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Finance (No. 3) Bill

My Lords, as I have said, and as the noble Lord recognises, the money is available and the Government are encouraging not just local authorities but all public sector bodies to stick to the rule that has been applied to central government employees. The noble Lord, Lord Sheldon, drew attention to another important area; that of an ageing population and its complexities that cut both ways, as he explained. My noble friend Lord Northbrook brought us back to one of the key points, for which I am grateful to him, on the Budget that has pro-business tax changes as central to it. In the middle of the debate, we had an interesting sub-debate around the importance of marriage and the family. Points were raised by the noble Lords, Lord Anderson of Swansea and Lord Browne of Belmont, and my noble and learned friend Lord Mackay of Clashfern. We are keen to send a clear message that family and marriage matter and that strong and healthy families help to create a strong and healthy society. In a little over a year, this Government have proved their determination to tackle the wider issues that can affect family stability. We have made great strides in improving outcomes for families, particularly those on low and middle incomes, through our work on welfare reform. Furthermore, the universal credit will ensure that people will generally keep more of their earnings for themselves and their families than is currently the case. However, we need to be realistic. It is not fiscally practical to introduce a transferable personal allowance for married couples at this stage. Having said that, our commitment remains clear. We then had some interesting discussion referring specifically to the Economic Affairs Committee report, and I am grateful to my noble friend Lord, MacGregor of Pulham Market, not only for chairing the committee but for drawing out some of the critical points from the report. I am grateful to him and to my noble friend Lord Tugendhat for their general welcoming of the Government’s new approach to policy-making. I shall respond to a couple of areas that were specifically raised, such as disguised remuneration. HMRC had indicated through its Spotlights publication, in particular, that these schemes were generally not effective. The Government decided to publish draft concert legislation for consultation at the same time as introducing proportionate anti-forestalling rules, with effect from 9 December 2010, because we saw that as the best way of combining the necessary tackling of an exceptional situation, to take the phrase of my noble friend Lord Tugendhat, with an ability to consult on the rules. I am grateful to the various noble Lords who talked about the road map on corporation tax. The noble Lord, Lord McFall of Alcluith, drew attention to it, and I agree with him that corporation tax reform is not just about cutting the headline rate, which is why in the broader package we are looking at such critical things as the patent box, the treatment of intragroup dividends, and so on. Also in the report, the question of evasion came up a number of times from my noble friend Lord MacGregor of Pulham Market. The noble Lords, Lord Bilimoria and Lord McFall, welcomed the £900 million of additional resources. HMRC is taking this very seriously. The noble Lord, Lord Davies of Oldham, is incorrect in his understanding. HMRC is increasing staff to tackle avoidance, evasion and fraud by around 2,500 full-time equivalent staff by 2014-15. It will consider the benefits of publishing a more detailed document, setting out its approach to evasion later in the year. It is getting late and I should and will conclude. As noble Lords are aware, this Government came to power inheriting the largest peacetime deficit in the nation’s history and an economy on its knees. We have taken difficult decisions in our two Budgets to date to tackle this dire inheritance, eliminate our structural current deficit over the coming four years and stimulate a private sector recovery. This strategy has been endorsed by the IMF, the OECD, the European Commission and UK business organisations. Of course, we have always said that recovery would be choppy. Our plans necessarily incorporate a degree of flexibility through the automatic stabilisers to allow government spending to move up and down with the economics cycle. This Bill further delivers our commitment to improve our competitiveness, encourage investment and support our businesses. At the same time it removes hundreds of thousands of individuals from income tax and helps reduce the cost of living for families across the country, and it makes these changes in a way that is fairer and more consultative than any previous Finance Bill. I commend the Bill to the House. Bill read a second time. Committee negatived. Standing Order 46 having been dispensed with, the Bill was read a third time and passed.