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13 Jul 2005 : Column 1065W—continued
KPMG
Mr. Austin Mitchell: To ask the Chancellor of the Exchequer if he will make KPMG partners personally liable for the loss of VAT in the light of the decision by the London Tribunal Centre in the case of RAL (Channel Islands) Ltd., RAL Ltd., RAL Services Ltd.; RAL Machines Ltd.—And—The Commissioners of Customs and Excise. [9673]
Dawn Primarolo: The case of RAL (Channel Islands) Ltd. was referred to the European Court of Justice, which found in favour of HMRC on 12 May 2005. As a result there has been no loss of tax in this case. The Government are committed to protecting the tax system against tax avoidance, and continue to keep under review a range of options to prevent loss of tax.
Mortgage Endowment Policies
Mr. Fabian Hamilton: To ask the Chancellor of the Exchequer for what reasons the Financial Services Authority is advising mortgage endowment policy holders to take legal action against their financial advisers for mis-selling policies. [11440]
Mr. Ivan Lewis: The FSA is not advising policyholders to take any particular course of action. The FSA has provided information on its website and through its consumer factsheets about the options available to consumers if they currently face a projected shortfall on their endowment mortgage or if they believe they have been mis-sold an endowment policy.
Mr. Fabian Hamilton: To ask the Chancellor of the Exchequer if he will set out the criteria against which the relevant regulatory authorities make judgments on allegations of the mis-selling of mortgage endowment policies. [11458]
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Mr. Ivan Lewis: The Financial Ombudsman Service (FOS) is an independent body that adjudicates consumer complaints against FSA authorised firms. It does not have a fixed set of criteria to use when determining whether a financial advisor has mis-sold a product. Rather, the FOS considers what is fair and reasonable to all parties, having regard to the individual circumstances of the case, the law, and any regulatory rules or advice in place at the time.
The Financial Services Compensation Scheme (FSCS) is the statutory compensation fund of last resort, which can provide compensation to eligible claimants where the investment firm responsible for the liability is itself unable to do so (usually because it has ceased to exist or is insolvent). With mortgage endowment claims, as with other mis-selling claims, FSCS looks to see whether there has been a breach of obligations giving rise to a civil liability for actual financial loss.
Mr. Fabian Hamilton: To ask the Chancellor of theExchequer what Government support is available tofinancial advisers threatened with legal action for the alleged mis-selling of mortgage endowment policies. [11459]
Mr. Ivan Lewis: The Government does not provide support to financial advisors threatened with legal action for the alleged mis-selling of mortgage endowment policies. However, the Financial Services Authority requires all authorised firms to hold sufficient Professional Indemnity Insurance.
Pension Funds
Gregory Barker: To ask the Chancellor of the Exchequer what plans he has to review taxes on pension funds in the UK. [10872]
Mr. Ivan Lewis: Following consultation the Government have simplified the taxation of pensions with effect from 6 April 2006. The new pensions tax regime will replace the numerous existing complex regimes with a universal regime for tax privileged pension savings. This new regime will provide greater flexibility to some 15 million pension savers. The pensions industry has welcomed the new regime as a removal of unnecessary obstacles to planning and saving towards retirement for the vast majority of people.
The Government will keep this aspect of the tax system, as with all others, under review.
Public Sector Employment
Mrs. Spelman: To ask the Chancellor of the Exchequer how many and what proportion of all those in employment were employed by the public sector in each year since 1996, in (a) the UK, (b) England, (c) Wales, (d) Scotland, (e) Northern Ireland and (f) each Government Office Region. [11418]
John Healey:
The information requested falls within the responsibility of the National Statistician who has been asked to reply.
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Letter from Len Cook to Mrs. Caroline Spelman, dated 13 July 2005:
As National Statistician I have been asked to reply to your recent Parliamentary Question about how many and what proportion of people in employment were employed by the public sector, in each year since 1996 in (a) the UK, (b) England, (c) Wales, (d) Scotland, (e) Northern Ireland and (f) each Government Office Region. (11418)
The most reliable source of public sector employment estimate—using the National Accounts definition of the public sector—is based on returns made to ONS by public sector organisations. The first two columns of the attached table show figures from this source for the number and proportion of people
- employed in the public sector in the UK respectively for the period 1996 to 2004. These estimates were published previously in a web-based report in March 2005 entitled Public Sector Employment.
A disaggregration of public sector employment by region is currently only available from the Labour Force Survey (LFS) households on the basis of respondents' own self-classification of whether they work in the public sector. However this produces an overestimate of the proportion of total employment which is in the public sector as seen by comparing the second and third columns. Nevertheless if this degree of overestimation is similar in each region the regional differences shown in the table are meaningful. The third to sixteenth columns of the table show the UK and regional figures for the proportion of public sector employment from 1996 to 2004 on this basis. ONS has work in hand to improve the public/private sector classification of employment in the LFS. Data from the LFS, as with any statistical sample survey, is subject to sampling variability.
(8) Data from Public Sector Organisations for 1996 to 2003 refer to June (Q2) each year and for 2004 they refer to March (Q1).
Notes:
1. Data from the Labour Force Survey for 1996 to 2003 refer to June to August (summer) each year and for 2004 they refer to March to May (spring).
2. LFS public private split is self-allocated by respondents and hence LFS figures are not on the official, National Accounts based definition of public sector.
Sources:
Estimates from public sector organisations and quarterly Labour Force Survey, Office for National Statistics.
Tax Credits
Danny Alexander: To ask the Chancellor of the Exchequer how many full-time equivalent staff are employed by the tax credit helpline. [10266]
Dawn Primarolo: I refer the hon. Gentleman to the answer I gave the hon. Member for Yeovil (Mr. Laws) on 6 July 2005, Official Report, column 436W.
Mr. George Osborne: To ask the Chancellor of the Exchequer how many letters have been received by HM Revenue and Customs in relation to (a) overpayments and (b) underpayment of tax credits in the last two years; and how many of these letters have not been answered. [11454]
Dawn Primarolo: Figures on the number of requests to reconsider the recovery of an overpayment are not available for 2003–04. For the number of requests received in 2004–05 I refer the hon. Gentleman to the reply I gave to the hon. Member for Lanark and Hamilton, East (Mr. Hood) on 4 July 2005, Official Report, column 107W. For the number of cases still awaiting a decision at 31 May 2005 I refer the hon. Gentleman to the reply I gave to the hon. Member for Chorley (Mr. Hoyle) on 4 July 2005, Official Report, column 95W.
The Department does not hold figures relating to letters received in respect of underpayments of tax credits.
Mr. George Osborne: To ask the Chancellor of the Exchequer (1) what guidance has been given to tax credit helpline staff on advising tax credit claimants to take out bank loans to cover the repayment costs of tax credit overpayments; [11456]
(2) how many tax credit claimants he estimates have been advised by Revenue and Customs to take out bank loans to cover the repayment costs of tax credit overpayments. [11564]
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Dawn Primarolo: HMRC Contact Centre guidance does not say that claimants should be advised to take out a loan to cover their tax credit repayments.
HMRC has issued a reminder to relevant staff to ensure that they are all aware of the correct position.
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