IMMUNITIES AND PRIVILEGES (Hansard, 19 June 1961)

§ The Joint Under-Secretary of State for Foreign Affairs (Mr. J. B. Godber)
I beg to move, That an humble Address be presented to Her Majesty, praying that the International Tin Council (Immunities and Privileges) Order, 1961, be made in the form of the draft laid before this House on 5th June. This Order is required to enable Her Majesty's Government to ratify the second International Tin Agreement, signed by Her Majesty's Government in London on 3rd November, 1960. This Council will be the successor to the present International Tin Council, established under the International Tin Agreement, 1954, which came into effect on 1st July, 1956. The duration of the earlier Agreement was fixed at five years from the date of its entry into force. It is, therefore, due to terminate on 30th June of this year and to be followed by the new Agreement which it is hoped will become effective on 1st July.
As is the case with the present Council, the new Council will have its headquarters in London. I think that the House will agree that this is a tribute to London's traditional importance as the centre of the international tin market.
When the present Council was established, it was granted certain legal capacities and privileges by two Orders in Council made in 1956 and 1957. The new Council will continue the work of its predecessor, and it is intended that it shall enjoy the same legal capacities and privileges. The Order, therefore, is designed merely to continue for the new Council the same measure of privileges for the same number of people as was established under the previous two Orders.
Knowing as I do the jealousy with which the House rightly regards any attempt to extend unduly diplomatic immunities and privileges, I am glad to be able to assure hon. Members on this occasion that I am seeking no extension at all beyond that which the House has already approved in relation to the International Tin Council.
As this Order involves no new departure in this field, I will not weary the House further. I hope that the House will be willing to accept the Order.

§ Sir Frank Soskice (Newport)
I do not want to be tiresome and difficult, especially at ten minutes to Twelve o'clock, but I cannot for the life of me think why the International Tin Council should have the like exemption or relief from taxes and rates—apart from taxes on the importation of goods—as is accorded to a foreign sovereign Power. The Minister did not give us any indication as to why that should be. I understand that the Council has it at the moment, but why should it go on having an exemption from tax which other corporations do not have? I can understand that as a matter of international comity foreign sovereign Powers obviously have that right, but why elevate the Council to the status of a foreign sovereign Power?
It seems an extraordinary procedure. The House and the country are no doubt generous in their approach to these bodies, but when we are asked to forgo public revenue in the case of the Tin Council we should be told why. What is the justification, in common sense, for exempting it from the requirements of paying tax? I do not know what its income is, or if it has an income, but if it has why should it not be a taxable income, in the same way as that of any other corporation or body in this country?
Not only has the Council this exemption from tax: paragraph 4 of the Order says: All employees of the Council except citizens of the United Kingdom and Colonies shall enjoy exemption from income tax in respect of emoluments received by them as officers or servants of the Council. I do not know how many employees the Council has in this country other than British subjects, but if it has 10, 20, 50 or 100 who receive their emoluments, earned in this country, as servants of the Council, why should they not be subject to the same liability to pay tax as are other taxpayers? The Minister cannot ask us to pass this sort of proposal on the nod. We are responsible for the custody of public funds, and we are under a duty to see that the public revenue is collected and properly spent. I cannot understand why this airy exemption is thrown out to us at midnight, and why we are expected to receive it with a smile and with acclaim.
1127 I do not know what valuable functions the Council performs in order to earn tax exemption. How long has it had it? What are its functions? Why should these special functions carry this valuable immunity in the case of persons who apparently live and work here; have to bring up their families here; enjoy the amenities of this country; are protected by the police and by the defence services of this country, and are able to enjoy the various privileges and advantages which are available to people who live here?
I do not want to be mean or ungenerous and suspicious in my approach, but I put it to the Minister that for him, airily and casually, almost as if there were something funny about it—as if he were telling us an amusing bedtime story—to expect us to agree to this Order, is a little too much. We should be told why the public revenue is to be deprived of this source of income. How far are we going? There must be some limit to this. The immunities conferred upon various bodies and persons week in and week out under this Government, and probably under preceding Governments, reach large and almost frightening proportions. We should have some further explanation why this concession is thought to be justified.

§ Mr. Michael Clark Hutchison (Edinburgh, South)
I entirely agree with the right hon. and learned Member for Newport (Sir F. Soskice). I do not oppose the Order, because no additional people are receiving these immunities. But will the Foreign Office do its duty and cut down these immunities and come to arrangements with foreign countries so that they are extended only to ambassadors and those who should receive them, and not to all these extraordinary people and civil servants from other countries?

§ Mr. Godber
I am sorry that the right hon. and learned Member for Newport (Sir F. Soskice) should have thought that I was dealing with this somewhat lightly. I felt that the argument I had adduced justified me in taking only a short period of time, particularly at this late stage of night. It was not my fault that it came at such a late stage.
1128 I noticed that the right hon. and learned Gentleman shifted his ground from the last time we discussed an Order of this kind, when he waxed indignant about an extension of privileges. On this occasion he realised that there was no extension here, and he therefore shifted his ground to the question of why this Council should be entitled to tax exemption at all. There is some justice in my reminding the House that the principle of according these immunities to this Council was accepted by the House in 1956 when the first Order was passed, and I am, therefore, asking for no extensions tonight. I thought, in those circumstances, it was not fair to bore the House with a long dissertation.
I will repeat, in view of what has been said, that there is no extension of any kind whatever. As to why this Council should receive these particular exemptions, the House should realise that in accepting that the Tin Council should be established in this country—and that is a valuable thing for the trade of this country—it was part of the agreement which was entered into at the time of the first Tin Council that, subject to the approval of this House, there should be arrangements for the mitigation of tax in the same way as there is in regard to certain other international bodies set up in other capitals of the world.
This is not a body which is trading for profit at all. It is a body doing a useful international function in that it is trying to stabilise the price of a commodity. Time and time again hon. Members opposite have urged us to establish some stabilising body for some commodity to help under-developed countries. Here is one set up for that purpose. I thought it would be welcomed and that its activities in this capital city of ours would be something we could take credit for, and that it would not be necessary to be niggling in regard to this.

§ Sir F. Soskice
I am not complaining of its functions. I simply asked what its functions were. I am inquiring why its functions merit immunity from tax. That is what I want to know. I am not complaining that it is set up. No doubt it is an excellent thing, but why should this particular function be accompanied by this extraordinary result?

§ Mr. Godber
That was what I was seeking to explain, but I thought I was entitled to assume from the tone of what the right hon. and learned Gentleman said that he was in some respects questioning the merit of the Order. I am grateful for his explanation that that was not so.
This is not a trading body in the normal sense of making a profit, and there is not the same feeling of the necessity to exact taxes from it. It is a body set up to stabilise a commodity price.

§ Sir F. Soskice
Would the Parliamentary Secretary please tell me, if the body does not make profits, on what could it be taxed?

§ Mr. Godber
I said it was not set up for the purpose of making profits. On occasion it may make a profit on some transaction, and on other occasions it will make a loss. It buys and sells tin to stabilise the market, and such profits as it makes are transferred back to the constituent bodies which provided the tin. It does not retain any profits for its own use.
When it was set up there was certainly competition to have this body, and one of the arrangements agreed was that if it was set up in London it would have these advantages regarding taxation. I am not, therefore, asking for any new powers, but merely an extension to carry forward to the new Tin Council the arrangements previously provided. I hope, therefore, that hon. Members will not feel it is unreasonable. Knowing the feelings about the extension of immunities I looked at this most carefully, and I am convinced that there is 1130 nothing here that contravenes the view hon. Members hold generally against any extension of privileges. I believe this body is one entitled to some help and assistance because of the valuable work it does. I hope the House will be willing to accept the Order.