60. Climate change levy (general)
That provision (including provision having retrospective effect) may be made amending, or making amendments connected with, Schedule 6 to the Finance Act 2000 (including so as to require the payment of sums into the Consolidated Fund).
61. Inheritance tax (indexation of rate bands)
That provision may be made about the indexation of rate bands for inheritance tax.
62. Inheritance tax (exemption for gifts to charities)
That provision may be made about the inheritance tax treatment of instruments of variation that benefit charities and registered clubs.
63. Inheritance tax (settled excluded property)
That provision may be made about the treatment of arrangements involving settled excluded property.
64. The bank levy
That provision (including provision having retrospective effect) may be made about the bank levy.
65. Stamp duty land tax (prevention of avoidance: subsales etc.)
That—
(1) In section 45 of the Finance Act 2003 (contract and conveyance: effect of transfer of rights), after subsection (1) insert—
“(1A) The reference in subsection (1)(b) to an assignment, subsale or other transaction does not include the grant or assignment of an option.”
(2) The amendment made by this Resolution has effect in relation to grants or assignments of options on or after 21 March 2012.
26 Mar 2012 : Column 1292
And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.
66. Stamp duty land tax (rates: residential property where consideration exceeds £2m)
That—
(1) In section 55(2) of the Finance Act 2003 (amount of SDLT chargeable), in Table A (bands and percentages for residential property), for the final entry (cases where consideration is more than £1,000,000 to be chargeable at 5%) substitute—
(2) The amendment made by this Resolution has effect in relation to any land transaction of which the effective date is on or after 22 March 2012.
(3) But that amendment does not have effect in relation to any transaction—
(a) effected in pursuance of a contract entered into and substantially performed before 22 March 2012, or
(b) effected in pursuance of a contract entered into before that date and not excluded by paragraph (4).
(4) A transaction effected in pursuance of a contract entered into before 22 March 2012 is excluded by this paragraph if—
(a) there is any variation of the contract, or assignment (or assignation) of rights under the contract, on or after 22 March 2012,
(b) the transaction is effected in consequence of the exercise on or after that date of any option, right of pre-emption or similar right, or
(c) on or after that date there is an assignment (or assignation), subsale or other transaction relating to the whole or part of the subject-matter of the contract as a result of which a person other than the purchaser under the contract becomes entitled to call for a conveyance.
And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.
67. Stamp duty land tax (higher rate for certain acquisitions by companies etc)
That—
(1) Part 4 of the Finance Act 2003 (stamp duty land tax) is amended in accordance with paragraphs (2) to (22).
(2) Section 55 (amount of tax chargeable: general) is amended in accordance with paragraphs (3) to (7).
(3) In subsection (1), after “chargeable transaction” insert “to which this section applies”.
(4) After that subsection insert—
“(1A) This section applies to any chargeable transaction other than a transaction to which paragraph 3 of Schedule 4A or step 4 of section 74(1A) (higher rate for certain transactions) applies.”
(5) In subsection (2), for “That percentage” substitute “The percentage mentioned in subsection (1)”.
(6) In subsection (5), for “74” substitute “74(2) and (3)”.
(7) In subsection (7), after “this section” insert “, step 4 of section 74(1A) or paragraph 3 of Schedule 4A”.
(8) After section 55 insert—
“55A Amount of tax chargeable: higher rate for certain transactions
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Schedule 4A provides for the calculation of the tax chargeable in respect of certain transactions involving higher threshold interests in dwellings.”
(9) After Schedule 4 insert—
“Schedule 4a
Stamp duty land tax: higher rate for certain transactions
Meaning of “higher threshold interest”
1 (1) In this paragraph “interest in a single dwelling” means so much of the subject-matter of a chargeable transaction as consists of a chargeable interest in or over a single dwelling (together with appurtenant rights).
(2)An interest in a single dwelling is a higher threshold interest for the purposes of this Schedule if chargeable consideration of more than £2,000,000 is attributable to that interest.
Transactions involving a higher threshold interest
2 (1) Sub-paragraphs (2) to (8) apply to a chargeable transaction whose subject-matter consists of or includes a higher threshold interest.
(2) If the main subject-matter of the transaction consists entirely of higher threshold interests, the transaction is a high-value residential transaction for the purposes of paragraph 3.
(3) If the main subject-matter of the transaction includes a chargeable interest other than a higher threshold interest, the transaction (“the primary transaction”) is to be treated for the relevant purposes as two separate chargeable transactions as follows—
(a) a transaction whose subject-matter is all the higher threshold interests, together with any appurtenant rights;
(b) a transaction whose subject-matter is the remainder of the subject-matter of the primary transaction.
(4) For those purposes, the chargeable consideration for a transaction treated as occurring under sub-paragraph (3) is so much of the chargeable consideration for the primary transaction as is attributable to that transaction.
(5) The transaction mentioned in sub-paragraph (3)(a) is a high-value residential transaction for the purposes of paragraph 3.
(6) “Relevant purposes” means the purposes of—
(a) paragraphs 3 and 5 of this Schedule,
(b) section 55 (amount of tax chargeable: general),
(c) Schedule 5 (amount of tax chargeable: rent),
(d) Schedule 6B (transfers involving multiple dwellings), and
(e) any other provision of this Part, so far as it is necessary because of any of paragraphs (a) to (d) to treat the purposes in question as relevant purposes.
(7) If a transaction treated under sub-paragraph (3) as two separate transactions is notifiable, each of the separate transactions (but not the primary transaction) is also treated as a separate, and notifiable, transaction for the purposes of section 76 (duty to deliver land transaction return).
(8) The provisions relating to land transaction returns are to be read with any adjustments that may be necessary as a result of sub-paragraph (7).
(9) The reference in sub-paragraph (1) to a chargeable transaction does not include a transaction to which section 74 (exercise of collective rights by tenants of flats) or section 75 (crofting community right to buy) applies.
Amount of tax chargeable: higher rate for certain transactions
3 (1) Where this paragraph applies to a chargeable transaction—
(a) the amount of tax chargeable in respect of the transaction is 15% of the chargeable consideration for the transaction, and
(b) the transaction is not taken to be linked to any other transaction for the purposes of section 55(4).
(2) This paragraph applies to a chargeable transaction if—
26 Mar 2012 : Column 1294
(a) the transaction is a high-value residential transaction, and
(b) the condition in sub-paragraph (3) is met.
(a) the purchaser is a company,
(b) the acquisition is made by or on behalf of the members of a partnership one or more of whose members is a company, or
(c) the acquisition is made for the purposes of a collective investment scheme.
(4) References in sub-paragraph (3) to a company do not include a company acting in its capacity as trustee of a settlement.
(5) If there are two or more purchasers acting jointly, the condition in sub-paragraph (3) is treated as met if it is met in relation to at least one of those purchasers.
(6) In relation to a transfer of an interest in a partnership that is a chargeable transaction by virtue of paragraph 17(2) of Schedule 15, sub-paragraph (3) has effect as if the following were substituted for paragraph (b) of that sub-paragraph—
“(b) the purchasers (see paragraph 17(3) of Schedule 15) include a company, or”.
(7) In relation to an event that is a chargeable transaction by virtue of paragraph 17A(4) of that Schedule, sub-paragraph (3) has effect as if the following were substituted for paragraph (b) of that sub-paragraph—
“(b) the purchasers (see paragraph 17A(5) of Schedule 15) include a company, or”.
(8) For the purposes of sub-paragraph (3), paragraph 3 of Schedule 16 (bare trustees) applies as if sub-paragraphs (2) and (3) of that paragraph were omitted.
(9) In the case of a transaction for which the whole or part of the chargeable consideration is rent, this paragraph has effect subject to section 56 and Schedule 5 (amount of tax chargeable: rent).
(10) The Treasury may by order amend this paragraph for the purpose of limiting the circumstances in which the condition in sub-paragraph (3) is to be treated as met.
Acquisitions of interests in the same dwelling through different transactions
4 (1) Sub-paragraphs (2) and (3) apply if—
(a) the subject-matter of a chargeable transaction includes a chargeable interest in or over a dwelling,
(b) one or more land transactions, the subject-matter of each of which includes a chargeable interest in or over the dwelling, are linked to that chargeable transaction, and
(c) the total consideration attributable to the interests mentioned in paragraphs (a) and (b) (and to any appurtenant rights, but disregarding any rent) is more than £2,000,000.
(2) Each of those chargeable interests is treated as a higher threshold interest for the purposes of this Schedule.
(3) If the condition in paragraph 3(3) is met in the case of the transaction mentioned in sub-paragraph (1)(a), it is also treated as met in the case of each transaction mentioned in sub-paragraph (1)(b) that is a chargeable transaction.
(4) The transactions referred to in this paragraph do not include any transaction to which section 74 (exercise of collective rights by tenants of flats) or section 75 (crofting community right to buy) applies.
5 (1) A company is treated as not being a company for the purposes of paragraph 3(3)(a) if—
26 Mar 2012 : Column 1295
(a) the company acquires the subject-matter of the chargeable transaction in the course of a bona fide property development business and for the sole purpose of developing and reselling the land, and
(b) the company has carried on that business for at least two years before the effective date of the transaction.
(2) Where the subject-matter of a chargeable transaction is acquired by or on behalf of the members of a partnership, those members are taken not to include a company for the purposes of paragraph 3(3)(b) if—
(a) that subject-matter is acquired in the course of a bona fide property development business and for the sole purpose of developing and reselling the land, and
(b) the partnership has carried on that business for at least two years before the effective date of the transaction.
(3) In relation to a transfer of an interest in a partnership that is a chargeable transaction by virtue of paragraph 17(2) of Schedule 15 (“the partnership transfer”) the purchasers are treated as not including a company for the purposes of paragraph 3(3)(b) (as modified by paragraph 3(6)) if—
(a) the acquisition effected by the land transfer referred to in paragraph 17(1)(a) of that Schedule was made in the course of a bona fide property development business, and for the sole purpose of developing and reselling the land, and
(b) the partnership is continuing to carry on that business at the effective date of the partnership transfer, and has carried it on for at least two years before that date.
(4) In relation to an event that is a chargeable transaction by virtue of paragraph 17A(4) of Schedule 15 (“the qualifying event”) the purchasers are treated as not including a company for the purposes of paragraph 3(3)(b) (as modified by paragraph 3(7)) if—
(a) the acquisition effected by the land transfer referred to in paragraph 17A(1)(a) of that Schedule was made in the course of a bona fide property development business, and for the sole purpose of developing and reselling the land, and
(b) the partnership is continuing to carry on that business at the effective date of the qualifying event, and has carried it on for at least two years before that date.
(5) A property development business is a business that consists of or includes buying, and redeveloping for resale, residential property.
(6) For the purposes of sub-paragraph (1)(b) a property development business is treated as having been carried on by the company at any time when it was carried on by a company which is a member of the same group as the company.
(7) Companies are members of the same group for the purposes of this paragraph if they are members of the same group for the purposes of group relief (see paragraph 1 of Schedule 7).
Partnerships: application of paragraph 2 to certain transactions
6 (1) Sub-paragraphs (2) and (3) apply where the subject-matter of a transaction to which Part 3 of Schedule 15 applies consists of or includes a higher threshold interest.
(2) The transaction is not to be treated as a high-value residential transaction by virtue of paragraph 2(2) unless the chargeable consideration for the transaction is more than £2,000,000.
(3) Paragraph 2(3) to (8) does not apply to the transaction if—
(a) the subject-matter of the transaction includes a chargeable interest other than a higher threshold interest, and
(b) the result of applying paragraph 2(3) and (4) would be that chargeable consideration of £2,000,000 or less would be attributable to the separate transaction mentioned in paragraph 2(3)(a).
26 Mar 2012 : Column 1296
(4) For the purposes of sub-paragraph (1) and paragraph 2, the subject-matter (and the main subject-matter) of a transfer of an interest in a partnership that is a chargeable transaction by virtue of sub-paragraph (2) of paragraph 14 of Schedule 15 is—
(a) if the transfer is a Type A transfer, the relevant partnership property as defined in sub-paragraph (5) of that paragraph, or
(b) if the transfer is a Type B transfer, the relevant partnership property as defined in sub-paragraph (5A) of that paragraph.
(5) For the purposes of sub-paragraph (1) and paragraph 2, the subject-matter (and the main subject-matter) of a transfer of an interest in a partnership that is a chargeable transaction by virtue of sub-paragraph (2) of paragraph 17 of Schedule 15 is the subject-matter of the land transfer referred to in sub-paragraph (1)(a) of that paragraph.
(6) For the purposes of sub-paragraph (1) and paragraph 2, the subject-matter (and the main subject-matter) of a chargeable transaction that is treated as occurring by virtue of sub-paragraph (4) of paragraph 17A of Schedule 15 is the subject-matter of the land transfer referred to in sub-paragraph (1)(a) of that paragraph.
7 (1) This paragraph sets out rules for determining what counts as a dwelling for the purposes of this Schedule.
(2) A building or part of a building counts as a dwelling if—
(a) it is used or suitable for use as a single dwelling, or
(b) it is in the process of being constructed or adapted for such use.
(3) Land that is, or is to be, occupied or enjoyed with a dwelling as a garden or grounds (including any building or structure on such land) is taken to be part of that dwelling.
(4) Land that subsists, or is to subsist, for the benefit of a dwelling is taken to be part of the dwelling.
(5) The subject-matter of a transaction is also taken to include an interest in a dwelling if—
(a) substantial performance of a contract constitutes the effective date of that transaction by virtue of a relevant deeming provision,
(b) the main subject-matter of the transaction consists of or includes an interest in a building, or a part of a building, that is to be constructed or adapted under the contract for use as a single dwelling, and
(c) construction or adaptation of the building, or part of the building, has not begun by the time the contract is substantially performed.
(6) In sub-paragraph (5) “contract”, “relevant deeming provision” and “substantially performed” have the same meaning as in paragraph 7(5) of Schedule 6B.
(7) A building or part of a building used for a purpose specified in section 116(2) or (3) is not used as a dwelling for the purposes of sub-paragraph (2) or (5).
(8) Where a building or part of a building is used for a purpose mentioned in sub-paragraph (7), no account is to be taken for the purposes of sub-paragraph (2) of its suitability for any other use.
8 (1) The Treasury may by order amend paragraph 7 so as to specify cases where use of a building is to be use of a building as a dwelling for the purposes of sub-paragraph (2) or (5) of that paragraph.
(2) The reference in section 116(8)(a) (power to amend section 116(2) and (3)) to “the purposes of subsection (1)” includes a reference to the purposes of paragraph 7(2) and (5).
“appurtenant rights”, in relation to a chargeable interest that is, or is part of, the subject-matter of a transaction, means any rights or interests appurtenant or pertaining to the chargeable interest that are acquired with it;
26 Mar 2012 : Column 1297
“attributable” means attributable on a just and reasonable basis;
“collective investment scheme” has the same meaning as in Part 17 of the Financial Services and Markets Act 2000 (see section 235 of that Act);
“company” means a body corporate other than a partnership.”
(10) Section 74 (exercise of collective rights by tenants of flats) is amended in accordance with paragraphs (11) and (12).
(11) After subsection (1) insert—
“(1A) The rate of tax is determined as follows.
Determine the fraction of the relevant consideration produced by dividing the total amount of that consideration by the number of qualifying flats contained in the premises.
If the amount produced by step 1 is £2,000,000 or less, determine the rate of tax and the tax chargeable in accordance with subsections (2) and (3).
If the amount produced by step 1 is more than £2,000,000 and the condition in paragraph 3(3) of Schedule 4A is not met with respect to the transaction, determine the rate of tax and the tax chargeable in accordance with subsections (2) and (3).
If the amount produced by step 1 is more than £2,000,000 and the condition in paragraph 3(3) of Schedule 4A is met with respect to the transaction, subsections (2) and (3) do not apply, and the amount of tax chargeable in respect of the transaction is 15% of the chargeable consideration for the transaction.”
(12) For subsection (2) substitute—
“(2) The rate of tax is determined under section 55 by reference to the fraction of the relevant consideration calculated under step 1 of subsection (1A).”
(13) Section 109 (general power to vary Part 4 of the Finance Act 2003 by regulations) is amended in accordance with paragraphs (14) and (15).
(14) After subsection (2) insert—
“(2A) The power under subsection (2)(b) includes power to alter the conditions for the application to a chargeable transaction of paragraph 3 of Schedule 4A (higher rate for certain transactions), other than the condition that the transaction must be a high-value residential transaction.”
(a) for “subsection (2)(b),” substitute “subsections (2)(b) and (2A),”,
(b) omit the “or” at the end of paragraph (a), and
(c) after that paragraph insert—
“(aa) section 74(1A) (exercise of collective rights by tenants of flats),
(ab) Schedule 4A (amount of tax chargeable: high-value interests in
(16) Schedule 5 (amount of tax chargeable: rent) is amended in accordance with paragraphs (17) and (18).
(i) after “section 55” insert “or 74(1A)”, and
(ii) after “Schedule” (in the second place it occurs) insert “4A or”, and
(i) for “that section” substitute “section 55”, and
(ii) after “Schedule” (in the second place it occurs) insert “6B”.
(18) In paragraph 9A(1), for “where there is chargeable consideration other than rent.” substitute “where—
26 Mar 2012 : Column 1298
(a) there is chargeable consideration other than rent, and
(b) section 55 (amount of tax chargeable: general) applies to the transaction (whether as a result of paragraph 2 of Schedule 4A or otherwise).”
(19) In paragraph 2(4) of Schedule 6B (transfers involving multiple dwellings)—
(a) omit the “or” at the end of paragraph (a), and
(b) after that paragraph insert—
“(aa) paragraph 3 of Schedule 4A applies to it, or”.
(20) Schedule 15 (partnerships) is amended in accordance with paragraphs (21) and (22).
(21) In paragraphs 11(2C) and 19(2C), in the substituted sub-paragraph (4)—
(a) after “section 55” insert “or 74(1A)”, and
(b) after “Schedule” (in the second place it occurs) insert “4A or”.
(a) for “either or both” substitute “one or more”, and
(b) after paragraph (a) insert—
“(aa) paragraph 3 of Schedule 4A applies to the transaction;”.
(23) Except as mentioned in paragraph (24), the amendments made by this Resolution have effect in relation to any land transaction of which the effective date is on or after 21 March 2012.
(24) Those amendments do not have effect in relation to any transaction that is—
(a) effected in pursuance of a contract entered into and substantially performed before 21 March 2012,
(b) effected in pursuance of a contract entered into before that date and not excluded by paragraph (25), or
(c) excepted by paragraph (26).
(25) A transaction effected in pursuance of a contract entered into before 21 March 2012 is excluded by this paragraph if—
(a) there is any variation of the contract, or assignment (or assignation) of rights under the contract, on or after 21 March 2012,
(b) the transaction is effected in consequence of the exercise on or after that date of any option, right of pre-emption or similar right, or
(c) on or after that date there is an assignment (or assignation), subsale or other transaction relating to the whole or part of the subject-matter of the contract as a result of which a person other than the purchaser under the contract becomes entitled to call for a conveyance.
(26) A transaction treated as occurring under paragraph 17(2) or 17A(4) of Schedule 15 to the Finance Act 2003 (partnerships) is excepted by this paragraph if the effective date of the land transfer referred to in sub-paragraph (1)(a) of the paragraph concerned is before 21 March 2012.
And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.
68. International military headquarters
That provision may be made amending section 74A of the Finance Act 1960.
69. Financial sector regulation
That provision may be made about the consequences of regulatory requirements imposed on the financial sector.
26 Mar 2012 : Column 1299
70. Incapacitated persons
That provision may be made amending section 72 of the Taxes Management Act 1970 and section 106 of the Finance Act 2003.
71. Repeal of miscellaneous reliefs etc
That provision may be made—
(a) removing certain reliefs from stamp duty,
(b) repealing section 57 of, and Schedule 6 to, the Finance Act 2003,
(c) in respect of harbour reorganisation schemes,
(d) removing reliefs connected with payments relating to reductions in pool betting duty,
(e) for and in connection with the abolition of relief under section 266 of the Income and Corporation Taxes Act 1988,
(f) for and in connection with the repeal of section 459 of the Income Tax Act 2007,
(g) in relation to mineral leases or agreements,
(h) repealing section 249 of the Taxation of Chargeable Gains Act 1992,
(i) removing certain reliefs from excise duty for black beer,
(j) removing certain reliefs from excise duty for angostura bitters, and
(k) removing tax relief on interest from tax reserve certificates.
72. Relief from tax (incidental and consequential charges)
That it is expedient to authorise any incidental or consequential charges to any duty or tax (including charges having retrospective effect) that may arise from provisions designed in general to afford relief from taxation.
PROCEDURE (FUTURE TAXATION: RATES OF INCOME TAX)
That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may contain the following provisions about income tax taking effect in a future year—
(a) provision that for the tax year 2013-14—
(i) the basic rate is 20%,
(ii) the higher rate is 40%, and
(iii) the additional rate is 45%, and
provision about other rates of income tax.
The House divided:
Ayes 319, Noes 22.
[10.41 pm
AYES
Adams, Nigel
Afriyie, Adam
Aldous, Peter
Alexander, rh Danny
Amess, Mr David
Andrew, Stuart
Arbuthnot, rh Mr James
Bacon, Mr Richard
Baker, Norman
Baker, Steve
Baldry, Tony
Baldwin, Harriett
Barclay, Stephen
Barker, Gregory
Baron, Mr John
Barwell, Gavin
Bebb, Guto
Beith, rh Sir Alan
Benyon, Richard
Beresford, Sir Paul
Berry, Jake
Bingham, Andrew
Binley, Mr Brian
Birtwistle, Gordon
Blackman, Bob
Blackwood, Nicola
Blunt, Mr Crispin
Bottomley, Sir Peter
Bradley, Karen
Brady, Mr Graham
Brake, rh Tom
Brazier, Mr Julian
Bridgen, Andrew
Brine, Steve
Brokenshire, James
Browne, Mr Jeremy
Bruce, Fiona
Bruce, rh Malcolm
Buckland, Mr Robert
Burley, Mr Aidan
Burns, Conor
Burns, rh Mr Simon
Burrowes, Mr David
Burstow, Paul
Burt, Lorely
Byles, Dan
Cable, rh Vince
Cairns, Alun
Campbell, rh Sir Menzies
Carmichael, rh Mr Alistair
Carmichael, Neil
Carswell, Mr Douglas
Cash, Mr William
Chishti, Rehman
Chope, Mr Christopher
Clappison, Mr James
Clarke, rh Mr Kenneth
Clifton-Brown, Geoffrey
Coffey, Dr Thérèse
Collins, Damian
Colvile, Oliver
Crabb, Stephen
Crouch, Tracey
Davey, rh Mr Edward
Davies, David T. C.
(Monmouth)
Davies, Glyn
Davies, Philip
Davis, rh Mr David
de Bois, Nick
Dinenage, Caroline
Djanogly, Mr Jonathan
Dorrell, rh Mr Stephen
Doyle-Price, Jackie
Drax, Richard
Duddridge, James
Duncan, rh Mr Alan
Duncan Smith, rh Mr Iain
Ellis, Michael
Ellison, Jane
Ellwood, Mr Tobias
Elphicke, Charlie
Eustice, George
Evans, Graham
Evans, Jonathan
Evennett, Mr David
Fabricant, Michael
Farron, Tim
Field, Mark
Foster, rh Mr Don
Fox, rh Dr Liam
Francois, rh Mr Mark
Freeman, George
Freer, Mike
Fuller, Richard
Garnier, Mr Edward
Garnier, Mark
Gauke, Mr David
George, Andrew
Gibb, Mr Nick
Gilbert, Stephen
Gillan, rh Mrs Cheryl
Glen, John
Goodwill, Mr Robert
Gove, rh Michael
Graham, Richard
Grant, Mrs Helen
Gray, Mr James
Grayling, rh Chris
Green, Damian
Greening, rh Justine
Grieve, rh Mr Dominic
Griffiths, Andrew
Gummer, Ben
Gyimah, Mr Sam
Hague, rh Mr William
Halfon, Robert
Hames, Duncan
Hammond, rh Mr Philip
Hammond, Stephen
Hancock, Mr Mike
Hands, Greg
Harper, Mr Mark
Harrington, Richard
Harris, Rebecca
Hart, Simon
Harvey, Nick
Haselhurst, rh Sir Alan
Hayes, Mr John
Heald, Oliver
Heath, Mr David
Heaton-Harris, Chris
Hemming, John
Henderson, Gordon
Hendry, Charles
Herbert, rh Nick
Hinds, Damian
Hoban, Mr Mark
Hollingbery, George
Hollobone, Mr Philip
Holloway, Mr Adam
Hopkins, Kris
Horwood, Martin
Howarth, Mr Gerald
Howell, John
Hughes, rh Simon
Huhne, rh Chris
Hurd, Mr Nick
James, Margot
Javid, Sajid
Jenkin, Mr Bernard
Johnson, Gareth
Johnson, Joseph
Jones, Andrew
Jones, Mr David
Jones, Mr Marcus
Kawczynski, Daniel
Kelly, Chris
Kirby, Simon
Knight, rh Mr Greg
Kwarteng, Kwasi
Laing, Mrs Eleanor
Lamb, Norman
Lancaster, Mark
Lansley, rh Mr Andrew
Latham, Pauline
Laws, rh Mr David
Leadsom, Andrea
Lee, Jessica
Lee, Dr Phillip
Leech, Mr John
Lefroy, Jeremy
Leigh, Mr Edward
Leslie, Charlotte
Letwin, rh Mr Oliver
Lewis, Brandon
Lidington, rh Mr David
Lilley, rh Mr Peter
Lloyd, Stephen
Lopresti, Jack
Lord, Jonathan
Loughton, Tim
Luff, Peter
Lumley, Karen
Macleod, Mary
May, rh Mrs Theresa
Maynard, Paul
McCartney, Jason
McCartney, Karl
McIntosh, Miss Anne
McLoughlin, rh Mr Patrick
McPartland, Stephen
McVey, Esther
Mensch, Louise
Menzies, Mark
Mercer, Patrick
Metcalfe, Stephen
Miller, Maria
Mills, Nigel
Mitchell, rh Mr Andrew
Moore, rh Michael
Mordaunt, Penny
Morgan, Nicky
Morris, Anne Marie
Morris, David
Morris, James
Mosley, Stephen
Mowat, David
Mulholland, Greg
Mundell, rh David
Munt, Tessa
Murray, Sheryll
Murrison, Dr Andrew
Neill, Robert
Newmark, Mr Brooks
Newton, Sarah
Nokes, Caroline
Nuttall, Mr David
Offord, Mr Matthew
Ollerenshaw, Eric
Opperman, Guy
Osborne, rh Mr George
Ottaway, Richard
Paice, rh Mr James
Parish, Neil
Patel, Priti
Paterson, rh Mr Owen
Pawsey, Mark
Penrose, John
Perry, Claire
Phillips, Stephen
Pickles, rh Mr Eric
Poulter, Dr Daniel
Pritchard, Mark
Pugh, John
Raab, Mr Dominic
Randall, rh Mr John
Redwood, rh Mr John
Rees-Mogg, Jacob
Reevell, Simon
Reid, Mr Alan
Rifkind, rh Sir Malcolm
Robathan, rh Mr Andrew
Robertson, Hugh
Robertson, Mr Laurence
Rogerson, Dan
Rosindell, Andrew
Rudd, Amber
Ruffley, Mr David
Russell, Sir Bob
Rutley, David
Sanders, Mr Adrian
Sandys, Laura
Scott, Mr Lee
Selous, Andrew
Shapps, rh Grant
Sharma, Alok
Shelbrooke, Alec
Shepherd, Mr Richard
Simmonds, Mark
Simpson, Mr Keith
Skidmore, Chris
Smith, Miss Chloe
Smith, Henry
Smith, Julian
Smith, Sir Robert
Soames, rh Nicholas
Soubry, Anna
Spelman, rh Mrs Caroline
Spencer, Mr Mark
Stephenson, Andrew
Stevenson, John
Stewart, Bob
Stewart, Rory
Streeter, Mr Gary
Stride, Mel
Stunell, Andrew
Sturdy, Julian
Swales, Ian
Swayne, rh Mr Desmond
Swinson, Jo
Syms, Mr Robert
Teather, Sarah
Thurso, John
Timpson, Mr Edward
Tomlinson, Justin
Tredinnick, David
Truss, Elizabeth
Turner, Mr Andrew
Tyrie, Mr Andrew
Uppal, Paul
Vaizey, Mr Edward
Vara, Mr Shailesh
Vickers, Martin
Villiers, rh Mrs Theresa
Walker, Mr Charles
Walker, Mr Robin
Wallace, Mr Ben
Walter, Mr Robert
Watkinson, Angela
Weatherley, Mike
Webb, Steve
Wharton, James
Wheeler, Heather
White, Chris
Whittaker, Craig
Whittingdale, Mr John
Wiggin, Bill
Willetts, rh Mr David
Williams, Mr Mark
Williams, Roger
Williams, Stephen
Williamson, Gavin
Willott, Jenny
Wilson, Mr Rob
Wollaston, Dr Sarah
Wright, Jeremy
Wright, Simon
Yeo, Mr Tim
Young, rh Sir George
Tellers for the Ayes:
Mr Philip Dunne and
Mark Hunter
NOES
Campbell, Mr Gregory
Dodds, rh Mr Nigel
Donaldson, rh Mr Jeffrey M.
Durkan, Mark
Edwards, Jonathan
Flynn, Paul
Hermon, Lady
Hosie, Stewart
Long, Naomi
Lucas, Caroline
MacNeil, Mr Angus Brendan
McCrea, Dr William
McDonnell, Dr Alasdair
Paisley, Ian
Ritchie, Ms Margaret
Robertson, Angus
Shannon, Jim
Simpson, David
Skinner, Mr Dennis
Whiteford, Dr Eilidh
Williams, Hywel
Wilson, Sammy
Tellers for the Noes:
Pete Wishart and
Mr Mike Weir
Question accordingly agreed to.
26 Mar 2012 : Column 1300
26 Mar 2012 : Column 1301
26 Mar 2012 : Column 1302
PROCEDURE (FUTURE TAXATION)
That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may contain the following provisions taking effect in a future year—
(a) provision about personal allowances for the purposes of income tax,
(b) provision for corporation tax to be charged for the financial year 2013,
(c) provision exempting certain persons from income tax in respect of certain income arising in connection with the 2013 Champions League final,
(d) provision about taxable benefits in respect of cars,
(e) provision in relation to profits arising from the exploitation of patents and other similar rights,
(f) provision about indexation of the annual exempt amount,
(g) provision amending Chapter 4 of Part 1 of the Finance Act 1994,
(h) provision about the standard rate of landfill tax,
(i) provision amending, or making amendments connected with, Schedule 6 to the Finance Act 2000,
(j) provision about indexation of the rate bands for inheritance tax,
(k) provision removing certain reliefs from stamp duty,
(l) provision repealing section 57 of, and Schedule 6 to, the Finance Act 2003,
(m) provision in respect of harbour reorganisation schemes,
(n) provision removing reliefs connected with payments relating to reductions in pool betting duty,
(o) provision for and in connection with the abolition of relief under section 266 of the Income and Corporation Taxes Act 1988,
(p) provision for and in connection with the repeal of section 459 of the Income Tax Act 2007,
(q) provision about capital allowances,
(r) provision in relation to mineral leases or agreements,
(s) provision removing reliefs in respect of incidental expenses incurred in connection with the disposal or acquisition of deeply discounted securities,
26 Mar 2012 : Column 1303
(t) provision repealing section 249 of the Taxation of Chargeable Gains Act 1992,
(u) provision repealing section 89 of the Income Tax (Earnings and Pensions) Act 2003,
(v) provision removing certain reliefs from excise duty for black beer,
(w) provision removing certain reliefs from excise duty for angostura bitters,
(x) provision removing tax relief on interest from tax reserve certificates, and
(y) provision repealing section 62(2) and (3) of the Finance Act 1946.
PROCEDURE (PAYMENTS INTO CONSOLIDATED FUND OF NORTHERN IRELAND OF AIR PASSENGER DUTY)
That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may contain provision for the payment into the Consolidated Fund of Northern Ireland of amounts of air passenger duty.
PROCEDURE (DISCLOSURE OF INFORMATION AND SERVICE OF DOCUMENTS IN CONNECTION WITH FOREIGN BANK LEVIES)
That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may make provision about the disclosure of information relevant to any foreign levy equivalent to the bank levy and the service of documents relating to such a levy.
PROCEDURE (DISCLOSURE OF INFORMATION IN CONNECTION WITH TAXATION OF SWISS RESIDENTS)
That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may make provision about disclosing information to Swiss authorities in connection with the taxation of Swiss residents regarding assets in the United Kingdom.
PROCEDURE (INFORMATION POWERS IN CONNECTION WITH CERTAIN FOREIGN TAXES)
That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may make provision about obtaining information in connection with—
(a) a tax of a member State, other than the United Kingdom, which is covered by the provisions for the exchange of information under the Directive of the Council of the European Communities No. 77/799/EEC (as amended from time to time),
(b) taxes and duties imposed under the law of a territory outside the United Kingdom and covered by arrangements having effect by virtue of section 173 of the Finance Act 2006, and
(c) value added tax charged in accordance with the law of a member State, other than the United Kingdom.
26 Mar 2012 : Column 1304
Finance (Money)
Queen’s recommendation signified.
That, for the purposes of any Act of the present Session relating to finance, it is expedient to authorise the payment out of money provided by Parliament of sums incurred by the Commissioners for Her Majesty’s Revenue and Customs in preparing for the introduction of a new tax to be charged in respect of high-value residential properties or dwellings owned otherwise than by individuals.
That a Bill be brought in upon the foregoing Resolutions;
That the Chairman of Ways and Means, the Prime Minister, the Deputy Prime Minister, Mr Chancellor of the Exchequer, Secretary Vince Cable, Secretary Iain Duncan Smith, Secretary Edward Davey, Danny Alexander, Mark Hoban, David Gauke and Chloe Smith bring in the Bill.
Presentation and First Reading
David Gauke accordingly presented a bill to grant certain duties, to alter other duties and to amend the law relating to the National Debt and the Public Revenue, and to make further provision in connection with finance.
B ill read the First time; to be read a Second time tomorrow, and to be printed (Bill 325) with explanatory notes (Bill 325-EN).
Business without Debate
Deferred Divisions
Motion made, and Question put forthwith (Standing Order No. 41(A)(3) ,
That, at this day’s sitting, Standing Order No. 41A (Deferred divisions) shall not apply to the Motion in the name of Secretary Vince Cable relating to Companies.—(James Duddridge.)
Delegated Legislation
Motion made, and Question put forthwith (Standing Order No 118(6)),
That the draft Companies Act 2006 (Amendment of Part 23) (Investment Companies) Regulations 2012, which were laid before this House on 7 February, be approved.—(James Duddridge.)
E-Tabling of Written Questions
That this House approves the recommendations relating to written parliamentary questions contained in paragraphs 7 and 8 of the Eighth Report of the Procedure Committee, on E-tabling of parliamentary questions for written answer, HC 1823.—(James Duddridge.)
Mr Speaker: We come now to the Adjournment—
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Andrew Bridgen (North West Leicestershire) (Con): On a point of order, Mr Speaker.
Mr Speaker: The hon. Gentleman was a bit slow on the uptake. I told him that he should do his point of order before the Adjournment, but anyway we will give him a go.
Andrew Bridgen: What powers do you have, Mr Speaker, to censure Her Majesty’s Opposition, who spent five days opposing the cut in the top rate of tax from 50p and then abstained from voting in the Lobby?
The Exchequer Secretary to the Treasury (Mr David Gauke): Further to that point of order, Mr Speaker. I note that the shadow Chancellor said:
“There will be a vote next week, and we will vote against the 50p change.”—[Official Report, 22 March 2012; Vol. 542, c. 960.]
What guidance can you provide, Mr Speaker, to right hon. and hon. Members to look at the Budget resolutions, where they will see clearly that resolution 72 referred to an additional rate of 45p, which was obviously a change from 50p?
Mr Speaker: I think the hon. Gentleman is seeking to offer that guidance, but he is a constituency neighbour of mine, so I know that what he would not seek to do, for it would be unworthy—and he would not be unworthy—is continue the debate that we have spent the past few days having. So we will leave it there for tonight. He looks contented, as he is smiling at me beatifically and that is a boon to the House.
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Jerusalem (Humanitarian Issues)
Motion made, and Question proposed, That this House do now adjourn.—(James Duddridge.)
10.59 pm
Alex Cunningham (Stockton North) (Lab): Thank you, Mr Speaker, for this opportunity to debate humanitarian issues in Jerusalem. The debate comes in advance of the presentation of a petition to the Prime Minister supported by a wide range of organisations, including the Palestine Solidarity Campaign, the Amos Trust, Friends of Al Aqsa, Jews for Justice for Palestinians and Pax Christi, calling on the Government to take urgent steps to stop the Israeli Government’s gradual but relentless eradication of Palestinian life and culture in Jerusalem. The Minister will not need to take my word for it that Jerusalem is facing a political and humanitarian crisis as people are denied the basic rights of a civilised society. His own UK mission in East Jerusalem issued a joint report with European colleagues last year. They concluded that if current trends of settlement growth and home demolitions
“are not stopped as a matter of urgency, the prospect of East Jerusalem as the future capital of a Palestinian state becomes increasingly unlikely and unworkable.”
The clear and long-standing position of the European Union is that all Israeli settlements are illegal under international law, that East Jerusalem is part of the Occupied Palestinian Territories and that the annexation of East Jerusalem by Israel is illegal and not recognised by either the UK or the EU. Yet that annexation is being reinforced with the Jerusalem municipality openly stating that it does not want the Palestinian population of Jerusalem to exceed 30%. Reducing the population from 38%, where it currently stands before any natural increase, to 30% can be achieved only by resorting to ethnic engineering that would be unthinkable in a liberal democracy and would require illegal and inhumane measures. However, we all know that this mission has been under way for years.
The first of those measures being implemented is the building of the wall that allows the exclusion of tens of thousands of Palestinians born in Jerusalem from their own city. Palestinians living outside the wall but inside the city boundaries have the status of Jerusalem residents and Jerusalem taxpayers but can access the city’s services, schools, hospitals and transport system only with the greatest of difficulty, if at all. The two major checkpoints for Palestinians render movement from outside to inside the wall extremely difficult. This can mean having to wait hours to get through a checkpoint and can put hours on a person’s work or school day, reduce access to religious sites, cause severe delay for a medical appointment and cause huge disruption to economic activity.
Many Palestinian organisations and businesses have been forced to leave Jerusalem as a result, but that could probably be considered a good result by some in the Israeli authorities. The International Court of Justice has called for sections of the wall built in East Jerusalem to be dismantled, but far from dismantling the wall the Israelis are rapidly extending it. Currently, they are building a wall that will completely encircle the small community of al-Walaja on the borders of Jerusalem so that villagers will be able to get in and out of their village only through an Israeli army checkpoint. Many
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people have gone to al-Walaja to see the wall and speak to the villagers, but the Israeli army does its best to discourage visitors. Only this month soldiers forced 55 Harvard students back on to their bus and arrested the villager Shireen al-Araj who was showing them the wall. That was a clear attempt at intimidation.
Robert Halfon (Harlow) (Con): Does the hon. Gentleman recognise that far from being a wall, what he is describing is a fence, a tiny proportion of which is wall? Does he recognise that the reason it was built in the first place was to prevent suicide bombers from coming into Israel on a daily basis? That is something that it fortunately has achieved.
Alex Cunningham: I do not really think it matters whether it is a wall that is 20 feet thick or a fence—it is a barrier to the Palestinian people going about their normal business and I do not think it should be there.
One of the most sinister ways of removing Palestinians from living in Jerusalem is the rule that Palestinians’ “centre of their life” must lie within the Israeli-defined municipal boundary of Jerusalem. This prevents many who study or work for extended periods of time from returning and enriching their city’s experience. The “centre of life” requirement is of course particularly Kafkaesque when Israelis are making it more and more difficult for Palestinians to live and work in Jerusalem because of the wall and checkpoints.
Jim Shannon (Strangford) (DUP): All of Jerusalem has been ravaged by war and terrorism. I am aware that all sections of those living in Jerusalem—Jews, Muslims and Christians—have the right to live and the right to guidance and support. Does the hon. Gentleman agree that that applies to all groups of Jews and Christians as well?
Alex Cunningham: I agree with the hon. Gentleman that everyone should be living together in peace and harmony with the right to the same human rights within the city of Jerusalem, and I hope that one day we will get there. To finish my point, the authorities make it impossible for the centre of Palestinians’ life to be Jerusalem, and then expels them because it is not.
Furthermore, planning rules have been made to ensure that as little land as possible is available for Palestinians to build on. Fewer than 200 building permits are granted each year, even though the EU heads of mission in East Jerusalem assessed that 1,500 housing units are necessary to meet Palestinian housing need. A building permit is rare, mostly because the Israeli municipality has zoned most Palestinian areas to prevent building—according to the UN, that restriction applies in all but 13% of East Jerusalem—but even those who live in areas where building is permitted suffer years of delay and mounting costs in seeking permission to build.
Palestinians face an impossible dilemma as their family grows: do they live in squalid overcrowded conditions, move out of the city, or risk building illegally? Many take the chance of building without a permit, resulting in about 85,000 Palestinians being at risk of losing their homes. In addition, Palestinian homes in East Jerusalem are being demolished by the Israeli authorities: they
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demolished 670 homes between 2000 and 2008, and recently rubber-stamped the decision to demolish homes in Silwan to make way for a tourist park, which alone will make another 1,000 Palestinians homeless.
That comes at the same time as the building of illegal Jewish settlements continues unabated, forming an inner and outer ring around Jerusalem. The inner ring, home to around 200,000 settlers, combined with the wall cuts off Jerusalem from the west bank. The outer ring, home to another 100,000 settlers, further isolates the west bank from the Palestinian cities of Ramallah and Bethlehem. Moreover, settlements continue to be built on land confiscated from Palestinians. On the fringes, homes are being seized by Israeli settler groups on the pretext that the land on which they are built was once in Jewish ownership, but to which those groups have no legal entitlement.
Mr Andy Slaughter (Hammersmith) (Lab): Does my hon. Friend agree that it speaks volumes about the arrogance of the occupying power that following the UN Human Rights Council’s vote last week, by 36 votes to one, to send a delegation to investigate the illegal settlements—illegal under international law—in East Jerusalem and the west bank, the Israelis have refused to co-operate with the council, refused admission to the delegation, and indeed is considering sanctions against the Palestinian Authority for even daring to raise the matter?
Alex Cunningham: It is clear that the world at large wants to do something about these issues, so why will the Israelis not let people in? What do they have to hide? I want an answer to that question, too.
The inequality of treatment of Palestinians’ claims is outrageous. They are legally barred from reclaiming property in West Jerusalem that they were forced to abandon, even if they still have the title deeds and the key to the front door. To ensure that Jerusalem can become the capital of Israel and Israel only, and to try to ensure that it never becomes the shared capital with Palestinians, Israel has used planning laws, home demolitions, settlement building, the wall and insecure residency rights, even as the international community, including the UK, the EU and America, has sat back, talked and done nothing practical to stop Israel. We all know about the influence of the US and of US and European aid to Israel. Why is no one taking action that will result in change?
Let me tell the House about Raya and Issam—two people who best illustrate the injustices faced by the Palestinian people. Raya lives in Jerusalem. Her husband, Issam, lives 15 minutes’ drive from the centre of Jerusalem in a village just outside the city limits in the west bank, but he cannot visit his children’s school and could not be with Raya in hospital when she had their baby, because his village is outside the city boundary. He says:
“It’s easier for me to go on holiday to Germany than it is to visit my children's school in Jerusalem.”
When they married, Issam applied for a family unification permit, so he could live with Raya in Jerusalem. The application cost him $5,000 in lawyer's fees, but was refused on the grounds that he worked for the Palestinian Authority five years earlier. The authorities also cited the fact that he had been in jail during the first intifada 20 years ago, despite his being there only for writing
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slogans and waving banners. Issam’s 15-minute drive has now turned into a two-hour nightmare, involving travelling by bus to Ramallah and waiting at the notorious Qalandia checkpoint twice a day to take the children to and from school, because an Israeli settlement has blocked the route from his village to Jerusalem.
As a brief aside, there are still 4,417 Palestinian political prisoners held in Israeli jails as of January 2012, including 310 people with indefinite detention without charge or trial, 170 children, 27 elected members of the Palestinian Legislative Council, and seven women.
It is on the record, from both Houses, that the UK has “made representations” month on month, year on year, to the Israelis objecting to increased settlements and home demolitions, making it clear that these actions are unacceptable, are illegal under international law and must stop, but what we are not told is how the Israelis reply, and we are never told of any positive outcome from these conversations.
Israel is accelerating the pace of settlement expansion, demolitions, expulsions and arrests in a way that makes the two-state solution increasingly unviable. Words are not enough; actions are clearly needed, and it is vital to demonstrate that breaches of international law have consequences, not only in diplomacy, but in the wider area of political and economic agreements.
Mike Freer (Finchley and Golders Green) (Con): I understand the hon. Gentleman’s concerns about the two-state solution, but does he agree that until the Hamas element of the Palestinian Authority accepts the Quartet principles, there can be no negotiated peace process?
Alex Cunningham: There will always be issues associated with Hamas and various other groups, but tonight we are talking about basic human rights within the city of Jerusalem and it is time that some of them were restored.
There are three sensible measures that I am calling on the Government to consider. They should insist on guarantees that products manufactured in Israeli settlements reaching the UK do not benefit from preferential treatment under the EU-Israel Association Agreement. Where there is any doubt that the goods originate from Israel’s side of the green line, they should not benefit. It is astonishing to me that not only do we not financially penalise these settlements of which we disapprove so vehemently, but as taxpayers we subsidise their activities.
Ian Paisley (North Antrim) (DUP): Will the hon. Gentleman give way?
Alex Cunningham: I think I have given way enough.
According to research compiled by the Norwegian Government, Elbit Systems “supplies an electronic surveillance system called Torch for the separation barrier”,
yet Elbit Systems benefits from an EU research programme, FP7, which is the EU’s main research funding project. Ahava Dead Sea Laboratories is partially owned by two illegal settlements and exploits resources from occupied territories. Ahava benefits from three FP7 European projects.
Is the Minister therefore prepared to call publicly on the European Commission to ensure that companies that aid and abet the occupation of East Jerusalem and other occupied territories are barred from benefiting from EU projects? Will the Government work to ensure
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that the companies are also barred from public contract tendering processes? These measures would go a good deal further to end Israel’s intransigence in East Jerusalem and the occupied territories.
Last summer I took my place with countless Palestinians and others and waited for hours to get through the Rafah crossing to enter Gaza. I saw the indignity that those people suffered waiting to get into their homeland, and once in Gaza learned of the very real challenges for everything from education to the supply of goods being faced by the Palestinian people. I toured the refugee camps and spent time with families and children living needlessly in poverty. I saw the beautiful beaches crying out for a tourist industry, and a people eager to pay their way in the world. But just like their brothers and sisters in Jerusalem, their lives are controlled by the restrictions placed on them by the Israeli nation.
I look forward to the day when I can visit Jerusalem, to make my own pilgrimage to the sites associated with my Christian faith. But the Jerusalem I want to visit is the international city that it should be, free and fair for all residents regardless of their religion or nationhood, as the hon. Member for Strangford (Jim Shannon) suggested. It is time to demonstrate that we are not prepared to support or even tolerate the ethnic cleansing of Palestinians from East Jerusalem, and that as a nation we in Britain will work to do something about it.
11.13 pm
The Minister of State, Foreign and Commonwealth Office (Mr Jeremy Browne): Thank you, Mr Deputy Speaker, for giving me the opportunity to respond to this short but important debate. I start by congratulating the hon. Member for Stockton North (Alex Cunningham) on securing the debate and on the measured but impassioned way in which he approached the topic.
The humanitarian situation in East Jerusalem and the rest of the occupied Palestinian territories is an issue that remains a high priority for both the Foreign and Commonwealth Office and the Department for International Development. This evening, in response to the many points that the hon. Gentleman has raised, I hope to set out the actions that the Government are taking. The Government’s position on the status of Jerusalem is clear. East Jerusalem is an occupied territory. The solution to Jerusalem must be sought as part of a negotiated settlement between the Israelis and the Palestinians. Any solution should enable Jerusalem to be a shared capital of the Israeli and Palestinian states. Moreover, that solution must allow access for all those for whom Jerusalem means so much, whether they be Jews, Muslims or Christians.
The Government share many of the hon. Gentleman’s concerns about Israeli actions in East Jerusalem and the rest of the occupied Palestinian territories. Those concerns relate to demolitions and evictions; the construction of illegal Israeli settlements; severe difficulties of access to Jerusalem for Palestinians from the west bank, or for those residents of Jerusalem who live beyond the separation barrier; the removal of residency rights from Palestinians; and detentions. I shall address each of those matters in turn.
Simon Danczuk (Rochdale) (Lab): Does the Minister not agree that Israel is doing everything it can to prevent the Palestinian people from developing economically?
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Mr Browne: I will come to that point. This is quite a narrowly prescribed debate, but I note that there will be an opportunity in Westminster Hall at 2.30 tomorrow afternoon to debate Israel and the peace process, so anyone who does not have an opportunity to speak tonight on this rather more narrowly prescribed topic will be able to join me in a few hours’ time to discuss the subject tomorrow when the net will be cast more widely.
Mr Browne: I shall give way first to my hon. Friend the Member for Harlow (Robert Halfon), and then to my newly acquired Friend, the hon. Member for North Antrim (Ian Paisley), who is normally on the Benches opposite.
Robert Halfon: I am delighted that my hon. Friend the Member for North Antrim (Ian Paisley) has joined us on these Benches tonight.
Does my hon. Friend the Minister agree that, before 1967, the Jews in East Jerusalem had no rights at all, and were not allowed to visit the holy sites? Does he also agree that Israeli Arabs in Jerusalem have far more rights than many Arabs in Arab countries, in that they elect MPs and live in a democracy?
Mr Browne: We want people of all faiths to have the right to practise their faith, but we also want a political arrangement in Jerusalem that will enable a two-state solution to become a reality.
Ian Paisley: I thank the Minister for his generosity in giving way. For the avoidance of doubt, will he make it clear that he will not succumb to or support calls for sanctions against Israel and the 6 million people who need to live and work in that country?
Mr Browne: Let me come to the subject in hand, and the hon. Gentleman can draw his conclusions. We are not talking about those measures this evening, but I would like to address the points made by the hon. Member for Stockton North.
First, like hon. Members, the Government are concerned about the threatened and actual demolition of Palestinian homes, particularly in the Silwan district of East Jerusalem. According to the United Nations, 515 structures were demolished in East Jerusalem and the west bank in 2011—a 40 % increase compared with 2010. Such demolitions and evictions are causing unnecessary suffering to ordinary Palestinians. They are harmful to the peace process and they are contrary to international humanitarian law in all but the most limited circumstances.
The Under-Secretary of State for Foreign and Commonwealth Affairs, my hon. Friend the Member for North East Bedfordshire (Alistair Burt), raised the issue of demolitions with the Israeli ambassador on 23 February, and again with the Israeli Deputy Prime Minister, Dan Meridor, on 19 March. Her Majesty’s ambassador in Tel Aviv and embassy officials have also lobbied the Israelis, at ministerial and municipal level, on this issue. We have received a welcome assurance from the Jerusalem municipality that it has no plans to conduct wide-scale demolitions in Silwan in the immediate future. As hon. Members are aware, evictions and
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demolitions are also a pressing issue in Area C of the west bank. The United Nations estimated that by the end of 2011 there were more than 3,000 demolition orders outstanding in Area C, including 18 issued to schools. There is also an increasing number of demolition orders against infrastructure projects that have been funded by international co-operation programmes, including those of the European Union.
In East Jerusalem, Palestinians, and indeed international organisations, face severe difficulties in obtaining building permits. On average, only 4% of building permits requested by Palestinians for Area C were approved last year. Together with our European Union partners, we continue to press Israel to address these serious concerns about the planning regime in Area C. More fundamentally, we urge Israel greatly to accelerate the process for transferring authority over Area C to the Palestinian Authority.
Secondly, another significant concern for the British Government, this House and the international community is the continued expansion of Israeli settlements, including in East Jerusalem. The combination of the growing settlements and the separation barrier erected by Israel is increasingly separating East Jerusalem from the west bank, making it increasingly difficult for East Jerusalem to function as the capital of a future Palestinian state. Settlements, including in East Jerusalem, are illegal under international law and an obstacle to peace. They make negotiations more difficult and constitute a growing threat to the feasibility of a two-state solution, a solution supported by Israel and the Palestinian Authority, the international community and a majority of both Israelis and Palestinians. Settlement activity has no justification and should cease immediately. We have repeatedly given that message to Israel, including at the most senior levels.
Along with EU colleagues, we are deeply concerned at the agreement recently reached between the Israeli Government to move settlers from the illegal west bank outpost of Migron to a new settlement in the west bank. We note that Israel’s Supreme Court has rejected the Government’s petition to allow settlers to stay until 2015. Had the deal been ratified, it would have set a dangerous precedent, entirely contrary to Israel’s obligations under the Quartet roadmap. Hon. Members will be aware of the statement issued by the Under-Secretary, my hon. Friend the Member for North East Bedfordshire, on 16 March calling on the Israeli Government to rescind their decision. We will continue to urge the Israeli Government not to pursue their current approach of legalising such illegal outposts.
Bob Blackman (Harrow East) (Con): Does the Minister accept that Israel has demonstrated its ability and determination to remove illegal settlements, for example in Gaza, in exchange for a peaceful resolution and that, therefore, so-called—in some cases—illegal settlements can of course be negotiated away in land in order to have peace with the Palestinians, but what is required is for both sides to sit around the table to determine a peace treaty so that everyone can live in peace and harmony?
Mr Browne:
We of course wish both sides—if I can put it in those terms—to live in peace in harmony. That is very much the Government’s ambition. For the avoidance of doubt, I should say that the Government do not
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support sanctions on Israel or any attempts to delegitimise Israel, but we do want Israel to honour the undertakings that I think people across the world expect it to honour with regard to settlements.
Alex Cunningham: Will the Minister give way?
Mr Browne: I will give way, because it is the hon. Gentleman, but after that I wish to address more of the points he made in his speech.
Alex Cunningham: If nobody is going to place any sanctions on Israel for what it is doing, what can be done to bring a solution? Talk is getting us nowhere.
Mr Browne: I want to address some of the hon. Gentleman’s other points and will then get to that point.
The Government will continue to argue for a just outcome for all the people affected by illegal settlement construction and the confiscation of land due to the separation barrier. That includes funding from the Department for International Development to the Norwegian Refugee Council to provide legal support to communities affected by the occupation.
I want to address a couple more issues, because time is short, and then see what more time I have to accommodate the wider points that have subsequently been made. The Government remain deeply concerned about restrictions on freedom of movement between the west bank and East Jerusalem. The permit system for Palestinians to enter East Jerusalem, whether for work, education, medical treatment or religious worship, is lengthy and complicated. There are heartbreaking stories of sons and daughters unable to obtain permits in time to visit parents dying in hospital or to attend funerals of relatives. Those Palestinians who have regular permits can spend hours queuing every morning at the checkpoints. We have lobbied the Israelis hard on the issue of movement and access, and there have been some improvements on the west bank, but there is still a long way to go.
A related concern is how many Palestinian residents of East Jerusalem face the threat of losing their residency rights in a way that does not apply to Israeli residents. There are families who are forced to live apart, or forced to move to the west bank, because they cannot obtain permits to stay together. There are also concerns about reported moves by the Jerusalem municipality to change unilaterally the boundaries of the city in a way that might deprive thousands of Palestinians of their right to residency of Jerusalem.
The restrictions on movement and access, as well as on building, not only affect individual Palestinian lives but have a very harmful effect on the Palestinian economy. It is estimated that the movement and access restrictions cost the Palestinian economy as much as 85% of its GDP every year.
Mr Slaughter: Will the Minister give way?
Mr Browne: Let me come to a key point that I want to make, and then I shall give way if I have time.
Israel needs to show a greater flexibility on the movement of people and exports in order to increase employment and to reduce aid dependency. We did see some welcome
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flexibility earlier this month when we saw the first exports from Gaza to the west bank since 2007. The Under-Secretary, my hon. Friend the Member for North East Bedfordshire, welcomed that in a statement on 9 March, and it is an important step by Israel towards fulfilling its commitment to allow economic development for the 1.6 million people in Gaza. We hope that further transfers of goods to the west bank, including fruit and vegetables, textiles and furniture, will now also be permitted.
But—and this might reassure my hon. Friend the Member for Harlow—I want to add that, on top of everything I have said, having I think made the Government’s position very clear, it would be wrong to give the impression that the Government are concerned only about Israeli action, although Israel has particular obligations under international law as the occupying force.
As the annual Foreign and Commonwealth Office human rights and democracy report, to be published next month, will highlight, we also have serious concerns about reports of abuses carried out under Hamas rule in Gaza. Those include arbitrary detention, the mistreatment of detainees and the use of the death penalty. We are also seriously concerned about rocket attacks fired by militant groups in Gaza.
We continue to believe that the way to resolve the Israeli-Palestinian conflict, including in relation to Jerusalem, is through negotiations. Negotiations remain the best way of giving the Palestinian people the state that they need and deserve, and the Israeli people long-term security and peace. If the hon. Member for Hammersmith (Mr Slaughter) wishes to intervene, I just about have time to accommodate him.
Mr Slaughter: I thank the Minister for pointing out some truths—I think to Government Members as well. He is going slightly off the subject by talking about the death penalty in Gaza, and perhaps he will also reflect on the 20 Palestinian civilians killed by the Israeli air force recently, as they too suffered the death penalty. His Government are not so good, however, on action. They did not support and, therefore, effectively sabotaged in the United Nations Security Council the Palestinian bid for statehood. If the bid goes back to the UN General Assembly in April, will the Government support non-member status?
Mr Deputy Speaker (Mr Lindsay Hoyle): Order. It was meant to be a very short intervention, but that was almost a speech. If you need to, you will have to put in for your own Adjournment debate.
Mr Browne: As I said, there will be an opportunity in Westminster Hall tomorrow afternoon for a debate three times the length of this one about such matters, but the Government’s position is very clear: we wish to see the two-state solution, which I have just described, and we make our judgments based on what we think is most likely to achieve that outcome.
We continue to urge both sides to demonstrate the political will and leadership necessary to break the current dangerous impasse and to achieve a sustainable solution to the problems highlighted in this evening’s debate.
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I am grateful to Members on both sides for fitting so many informed and passionate contributions into the short period that was allotted for our deliberations on the matter.
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