Commissioners for Revenue and Customs Bill

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Mr. Laws: I am grateful to the Paymaster General for giving way and for her clarification, which takes matters a little further. To be clear about this particular clause, is the Paymaster General saying that she would not expect the commissioners to comply with a direction of a specific nature if it were given to them by a Minister?

Dawn Primarolo: It would be for the accounting officer to decide whether the decision from the
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Minister was inappropriate. I cannot think of an example to illustrate that. The department would advise me. A Minister does not just suddenly say, ''I want the department to do this''. There would have been a discussion of the issues and advice would have been given. If Ministers ignored good advice and still insisted on issuing the decision, the accounting officer would, as I said, decide whether that was inappropriate. If they decided that, the other rules would come into play.

Does the hon. Gentleman want to pursue that point?

Mr. Laws: I am very grateful to the Paymaster General for giving way. I appreciate that she is trying to be helpful. Let us take one example of a direction that the Minister might want to give to part of the Inland Revenue in certain circumstances, for instance. If the Minster decided that she wanted to give a direction to the tax credits department to treat overpayments in a particular way when they appear not to be the fault of the individual who received the overpayment—because of computer error, for example—it is quite possible that legislation would take either the very strict approach that the department itself was taking, or would allow greater latitude. Would not the Paymaster General be prepared to give a specific direction, and would not it be acceptable to most people under those circumstances that she should do so?

Dawn Primarolo: I may give a specific direction but, on that basis, the Department would advise me as to whether or not there was a breach of value for money, equity or finance to all other taxpayers, whether the Government would be open to a legal challenge for unequal treatment and whether or not the National Audit Office would consider writing off an appropriate amount. The Department would advise me on procedure to deal with that.

I can only speak for myself in this example. If a Department tells me that a decision breaches value for money, accountability and fairness, and does not comply with the rules required of a department of civil servants within a Government Department, I can think of no circumstances in which, having been told that, I would then say to the Department, ''I have heard what you say, but go ahead''. The dialogue and advice that Ministers get is complex. We trust that the advice we receive from our civil servants is accurate, and we act on that basis; the hon. Gentleman has chastised me a number of times when he has not considered that the advice has been accurate.

Mr. Fallon: The Paymaster General continues to present this clause almost as a dialogue concerning some debate between her and the commissioners. She has been helpful in getting over to the Committee the fact that she sees this clause as restrictive, and I fully accept that. But she describes the directions as ''of a general nature''; that is restrictive. That is a safeguard and is welcome, and it is why I did not press amendment No. 2 this morning. The difficulty the Committee has had this afternoon is simply the definition of the word ''direction''. It is not a decision that resolves an argument. We are seeking to establish what kind of direction that would be.
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The Paymaster General would help us if she gave an example of a direction of a general nature that she has given in the past three or four months, or three or four years—she has been in her position for a while—or an example of the kind of direction of a general nature that she might give in future. If she could describe one such direction, perhaps we could wrap the issue up and move on.

Dawn Primarolo: I have never directed the department. With the exception of PSA targets, which are published and set for all Government Departments, which strive to comply with them, I can find no examples—my officials have checked back to before the election of this Government in 1997—of the Minister of the day directing the department to do something. The words ''general direction'' have existed for a very long time; they are well understood and built into the training qualifications and the operation of all Government Departments of the civil service. For them, the words are clear.

Having been a Minister in a previous Government, the hon. Member for Sevenoaks will know that there are sometimes robust discussions between Ministers and officials when the Minister would like to develop a policy area but the officials say that it cannot be done; there is probing until the Minister is satisfied that it cannot be done. However, there have been no examples of officials being directed. The hon. Member for Chichester described very well the working and day-to-day relationships between the department, the Treasury and the Minister.

Mr. Burnett rose—

Mr. Tyrie rose—

Dawn Primarolo: I am going to give way to the hon. Member for Chichester.

Mr. Tyrie: I am quite worried by what I have just heard. Am I making an intervention or is the Minister giving way?

Dawn Primarolo: I am giving way.

Mr. Tyrie: I shall say something at the end of the Paymaster General's remarks.

Mr. Burnett: The Minister responded to the point about tax credits by giving a hypothetical example of her receiving advice, overruling it in a particular manner and giving a direction contrary to that advice. Earlier, she said that such a direction would come to light and eventually arrive before the Public Accounts Committee. Would that invariably be the case? How long would a case of a Minister overruling officials' advice take to get to that Committee?

Dawn Primarolo: I do not know. I have no experience or knowledge of Ministers' overruling direct, specific advice from within any of the Treasury departments or any others. That is a very hypothetical question. If the hon. Gentleman really wants me to pursue it, I shall ask my officials what the process would be if I had been that foolhardy.
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I shall ask my hon. Friends to reject this amendment if it is pressed to a Division, although I think that the hon. Member for Chichester said that it was a probing amendment. However, I seem to have made him more unhappy rather than less.

Mr. Tyrie: I am afraid so.

Dawn Primarolo: Maybe the moral of the story is that Ministers should not try to be helpful, but should just speak very narrowly to the point.

Mr. Tyrie: When the Paymaster General was being helpful this morning, I regretted that we moved on speedily, so she should not feel that. She seemed to imply that my amendment might lead to Ministers being virtually written out of the piece. That is an astonishing interpretation of what is a relatively straightforward clause. The overriding duty of a Department of the Crown is protected.

Perhaps inadvertently, the Paymaster General said something else that was astonishing. She said that she had not only looked to see whether any directions had been issued since 1997, but that she had asked officials to look prior to 1997 to see if there had been directions under a previous Administration. If she directed officials to do that, she was in breach of all sorts of rules, regulations and codes, which I shall not begin to enumerate because it would take too long. However, that is a very serious breach, and the officials concerned should have immediately come back and said that they were not prepared to do that.

Dawn Primarolo: Will the hon. Gentleman give way?

Mr. Tyrie: I will in a moment. I hope that, in fact, there was a slight slip of the tongue and that all that someone was tasked to do was refer to a few memoirs—''The View from No. 11'' for example—and to look up the word ''direction,'' and when they found nil return to report back to that effect.

Dawn Primarolo: First, I said I asked about other Ministers. Secondly, the issue of whether there was a direction is about whether or not an accounting officer letter was left, and that would be in the public domain. The hon. Gentleman is right; there is no way that I would ask that investigation to go back prior to May 1997. He knows that, but it was a good point to make; he has, as ever, been helpful, and I am grateful to him for allowing me to correct the record.

Mr. Tyrie: Good; I am grateful for that. I am left bereft of any understanding of why we will have this clause if the Paymaster General has concluded that she cannot conceive of any circumstances in which such a direction would be required. She said that there had never been any such direction, and that she could not think of any circumstances in which one would need to be made.

The Paymaster General also said that if a direction had been made, relations would have broken down so badly that it is inconceivable that the normal work of the department could have continued. That suggests that the clause has been written for a set of circumstances that are inconceivable, in which case what is the point of putting it in the statute book? However, I do not think that that is correct; the clause
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has far more substance than that. That is why I am nervous.

One specific reason why I am nervous is that the Paymaster General said that we cannot work out what the clause means by defining the word general. What we have to do is define a word that is not in the Bill; that word is ''specific.'' When pressed on what that word means, she said that she thought that we are partly talking about codes and inappropriate behaviour that Ministers might get up to, and other statutory limitations and conventions. However, officials will alert Ministers to them even without this clause, to make sure that things are fair. Finally, she referred to only one word, which is confidentiality; confidentiality of individual tax cases. What this clause really means—what it only means, as far as I can tell—is that a Minister may make any direction to the Treasury except where that direction will lead either to the creation of a tax that targets a specific individual or company or a demand for information about a specific taxpayer. That is a very narrow definition of what the clause means. I now find the clause deeply satisfactory.

3.30 pm
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