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Lord McIntosh of Haringey: I am grateful to all noble Lords who have taken part in this short debate. When the noble Viscount, Lord Eccles, first intervened I neglected to welcome him to our deliberations. He was not in the House when we considered the matter before. The only hesitation I have in expressing my pleasure in seeing him here today is remembering the sad death of his father.
I anticipated a number of the questions which have been posed, but I shall respond to the additional points raised. The noble Baroness seems to think that this is the thin edge of the wedge and that because we have made special provisions for CDC, it will be easier for other people--she named the National Lottery--to take advantage of the same procedures. The fact that it has been so difficult, that it has required primary legislation, and months of negotiation and consideration during the passage of that primary legislation, in my view makes it clear that this is not a precedent that is likely to be followed. If anyone attempted to follow it in regard to the National Lottery, it would be over my dead body. I believe it would be over the dead body of the Chancellor of the Exchequer as well. We have taken care to get the procedures right because we recognise
Lord Redesdale: My Lords, I am sorry to interrupt, but I am reminded that a number of years ago--I believe in 1994--when we debated the National Lottery, the Minister, when speaking from the Opposition Front Bench, opposed the 12½ per cent tax on the National Lottery. I put that forward for information.
Lord McIntosh of Haringey: I had nothing to do with the National Lottery. There are those of us who think that in the next negotiations for the National Lottery we should consider the possibility of a not-for-profit National Lottery. We said that at the time. That will be possible in the consideration of the re-awarding of the contract. That is not the same as a tax exemption, and it certainly is not the same as going off-shore, as appeared to be suggested.
The amendment concerns where we enshrine the investment policy and the development purpose of CDC. I hope that I made it clear in my opening speech that it is well entrenched in the memorandum and articles of the CDC and in the procedures that make it clear that it cannot be changed without the agreement of the Secretary of State and without the agreement of Parliament. I believe that that is the right place for that entrenchment, rather than in the provisions on tax exemption, which is where Amendment No. 5A would place it.
The concerns of the noble Baroness go much wider than how the investment policy is protected. She queries the investment policy and says that her honourable friends in the Commons suggest that we are already departing from what ought to be the investment policy and development purpose of the CDC. She gave some examples.
It is difficult to judge individual investment decisions in that way as the work of CDC in any country is complementary to other investment activities, whether venture capital activities or the investment activities of the state itself. It is difficult to say in Pakistan, Uganda or anywhere else what the role of CDC may be because it will vary from country to country. If your Lordships will forgive me, I do not want to open up the question of the adequacy of the purposes of CDC. They were fully debated when the Bill went through the House. Those issues are not raised by the Commons amendment before us or the amendment to it.
On Amendment No. 5B, which concerns the exempt period, I do not believe that CDC wanted a longer period than that which is provided. As I said in my opening speech, my understanding is that it is content that that will meet its needs. If we have an average investment cycle of seven years, the investments will be falling in over that seven-year period and all but perhaps a tiny number of them will have fallen in by the time the seven-year period is reached.
The noble Viscount, Lord Eccles, asked about the restructuring of the balance sheet. It is the important next step. We aim to have it in place for inclusion in the 1999 report, which will be produced for April 2000. It will take the results of 1999 into account after the abnormal results of 1998. As for the timing of the prospectus and the sale, it is far too early to say. That will depend on market conditions and the CDC track record. We have always made it clear that we expect that to be a considerable way off.
The noble Lord, Lord Birdwood, asked about the culture of CDC and whether that will be preserved. I very much hope so. I believe that we have set in place a process and a framework which will enable those who have valiantly served CDC over the years to continue to serve and to achieve even better results than they have in the past.
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