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Mr. Levitt: A few weeks ago, The Mail on Sunday described me as sycophantic. Obviously, it had never heard me talking about aggregates tax. I am co-chairman of the parliamentary minerals group and a member of the GMB, which is the largest trade union in the quarrying industry. The Quarry Products Association was launched in my constituency in 1997. Quarrying is the largest single part of the manufacturing industry in High Peak, which has nine major quarries and many smaller ones. I lay some claim to the second runway at Manchester airport, all 2 million tonnes of which used to be located in my constituency, but were transported by rail to the site.

In the quarries of High Peak, we have some of the best environmental practices that are used in quarries today. We have some massive quarries that are practically invisible to the outside world. Blue Circle at Hope takes some 70 per cent. of its product out by rail rather than road, and always stays one leap ahead of the law in terms of environmental emissions and so on. Some very good practices are followed not only by Blue Circle, but by Tarmac--formerly Buxton Lime Industries--RMC and Lafarge. The big names are all represented in the area, but unfortunately, so are some of the worst. In particular, a quarry at Moss Rake, next door to Blue Circle, is a disgrace. I shall say more about that very small, but highly visible, quarry in a few moments.

My views on aggregates tax in general are well known to the Department of the Environment, Transport and the Regions and the Treasury. My hon. Friend the Financial Secretary and I have spent many happy hours debating the issues either publicly or privately. I have tabled parliamentary questions and led delegations in relation to the matter on behalf of the all-party minerals group. I am a sceptic about the aggregates levy, which is why I think it right to consider carefully the possibility of introducing a rebate scheme. That does not lead me to conclude that I shall vote in favour of the amendment, for reasons that I shall explain in a moment, but I think the tax needs improving.

Mr. Letwin: Will the hon. Gentleman tell us whether he will vote against the clause?

Mr. Levitt: I shall say exactly which way I shall vote, but the hon. Gentleman will have to wait for that moment to arrive. [Interruption.] I shall not change my position between now and a few minutes' time.

Let me say why the tax needs improving. I believe that it is based on a very narrow and controversial definition of costs and benefits. It does not discriminate between existing good and bad practice. It makes the assumption that it is only improvements on the current state of play that will be taken into account. Contrary to some claims for it, I do not understand how the tax promotes recycling.

5.45 pm

Contrary to the comments of the hon. Member for Somerton and Frome (Mr. Heath), the landfill tax accelerated a move towards recycling. The investment of many companies in recycling building materials, the fact that some parts of the country have a greater demand for

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materials while others have a greater supply, and transport costs that can militate against using recycled materials, even when companies want to, all mean that the industry is already reaching its maximum capacity for recycled materials. The supply of recycled materials is not available in the right place and at the right time to enhance further use, even if an aggregates tax provides an incentive.

The industry remains unconvinced about the operation of the sustainability fund. I suspect that those who tabled the amendment wished to replace the tax or at least complement it with a system of rebates. At least the sustainability fund has the advantage of being proactive, whereas a rebate scheme would presumably only react to changes. The industry--certainly the Quarry Products Association--is well aware of its responsibilities.

Nowadays, the industry cannot and must not ignore environmental interests and progress. Quarries are part of and integral to their neighbouring communities, where many of their employees live. The industry recognises that, and the fact that a clean reputation is commercially and hence economically a good asset for quarries. Good practice already exists in environmentally sound quarrying. We must not pretend that it does not, or fail to reward those in the industry who have got their act together in the past and produced some excellent environmental measures.

Over the years, the Quarry Products Association has presented arguments on behalf of the responsible elements of the industry. However, its strategy has a major flaw. It accounts for only 80 or 90 per cent. of the industry. The remaining 10 per cent, which, by and large, comprises the smaller operators who may be represented by the British Aggregates Association, and, more importantly, those represented by nobody, do the most damage to the environment and the industry's reputation. The hon. Member for Croydon, South (Mr. Ottaway) nods. It is therefore odd that the amendment that he has tabled in the next group would exclude such cowboys and smaller operators from the Bill.

Mr. Ottaway: I was nodding because I believed that the hon. Gentleman said that small quarries were environmentally effective. We believe them to be so.

Mr. Levitt: I invite the hon. Gentleman to the Peak district where he can compare large and small quarries. Planning regulations are tighter in national parks than elsewhere, but he will find that the worst offenders, who are prepared not only to leave an unacceptable scar on the landscape but to raise two fingers to health and safety regulations, are the smaller operators. I do not want them excluded from the Bill. However, that is covered in the next group of amendments.

Mr. Ottaway rose--

Mr. Levitt: If the hon. Gentleman has something to say about my comments rather than about the next group of amendments, I shall give way.

Mr. Ottaway: I rise because I do not believe that we shall reach the next group of amendments. The point behind them is that the smaller quarries are in rural areas. They are environmentally effective because they are dotted around the country--

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The Temporary Chairman (Dr. Michael Clark): Order. We cannot debate the next group of amendments simply because the hon. Gentleman believes that we will not reach it. [Hon. Members: "The hon. Member for High Peak (Mr. Levitt) is talking about it."] If the hon. Gentleman does that, I shall check him.

Mr. Levitt: I will not go further on the question of smaller quarries. I shall do precisely the opposite, in saying that one of the quarries in my constituency, at Tunstead, is visible from the moon. It has the largest quarry face in Europe and is in a very rural area.

I return to my conclusion. Let me not give the impression that the Government have not been listening. I disagree with those hon. Members who have suggested that they have come up against a brick wall. There has been no such brick wall. Certainly, £1.60 a tonne is less than the amount that it had appeared might be introduced, and imported aggregates being subject to the same levy is an improvement on the original proposals.

The fact that there are many exemptions will also be welcomed by many industries and many parts of industries, although the provisions could be incredibly complex because quarries such as the Tarmac quarry in my constituency produce materials that might be subject to the aggregate tax in certain circumstances but not in others--perhaps if they were dirty but not if they were clean--and might be subject to it at some time in their life but not at others.

Mr. Letwin: Will the hon. Gentleman give way?

Mr. Levitt: I want to draw to a close so that others can speak.

It is significant that a rebate system of some sort--I do not know what--is, I believe, being discussed by the Government and the major representatives of the industry, those whom I call the responsible elements of the industry. A rebate system must take into account good practice and the current records of the companies. It must encourage progress on environmental measures and apply to the whole of the industry to be affected by the tax. However, I do not think it essential--this is the key--to include such a rebate scheme in the Bill. The sustainability fund is in the Bill, and because how it will be used is not defined, it will be able to be used in a way that could include a rebate system.

Sir Robert Smith: Will the hon. Gentleman give way?

Mr. Levitt: I want to conclude, if the hon. Gentleman will excuse me.

I voted for this part of the Budget, and I shall vote for the Bill at the end of the Committee and on Third Reading, however much I think there are opportunities for improvement. The amendments before us today are at worst mischievous and opportunist, and at best--as in this case--premature and, hopefully, unnecessary. That is my objection to the amendment under discussion.

It is three years since the aggregates tax was first suggested, and a year before it is to be implemented. Now that the basic arguments against the levy have been lost and the Government have the backing of the House to proceed along the lines that they are, this is not the time to rock the boat. It is the time to tell Ministers that the

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tax is unpopular with large sectors of industry and the work force. The proposal assumes a starting point that all quarries are equally bad; it promises much to the green lobby without providing the capacity to deliver; and it is far from complete in terms of being a genuine and fair package of measures to balance the legitimate concerns on both sides of the debate. However, the opportunity for correcting those issues is still there.

The way in which the sustainability and environmental clauses relating to the aggregates tax will be implemented will be an essential factor in the way the Government's environmental record is seen. It is important to have a very strong environmental element in the Bill, and in the levy. We must recognise and reward those parts of the industry that have already gone down that road. Without my full enthusiasm, but in opposition to the amendment and in support of the Government's position, I hope, on balance, that the Minister will take the opportunity to redouble his efforts to find an environmentally acceptable way forward in co-operation with the industry.

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