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Lord Goodhart: Before the noble Lord sits down, perhaps I can ask him this. Obviously what will happen is that the Finance Bill will be enacted in July 2000 and will take effect retrospectively to 6th April. The modifications to the NIC rules under subsection (9) therefore cannot be made until after 6th April because there will not be anything to align with at that stage. Is the Minister satisfied that subsection (9) gives power to the Treasury to make regulations having retrospective effect?

Lord McIntosh of Haringey: That was my understanding, but if I am wrong I shall write to the noble Lord.

Lord Goodhart: It will be necessary for them to have retrospective effect.

Lord Higgins: I expected the noble Lord, Lord Goodhart, to dispute the point made by the Minister as to whether or not the contributions were a tax since it is a clear policy of the Liberal Democrats to say that they are. However, I am grateful to the Minister for clarifying the situation. As I understand it, there will be a corresponding set of clauses related to the tax aspect of this matter in the Finance Bill next year.

Having said that, the reality is that the Treasury has taken over the Contributions Agency and the provisions the Minister mentioned now seem somewhat anachronistic in this context in as much as the Treasury seems to be taking over more and more of the department. However, in the light of what he said, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

On Question, Whether Clause 70 shall stand part of the Bill?

Lord Higgins: This has been a helpful, if at times rather technical, debate. The Minister has taken a conciliatory attitude. In particular, he has given us an assurance that we will return to the matter on Report in the light of discussions which are taking place with the various interest parties. It is quite difficult to discuss this kind of issue in Committee. The preparatory work which the noble Lord has suggested will certainly be welcomed, albeit it is taking place rather late in the day.

It is clearly the Government's intention that such provisions should not adversely affect legitimate service companies, which are not designed for tax avoidance.

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Indeed, if that is not so, the danger is that yet another so-called "stealth tax" will be imposed, which will have an adverse effect on business. That will be in addition to the very considerable burdens which administration of such a situation is likely to create if the Government do not succeed in narrowing down the definition of companies which are clearly avoidance vehicles in the way that all of us on all sides of the Committee would wish to see. We welcome the Minister's assurances and look forward to debating the matter further on Report in the light of those discussions.

Lord McIntosh of Haringey: If it would be helpful, I should like to suggest that, as soon as we have our response to the consultation ready and even if it is during the Summer Recess--in other words, before the House returns in October--we could seek a meeting with everyone who has expressed an interest in this subject to see whether we can find a mutually convenient time when we can all sit down together and have a seminar. If noble Lords would find it helpful, I would certainly be willing to return to the House when it is not sitting for that purpose.

Lord Higgins: That seems to me to be an extremely helpful suggestion because the matter is of considerable importance to industry. It is important that we should get it right. We may, of course, be under some time constraints when we return as regards the spill-over. Therefore, if we can be clear in advance about what are the outstanding issues between us, if any, that would be helpful. Speaking for myself, I would be happy to co-operate with what the Minister has suggested.

Clause 70 agreed to.

[Amendments Nos. 141 not moved.]

Clause 71 [Earnings of workers supplied by service companies etc: Northern Ireland]:

[Amendment No. 141A had been withdrawn from the Marshalled List.]

[Amendment No. 141B not moved.]

Lord Higgins moved Amendment No. 142:


Transpose Clause 71 to after Clause 73

The noble Lord said: This is the transpose clause. Unfortunately, I was not quick enough a few moments ago. I said "not moved" when Amendment No. 141 was called. Quite clearly, in the light of the speed with which Clauses 70 and 71 were introduced, it seemed to us that they ended up in the wrong place. In fact, Chapter II of Part V of the Bill starts with Clause 68, which deals with new thresholds for primary Class 1 contributions and Clause 69, which deals with the same thing for Northern Ireland. We then have the two clauses that we have just discussed, followed by Clauses 72 and 73 relating to Class 1B contributions both here and in Northern Ireland.

Therefore, it seems to us that Clauses 70 and 71 were put in the wrong place and that they really ought to have been placed at the end of the chapter. However, having said that, I hesitate slightly to move such amendments and press them because Clause 70 is now such a

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notorious clause that, if we renumbered it, we might cause great confusion outside. So I do not propose to move this amendment--

Lord McIntosh of Haringey: If the noble Lord does not mind, I would prefer him to move the amendment so that I may say a few words in response.

Lord Higgins: I understand that the Minister wishes to respond. In that case, perhaps we may delay the proceedings for a few moments to allow him to do so. I beg to move.

11 p.m.

Lord McIntosh of Haringey: I can be brief. The placing of the clause in the Bill is done on the advice of parliamentary counsel. I certainly never had the courage to question parliamentary counsel's judgment on these matters. No doubt the noble Lord did so constantly when he was in office. Clauses 72 and 73 are minor clauses. It is appropriate that they should come last in this chapter.

Lord Higgins: I fully accept that. My recollection mostly is that parliamentary counsel--we may have had a heavier legislative programme--were paid vastly more than us but had more frequent nervous breakdowns. But be that as it may, I accept the point that the noble Lord has made. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clauses 72 and 73 agreed to.

Clause 74 [Measures to reduce under-occupation by housing benefit claimants]:

Baroness Buscombe moved Amendment No. 143:


Page 80, line 29, at end insert--
("(d) for ensuring that, in relation to a housing benefit claimant who is disabled, due account is taken of his need for additional space, including an extra bedroom for a carer.")

The noble Baroness said: This amendment is intended to protect the interests of those individuals who are in receipt of housing benefit, who are disabled and who require the support of a carer in their home. Clause 74 will enable the Government to make regulations that will establish a pilot scheme under which tenants in the social rented sector who are under-occupying their homes and who receive housing benefit will receive a financial incentive to move to smaller and cheaper accommodation.

The financial incentive will involve those tenants being rewarded with a lump sum payment equivalent to half the difference between their old and new weekly rent, multiplied by 156. While broadly supporting this proposal, in moving this amendment we look to the Government for reassurance that they will take adequate account of individual circumstances, and in particular circumstances whereby a claimant has need of a carer, in which case additional space is assured for that carer, including an extra bedroom for that carer.

A carer's role is recognised through the invalid care allowance. In many situations where claimants are in receipt of that allowance it is necessary for the carer effectively to live in. We believe that it is tremendously

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important to protect the ability of that carer to be able to live in in a separate room and to be able to rest and recuperate as and when relief from the caring allows. I believe that the wording of the amendment speaks for itself. I beg to move.

Baroness Hollis of Heigham: I recognise that this amendment aims to protect disabled people by ensuring that their needs are taken into account in the under-occupation scheme. I should mention that the same amendment was debated in the other place and my honourable friend Mr Hugh Bayley reassured honourable Members that the amendment was not necessary, whereupon Mr Quentin Davies withdrew his amendment on the grounds that the Minister had given,


    "the clear assurance that we wanted".

Therefore I am a little surprised that the amendment was retabled as all I can do is to give the same assurance as has already been given by the Minister in the other place. Therefore I do not think that this amendment is necessary.

However, I am happy to repeat the speech of my honourable friend Mr Hugh Bayley, who said that some disabled people have a requirement for additional space arising from, for example, a carer who resides with them and that the scheme will take that into account, including the needs of other people who may need additional rooms, such as parents with children who come home at weekends. People will gain from the scheme even where they require additional space as long as the overall size of their new home is smaller than their old. For example, a single disabled person living in a four-bedroom house could move to a two or even a three-bedroom house and still be entitled to a payment under the scheme. He or she would not be required to move to a one-bedroom flat.

I hope that in the light of that reply the noble Baroness will appreciate that her amendment is unnecessary. The scheme is also, of course, entirely voluntary. No one will be forced to take part and no one will receive less benefit if they do not move. It is up to them. I hope that the noble Baroness will agree that the amendment is unnecessary and will withdraw it.


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