Finance Bill

In the previous debate I was inaccurately accused of taking insufficient interest in the details of the Bill. Here I am now, but my detractors have left to discuss other matters elsewhere, which I regret. Although this does not at first sight appear to be a box office string of amendments, it is quite significant as it deals with the balance between the powers of the state and the liberties of the individual citizen. PricewaterhouseCoopers, which obviously follows these matters closely, has described the proposals that we seek to amend this evening as"““the most fundamental changes to HMRC's ability to inquire into direct tax returns since 1976””." A series of different Acts, including the Taxes Management Act 1970—the year in which I was born—and the Finance Act 1998 has been scrapped and a new framework for governing the practices of Her Majesty's Revenue and Customs, augmented by further published guidance, has been put in its place. Members of all parties would recognise that HMRC has an important job to perform. It has a duty to collect on behalf of the Government the taxes that this Parliament has decided to levy on the people of this country. We would not, of course, enjoy the public services and other aspects of public expenditure if that task were not performed collectively on behalf of us all, so I am not in the business of running down HMRC. It has an important job to do; nobody likes paying taxes, but I observe that nobody likes the withdrawal of the public spending consequences either. We thus owe a debt to HMRC for undertaking what is not always the most popular work on our behalf. There will be occasions when HMRC detects behaviour that is either consciously fraudulent or, in some cases, not fraudulent but where the individual is not paying a level of tax that is deemed, on further inspection, to be appropriate and necessary. Up to a point, HMRC needs powers to probe the private affairs of individual citizens, but legitimate concerns have been expressed by many representative bodies that those powers have become excessive. HMRC's website claims that"““the Review of Powers is committed to consulting widely at each stage in the development of policy and legislation””," but many feel that the Government have ignored wider stakeholder reservations about the Bill. I made the point in Committee that the consultation period ended on 6 March, but the details of the proposed changes were announced in the Budget of 12 March. Although I have never worked in the Treasury, I suspect that many of these matters were decided not in the final few days, but many weeks earlier. A number of professional bodies share my suspicion that many of their representations were overtaken by the considerations and deliberations of the Treasury and that the consultation process was not as comprehensive or as ““listening”” as it might have been. The Liberal Democrats have tabled new clause 19 and amendment No. 8, which I propose to discuss in reverse order. I said during the debate on the previous group of amendments that when the history of this Prime Minister's time in office comes to be written, the feature of his premiership that will attract the greatest degree of criticism will probably be the doubling of the 10p tax rate and the wrath that it incurred among the electorate. Another contender for the moment that inflicted the greatest damage to the Prime Minister's reputation, however, is an action that was not specifically within his control but that summed up for many people the accident-prone nature of his premiership—the loss of data on 25 million of our citizens when two tax discs went missing. It is important that we recognise the seriousness with which our fellow citizens take the need to protect their individual data and private information. As with medical records—and, of course, the Government are enthusiastic about introducing ID cards—more and more of our individual data, which can be sensitive and private, is being stored electronically and centrally. If we think back to 10 or 20 years ago, it would have been difficult to distribute personal data about 25 million people—even if one sought to do so—without lorry loads of couriers to take the information to the required destination. Nowadays, all that can be sent on CDs or at the press of a computer button. Understandably, people have come to rely on the efficiency of data transfer, which is also hugely important in any modern economy, but, at the same time, people are concerned about how good the safeguards are to protect their confidential affairs. Amendment No. 8 would prevent clause 112 from coming into force until"““a review of the ability of HMRC to secure electronic documentation””" had been undertaken and approved by the House. I appreciate that the Government are already trying to make progress in that regard, that the Chancellor has come before the House to make statements and that other Treasury Ministers have spoken, so all parties recognise that the subject is serious. The amendment would, however, give a firmer and more formal standing to that process and allow the elected Chamber of the UK to debate, discuss and, ultimately, approve the actions taken by the Government to make improvements. New clause 19 is probably more significant, as it is designed to put a charter into law. Of course, charters were very fashionable in the 1990s; I remember them covering all sorts of areas, some more important than others. This provision is a bit of a return to those days, when the Government were crumbling and defeat looked inevitable. The charter under discussion seeks to ensure that the rights of the individual citizen are protected when they are dealing with HMRC.