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Finance Bill

The clause allows for changes to the system of taxing collective investment funds to be undertaken by regulation rather than by an Act. This morning, we had a written ministerial statement saying that the description of those regulations was being placed in the Library. If I said, ““Better late than never””, it would be an understated verbal act of kindness. It sounds again like a Government, and particularly a Treasury, who have two enduring characteristics—first, obsessive micro-management, and secondly, a lack of attention to detail or simple functional incompetence. All this was in the original Finance Bill and the Treasury has had plenty of time to come up with the details, but it has failed to do so in good time. Most of the changes in clause 18 are non-controversial, but we need to get to grips with Government thinking on some underlying issues. It may be constructive and informative if I pose Ministers a series of questions, on which I shall expand, to give them the opportunity to respond appropriately. First, can the Government give us a firm timetable as to when the regulations under clause 18 will be introduced, given the massive sum of UK funds under management that will be subject to those rules? Secondly, can the Government indicate the likely benefit of the proposed changes under the clause? Can they provide a cost-benefit analysis in the light of the uncertainty and the expensive system changes that fund management houses will have to make as a consequence of the changes? Lastly, for equity, open-ended investment company and unit trusts, will the Government indicate the moneys lost by UK pension funds due to the removal of the tax credit on distributions in 1997 and to what extent they blame the reduction in savings in ISA-style vehicles on that tax raid? On Second Reading last week, the two Liberal Democrat spokesmen went into the rather wild woods of vintage wine and property windfall taxes and clearly indicated that they wanted to examine clause 18 more fully. My hon. Friends and I and, I dare say, Members on the Treasury Bench are somewhat amazed that the Liberal Democrats felt unable, in view of what they said last week, to table any amendments to clause 18. The contrast between us and them says it all.