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Finance Bill

I shall speak for a far shorter time than I did when you allowed me to continue for longer yesterday evening, Sir Alan. I think it is rather touching that we in this House believe that our debates that take place a few days before elections will shift large numbers of votes. I am sure that that is why this particular aspect of the Bill has been brought to the fore in the Chamber this afternoon. I fear, however, that our conversation is not being as closely watched by people across the capital city as we might wish. I share the distaste expressed from the Conservative Front Bench for some of the more extravagant spending priorities that the current Mayor of London has indulged in during his period in office, although I do not share the Conservatives' enthusiasm for their candidate, who has failed to put forward a persuasive case for his election. Let me, however, return to the topic of severance payments. We think it is reasonable for there to be a package in place for a person who has served a period as an elected politician in this country—that rule also applies to Members of this House. There is a lack of clarity, however, on the wider point of the taxation of severance payments, where a distinction is made between the treatment when that is a one-off redundancy payment that does not attract tax below the £30,000 level, and the contractual payments when there is a tax liability. A concern has been expressed to my colleagues and me that Her Majesty's Revenue and Customs does not always act within the spirit of the rules. This is meant to be a one-off payment that softens the burden of redundancy, allowing people to make some provisions for seeking alternative employment and to pay the bills during that transition period. However, it is said that HMRC looks at it as an opportunity to raise revenue—and just at the point when people often require a bit of breathing space to get their financial affairs and working lives back on track. That is a rather aggressive way of trying to raise what is a fairly small amount of money.