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Stenbell Ltd.
5. Mr. Andrew Robathan (Blaby): How much tax has been paid by Stenbell Ltd. in the last five years. [61749]
The Chief Secretary to the Treasury (Mr. Stephen Byers): As has been the case under successive Governments, the law on taxpayer confidentiality prevents the Inland Revenue from disclosing any information relating to the tax affairs of any particular taxpayer.
Mr. Robathan: This is a matter of real public interest and, I suggest, of grave concern to hon. Members on both sides of the House. Is it not the case that the tax paid by Stenbell, together with the £500,000 of tax not paid by AGB, the connection with Hollis Industries, the implication of Robert Maxwell in both those companies and the claims of the Maxwell pensioners are part of a tangled web that must interest the Treasury--yet at the centre of the web is a Treasury Minister? Notwithstanding the Paymaster General's friends in high places and his holiday guests in Tuscany, does not the Minister consider that a Minister in the Paymaster General's position should have resigned long ago?
Mr. Byers: The hon. Gentleman makes allegations. The Paymaster General is a highly effective Minister, and I look forward to working with him for many months to come. The question that Conservative Members need to answer is why, in the Tory party's recently published accounts, there is a secret donation of £1 million which, we are told, was donated by a party connected to Michael Ashcroft, the Tory party treasurer. We know that Mr. Ashcroft has been a tax exile for a number of years, preferring to pay his tax in Belize rather than Britain. That is the question that the Conservatives must answer.
The Leader of the Opposition has said that he wants to lead a party with no secret donations. Why the secrecy in this case? Why has there been no disclosure? The time has come for the Conservative party to answer those questions.
Madam Speaker:
Order. That does not relate to the question. I will take only questions which relate directly to the main question.
Mr. Francis Maude (Horsham):
The Paymaster General--who is, I understand, the owner of Stenbell
He has been shown to have systematically concealed his business links with Robert Maxwell. Why do not the Government abandon--
Madam Speaker:
Order. The right hon. Gentleman is fully aware that he should have a substantive motion on the Order Paper before he criticises a Member of this House. If he will restrict his supplementary question to what is on the Order Paper, I will hear it. Otherwise, I must ask him to resume his seat until he has a proper motion on the Order Paper.
Mr. Maude:
The Paymaster General is the subject of this question. Why do not the Government abandon the search for a face-saving exit for the Paymaster General, and simply sack him?
Mr. Byers:
The shadow Chancellor can put two questions to the Treasury today, and it is interesting that he has chosen to use one of them for a deliberate personal attack on a Treasury Minister. I am sure that there are many other issues that members of the public would have thought he might raise. His misguided priorities all too often reveal the nature of the Conservative party. I think that he will come to regret the way in which he put his question. I am pleased to be working with my hon. Friend the Paymaster General, who is an effective Minister, and I am sure that I will continue to work with him for many months to come.
6. Mr. John Greenway (Ryedale):
What assessment he has made of the potential impact of the proposed EU withholding tax. [61750]
The Financial Secretary to the Treasury (Dawn Primarolo):
We have carefully examined the draft directive on taxation of savings, and consulted the City about its possible impact on the markets. My right hon. Friend the Chancellor has made it clear that, in its present form, the directive is unacceptable.
Mr. Greenway:
I am grateful to the Financial Secretary for confirming what she said last night--that the EU withholding tax is unacceptable in its present form. In what form would a withholding tax be acceptable? Does she agree that any international action to protect UK interests, unless it is mounted on a global scale, will automatically mean the transfer of business and jobs not only from London but from all member states to America, Japan and Switzerland?
Dawn Primarolo:
The Government have always made it clear that we are determined to protect the competitiveness of the European financial sector, and in particular the City of London. We favour--as, I hope, did the previous Government--effective international action against tax evasion. The solution that we prefer is the exchange of information, and the previous Government
Ms Diane Abbott (Hackney, North and Stoke Newington):
My hon. Friend will agree that the xenophobic tone of much media comment on European taxation matters is to be deplored. Does she also agree that, if a country is to proceed with economic and monetary union and complete monetary integration, a degree of fiscal integration follows, as night follows day? It is misleading the public to pretend that one can have monetary convergence with no effect on fiscal policy.
Dawn Primarolo:
I am sorry that my hon. Friend missed the debate last night. I reiterate what I said then: monetary union does not equal harmonisation. It does not in the United States, and it will not in Europe. The Government have made it clear that harmonisation is not on the agenda for the foreseeable future.
Mr. David Heathcoat-Amory (Wells):
Is the Financial Secretary aware that it is strongly believed in the financial services industry that the Government are preparing a sell-out on the withholding tax? Does she understand that, even if we get rid of the compulsory 20 per cent. savings tax, the alternative is just as bad? The compulsory provision of information to overseas tax authorities would have the same effect, driving business right out of the European Union.
Instead of giving vague assurances about protecting the national interest, as defined by the Government, will the Financial Secretary for a change announce that she will simply veto this damaging directive, which will not only destroy an important and successful British industry but put at risk the thousands of jobs that depend on it?
Dawn Primarolo:
The right hon. Gentleman may be having some difficulty with his hearing. I repeat that the exchange of information, which is the Government's preferred way to deal with that issue, is the way that we are proceeding in our negotiations. I repeat also that his Government agreed to a directive in 1988 that enshrined exchange of information. It was called the directive on capital movements. I know that the Tories like to forget quickly what they did in government, but the right hon. Gentleman's forecast did not happen then and will not happen in the future. This Government will defend the national interest and take decisions on the directive based on the national interest.
7. Mr. David Chaytor (Bury, North):
What plans he has to improve the system of regulation of stockbrokers. [61751]
The Chief Secretary to the Treasury (Mr. Stephen Byers):
Soon after coming to office last May, the Government announced their plans to modernise the system of regulation for the financial services industry generally. A single body, the Financial Services Authority, has been established, which will be given statutory powers in the financial services and markets Bill which we will bring forward later in this Session.
Mr. Chaytor:
I thank my right hon. Friend for that reply. One of my constituents, a characteristic small
Mr. Byers:
I sympathise with the difficulties that my hon. Friend's constituent has experienced. For the reasons that he has outlined, we felt that it was necessary to bring together the nine existing regulators into one body to regulate the financial services market. That body will have a single compensation scheme, which will help individuals who may have been subject to harmful treatment by stockbrokers or others involved in the financial services market. The aim of the new regime is to ensure that no individual, such as my hon. Friend's constituent, ever again has to suffer as a result of inappropriate conduct by people in the financial services market.
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