia and those engaged in spin-outs. If he sees a particular advantage in the affirmative resolution procedure, I am sure that the House would be glad to hear what it is.

Mr. Bercow rose—

Mr. Boateng: I shall give way in a moment.

It seems to us that the proposed changes, on which we have extensively canvassed the sector, have been widely welcomed. We received more than 45 responses to the consultation following publication of the technical notes and the partial regulatory impact assessment at the pre-Budget report stage. UNICO, which the hon. Gentleman knows is the University Companies Association, says that feedback to the draft legislation, which we published as long ago as February this year, has been

and people have found

I fancy it did not take into account the seemingly infinite capacity of the hon. Gentleman to complain. [Hon. Members: "Oh!"] Oh yes, no more Mr. Nice Guy. I was only too happy to approach the debate in a non-partisan way and to be brief, but my patience has been tested.
6 Apr 2005 : Column 1439

Mr. Bercow: I congratulate the Chief Secretary on his appointment as British high commissioner in South Africa. He will do a fantastic job in that role, and I wish him well. Frankly, though, that was a ponderous and meandering response to a straightforward question. If he had just said that he did not know the difference between negative and affirmative procedure, the House would have been greatly obliged. The affirmative procedure maximises ministerial accountability to Parliament and the negative procedure minimises it. It could hardly be clearer.

Mr. Boateng: If my memory serves me well, the hon. Gentleman and I have had this debate in relation to other clauses in the course of other Finance Bills discussed Upstairs. Those Conservative right hon. Members present who have had to do what my right hon. and hon. Friends have had to do in Committee know very well that it is to assist the ministerial conduct of business that one prefers the negative to the affirmative. In due course, 20 or 25 years hence, it is possible that the hon. Gentleman might discover why Ministers tend to prefer the negative to the affirmative.

Mr. Dorrell: Will the Chief Secretary confirm that he once appreciated the force of the argument that my hon. Friend the Member for Buckingham (Mr. Bercow) advances, not least when the right hon. Gentleman advanced exactly that argument from the Opposition Benches? Does he recall the precise Damascene moment when he was converted to the view always taken by the Treasury Bench?

Mr. Boateng: It was in May 1997. Hands up; it's a fair cop, guv. We all know the reason for that, and there is widespread acceptance on both sides of the House that that is the best way to proceed in the circumstances.

We want to build on the steps taken in successive Finance Bills, which is why clause 101 introduces a package of supplementary measures to refine the 2004 legislation. The measures will provide additional flexibility for schemes and individuals, and smooth the transition from the current regime to the new regime. Moreover, the Pensions Act 2004 legislated for the pension protection fund, which comes into being today. Clauses ensure that the PPF has the same tax privileges as the pension schemes that it protects, but to make our tax system fairer, we must also ensure that it applies equally to all. That is why these clauses are designed to introduce changes to income tax, corporation tax and capital gains tax rules relating to alternative finance arrangements that do not involve either payment or receipt of interest, including those that are designed to be Sharia compliant.

Mr. Tyrie: While the Chief Secretary is on the subject of pensioner poverty and measures to deal with pensioners, will he explain why the Government have decided to give a £200 relief for council tax to pensioners for one year only? Will he also explain why the fact that it was for one year only was dropped from the Chancellor's Budget speech?

Mr. Boateng: I do not want to engage in retrospective analysis of the Budget presentation. We made the position clear at the time. [Interruption.] I and all my
6 Apr 2005 : Column 1440
colleagues made it clear that we were trying to respond to the concerns of pensioners. We introduced the Lyons review to enable us to arrive at a position in which the issues are seen within the context of local government finance overall and the undoubted need for reform, which we have recognised in relation to council tax.

I do not want to get drawn down that road, but if the hon. Gentleman tempts me, I will. We all know that the council tax arose out of the poll tax debacle. We all know that the origins of the poll tax lay with the Conservative party and in particular—I know this because I was in the House at the time—with the contribution to local government finance made by the Leader of the Opposition. We do not want to return to those days because we know what it would mean for local government finance and pensioners, as it would increase pensioner poverty.

Next Section IndexHome Page