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Lord Higgins: My Lords, I am grateful to the noble Lord for giving way. What he says is true as regards insurance, but there is a crucial difference between a national insurance contribution and a tax. Paying your taxes does not entitle you to any specific benefit, but paying a national insurance contribution does. Until now, and subject to the erosion of the principle by the present Government that has been the case.
Lord Goodhart: My Lords, that has not been the case. For instance, it occurred not only under the present Government in relation to widows' benefits, but it happened twice under the previous government in
I welcome the Minister's statement that the process of alignment will continue. I should like that process of alignment to proceed to the point of open recognition that national insurance contributions are indeed a tax. If the Government were to replace SERPS with a compulsory funded second-tier pension--as we believe they should and we will hear soon whether they plan to do so--we can open up the argument as to whether we need to keep contribution records at all. That would lead to a substantial saving in administrative costs. It would provide help to those who do not have a full contribution record; for example, because their earnings are below the lower earnings limit or because they are women who do not qualify for home responsibility protection. It would greatly simplify record-keeping for employers which, as the Minister conceded, the present proposals do not.
However, it must be said that those are issues for another day and for another Bill. They cannot be included in this Bill. Having gone through the argument on Second Reading, it would not be appropriate to bring it back at a later stage in the Bill. For today, I am happy to say that Part I is a sensible and practical step in the direction in which we would wish to go.
I turn to Part II. When the Social Security Act 1998 was going through this House, we welcomed the fact that for the first time there would be an independent tribunal for deciding questions about contribution payments. However, the Social Security Act provided that contribution questions should go to the social security appeal tribunals. Many people, including members of the Tax Law Review Committee, felt that that was the wrong tribunal and that the proper tribunal was the Commissioners for Income Tax. The reason for that view is that contributions questions are very different from most questions decided by the social security appeal tribunals. The vast majority of the questions decided by that tribunal will concern right to benefit or disputes as to the amount of benefit to which somebody is entitled. Those questions are entirely different from questions related to liability to pay contributions.
However, contributions questions and income tax questions are often similar or identical. As the Minister pointed out, the question whether an earner is an employee or self-employed will decide whether he or she pays tax under Schedule D or Schedule E; it will decide whether the PAYE system is applicable; it will decide whether the individual pays contributions as an employee or as someone who is self-employed; and it will decide whether there is an employer who is liable for the employer's contributions. It is obviously right that there should be a single tribunal which decides whether an earner is an employee or self-employed for both tax and national insurance.
As the Minister mentioned, we raised this issue by amendments in Committee on the Social Security Act. The Government replied encouragingly. They gave an undertaking that the matter would be reviewed in the light of the proposed transfer of functions which is taking place in the Bill. The Government have made good their undertaking and I can therefore give a very warm welcome to Part II.
I have only one doubt about Part II, which is technical. I understand from paragraph 170 of the Explanatory Notes that the effect of Clause 15 is that decisions on the contracting-out of SERPS by occupational pension schemes will be taken by an officer of the Inland Revenue, but appeals from that decision will go to the social security appeal tribunals rather than to the commissioners for income tax. At first sight, that seems rather odd. The Government's explanation is that it will enable pensions experts to sit as members of the social security appeal tribunals. My view is that while contracting-out issues are unsuitable for the general commissioners of income tax they would be entirely suitable for the special commissioners.
The commissioners decide questions relating to pensions; for instance, a question as to whether a scheme satisfies the conditions for approval under Section 590 of the Income and Corporation Taxes Act would go to the commissioners. Special commissioners are used to dealing with questions of great complexity and technicality and are perfectly capable of handling contracting-out cases. I believe that that is the tribunal to which the contracting-out issues should go, together with other contributions questions.
Although I said that that was the only point that I wished to raise, I am not giving an undertaking that at a later time I shall not find other points to raise. Indeed, I have not yet received a proper briefing from the Tax Law Review Committee, which may have other points it wishes me to raise in Committee. But that is all that I wish to raise for the time being.
I conclude with two comments. First, like the noble Lord, Lord Higgins, I found the new Explanatory Notes extremely helpful. They are a most desirable innovation. Secondly, I welcomed the meeting with the Minister and several civil servants from the DSS and the Inland Revenue in the Moses Room last week. It was most helpful and it satisfied me on two or three other issues which I might otherwise have had to raise in the course of debate. In extending a welcome to the Bill, I hope and expect that the remaining stages will not detain us for too long.
Lord Hunt of Kings Heath: My Lords, before we move to the Statement on tobacco, I would like to take this opportunity to remind the House that the Companion indicates that discussion on a Statement should be confined to brief comments and questions for clarification. Peers who speak at length do so at the expense of other noble Lords.
The Parliamentary Under-Secretary of State, Department of Health (Baroness Hayman): My Lords, with the leave of the House, I would like to repeat a Statement made in another place by my right honourable friend the Secretary of State for Health. The Statement is as follows:
"And it is a deadly habit. Out of 1,000 20 year-olds who smoke regularly, one will be murdered, six will die in road accidents, 250 will die in middle age from smoking and a further 250 will be killed by smoking later in life.
"Smoking does not just cause lung cancer, it causes cancer of the mouth, the larynx, oesophagus, bladder, kidney, stomach and pancreas. Smoking causes one in seven of deaths from heart disease. Smoking is very high among people who are severely mentally ill.
"Smoking is now the principal avoidable cause of premature deaths in Britain. It hits the worst off people hardest of all. Smoking is one of the principal causes of the health gap which leads to poorer people being ill more often and dying sooner. Smoking harms people who do not smoke. Smoking harms babies in the womb.
"These are all good reasons why this Government are so determined to turn things round. We cannot possibly achieve the reductions everyone wants to see in deaths and illness from cancer and heart disease unless we tackle smoking.
"Unless we reduce smoking we cannot reduce the inequalities in health which bear down most on the worst off. We want to help existing smokers quit the habit and help children and young people not to get addicted in the first place.
"We face an uphill struggle because the tobacco companies are committed to doing everything they can to promote the sale of cigarettes. That is because they have to keep recruiting new smokers to make up for the 120,000 of their own loyal customers they kill off every year.
"Most smokers take up the habit when they are children or young people. Few people start smoking once they are grown up. For years, the tobacco industry has poured millions into highly sophisticated advertising campaigns. People of all ages, including children, have been exposed to clever and eye-catching advertising material.
"This White Paper spells out the measures which will be targeted on children to protect them from being exposed to tobacco promotions. It will require a sustained effort over a long period. Some benefits will not show up for decades, but unless we act now they will never show up.
"From 1989 up to the last general election the previous government had helped block all European efforts to ban tobacco advertising and sponsorship. We changed that. We put Britain's full weight into getting a European directive through. We succeeded.
"As a result a Europe-wide anti-smoking framework is in place. We now propose to end tobacco advertising on billboards and the printed media in this Parliamentary session. Most tobacco sponsorship will end by the year 2003. Formula 1 motor racing, as a global event, may qualify for exemption to the year 2006 if, and only if, tobacco sponsorship funding and advertising are already being reduced.
"The tobacco advertising ban will be backed up by an anti-smoking campaign. Over the next three years we will be putting £50 million into an anti-smoking campaign. We want to make sure that children and young people no longer fall into the trap of seeing smoking as cool and a passport to adulthood.
"It is illegal to sell cigarettes to children under 16. This law is very frequently broken. We are taking action to increase compliance with this law by shopkeepers and to promote more effective action by trading standards officers.
"Some individual shopkeepers and others knowingly and repeatedly flout this law. To deal with repeated offenders we propose to introduce a new criminal offence and we are looking at the practicalities of such a measure.
"Following discussions with my officials the National Association of Cigarette Machine Operators are issuing new rules on the siting and operation of cigarette vending machines to make them inaccessible to children.
"We have also been encouraging the companies who sell age restricted goods such as alcohol, cigarettes and fireworks to develop an industries-wide 'proof of age' card. This package should make a real impact on the illegal sales of tobacco to children: the tobacco advertising ban, the £50 million anti-smoking campaign, the crack down on sales to children, a new
"Then there are the people who are smoking already. Every 10 years more than 1 million British people get killed by smoking. Most of the millions who will be killed by tobacco over the next few decades are already adult smokers. Most smokers say they want to stop, and these are the people that we particularly want to help.
"If they keep on smoking there is a 50-50 risk that they will eventually be killed by their habit. Yet if they stop smoking before they get ill then they will avoid most of that extra risk of death. So it is really worthwhile for people to quit smoking.
"As part of our effort to help those seven out of 10 adult smokers who want to quit we are investing up to £60 million in the first ever comprehensive NHS service to help them give up their addiction. This will involve all health professionals--midwives, health visitors, doctors, nurses, pharmacists and dentists, all taking every appropriate opportunity to counsel patients to give up smoking.
"This effort will be particularly targeted on smokers living in those deprived areas which have been chosen as health action zones. We will encourage the use of nicotine replacement therapy (NRT) again especially targeted on health action zones where free NRT products will be available for the worst off. Health improvement programmes in every part of the country will be expected to address the need to reduce smoking in the worst off areas.
"These and other measures set out in the White Paper amount to a formidable plan of action to stop children from taking up smoking and to help existing smokers to quit. To achieve this we will need to counter the efforts of the tobacco companies. There is evidence to show that for most of the last 20 years they have been planning to counter the loss of sales which might follow an advertising ban.
"That time has now arrived so we can be assured that they will be well prepared. As I speak, I am certain that executives in the tobacco industry will be planning their strategy to keep up tobacco sales. We have got to get ahead of the game. That is all the more reason why everyone who cares about the health of the nation should work together to support this strategy and I am confident that everyone who cares about the health of the nation will do so".
Earl Howe: My Lords, as ever, I am grateful to the Minister for repeating the Statement. I wish to say at the outset that there is much in it that we can welcome. I shall comment on those sections of the Statement which are less palatable to us on this side of the Chamber. The
Smoking is the single most important cause of premature death in this country, accounting for, as I believe the Minister said, 120,000 deaths every year. The avoidance of smoking would eliminate one-third of the cancer deaths in Britain and one-sixth of deaths from other causes. However, the recent trends in smoking prevalence are of particular concern. Looking at the graph of the number of adult smokers, one can see that the downward curve, seen since 1972, was reversed in 1996.
Among young people the trend has been upwards for a much longer period. That is extremely worrying. We know that almost all smokers start to smoke as children or young adults. We also know that the health warnings, while they are known about and understood, are simply ignored as irrelevant by most young smokers. At the same time, it is clear that a variety of factors influence the take-up of smoking in younger age groups: for example, parental attitude, peer pressure and, not least, the price of cigarettes. Therefore, we understand the Government's view that only a concerted and sustained government campaign is likely to stand any chance of shifting attitudes and behaviour among smokers, and especially among young people.
Let us look at the ingredients of the campaign and specifically at the proposed ban on tobacco advertising and sponsorship. I have always been sceptical about a compulsory ban. I say that for a number of practical reasons. The first is, paradoxically, that a ban may turn out to be counter-productive. If different brands are prevented from competing with one another through advertising, then they are likely to try to compete in the other obvious way; that is, through price.
We know that cigarette consumption is extremely price-sensitive. It has been shown to decrease by 0.5 per cent. for every 1 per cent. increase in the retail price. That effect, not surprisingly, is greater in the low income groups. There must therefore be a real concern that more intense price competition will start to occur and will actually drive up the number of cigarettes consumed.
The second feature about advertising which will be lost with a ban is that one important way of encouraging smokers to switch from strong brands to less harmful ones--that is to say, the low tar varieties--will disappear. That seems perverse. Aside from saying that they want smokers to give up the habit altogether, what is the Government's answer to that point?
I worry too that it will be all too easy for the tobacco companies to drive a coach and horses through the legislation. I do not know how many of your Lordships have travelled on the London Underground in recent days. There is a prominent advertisement in many stations for a certain brand of cognac. It depicts a glamorous and sophisticated-looking young lady holding a smoking cigarette. If the tobacco companies are looking for a way of glamorising the activity of smoking, they need look no further than that. But it is not as such a cigarette advertisement.
While I have no evidence to suggest any involvement by the tobacco companies in that poster, how do the Government feel it will be possible to stop tobacco companies taking advantage of that type of opportunity in the future by, as it were, piggy-backing on other products? For all those reasons we strongly question the wisdom of a compulsory ban on tobacco advertising and would have preferred to see an extension of the voluntary approach. However, I have a specific question for the Minister on that aspect of the White Paper and it relates to the withdrawal of tobacco sponsorship. Tobacco sponsorship will need somehow to be replaced if a number of sports are to continue in their present form. What proposals do the Government have to assist those sports in obtaining alternative sponsorship?
We welcome the emphasis placed on encouraging smokers who want to quit the habit. Nicotine patches are an obvious way to do that. However, there is an interesting aspect to the Government's proposals. The Minister said that free NRT (nicotine replacement therapy) products will be available for the worst off. I have no quarrel with the idea of promoting NRT products. But what does the proposal say about the Government's publicly stated and oft repeated policy towards the health service? If they make a nicotine patch prescription available free to those on a low income and do not make it available to anyone else, does not that amount to the introduction, for the first time, of a means test for prescriptions? How much further down that road do the Government intend to travel?
Looking at the issue from a broader perspective, do the Government agree that this is a classic example of how community pharmacists can play a part in preventive help, advice and treatment? Research indicates that a smoker has a one in 100 chance of a successful cessation of smoking using willpower alone. Quitting with informal support increases that to one in 20; using NRT doubles the chances of success but if professional counselling is given as well--for example, from a pharmacist--in conjunction with NRT, that can increase the success rates to better than one in four. To my mind that is a powerful argument for looking to the local pharmacy as an important means of delivering the Government's targets.
Perhaps I can turn briefly to smoking in the workplace. Can the Minister be a little more specific about what the Government intend under the code of practice? If its force under the Health and Safety at Work Act is to be as robust as the White Paper suggests, it would appear that businesses will ignore it at their peril. Will the code require companies to create smoking areas in the workplace if smoking is to be allowed there at all? If there is to be any suggestion of compulsion for employers to alter their workplace premises, can the Minister confirm that that would be the subject of primary legislation to give the opportunity for a full and proper debate on the matter? Will all workplaces be affected by this legislation?
Finally, it would be helpful to understand what targets the Government have in mind to judge the success of these measures. Can the Minister say what percentage drop in cigarette consumption over whatever period of time she chooses to take, is envisaged as a result of the measures announced today?
Lord Clement-Jones: My Lords, I too thank the Minister for making the Statement today and warmly welcome a great many aspects of it. On these Benches we wholly accept the medical evidence which shows that there is an increased risk of disease not only through smoking, but also through passive smoking. That was demonstrated by the report of the Scientific Committee on Tobacco and Health which reported earlier this year and also the recently published WHO multi-centre research into the effects of environmental tobacco smoke which your Lordships may recall was the second largest study ever carried out on the subject. That shows quite clearly that there is a risk equivalent to the death of several hundred lung cancer deaths a year in the UK as a result.
As the Minister pointed out, significantly associated with passive smoking is sudden infant death syndrome, heart disease in adults and respiratory illnesses and asthma in children. We particularly welcome the proactive stance of the Government towards the European directive and of course that is in sharp contrast to that of the previous government.
However, there are some areas of concern in the Statement and in the White Paper. One of the areas your Lordships may recall which the BMA raised in recent weeks is the whole question of regulation of nicotine content. It is clearly vital to reduce the nicotine content of cigarettes. They must be manufactured to be less addictive. On these Benches we support the BMA's call for an overhaul of the regulatory framework in that respect. We must also deal with misleading labels and additives.
We need the Government's commitment in relation to raising the price, in particular the duty, on cigarettes. We are not quite clear from the wording of the White Paper whether it is an unequivocal commitment to raise the price year by year or simply a general statement of intent.
As regards the methods of marketing in the third world, clearly they must be regulated. We note the Government's strong support for an international framework convention by the WHO and welcome that. But we note also that the Statement said that it was likely to be brought forward to the World Health Assembly in 2003. Is there any way in which we can bring that forward earlier? Clearly international action in so many of these areas is the only way forward.
We also note the code of practice proposed for the workplace, to be introduced on a voluntary basis. Although the Government clearly trailed their coats in terms of a ban on smoking in the workplace, no doubt many people have been surprised by the eventual conclusions. We believe, unlike the noble Earl, Lord Howe, that the ban should have real teeth and that if it does not work on a voluntary basis enforced by the Health and Safety Executive then eventually a complete ban on smoking in the workplace may be necessary. For pubs, restaurants and so on, we agree with the voluntary approach and we made that quite clear in the previous debate on the subject in October. We believe that we should effectively outlaw smoke and not the smoker but, as part of that, we insist on the ability to segregate and to have adequate ventilation. We believe that the voluntary code should make that quite clear.
We commend the Government's approach, in public health terms, of setting very clear targets for smoking cessation. This is absolutely vital, as Sir Donald Acheson made quite clear in his recent report, to combat health inequalities. This must be reflected through health improvement programmes, health promotion and so on, but it must be put explicitly in the national priorities guidance. We do wonder whether some of those targets themselves are quite strong enough, in view of the recent take-up rise in smoking by the young. We believe that the target of a decrease from 13 per cent. to 9 per cent. over 12 years is rather too modest. One can argue about those targets over a period of time but they must be reflected in health improvement programmes.
It is particularly vital that pregnant women should be discouraged from smoking because, as we know and as Sir Donald made quite clear, smoking leads to low birth weight in children, a failure to thrive in early childhood and also to glue ear. Clearly we need education through the midwifery health visiting services, as recommended by the Scientific Committee on Tobacco and Health. We welcome the Government's statement of intention in that regard, but again the White Paper is not absolutely specific. What are the specific intentions of the Government as regards making that information available through the midwifery and health visiting services? We need strong campaigns directed at young people, as both the Minister and the noble Earl, Lord Howe, mentioned. It is particularly worrying that one-third of teenagers now smoke, and we know there has been an increase in the numbers of young women who smoke.
We welcome initiatives like the Respect Roadshow which ran in May but we ask what will be done on a continuing basis. It is important that any such campaigns are properly evaluated. For example, how far is the Department of Health exploring the possibilities of peer group education, where young people can communicate with each other about the problems associated with smoking, in a way similar to drug-education campaigns?
We welcome the additional expenditure announced by the Minister today. Currently, only something like £6.5 million is spent on education as regards smoking, compared with the costs of smoking-related diseases for the NHS, which is estimated to be between £1.4 billion and £1.7 billion, so the rise from £6.5 billion to £50 billion is, in our view, a significant increase.