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Baroness Noakes: I thank the noble Lord, Lord Brooke of Alverthorpe, for taking part in the debate. To give him a little background, it was not the commissioners of the Inland Revenue who thought that it was about time that they should move forward. I believe the then Paymaster General decided that somebody was needed to crawl over the figureswhich was why I was one of the first appointments. Then, opportunistically, it was claimed that there was a gender balance problem, which was why the first two appointments were my noble friend Lady Wilcox and myself. We were constantly referred to as the "two ladies", which we hated.
I shall deal with a couple of points of detail then move on to the overall theme. One point of detail was whether a balance between executives and non-executives should be written into the Bill. I believe that the Minister said that he would regard having a balance written in as a fatal objection; if it is a fatal objection to this amendment, it is a fatal objection to a very large amount of legislation that his Government have passed in the past seven years. Provisions along those lines were included in the Bill creating foundation hospitals; I could refer to the Pensions Regulator and trawl through a whole lot more, if Members of the Committee wanted me to.
On another point of detail, the Minister said that it is clear that the people referred to are not employees, but it was not clear when I had the altercation with the Treasury civil servant. That was precisely the nature of the altercationwhether I was an employee of the Inland Revenue. It was precisely the lack of clarity at the time that led to a loss of money in circumstances that I do not need to explain to the Committee, and it was that lack of clarity that led me to propose the amendment. I believe that it is on the matter of that lack of clarity that the noble Lord, Lord Brooke of Alverthorpe, has voiced his support.
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At the end of the day, I believe that the Government's position is that this is just another government department, government departments are our playthings and we decide what they do and do not do over time. If the Treasury decides to issue a code, government departments will have to comply with it; until then, it is something of a free for all, unless Parliament catches up with them a couple of years after they have done something.
I do not believe that that is a satisfactory way to go forward. The Bill gives us a good opportunity to lay down some markers for the kind of organisation that Parliament expects to see. I am sure that we shall not be able to pursue this much today, but I will want to reflect very carefully on the Government's approach between now and Report. I beg leave to withdraw the amendment.
The noble Lord said: There are two main considerations in the merger of the Inland Revenue and Customs and Excise. We are seeing very big changes in procedure, but when you bring these two very large departments together there will obviously be very great changes in the way they operate. We understand that with £400 billion it is a major undertaking. We have seen by the comments by my noble and learned friend and others that this merger is slowing down. When the debate took place in the House of Commons it looked as though it would go much faster than it is. We are seeing that the prosecution service will be the main mover in keeping to the schedule to save the 3,200 staff which was envisaged at the time.
The most important aspect is the standard of honesty that we have to try to maintain. The great advantages that we had in the last century came with the Northcote-Trevelyan reforms of 150 years ago. We gained enormously from that. The level of corruption throughout the whole of our administration and the Civil Service has been much less than in comparable countries. It is the tradition that has been so valuable
Lord Sheldon: As I was saying before the Division, this important aspect of the Bill needs to maintain the
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standards of honesty that we have had the enormous advantage of retaining over the years. It came from the Northcote-Trevelyan report, which produced the kind of Civil Service that we have come to expect. When we have tradition in such matters, it is easier to retain it so, fortunately, we have not had the disadvantage of having to undergo the dangers of corruption that we see in so many other countries.
The best way to retain standards is to keep things much the same. If you bring about major changes, you change the structure and the opportunities for people to do things that they otherwise not would do. There could be a decline in standards. Because of that, I feel that this is not a time to replace the oath. It has been one of the great standards that we have had, and the dangers of moving away from it are clearto me, at any rate.
Those dangers are also clear to a very important person who had responsibility for these matters, Jim Callaghanthe noble Lord, Lord Callaghan. He sent me a letter on 10 February that referred to my speech at Second Reading. I now have the privilege of reading that letter out. It states:
I was of course very interested to read the HMRC debate, especially so when you made the point about the need to keep the Revenue as a statutory duty. I highly agree with what you say and hope you will convince the Attorney.
To give you an example, I have never forgotten the importance attached to the occasion when I was required to take the Revenue Oath, even though it is seventy-five years ago when it happened. I was seventeen years old at the time, in 1929, and just out of school, having passed the Civil Service entrance examination and been appointed to Maidstone Tax Office. When I had been there for only a week or two, Norman Sparks, the Senior Clerical Officer, told me what I had to do and then escorted me personally to the office of the Commissioner for Oaths. The Commissioner was a man named William Day, a huge man with a large beard, who sat me in front of his desk whilst he explained the importance of what I was undertaking, and I then took the Oath in the presence of the SCO.
As you will realise from what I am saying, it had a great effect on the young impressionable mind of a seventeen year old. Perhaps the Revenue Oath is even more important nowadays, when many young people seem ready to enter into their obligations without too much thought, so I hope you will continue to insist on its value, and that you are successful.
As I said, by international standards we have this enormous advantage over other countries, and it is when these major changes are brought about that this kind of thing can occur. If things are left much the same, the same tradition of high standards of honesty is more likely to prevail. When new systems are brought in, and with an amount of £400 billion, it will
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always be possible for a number of things to go wrong. Quite rightly the noble Lord, Lord Callaghan, saw that, as indeed I do. I beg to move.
Lord Campbell of Alloway: I was going to support this amendment in any event but, of course, following what was said by the noble Lord, Lord Sheldon, at col. 599 of the report of Second Reading, I wholly agree that one does not want to downgrade the system.
The Earl of Northesk: I, too, support the amendment. Like my noble friend Lord Brooke of Sutton Mandeville, I should perhaps begin by apologising to the Committee that this is my first intervention on the Bill. I should have preferred to give some indication of the nature of my concerns at Second Reading but, in the event, that was not possible. With that in mind, I hope that in due course the Committee might allow me a modicum of leeway in explaining the context of some of my later amendments.
I should also say that I am only too well aware of the collective experience and expertise of the Committee in Revenue and Customs matters. For me, given my relative lack of experience, the moving of the amendment by someone as distinguished as the noble Lord, Lord Sheldon, argues strongly in its favour.
I also view with approbation the Government's acquiescence to the arguments of my honourable friends and others during scrutiny of the Bill in another place. The result was, in fact, the insertion of this clause on Report. It is wholly appropriate that any individual appointed as a commissioner or an officer of Revenue and Customs should be subject to a duty of confidentiality and that that duty should be subject to an appropriate form of declaration. I am sure that that is common ground among us all. As the Paymaster General put it at Second Reading in another place:
"It is vital for continuing compliance rates that taxpayers provide information to the Revenue departments. The bedrock of that process is the knowledge that their confidentiality is protected".[Official Report, Commons, 8/12/04; col. 1177.]
That being so, the contribution that the maintenance of a culture of confidentiality within the Revenue can make towards closing the tax gapafter all, that is one of the Government's stated purposes in seeking the integrationshould not be underestimated. The proposition for the taking of an oathit is but a small step further along the road that the Government have already embarked onattaches due gravity and solemnity to the importance of the issue.
That said, my principal motive for supporting the amendment stems from a slightly different perspective. I believe it is just as important that the self-same gravity and solemnity provided for by the amendment be attached to the principle of privacy rights emanating from Article 8 of the ECHR. As I said, I support the amendment.
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