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John Healey: I beg to move amendment No. 38, in page 5, line 10, leave out—

'the date on which this Act is passed'

and insert—

'such date as the Commissioners of Customs and Excise may by order made by statutory instrument appoint'.

Madam Deputy Speaker: With this it will be convenient to discuss Government amendments Nos. 39 to 41.

John Healey: Part of the Budget 2001 package that my right hon. Friend the Chancellor introduced to develop the

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green fuel strategy was the decision to introduce a 20p per litre duty incentive for biodiesel in the Budget 2002. The Government decided to delay implementation until this year because we recognised that we would need a derogation of the EU mineral oils directive before the new rate could be introduced.

Over the past year, we have worked to secure that derogation. Hon. Members will know that the process can be difficult and protracted, but we now expect to receive all necessary European clearance before Royal Assent, when the new rate of duty will come into force. The derogation received final approval from the EU Agriculture Council on 25 June, and is now in place. The new duty rate, therefore, awaits only clearance by the Commission as an allowable state aid. The Government expect that clearance in the next two weeks.

However, if for any reason Royal Assent were to occur before we have been given state-aid clearance from the Commission, the UK technically would be in breach of the treaty of Rome. The amendments are simply a sensible precaution against breaching treaty obligations, although we expect to get the required clearance before the date on which Royal Assent is granted.

Mr. Bercow: I think that the Economic Secretary has finished his speech on these amendments, so I shall ask a question to which I think hon. Members and people outside will be anxious to know the answer.

There is an implication that the Economic Secretary might be mistaken about when clearance might be received. That is not very likely: he seemed confident that the required dates will be met, but he admitted to the possibility that they may not. That is why the Government feel it necessary to protect themselves against a possible breach of the treaty. Will the hon. Gentleman describe the revenue implications if the date that he envisages is met, and also if there is a delay?

John Healey: We do not expect any Revenue implications. Should we not get final clearance from the Commission before the date of Royal Assent—we do not expect those circumstances—immediately we get that clearance, Customs Commissioners can sign into force this provision, and they will do so without delay.

Mr. Simon Thomas (Ceredigion): The speeches are so short I do not know whether they are interventions or speeches. Mine is a very short speech. I simply want to ask the Minister a question. I welcome what the Minister is doing—it is important to get that across. He obviously needs to make arrangements to be sure of compliance within Europe. Can he say something about the new biofuels that are being discussed at European level? Will that impact on the Government's planning? Will it be permissible for the Government to reduce the rate still further in future or, having agreed to this derogation—which we hope will be passed—does this now tie the Government's hands as regards any further reduction and support for biofuels in future Budgets?

John Healey: No, this does not tie the Government's hands. Any decisions that flow from this will be for the Chancellor of the Exchequer. I will stop now because I am in danger of straying well beyond the terms of a narrow technical amendment designed as a belt-and- braces job to make sure that the Government do not fall foul of the treaty of Rome.

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Amendment agreed to.

Amendments made: No. 39, in page 5, line 17, leave out—

'on which this Act is passed'

and insert "appointed under subsection (6)(a)".

No. 40, in page 5, line 26, leave out—

'that on which this Act is passed'

and insert—

'the date appointed under subsection (6)(a)'.

No. 41, in page 5, line 28, leave out—

'day on which this Act is passed'

and insert—

'date appointed under subsection (6)(a)'.—[John Healey.]

Clause 19

Vehicle Excise Duty

Mr. Bercow: I beg to move amendment No. 25, in page 13, leave out lines 41 and 42.

Madam Deputy Speaker: With this it will be convenient to discuss the following amendments: No. 26, in schedule 5, page 135, leave out from beginning of line 38 to end of line 2 on page 136.

No. 27, in page 136, line 4, leave out from "vehicle" to end of line 6.

No. 28, in page 136, line 8, leave out "or (1A)(a)".

No. 29, in page 136, line 14, leave out "or (1A)(b)".

No. 30, in page 136, line 20, leave out "or (1A)(b)".

No. 31, in page 136, line 25, leave out "or (1A)(a)".

No. 32, in page 136, line 28, leave out "or (1A)(b)".

No. 33, in page 136, line 31, leave out "or (1A)(a)".

No. 34, in page 136, line 35, leave out "or (1A)(a)".

Mr. Bercow: I am in the mood for brevity, Madam Deputy Speaker, as you have become aware over the past 24 hours. Other right hon. and hon. Members may wish to contribute to the debate. I should like to remind the Economic Secretary of the interest taken in this subject in Committee by my hon. Friends the Members for Christchurch (Mr. Chope) and for Arundel and South Downs (Mr. Flight). That interest was reflected in speeches from other political parties.

Our concern all along has been about the ambiguity, if not impenetrability, of clause 19 in its unamended form and of schedule 5. Specifically, we wish to see in the Bill, as my hon. Friends previously indicated, a declaration of a nil rate vehicle excise duty for vehicles that are neither used nor kept on the public highway. We do not dispute the need to charge back VED on things that may have been vehicles if, and only if, it can be proved that they were used or kept unlicensed at one time on a public road. The terms "unregistered" and "unlicensed" could be used to clarify what the Government are aiming at. Unless there is a specific declaration in terms in the Bill that people who are manifestly innocent cannot end up copping it simply because there is no one else able to foot the bill, the concern of reputable organisations will persist that

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there could be unintended consequences and financial penalty resulting from the way in which, no doubt inadvertently, the clause is drafted.

I am also aware, as no doubt other hon. Members are, that the Government have provided themselves with their old and favourite facility: the statutory instrument. If memory serves me correctly, they are in a position to proceed on this matter through their preferred route, the negative—as distinct from the affirmative—resolution procedure. While on the subject of ambiguity and impenetrability, I am conscious of a certain irony and I owe it to the House and, more important perhaps, to people outside the House, to underline the significance of the difference between the two.

3.15 pm

If there is an affirmative resolution procedure and the regulations, which in due course are forthcoming, are subject to debate on the Floor of the House, however inadequate and truncated that debate might be, we shall at least have the opportunity to see whether the spirit to which we think the Government during the Committee and Report stages have committed themselves, is reflected in the terms of the regulations. If, however, we are to be fobbed off—I hesitate to use that term in relation to the Economic Secretary, because he is a decent cove—with the negative resolution procedure, there will not be another opportunity to debate this matter and we have to take the Government purely at their word—the Government purely at their word in terms of what they say and of their capacity to ensure the equity as well as the intelligibility of the regulations.

Once again I therefore ask the Minister whether he recognises that there is a case for ensuring that only people who are guilty will face a charge and that those who have not possessed a vehicle for a long time and are thus in no sense liable for its current whereabouts will be faced with a VED charge back. That is what we want to know. It seems a reasonable request. It is not necessary to go to the wall on it, but I am not persuaded that my hon. Friends' efforts have met with the fair result that they wanted and that the Automobile Association and other organisations have a right to expect.

John Healey: The amendments would stop the registered keepers of vehicles which ceased to be mechanically propelled from being liable for their vehicle. That would not help to tackle the abandoned vehicles problem, but it would undermine the integrity of the vehicle database that we are seeking to reinforce, and the whole thrust of our policy that those who abandon their cars are more easily called to account and made to pay would be undermined.

The purpose of clause 19 and schedule 5 is to reduce the number of abandoned cars and to deal with VED evasion by improving the quality and integrity of the vehicle records that we keep through ensuring that the registered keepers retain liability for their vehicles until they notify the DVLA of a change in circumstances. Were the amendments successful, the registered keeper could abandon their vehicle and avoid their fiscal responsibilities for the vehicle simply by disabling it. That would not help us tackle the problem of abandoned vehicles but would undermine the thrust of our policy.

The hon. Gentleman was concerned, as he said in rather colourful language, about innocent people "copping it". The schedule already contains clear exemptions from the

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new offence of being the keeper of an unlicensed vehicle. These include circumstances in which the vehicle has been stolen, the DVLA has been notified of its disposal or that it has been scrapped, and the vehicle has been taken off the road and a statutory off-road notification has been made.

The schedule also allows for new exemptions to be made through secondary legislation if necessary. The hon. Gentleman might see this as a strength, rather than a weakness. It could be the outcome of the discussions and consultations that the Government are conducting with stakeholders, including the AA, on the best way to implement the provisions.

Let me again give the assurance that clause 19 and schedule 5 will not affect the current exemptions for pre-1973 vehicles and that the current system of statutory off-road notification will remain in place. On that basis, I ask the hon. Gentleman to withdraw the amendment.

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