Financial Services and Markets Act 2000 (Regulated Activities) (Amendment)(No. 2) Order 2006

My Lords, it is literally a year and a week since we debated the primary legislation from which this order flows. The Minister’s description of its purpose brought back memories of that happy time. The noble Baroness has just made a point about timing. I have some sympathy with her, not least because there is evidence that some providers have been waiting for these regulations to come into effect before deciding to offer products to the market. These are useful products for a lot of people, so urgency would and should have been of the essence. However, we are grateful that the regulations are now before us and that they are coming into force reasonably quickly. It is also pleasing to note that the likely cost of introducing and managing the order is less rather than more than was envisaged. The figures that were bandied about were very high, so I am particularly pleased. Without going into the minutiae of the new computer programmes or whatever would be required, it seemed to me that this would be a big barrier to entry for many providers. I think that during the previous debate we were talking of costs of more than £400,000 for a regulated firm. I should welcome the Minister's view on the press speculation that these products might serve as a form of inheritance tax avoidance. Under these provisions, a person could sell a half or two-thirds of a whole house and at that point distribute the income to his heirs and successors but, at the point of death, he would not have ownership of the assets. Subject to the seven-year rule, this might be a rather crafty way of avoiding inheritance tax. It seems to me that the innovation used by—I shall not say ““the accountancy profession”” in present company—the markets for providing people with ways of avoiding inheritance tax knows no bounds. I wondered whether this issue had crossed the Treasury's path, whether the Treasury thought that it was likely to be significant and, if so, whether it had given any thought to the potential leakage of revenue that might flow from it. Subject to that question, we remain as supportive of this measure as we were a year and a week ago.