Mr. Hammond: I do not disagree, but the Minister could have reassured the Committee hugely and avoided this debate if the clause had referred narrowly to the creation by statutory instrument of criminal offences related to the disclosure of confidential information. The purpose would then have been clear and narrowly
Angela Eagle: It is important to say that the auctioning of emissions allowances is novel, and that the framework needs to be flexible to allow the Government to learn from experience. I am not in a position to say that the measure will not be extended into other areas, but the issue about which we are most concerned is the inappropriate disclosure of information. Given that the situation is evolving, it is important not to cut off attempts to put flexibility into the Bill so that we can evolve structures as our understanding of how the markets work and what would destabilise them evolves.
The Government will clearly not do outrageous or unreasonable things, and the law requires that measures must be reasonable. The hon. Gentleman should take some comfort from that. At this stage in a fast-moving situation, I am reluctant to close down the Governments options so that we have to keep coming back to primary legislation. Things move quickly, and measures will be subject, too, to multilateral negotiations at the EU and international levels.
Nobody has auctioned carbon or carbon permits before in that manner, and we are developing our approach and policy as we go along. We think that it is important that the carbon market should be robust and liquid, and that it should not be subject to the risk of being laid low by the behaviour of people wishing to profit from the inappropriate disclosure of confidential information. That might well have other detrimental effects from a wider public policy view.
I agree that we are in a rather odd situation with the statutory instrumentsthe hon. Member for Runnymede and Weybridge was right to point that out. The main regulations for auctioning permits were laid on 3 June. They set a flexible framework to accommodate a number of different auction designs, because we had not made final policy commitments to a design. However, we have set a deadline for the first UK Government auction by the end of the year, so we want to signal how we will proceed to those who are ready and willing to involve themselves in the first auction of permits some time this year. At the moment, the main regulations for auctioning, which were laid on 3 June, deliberately set a flexible framework to accommodate a number of different auction designs.
Mr. Hammond: I am grateful to the Minister for that clarification. I have to say that my searchI should say my researchers searchthis morning did not turn up the fact that they had been laid, and the copy that has been circulated is a draft copy without a statutory instrument number. Has it occurred to the Minister that peoples willingness to participate in the process might be affected by the knowledge that another statutory instrument will be introduced that will create criminal offences that could apply to them personally?
Angela Eagle: I expect that they might be put off engaging in the auction if they intended to leak inappropriate and commercially confidential information.
Mr. Hammond: The Minister says that there may not be any new offences, but a draft has been circulated. Unless the Government manage to lose their majority in the statutory instrument Committee that considers the matter, she surely is not signalling that it is not their intention to proceed along the lines of that draft.
The hon. Gentleman spoke earlier about further extensions, and I tried to reassure him. The clause seeks, through secondary legislation, to make it a criminal offence inappropriately to disclose information that might destabilise the carbon market or compromise an auction unfairly, which may also lead to profit being acquired in a way that no one in Committee would approve. That is the behaviour that we are trying to prevent. The Government clearly intend to use regulations to make it a criminal offence to compromise an auction by the inappropriate release of confidential information. I hope that that is clear.
The hon. Gentleman is worried about widening the range of criminal offences. We may not wish to widen them, but given the novel nature of the process, and the fact that it is a new market in an area of which we have little experience, we have finally to decide on the form that the auction should take. By definition, it is in the public interest for us to be as flexible as possible and not to close our options too early, and we have a legislative system that does not easily allow us to do so. Parliament would have to consider any further extensions. I suspect that it will not have to do so, but I hope that I have reassured the hon. Gentleman about our intentions.
Mr. Hammond: I am grateful to the Minister for clearing up the issue over the two draft regulations. I shall go back and check why it was not possible this morning to establish that the first set of regulations had been laid.
The Minister argues for flexibility. I am sure that Henry VIII would have argued for flexibility, and the Government, particularly on Treasury matters, have quite a lot of legislative flexibility. The Finance Bill has high priority, and it takes precedence in the legislative timetable. The longest that a Government could ever wait to cast legislation on the subject is one year. No other Department can be as confident. I am afraid that I take a rather old-fashioned view, despite the fact that I accept at face value the Exchequer Secretarys clear assertion she is concerned about disclosure. The clause
Question put, That the clause stand part of the Bill.
The Committee divided: Ayes 16, Noes 10.
Division No. 17]
Question accordingly agreed to.
Clause 158 ordered to stand part of the Bill.
Periods of residence
Mr. Jeremy Browne (Taunton) (LD): I beg to move amendment No. 47, in clause 22, page 12, line 4, at end insert
(1C) Subsection (1) does not apply to an individual who is enrolled in a higher education institution in the United Kingdom..
The Chairman: With this it will be convenient to discuss amendment No. 48, in schedule 7, page 153, line 19, at end insert
(excluding each year the individual was enrolled in full-time higher education in the UK).
Mr. Browne: Good afternoon, Sir Nicholas[Interruption.] Indeed, the room is emptying. I thought that the Conservative spokesman was going to resign his seat as a matter of principle on the last clause, but we had to content ourselves with a mere Division.
The purpose of Amendments Nos. 47 and 48 is to exempt students from the Governments new definition of residents. It may assist the Committee if I explain
In 2005-06, the most recent year for which numbers are available, there were 31,477 overseas academics teaching at UK universities. Higher education in this country is extremely diverse. We operate in an international marketplace and many of our universities have partnership arrangements with universities in countries such as China and Malaysia. We cannot divorce the issue of students from that wider international set of considerations.
Stephen Pound (Ealing, North) (Lab): It will come as a considerable surprise, not just to the Committee but to anybody who knows me, to learn that I am a graduate of the London School of Economics. I take the hon. Gentlemans point, but the amendment does not refer to an individual who is enrolled in a Russell group higher education institution; it refers to a higher education institution. We must bear in mind the vast number of highly suspect bucket shops, which exist the length and breadth of this land, that call themselves higher education institutions, frequently to allow people to avoid immigration regulations. Would the hon. Gentleman consider tightening the wording to the elitist definition that he and the Liberal Democrats have used, or would he spread the measure far and wide?
Mr. Browne: I think that I am grateful to the hon. Gentleman. I am very pleased to say that I attended a Russell group university as an undergraduate. I shall only observe that every hon. Member becomes rather less snobby in this regard when a new institution is proposed for their constituency. I would not wish the definition to be drawn too narrowly. The figures that I gave were relevant to the UK higher education sector as a wholethey were merely provided to me by a representative of the Russell group.
Amendment No. 47 is a minor amendment and would insert new subsection (1C ) into the clause, with intention of expressly excluding foreign students enrolled in UK higher education institutions from liability for the 183-day test for residency. There is some HMRC guidance on the matter, but it is not legislation.
Mr. Greg Hands (Hammersmith and Fulham) (Con): I am sympathetic to the hon. Gentlemans argument. How much potential might there be for people trying to avoid taxation by signing up to additional courses? Let us take the example of bankers in London who decide to sign up to an evening course, which might be at an institute of higher education and might be linked to their jobs and justifiable to their employers, but who would then, seemingly, be exempt from taxation.
Mr. Browne: I am genuinely grateful for that contribution. My honest answer is that there probably is scope for abuse and the Government would need to consider how they framed the legislation carefully to try and prevent it. If the Exchequer Secretary were to get to her feet and suggest that the intentions behind my amendments were honourable and that she agreed with them but that the Government needed to produce more watertight versions, I would regard that as considerable progress.
I say that because the current proposal is for a seven-year threshold before the £30,000 levy kicks in for people who are non-domiciled and working in this country. Longer courses such as medicine, engineering and other vocational courses may in themselves last five or six years. For example, people who come here to study medicinethat is increasingly commondo a five-year course and are then fully qualified doctors. There are then shortages in the national health service in the area in which they have specialised, they apply for a job and make an important contribution to the well-being of our citizens. However, they already have five of the seven years on the clock. That is a serious disincentive to continue to serve people in the national health service for more than a year or two, before they choose to go home or to another country.
We are talking about a fluid marketplace and somebody with such skills and qualifications may be able to find alternative employment in another country. They have already demonstrated a willingness to travel by being in the UK in the first place. There is a danger that that persons skills will be lost to our country and there will be no mutual benefit. There is also a perhaps even greater danger, which is that the potential student sitting in their country of origin and considering where to do their higher education course, would look at Britain and consider the incentive to study here as less strong than it was, because they will fall foul of this test if they choose to work here after gaining their qualification, and as a result be much poorer. The purpose of amendments Nos. 47 and 48 is to address that serious point.
The hon. Member for Wirral, South and I were part of an extremely informative delegation to China about three weeks ago. We visited a joint university venture with the university of Liverpool, and had a meeting with a representative of the university of Nottingham which has three campuses, one in Nottingham, one in Malaysia and one in China. That is indicative of the desire of higher education institutions in the United Kingdom to operate on a global stage, and to attract the best-qualified students and potential students from across the board, particularly in the disciplines that I mentioned such as science and engineering. We do not want to put that international leadership and the reputation that British universities enjoy at risk.
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