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Mr. John Burnett (Torridge and West Devon) (LD):
We have had long discussions about taxpayer confidentiality, and the provisions in the Bill contain some useful protections in that regard. We share the
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desire of the hon. Member for Chichester (Mr. Tyrie) and other Conservative Members to see the oath retained.
I have asked Inland Revenue employees about the oath, which not only buttresses taxpayer confidentiality, but strengthens the position of Inland Revenue employees should someone in a superior position ever seek for them to compromise their integrity on taxpayer confidentiality. As the hon. Member for Chichester has said, it is important that we do nothing to erode taxpayer confidence, otherwise the tax yield is surely at risk.
We welcome the limits on disclosure and noted what the Attorney-General said in the House of Lords on 5 April 2005. The case of Pepper v. Hart is instructive, and hon. Members and tax professionals are only too well aware of the protections that the Attorney-General put on the record.
We are happy to welcome the provision, and we hope that the Bill will be a success. We also hope that the Inland Revenue culture will prevail and that Customs, which has been subject to certain criticisms, will become more receptive to taxpayers' interests, fairness and the rule of law, which should be the culture that guides Revenue and Customs once the merger comes into effect.
The Economic Secretary to the Treasury (John Healey): The hon. Members for Chichester (Mr. Tyrie) and for Torridge and West Devon (Mr. Burnett) have carefully considered aspects of the duty of confidentiality throughout the passage of the Bill.
The duty of confidentiality is a weighty matter for any Revenue department and the officers who work within it. As they know, my right hon. Friend the Paymaster General and I, as well as my right hon. Friend the Attorney-General, have emphasised and re-emphasised that throughout the passage of the Bill. I welcome the comments that both hon. Gentlemen have made on the amendments made in another place. That is in keeping with what has been a full and productive debate on the Bill at every stage in the other place and in this House.
The changes with which the Bill returns to this House from another place amend the provision for disclosure of information in the public interest. They have been made because my right hon. Friend the Attorney-General listened to the arguments in the other place and compiled a package that proved acceptable to all parties there. These amendments place the details of when public interest disclosures will be made in the Bill instead of in regulations in the first instance. They also tighten the circumstances in which commissioners could delegate instructions to make public interest disclosures.
Those changes, together with commitments on matters such as information sharing and governance and changes made by my right hon. Friend the Paymaster General to include the introduction of the declaration to acknowledge the duty of taxpayer confidentiality, make this truly a Bill that has all-party support. The establishment of the new integrated department is a valuable step forward in enhancing revenue and customs administration in this country.
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Over time, it will produce real benefits for taxpayers and other customers and will improve the effectiveness of the department.
David Taylor (North-West Leicestershire) (Lab/Co-op): The Minister is talking about the projected effectiveness of the merged department, although it will be somewhat slimmer than the two existing departments. Is he confident that two or three years down the line that new, merged andas he would saymore effective department will have done more to bridge the tax and revenue gap of around £35 billion that hon. Members on both sides of this Chamber, and indeed people across the whole finance sector, would acknowledge exists? Should not we be doing more on that front, and will the new department be in a better position to do so?
John Healey: Over the past two or three years, both the existing departmentsthe Inland Revenue and Customs and Excisehave indeed taken steps to close the revenue gaps that my hon. Friend mentions, and as Customs Minister I have been heavily involved in that. The new integrated department will take further steps to close the gaps that he and I wish to see closed, and in so doing protect revenue that should be coming into the public purse but currently is not.
The Bill creates an independent Revenue and Customs prosecution office. That is an important step that is strongly supported by the hon. Member for Torridge and West Devon in particular, and has been widely welcomed by the legal profession.
When the amendments were tabled by my right hon. Friend the Attorney-General in the other place, they were welcomed by Baroness Noakes and Lord Newby, who speak for the Conservatives and the Liberals. On that basis I commend them to the House.
Mr. Tyrie: Anybody who looks at these amendments will see that it is very difficult to speak to amendment No. 2 without examining amendments Nos. 3 to 9 at the same time. Frankly, they look to me as if they were originally intended to be grouped together. With your permission, Mr. Deputy Speaker, I will not rise to speak to any of the subsequent amendments
Mr. Deputy Speaker: Order. I trust that the hon. Gentleman's comments will be brief. I should explain that we have already dealt with the entire group of amendments. When we first dealt with them, we debated them as Lords amendment No. 1 plus Lords amendments Nos. 2 to 9. So we have debated them, and having completed the debate we should now be putting them formally only. As the hon. Gentleman has started, I shall let him complete his remarks.
Mr. Tyrie: I am very grateful to you, Mr. Deputy Speaker, for allowing me to make pertinent remarks on the remaining clauses. Perhaps I can also get in some more general remarks that might reasonably be made in response to the Minister's points.
The most important element of the remaining clauses was the almost untrammelled power given to the Treasury to make regulations under the original Bill. Their lordships have rightly argued that such power should be circumscribed more tightly. The Conservatives in the Lords proposed that any change to the power of disclosure be subject to what is known as the super-affirmative resolution procedure, which was originally laid down for use in respect of the Identity Cards Bill. Under that procedure, regulations can be amendedin other words, more tightly drawnwhich is what is desired in this case.
Of course, that proposal has been around for a long timethe royal commission on House of Lords reform came up with it some time agobut the Government, having flirted with it, decided that they did not like it. They have rejected that approach in this Bill and have included something else instead, and that is what we are debating now and have to examine. They have established in a reasonably detailed way the conditions that have to be satisfied in order for disclosure to be permissible. Those who are following this debate carefully can look at proposed new subsection (8), where they will find a list of those conditions. As I said a moment ago, they cannot be considered independently of the surrounding clauses.
Having listened to the Minister and, more particularly, having read the Hansard account of the Lords debate on this issue, I worry about the differences and misunderstandings that could develop in the merger of these two cultures. Much of the debate in the other place was at cross purposes. Some peers focused all their arguments on trying to protect taxpayer confidentiality, while others tried to ensure that powers were retained to
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enable the catching of criminals at the border. It was like two cultures passing in the night: one worry was an Inland Revenue worry, and the other was primarily a Customs worry. In addition to the threat to revenue that we briefly alluded to, a major concern remains about the risk associated with merging these cultures. These amendments and our discussion of them reflect that risk. I note that Lord Goldsmith conceded some ground on this very point in the Lords. The amendments are a step forward, but only a very modest one.
A moment ago, the Minister welcomed our comments on confidentiality. That was a great change in tone compared with the beginning of the debate on this Bill, when we had to struggle to convince the Government to keep the oath. I am very pleased that there has been a change of tune in that regard.
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