§ Sir Henry d'Avigdor-Goldsmid (Walsall, South)
I beg to move Amendment No. 35, in page 7, line 11, to leave out from "subsection" to the end of line 14 and insert:after the words 'agent of the settlor' in the proviso there shall be added the words 'or is under the age of 21 years and is receiving full time instruction at any university, college school, or other educational establishment'".
§ The Deputy-Chairman (Sir Samuel Storey)
We can discuss, at the same time, Amendments Nos. 36, in page 7, line 14, at end insert:and there shall be substituted the words—'(a) is payable to a parent for his own use; or'".
Amendment No. 37, in page 7, line 14, at end insert:
except in relation to settlements made for valuable and sufficient consideration".
Amendment No. 323, in page 7, line 14, at end insert:
Provided that for the purposes of this section any scheme or arrangement whereby the individuals carrying on a business or profession in partnership pay any pension or annuity to an individual who has retired from the partnership or to the widow or widower of an individual who has been a partner shall not be treated as a settlement if the Commissioners of Inland Revenue are satisfied—
Amendment No. 93, in page 7, line 25, at end insert:
Deeds of covenant entered into for the purchase of businesses or professional practices, if for full consideration, shall be exempt for surtax purposes.
§ Sir H. d'Avigdor-Goldsmid
This Clause is a very good example of the Socialist technique of throwing out the baby with the bath water. If there have been abuses of covenants, they can be remedied without real difficulty by requiring the makers of covenants to certify that they obtain no benefit therefrom. This is a form of words which is known to the Inland Revenue and which could accompany any return made by a Surtax-payer to justify deductions made in connection with the covenants.
Rather than look at the detail, the whole principle has been thrown overboard without paying attention to the many real benefits which have arisen from the use of covenants in various connections. Many of these are covered by Amendments which my hon. Friends will be discussing later. We are discussing a number of Amendments, but the one to which I wish mainly to draw attention is No. 37, which refers particularly to the use of Surtax covenantsexcept in relation to settlements made for valuable and sufficient consideration".This is acknowledged business usage which has proved over the years of considerable value mainly to people in practice in partnerships.
In the past, it was an accepted fact that an incoming partner might be expected to pay a premium for his admission to the partnership or practice. This was true of the medical and legal professions and of accountancy. It may have been true in other connections, but certainly among many classes of professional men it was the acknowledged practice for an incoming partner to pay a premium for his entrance. That premium was often drawn by an outgoing partner as a consideration for his giving up the practice.
This form has been very largely negatived by increasing taxation of recent years. As a result, young men coming into partnership are rarely in possession of a capital sum available for investment in it. Also, because older men seeking to retire from a partnership, although perhaps earning large fees, have had very 1797 little chance of earning enough to provide themselves with a competence on retirement, the habit has grown that an incoming partner on coming into a partnership, in which he is liable to become a substantial earner of fees, makes his personal covenant in favour of an outgoing partner, who thereby obtains some recompense for the years of work which he has devoted to building up the practice and continues in this way to share in the income of it.
For a young man to earn £5,000 a year obviously represents an important increase in his earnings, but if out of that he has to pay, say, £1,000 to an outgoing partner after deduction of tax, there might be little left for him. Although it is a fairly common practice among individual partnerships, it is even more applicable in cases of amalgamations. When two businesses amalgamate, there obviously is not room for all the partners in both businesses to stay in and it may suit one or more of the elderly partners of one business to drop out. It is common practice for younger partners in the business when taking it over to make personal covenants in favour of the older retiring members. There is nothing unjust about this. It seems perfectly fair that where a man has spent his life in building up a practice, if he hands the fruits of it over to a successor he should be entitled to some reimbursement of the effort he has made.
An incoming partner can covenant to make payment to a retiring partner without completely losing the benefit of his partnership as long as the covenant is free of Surtax. This has been the case up to now by covenanting that the payment is taken directly from his earned income. He does not obtain the benefit of that earned income in any way and Surtax on it is thereby saved. If this payment comes from the top half of one's taxed income, the cost to the incoming partner is so much greater that it may well not be worthwhile to undertake the transaction.
The situation might quite easily arise that a number of small firms are withering on the bough because no one can afford to go into them there remains only the vast monster, which in American Stock Exchange terms would be known as the thundering herd.
I am sure that it is not the desire of right hon. and hon. Members on the 1798 Treasury Bench to produce a situation in which, to all intents and purposes, only a handful of firms are capable of dealing with the vast number of complicated problems which arise in the accountancy world and in the legal world and to so many of which they have contributed so largely themselves.
The object of Amendment No. 37 is to suggest thatsettlements made for valuable and sufficient considerationshould escape the mischiefs of Clause 12, which throws out the baby with the bath water. Because there may have been some abuse of covenants in the past—I am not arguing this myself—it proposes to allow no covenants whatsoever of any sort to subsist which enable a covenanter to escape paying full Surtax.
This is a Clause which today, when taxation not only is higher than it has ever been before but is more complicated, really makes the professional man think, "Is it worth while going on earning? Is it really worth while my going on spending my energies when not only shall I have to pay a high rate of tax on anything I earn but, more than that, there is no chance whatever of my ever being able to retire on savings, or any chance of my successor being able to give me enough to live on afterwards?" We are talking about professional men, and I do not think that even this Government would like to imagine a world where professional men in retirement find themselves applying for National Assistance. This is not a concept, surely, of the mixed economy in which we live?
I feel that this Clause, in its full and most savage application, is a statement of doctrinaire egalitarianism, and I do hope that the Committee will be prepared to support the Amendment which I have proposed.
§ Dame Patricia Hornsby-Smith (Chislehurst)
I am delighted to follow my hon. Friend the Member for Walsall, South (Sir H. d'Avigdor-Goldsmid), who has dealt with one particular aspect of the Amendments chosen for debate, but I should like to speak on other aspects of these Amendments and deal with what is a very wide range of covenants. My particular interest is in Amendments No. 35 and No. 36, because they are 1799 very much personal covenants, concerned with social, affectionate, charitable, dutiful settlements which, in the main, are given to kith and kin.
My opposition to the Chancellor's proposal to abolish covenants in respect of individuals stems mainly from the fact that I believe that he is penalising those who are amongst the most responsible members of the community who accept their family responsibilities to kith and kin, or even to faithful retainers, or to persons who have no legal claim on them whatever. I think that it is wrong that because they happen to be Surtax payers we should penalise them for the responsibilities they so accept.
I had the privilege of serving in both the Ministry of Health and the Ministry of Pensions and National Insurance, and there is not an hon. Member in this Committee who has not in his constituency met people who have been shocked by the lack of responsibility of close relatives.
To amplify the case I want to put, I well remember two young people, married, both professionally earning. For 10 or 12 years the mother of one of them kept house, looked after the children and enabled these two people to enjoy a very full professional and social life. The mother was always home to see the children to bed and to provide dinner every night for her daughter and son-in-law.
One of the greatest tragedies that I have experienced in the interviews that I have had in my constituency was when one day this couple come to me and complained bitterly that the mother was in hospital, was due to be discharged and had nowhere to go. They asked what were "they" going to do about it—"they" being the Government. I made inquiries and I do not think that I have ever known the very calm and skilled almoner in my local hospital more furious than when she told me that within a week of the old lady going into hospital, when she would obviously not be as fit as she had previously been, and when by that time the children were teen-agers, the couple had sold the house and had taken a flat so that they would not have a bedroom for the old lady.
1800 The people I am supporting are those who do accept and recognise their responsibilities, not only to their direct kith and kin, such as father and mother, but people like aunts, uncles, elderly retainers, old nurses and housekeepers, who have given service and who do not come within the ambit of pensions, and for whom they are providing from no legal liability whatsoever. They are providing for these people solely because of a sense of duty and affection for them and because they wish them to live their later years in some modicum of comfort. I think that it is a miserable act to "clobber" people who accept such responsibilities. No vast sums are transferred to allow people to wallow in untaxed luxury.
I put down three Questions to the Chief Secretary to the Treasury and got some very interesting Answers. On 14th May I asked the Chief Secretary how many covenants were in respect of registered charities and individuals. We are not dealing with charities at the moment and I will, therefore, confine myself to the answer so far as it relates to individuals, to which these Amendments are applicable. The answer was 160,000. I then asked what was the average annual sum covered by covenants in favour of individuals and the answer that I received was £250 per annum—that is, £5 a week, That hardly allows people to wallow in untaxed luxury.
Not all of these people are Surtax payers. I do not know whether it is my duty to declare my interest. I am not hit by this Clause, because I am not a Surtax payer, but I have a covenant in respect of a relative to whom I owe no legal liability. She is not a direct relative, but I endeavour in my small way to provide some comfort for her in the twilight of her life. I am proud to do it and I do it out of affection. Since I am not affected by the Clause I am not sure whether or not I need have declared my interest.
Let us now consider covenants which are made for children's education. Surely the Chancellor is aware that this money goes mainly to fee-paying schools and obviates the necessity of the local authorities having to bear this burden by paying for the education of these children. Obviously, it relieves the burden on State-run schools.
1801 I fear that hon. Gentlemen opposite are so jaundiced in their prejudice against fee-paying schools that they make it sound like a crime for a grandfather or aunt to provide the fees under covenant, or the money under covenant to pay the fees, for children going to fee-paying schools. If one has a really ripsnorting grandparent who goes bust on beer, bingo, or betting, good luck to him, say hon. Gentlemen opposite. But if one has a grandparent who pays for his grandchildren to go to school, he is a shocker and must be penalised.
I wonder, with respect, whether the Chancellor and the Financial Secretary have considered the very tremendous effect the Clause will have on Roman Catholics who hold dearly to their right to ensure that children receive the religious education which their faith demands, remembering that they make great sacrifices to ensure that their children get that education?
I have received several complaints from Catholics who happen to be Surtax payers and who, because of their belief in their faith, are paying not for their children but for others' children, in whom they are interested, to go to fee-paying schools, sometimes from areas where there is no readily available aided Catholic school. They hold their religion so dear that many a Catholic contributes by covenant to a grandchild, niece, or nephew's education. Now they may have to pay the Surtax levy to provide the same final contribution. This is exacting retribution on the responsible and on the devoutly religious.
I return to the question of the elderly beneficiaries from these covenants. The number of aged people is increasing rapidly as medical science enables people to live longer. This is a headache for any Government and the problem will grow more complex as the years pass, whatever Government is in power. When we consider the 160,000 covenants we realise that it is not a vast number of people who accept the responsibility of committing themselves for a minimum of seven years to provide for elderly people. In many cases they are not even their parents, but elderly sisters, aunts, uncles, or even handicapped relatives.
I know of a case in my constituency where a sister worked throughout her life while the other sister accepted the responsibility of running the home and 1802 looking after her elderly parents. For 10 years she hardly left the side of her blind and sick mother. When the mother died, and her modest income died with her, the sister was 59 and worn out.
Her brother and sister, both professional people, one of them certainly a Surtax payer, did not just shove this devoted woman—who had been perfectly capable of earning her own living and who would have been able to make a good career or profession had she not opted to stay and work at home and look after her ageing parents—on to National Assistance. She is provided for by covenant, and certainly one of the two who helps her is a Surtax payer. In this case, he is a doctor.
We have heard that doctors are not all that roaringly well paid, but his qualifications, his skill and now his status bring him into that classification.
In another case a professional man provides by covenant for an elderly housekeeper who, until retirement, looked after his very aged father who lived to 97. He has no legal liability at all to do so, but felt it his duty. Surely this type of citizen who voluntarily—from affection, from a sense of duty, or from human charity—undertakes for seven years or more to accept a financial liability which he need not incur, and which, in many cases, keeps the recipient from National Assistance—because many of these people in this day and age are elderly who could not and did not qualify to come into the pensions scheme—the responsible who provide for them should be encouraged, and not clobbered like this by the Chancellor of the Exchequer.
In reply to my third Question, I was told that the Chancellor of the Exchequer expected to save £1½ million in 1966–67 and £2 million in a full year. Many of these elderly recipients are not eligible for retirement pensions. The average covenant is for £5 a week, according to the Chief Secretary. If only a very few of the Surtax payers who are involved in this felt that this proposal really was too much and, since they have no legal liability, they refused to renew their covenants when they expired, it would only take 8,000 of the 160,000 to go on National Assistance for the whole of that £1½ million to be wiped out. The whole 1803 gain from this mean and miserable Clause would disappear.
I ask the Minister to look at this matter again. These are responsible people. They do not forever ask "What are 'they' going to do about it?" They do not write to their Members saying, "Our old retainer has now left us, and the National Assistance Board should do something about it." They accept the responsibility to give comfort. I am quite sure that the Economic Secretary will not suggest that only——
§ Dame Patricia Hornsby-Smith
I beg the Financial Secretary's pardon—I only hope that his knowledge of finance is better than the Chancellor's knowledge of economics.
I do not have a break-down of the figures, and the hon. and learned Gentleman will correct me if I am wrong, but I am quite sure that most of the 160,000 covenants must be for old people, and if only 8,000 of those covenants were removed the whole saving of £1½ million would be wiped out.
As I say, the people who enter into these covenants are responsible people. They do not rush to their Members, or to the various social welfare Departments, and ask, "What are you going to do about it?" The Minister should be prepared to look at this, and see that reliable citizens who are prepared to provide for another's need are not discouraged from doing so. The Minister cushions the rakes who bet, but takes a cosh to the reliable citizen who provides for another's need.
§ 10.45 p.m.
§ Mr. John H. Osborn (Sheffield, Hallam)
I should like to mention a case put to me by partners in larger partnerships. It is a more technical case, and I have found it very difficult to know how best to hang it on to a particular Clause in the Finance Bill.
The object of Amendment No. 323, which is in my name, is to enable partners who cannot incorporate their businesses because they carry on a profession, to make allowances to retired partners or widows of former partners and have such 1804 allowances deductible in computation of profits. This would bring them into the same position as retired directors and their widows. My hon. Friend the Member for Walsall, South (Sir H. d'Avigdor-Goldsmid) dealt with the case of the smaller professional man. Doctors, practitioners at the Bar, and so on, and a growing number of people, particularly in consultancy, engineering and accountancy, have larger practices and partnerships. They have capital which might run into hundreds of thousands and the profits could fall between tens and hundreds of thousands. As partners die or retire and where there is a change in partnership, such partners, either for the purpose of paying death duty or for their own requirements, find their income subject to a capital charge and ultimately to Capital Gains Tax.
My hon. Friend the Member for Walsall, South said that new partners had to buy their way into a practice at a time when they are having to finance their own homes. Partners may well want to make provision in various ways for their families and have to build up capital in the firm and finance any expansion in that capital. They probably have nothing left to take up expensive life policies to provide for retirement or for their wives and families. It is impossible to provide in a partnership deed for the payment of annuities to an outgoing partner or a partner's widow. I have had figures given to be showing that capital after death duties to provide an annuity is paltry compared with the original income of the person who died.
For instance, in an industrial concern a senior manager, let alone a director, if he dies can expect his widow to have some sort of pension in the proportion of 25 per cent. or 33 per cent. of the income he was earning. The provision in a partnership deed for a partner's widow is apparently assessed for death duties and the private capital swallowed up is such that the proceeds of the annuity are not enough to provide this paltry figure. If that is the position now before the Finance Bill is in operation, it will be a great deal worse when it is law. These difficulties could be overcome because partners, out of a sense of moral obligation to outgoing partners or widows, granted them allowances in exactly the same way as companies grant 1805 pensions to retiring directors or their widows, and enable them to deduct the annuities for tax purposes.
If deeds of covenant are entered, sometime for seven years with the intention of renewing them at the end of the period, this method will now become impossible under the Finance Bill. In addition, if partners wish to retire and sell out, they will be subject to Capital Gains Tax. The object of the Amendment is to preserve the position of the larger partnership. It can be done in several ways. The Amendment suggests one way of doing this by making it possible for covenants which provide for retirement and particularly for widows in the event of early death, to be exempt from the impact of the Clause.
I hope that the Financial Secretary will give this due consideration. There could be other ways of dealing with this—I could write to him further—but as he is no doubt very well aware of the position I take this opportunity of putting this specific point forward now.
§ Sir Tatton Brinton (Kidderminster)
There seems to be a very important point arising out of the abolition of the right to covenant, particularly in respect of people who are retired. There are certain human, moral obligations which people, particularly those who are more fortunate in life, are expected to fulfil.
There are two categories. First, there are the aged relative and the aged servant, who may have served a man for 20, 30 or 40 years and for whom, under the existing systems of today, no proper pension arising out of his service has been provided. These people are in the nature of moral obligations to the person by whom they are employed, or to whom they are related.
Up to date it has been possible for a man with a substantial income to covenant for the support of these people. In future he will, if he has a substantial income, have to bear what may be a very heavy burden of Surtax in fulfilling these moral obligations. Today, there are still a number of people who have substantial amounts of capital and who may be able to provide out of this capital, or even by a gift or settlement of capital, for these obligations. But if we look into the future do we not face an age in which we will have an increasing num- 1806 ber of people who are themselves able to earn large salaries by their abilities, and so it should be, but who have little or no capital?
People in this position could very well have elderly relatives who have very little money indeed. A man who has worked his way up from the bottom to the managership of a great industry may be a man worth £20,000 a year to his firm, but he may never have had the opportunity of securing any capital. He may have an old monther, perhaps a widow who herself was simply a working woman, who never had any money. Is he to be left in the position when, with a gross income of £20,000 a year, he must leave his mother to live on the old-age pension or sacrifice a substantial part of his income after tax? That is what it amounts to.
I ask that these particular categories of people should be subjected to a special regulation. I suggest that it is not impossible for the Government to control any such covenants by making them subject to the inspection of the special commissions. If this were done it would be agreed beforehand that there was a real moral obligation and that the sum to be covenanted for was reasonable in the circumstances, both to the covenantor and to the beneficiary. If something like that were done, I think that a very difficult position would be avoided in the future, of people who have obligations which to a great extent they can only meet out by a sacrifice of their taxed income.
§ Sir Frederic Bennett (Torquay)
Like everyone else in the Committee, I was interested and indeed moved by the remarks of my right hon. Friend the Member for Chislehurst (Dame Patricia Hornsby-Smith). She really did touch on a number of important human angles, of which, not with very great confidence, I appeal to the Government to take note. She made only one mistake. She was generous enough to believe that the question of saving a million and a half pounds was in the mind of the Government for one single, solitary moment, and in her mathematics she sought to prove this.
That is not so. This is as blatant a piece of class legislation, of appeal to the left wing as could be imagined. Whether saving £50,000, or a million and a half, or two million and a half, it does not 1807 matter a bit. If it could be proved to-night that nothing would be saved, it would not make the slightest difference, because the Government Front Bench want to wave the flag in order to bring in hon. Members below the Gangway. That is the purpose of this piece of legislation. Of course, there are at present very few hon. Members opposite below the Gangway. It is especially hard to-night, because there are very few above the Gangway either. One of the most difficult things about contributing in debates on this Finance Bill is the very small number of hon. Members opposite who are taking part in the debates.
To digress for a moment, a few days ago the Chancellor of the Exchequer said that one of the reasons why he did not take part in previous Committee stages of Finance Bills was that he thought that he would be Chancellor of the Exchequer the next year. All I can say is that there are many potential Chancellors of the Exchequer in the Parliamentary Labour Party at present.
§ The Chairman
Order. I hope that hon. Gentlemen will not prevent by intervention the hon. Member who has the Floor from coming to the Amendment.
§ Sir F. Bennett
I beg your pardon, Dr. King. I digressed for a few moments because of the hilarity with which my remarks about the sparseness of attendance by hon. Members below the Gangway opposite were treated.
The amount of money being saved has nothing to do with it. It has been shown conclusively that, if one starts on the sums, it might well end up with the Treasury having rather less money than it has at present. The figures produced were extraordinarily impressive. They were all the more impressive because the Treasury has been forced to give them in a Written Answer. There are 160,000 covenants altogether, at an average of £250 a year. If the Financial Secretary thinks that he will somehow or other get hold of the very rich who have been avoiding this taxation, he has far less confidence in the mental ability of the very rich and of their advisers than I have. I shall 1808 not give the hon. and learned Gentleman the benefit of some free advice, but I could give him some very easily. I know of at least three ways in which a coach and horses could be driven through the Clause by the very rich who could afford to have the right advisers. The only people who will be caught are those who have been spoken of. I want to mention two specific cases which come within the working of the Amendment. The first is the children. I want to say straight away that I have no interest one way or the other, because I have no children. The only covenants I have made are in favour of elderly people. I have made none in favour of children, of my family or otherwise. The Clause is not very clever in the effect it will have on children as a whole, merely to try to prevent a limited number of abuses. In large numbers of instances covenants, because of the income to a child in its younger years for an educational trust purpose, prevent the child from otherwise having access to State grants for higher school education or for university education, grants which otherwise, within the means test applied, would be applicable. If that factor is added, I can assure my right hon. Friend the Member for Chislehurst that they will be even more out of pocket than the £1½ million of which we have heard.
At the moment, the various educational grants take into account the financial means of the applicant. The applicant in this case being a child, quite apart from its parents' means if these covenants are abolished in future there should be many more applicants for State grants than there are at present.
As to elderly people, it would be repetitive to go over the case very much more. There is a considerable social consequence here. Oddly enough, this was mentioned in a debate a few days ago. We are one of the countries where less and less moral regard is being paid to the liability of children to look after their elderly parents. My hon. Friend the Member for Kidderminster (Sir T. Brinton) made it perfectly clear that in many cases nowadays it is not a matter of those with very rich inherited incomes looking after their parents. There will be a new highly paid managerial class, often with not so well-off parents. As a result of this, even more so the moral 1809 liability of children who have done well in the world as a result of sacrifices made by their parents in former years will be curtailed.
So I conclude with this one remark. The Financial Secretary here believes, as in the case of other Amendments we are going to come to in relation to business expenses and other matters, that because he thinks he can find a few abuses it is worth sweeping the board completely clear. This is the secret of all these types of measures which are being introduced in this Budget. Because there are a few racketeers, slash the whole lot right across the board.
Let me finish as I began. The Financial Secretary and his Government are not nearly clever enough to catch the racketeers, but they will push through these things to catch people who are trying to look after their obligations.
§ Mr. MacDermot
We have had a most moving debate in which we have had depicted to us the terrible plight of the poor taxpayer earning £20,000 a year who is to be forced by the wicked Socialist Government to leave his aged mother to go on National Assistance. If that argument convinces hon. Members opposite, I would have thought that almost any argument would.
We have heard it urged upon us that it would be a good thing to have television in this House. I would have been delighted to have had some of the arguments and artificial heat we have seen engendered tonight on television, so that we could let the country decide upon this matter.
The hon. Lady the Member for Chislehurst (Dame Patricia HornsbySmith) said that we regarded the Surtax payer helping to pay for his children and his relatives as a shocker who should be penalised. We do not. We think it admirable that he should want to help his aged mother, or any relatives he wants to help. All we are arguing is that a limit should be put on the extent to which the State should be asked to subsidise his generosity and subsidise it beyond the point of complete relief from Income Tax.
The hon. Lady referred to some of the figures which she elicited in answer to some Written Questions. The figures she 1810 asked for related to the covenants made by Surtax payers in favour of individuals as one class and charities as the other class.
In the case of individuals, it is estimated that there are about 160,000 Surtax payers who have made covenants in favour of individuals. The average amount of each of these covenants is £250 per annum, and, therefore, the total amount covenanted was £40 million by the 160,000. In the case of charities there were no less than 1,340,000 covenants of an average amount of £20, making the total amount covenanted £27 million.
So whereas, on the one hand, you have 1,340,000 covenants in favour of charities and the total covenanted is £27 million a year, the mere 160,000 Surtax covenants in favour of individuals totals £40 million a year.
Let us see the breakdown of how that £40 million is paid. The net cost of that £40 million to the Surtax payers is £23 million. The contribution which the tax-paper is making is £17 million, £11 million of that being in Surtax relief and £6 million by refund of Income Tax. Well, the £6 million refund of Income Tax will continue. This hard-hearted Socialist Government are to allow these 160,000 Surtax covenants to continue to be supported by the taxpayer to the tune of £6 million.
The "drastic and wicked and cruel action" which we are doing by this Clause is to say that it is too much that £11 million in relief from Surtax, in addition to the Income Tax relief, should be given to these Surtax payers. That is the extent of the hardship we are imposing.
§ Dame Patricia Hornsby-Smith
I would like to get this point clear. The Financial Secretary has just referred to 160,000 Surtax payers. It may be that my Question was not sufficiently clearly framed. I should like to get this point straight. My Question was to ask the Chancellor of the Exchequer how many seven-year covenants are in operation. I did not ask whether they were paid by Surtax payers or non-Surtax payers. The Answer which I received was 1½ million to charities and 160,000 in favour of individuals. Therefore, unless in reply to my Question the Chief Secretary to the Treasury has assumed that I meant Surtax payers, it is quite wrong for the Financial Secretary to 1811 suggest that all the 160,000 are Surtax payers. I should like to have clarified the Answer which I received.
§ Dame Patricia Hornsby-Smith
I have been on the Front Bench opposite and I know that its occupants can get caught up from time to time. May I raise a further question while the answer to that one is sought?
The hon. and learned Gentleman made a great point about the average. Again, I was given the reply to my Question that the average for charities was £20 a year. The hon. and learned Gentleman referred to that with some derision. It is not an unusual subscription or an ungenerous average. One cannot compare the contribution which one makes to a charity, which may be one of many, with what one provides to keep a person for a year. I see nothing wrong in the average being £250 to keep a human being for a year. It is no reason for the hon. and learned Gentleman's derisory comment.
§ Mr. MacDermot
The right hon. Lady's intervention was so long that I am now able to answer her question in full. The answer is that we are both right. The figure of £11 million Surtax relief which I gave is correct. The figure of 160,000 applies to all covenants by Income Tax payers only and by Surtax payers, but this means that the £11 million figure of Surtax relief must be for some figure lower than that. I shall be interested to obtain it and give it to the House if someone cares to address a Question to me. It means that the estimated number of Surtax payers who have been getting this relief of £11 million has been something which one assumes is lower than the 160,000 figure. I am only hazarding a guess, but I would imagine that the majority of the 160,000 would be paid by Surtax payers.
§ Mr. MacDermot
If it is not, it makes the £11 million figure all the more surprising.
This, I stress, is all that we are doing. We are not in the slightest stopping Surtax payers from making covenants. No existing covenants will be affected. That 1812 is why the amount of revenue in the initial year will be small. I think that it is £1½ million for the first year. It will build up later. The picture which hon. Members opposite tried to give, of pathetic people who will no longer be supported by their rich Surtax-paying relatives, seems not to cast great credit on the generosity of the Surtax payers. Surely, when they will continue to get the benefit of full relief from Income Tax, they will still prefer to exercise their generosity to assist their needy relatives rather than see them go on National Assistance, which was the picture to which we were asked to lend credulity.
May I turn to the Amendment. The right hon. Lady moved Amendment No. 35, the effect of which is to propose to add to the list of disallowable beneficiaries a further class, namely, children under 21 who are receiving full-time instruction at school or university. The intention is that our Clause should operate only in the case of covenants which are made in favour of minors undergoing full-time education, but that any other covenants in favour of individuals should remain. This would mean that roughly half the deeds of covenant would continue to enjoy the benefit of exemption from Surtax, because I am told that it is only about half the total of covenants which are in favour of minors.
Some of these may be in favour of needy and elderly relatives, but others undoubtedly are covenants the real and sole purpose of which is tax avoidance. The Amendment would leave Surtax relief for covenants in favour of children below school age or children over school-leaving age who are not at school or university, and there seems to be no particular reason for giving them special treatment.
But it is not on these grounds that I invite the Committee to reject the Amendment, but because of the broad principle announced by my right hon. Friend the Chancellor when he referred to the matter in his Budget speech, which is that this type of bounty, it is generally felt, should no longer be supported by the general taxpayer to the extent of relief against Surtax as well as relief against Income Tax.
The right hon. Lady spoke of Catholics who send their children to 1813 Catholic schools. The vast majority of Catholics, however, are not sending them to the expensive fee-paying schools which benefit from this form of covenant. If she is suggesting that suddenly the so-called public schools will cease to receive any more pupils because of the withdrawal of Surtax relief from covenants made in favour of such children, I think that she is imagining a rather more drastic result of the Clause than anybody else imagines.
§ Dame Patricia Hornsby-Smith
I have great respect for the hon. and learned Gentleman's mental capacity, and I am certain that he knows that there are very many convent schools which are fee-paying, but which are not high-fee-paying, fashionable public schools. Devout Catholics send their children to such convents, often outside their own bailiwick, because they are determined that their children shall be educated within their faith and under the control of their faith. To suggest that the covenants refer only to the fashionable public schools, in referring to the Catholic religion, is an insult to our intelligence.
§ Mr. MacDermot
I Dome from a Catholic family and my sisters went to Catholic convent schools. I know as much about the subject as does the right hon. Lady. But I suggest that the number of cases in which it is Surtax payers who are getting Surtax relief through covenants in favour of such children represents a very small proportion of the pupils in the schools to which she is referring. That was the point which I was making.
May I now turn to the Amendment tabled by the hon. Member for Walsall, South (Sir H. d'Avigdor-Goldsmid), in which he urged us not to throw out the baby with the bath water. I must say that I found the plaintive note of his baby somewhat appealing, but I think that he has drawn attention to a class of covenant in a very different category from the covenants at which the Clause is aimed. The form in which the Amendment is framed is very wide, and proposes to exclude from the operation of the Clause those covenants made in the matter of settlements made for a valuable consideration. In that form it could be very wide indeed and a very obvious instrument 1814 of tax avoidance because it is not difficult, in law, to establish a valuable consideration. The traditional peppercorn is a valuable consideration.
The hon. Gentleman and the hon. Member for Sheffield, Hallam (Mr. J. H. Osborn) spoke of the position of covenants made in favour of a retiring partner or his dependants from a professional firm, and pointed out the particular problem that, in these modern days, people are in compared with what used to be common practice. They are not in a position to buy their way into a partnership as they were, and, therefore, there is not usually available a lump sum for a partner. It is not right that partners should be saddled with sleeping partners in retirement. There are obvious advantages in his being able to break free from the partnership in the interests of its smooth working, and I am satisfied that there is a real problem here and that we should look at it.
I am advised that there may also be other categories of people we should look at, for example, the case of payments made by a husband to a divorced or separated wife. Where these are made under a court order, the problem does not arise, but frequently there are covenants entered into which are not made by court order and there seems to be no point in framing our tax laws so that people have to obtain a court decision when the matter can be disposed of by agreement.
There may also be problems in connection with the purchase of businesses where, I believe, covenants of this kind are used. I hope that the Committee will not think that I am being evasive when I say that I cannot reach a final conclusion at this stage. I would like time to consider this matter further and, since the hon. Member for Hallam offered some further information, I hope that we may have it to help with our study of this matter. I will undertake to look at this further with a view to bringing forward an Amendment on the Report stage, which, I hope, will find favour with the hon. Member and which will be aimed at meeting this situation and rescuing the legitimate baby. Perhaps we could throw out the others with the bath water.
§ Mr. William Clark
The Committee is grateful to my hon. Friend the Member 1815 for Walsall, South (Sir H. d'Avigdor-Goldsmid) for having initiated this debate, and we were all moved—I am sure the Financial Secretary was—by the speech of my right hon. Friend the Member for Chislehurst (Dame Patricia Hornsby-Smith). It was a first-class speech, and I am delighted that it has had at least some effect on the hon. and learned Gentleman. The Financial Secretary said, in jocular vein, I suppose, that he would like the television cameras to be on the Chamber while we discuss various matters. I should welcome them this evening. The public would then realise how the Government view the finances of the country, and it would be a salutary lesson to the electorate.
After slight hesitation, the hon. and learned Gentleman managed to get information to refute the information given by my right hon. Friend the Member for Chislehurst about 160,000 covenants costing £1½ million a year. He got the answer that those 160,000 Surtax covenants totalled £40 million, and the cost to the Exchequer, he said, was £17 million, made up of £11 million Surtax and £6 million Income Tax. I hope that I do not misrepresent the hon. and learned Gentleman's words when I repeat these figures. If he is right in saying that £40 million worth of covenants are paid, and if one takes the standard rate of Income Tax, which is the amount one is entitled to deduct from a covenant, that gives a figure of precisely £17 million. That is the arithmetic: £40 million at 8s. 3d. in the £ is £17 million.
I wonder whether the Financial Secretary's arithmetic is correct. If he says that the Surtax element of the £17 million is £1½ million, this means that the Income Tax repayment from £40 million paid out in covenants is only £6 million, which gives a flat rate per £ of 3s. We cannot have it both ways. At this hour, I regret having to put these arithmetical riddles to the hon. and learned Gentleman, in the absence of those who might be able to advise him best, but I suggest to him that the £17 million really must be looked into——
§ Mr. MacDermot indicated assent.
§ Mr. Clark
I am glad to see the hon. and learned Gentleman nodding his head—and, for my part, I shall accept the figures which my right hon. Friend 1816 gave which I imagine to be much nearer the truth.
We accept that the Financial Secretary, without giving any concrete undertaking, has said that he will look again at the question raised by my hon. Friends the Members for Sheffield, Hallam (Mr. J. H. Osborn) and for Walsall, South about professional partnerships. He has pointed out that the expression "valuable consideration" is not the right one to use in the Amendment. We accept that. As he said, a peppercorn is valuable consideration. But the hon. and learned Gentleman has not gone far enough. Obviously, in the face of public opinion and professional opinion, the Government could not have pushed through this proposal against professional business partnerships. But what about the other type of recipient of covenant moneys, the dependant? How can a dependant give valuable consideration? I am no lawyer, but I do not think that love and affection are nowadays valuable consideration in this context.
§ Mr. Clark
But it certainly could not be written into a covenant. Although he has tried to come some way to meet us, the Financial Secretary has not come far enough as regards dependants. I am certain that my hon. Friend the Member for Torquay (Sir F. Bennett) was right when he inferred from this Clause that the Government are being penny-wise and pound-foolish. They say that they will save £1½ million. But how many other people who now receive the benefit of covenants will have to have recourse to some sort of State assistance?
I do not think that the hon. and learned Gentleman can brush this off on the assumption that all the recipients under covenants are wealthy. Many of them receive, for instance, an income from a relative; it is not huge but merely enables them to stay in their own homes. Although we accept that the hon. and learned Gentleman has tried to help us, he has done nothing about dependants. I therefore ask my right hon. and hon. Friends to divide the Committee.
§ Mr. Harold Lever
I hesitate to intervene, because I know that hon. Members opposite are anxious to go home. But 1817 the hon. Member for Torquay (Sir F. Bennett), with a wave in my direction, suggested that the origin of this Clause was the desire of the Government to keep Left-wing Members below the Gangway happy.
I am not at all unsympathetic to the concept of covenants in order to benefit people who have served one and are now in need or widows and others, but I am not persuaded that, because there is a moral obligation towards old servants or elderly parents, this implies that such a moral obligation must be financed as to Income Tax and Surtax by the State.
§ Mr. Percy Grieve (Solihull)
When someone gives his money away is it his or the State's? The view of hon. Members opposite seems to be that if one gives money away it is the State's money.
§ Mr. Lever
I will try to put the argument with a simplicity which will appeal to the hon. and learned Member.
I may have a moral obligation to my aged and poverty-stricken parents, for instance. I also have a moral obligation to pay my debts. I do not expect Surtax relief on payment of my debts, although I have a moral obligation to discharge them. The argument is that if I have a moral obligation to my parents I can qualify for Surtax relief, but if I have a moral obligation to pay my debts there is no suggestion of Surtax relief.
§ Dame Patricia Hornsby-Smith
The hon. Gentleman mentioned servants and others not in the direct line of moral obligation as parents are. Would not he agree that, where people are providing a covenant which prevents the beneficiaries going on National Assistance, the Government gain because those people are removed from the orbit of National Assistance?
§ Mr. Lever
That argument is arithmetically unsound. It suggests that the Government will lose more than they gain by this provision. If that be so, then the amount under covenants the unfortunate beneficiaries are receiving is below the National Assistance level which is their statutory right. Otherwise, I cannot see any sense in the argument.
1818 If the right hon. Lady wishes it to be said that it is conceivable that, in some circumstances, part of what the Government will save will be lost in fulfilling the ordinary obligations of National Assistance, that much is obvious; and so what? The fundamental point is the argument that people with moral obligations are automatically entitled to set those moral obligations against Income Tax and Surtax.
One has a moral obligation to pay gambling debts. There is also a legal obligation to pay them, which strengthens the argument. Should they be charged to Surtax on the ground that this moral obligation is something that hon. Members would wish to see encouraged? Much as I am in favour of these covenants being made, I cannot see that the arguments advanced by hon. Members opposite justify voting against the Clause, even by Left-wing Labour Members below the Gangway.
Ideas on this sort of subject are not immutable. As time goes by, people have another look in new circumstances at practices that have gone on for a great many years. I would not say that they are "rackets", or tax avoidance. I have signed for all sorts of things, from Socialist Commentary to needy friends. There is nothing shameful in supporting either of those objectives. After a period of years, the House of Commons is entitled to look again at these things. I think that a modern "new look" would come to the same conclusion as the Government have reached.
I must compliment the Government on having been very reasonable about the change. There has been no retrospection. All existing covenants are allowed to run their course. It is only for new covenants that this restriction, and then only a partial restriction, namely, that Surtax shall not be allowed, is introduced.
The hon. Member for Bath suggested that a man would now henceforward have to support his aged parents from his net income. That is not correct. It would be his income after Surtax, but not after Income Tax, that would bear the burden.
§ Sir T. Brinton
After all the weeks when I sat in Standing Committee under the chairmanship of the hon. Member, I 1819 should like to remind him that I am the hon. Member for Kidderminster.
§ Mr. Lever
I beg the hon. Member's pardon. I got his constituency wrong, but his argument right. I have provided the short answer to it.
In these circumstances, the Committee is making heavy weather of the point and it should yield to the obvious desire of so many hon. Members opposite to go to their rest so that they may, with renewed zeal, criticise those parts of the Bill which will occupy us all next week.
§ Sir D. Glover
This has been a very interesting debate. A moving speech was made by my right hon. Friend the Member for Chislehurst (Dame Patricia Hornsby-Smith), and all the speeches which have been made from the other side of the Committee show——
§ Sir D. Glover
If my hon. Friend would keep quiet, I should probably take a little less time, and I do not need encouragement from him to make a speech.
This is one of the most important debates that we shall have on the Finance Bill because we are discussing the fundamental difference that exists between the two sides of the Committee. Right hon. and hon. Members opposite think that it is perfectly laudable and desirable and to be encouraged, and that we should all put our hands on our hearts with virtue and say, that Mrs. X, the widow woman, will never fall below a certain level of income because she can get National Assistance, but they think that it is quite wrong that somebody who is in a more fortunate financial position should say that Mrs. X the widow shall not go to National Assistance because he will provide a covenant that will provide her with a figure slightly above the National Assistance figure.
The difference between the two sides of the Committee is that, according to hon. Members opposite, collective virtue is a virtue but private virtue is a sin. I am sorry that the Minister of Labour, who was present on the Government Front Bench a few moments ago, has left us, because in all his speeches his right 1820 hon. Friend the First Secretary pleads for a sense of responsibility, that people will undertake the responsibilities that are within their ken, be moderate in their demands for increases in wages and be responsible in doing a good day's work for a good day's pay, and yet when people—if the Financial Secretary will attend to the debate instead of talking to one of his hon. Friends, I shall be appreciative.
When we talk now about those people who take on responsibilities, they are looked upon by the party opposite as being, not good citizens, but anti-social.
§ Sir D. Glover
The hon. Member came into this debate only half way through, and, if he will not mind my saying so, made the worst speech I have heard him make in this Chamber. He has made some very good speeches, but his last contribution was not worthy of his ability.
We are really discussing whether the nation is to try to inculcate to a far greater degree than we have it at the moment the sense of the responsibility of the individual, or whether we are to try to remove it altogether and put responsibility on the State. This is what, fundamentally, the argument tonight is about. Of course, the issue is clouded over with talk about someone being a Surtax payer and another not being a Surtax payer. I accept that we are discussing a question of Surtax, but what the Financial Secretary does not realise is that, even so, we are discussing whether the private individual will deprive himself of part of his income after paying 8s. 3d. in the £ which otherwise would accrue to himself, deprive himself of it to relieve the distress, relieve the hardship, of some other individual who otherwise would become chargeable to the State.
Now, I admit that one could carry this argument too far. One could say that if none of these covenants applied all the beneficiaries could finish up on National Assistance—but then my right hon. Friend has in her speech very movingly cited many oases where it has happened that people have had to go to National Assistance. But is it really the philosophy of the other side of the Committee to drive people to National Assistance, if there is a system whereby that can be avoided? Someone 1821 entering into one of these covenants may be saved some Surtax, but what the Financial Secretary does not seem to realise is that such a person still deprives himself of part of his income which is left to him after payment of tax.
This is the first time I have ever cited here any personal experience of mine of this sort, but I am paying a covenant to an old gentleman and his wife now reaching very close to 90. I have been paying it for many years. I think that this is rather interesting. I would not cite it if I did not think it interesting. He was employed by my family firm. At one time, when it appeared to him to be far more advantageous to him to do so, he asked my father if he could be removed from the salary scale and paid on commission. That meant that when he retired we had no obligation to him whatever, but we said, as he got older, that we did have an obligation to him, and we have been loyally, for 15 or 20 years, carrying that obligation.
§ Sir D. Glover
Of course we shall, but let the hon. Member have no doubt about it, that we have no legal obligation to do it.
Let us be clear about it, that what is being done by the Bill will make it easier for me to salve my conscience by being able to say, "I have no obligation." [HON. MEMBERS: "No."] Oh, yes, it is. Hon. Members can laugh this off as much as they like, but that is what is being done by the Bill. Of course, I shall not alter my mind about the obligation, but I might not have entered into it if the alteration which the Government are bringing in had been brought in some years ago. [HON. MEMBERS: "Ah."] I might not. I do not know. I do not know how I would have reacted.
What I am saying is that that man has not cost the State anything. He would have been a charge on the State, but he is not a charge on the State, and the State, for all these years, has been saved the cost of part of my net, after tax, income. What the Government are doing is to make it less likely in the years ahead that people will enter into these commitments. The Government are going round the country talking about building up a responsible society, yet they are doing 1822 their very utmost to make people behave a little less responsibly than they have behaved up to now.
I ask the Financial Secretary to give careful consideration to the Amendments. The net amount of money involved is almost negligible because in so many cases if these covenants were not in operation the persons who are getting benefit from them would be a charge on the State. Today, they are not a charge on the State. The Government are making it only too likely that many of the people to whom my right hon. Friend the Member for Chislehurst referred will become a direct charge on the State. There will be a little less responsibility, community spirit and desire to do a job for one's fellows than exists at present.
This is a very squalid provision and will bring in little real revenue. In fact, I think that it will remove a great deal of the sense of virtue and responsibility that now exists among many people.
§ Mr. Grieve
If I rise at this late hour to add a few words after the able, cogent and persuasive arguments which have been heard from my right hon. and hon. Friends, it is not because I wish to detain the Committee, and certainly not my hon. Friends on this side of the Committee who, I know, are anxious to express their opinions on the Amendment in the Division Lobby as soon as possible.
I wish to protest against the heartless sarcasm and derision with which the Financial Secretary treated the very human problem to which this Clause will give rise amongst many people who, at the most expensive time of their lives, when they are bringing up their own children, take upon themselves the additional burden of supporting aged parents. [HON. MEMBERS: "Burden?"] Yes, a burden.
Many hon. Members opposite do not realise the burden of supporting aged parents and, at the same time, bringing up one's own children.
Such people will not be deterred from continuing to carry that burden by the squalid tax which is now to be imposed upon them. Hon. Members opposite seem to take the view that in supporting one's parents out of one's own money one is somehow doing it out of the Exchequer.
1823 That was the point on which I rose to interrupt the hon. Member for Manchester, Cheetham (Mr. Harold Lever) not many moments ago. It is that attitude on the part of hon. Members opposite which gives rise to this type of Clause, which is dictated by class hatred
§ and which is aimed at people who are relieving the State of a burden by looking after their parents.
§ Question put, That the words proposed to be left out stand part of the Clause:—
§ The Committee divided: Ayes 148, Noes 121.1825
|Division No. 122.]||AYES||[11.45 p.m.|
|Abse, Leo||Heffer, Eric S.||Page, Derek (King's Lynn)|
|Alldritt, Walter||Horner, John||Paget, R. T.|
|Allen, Scholefield (Crewe)||Houghton, Rt. Hn. Douglas||Palmer, Arthur|
|Atkinson, Norman||Howarth, Harry (Wellingborough)||Park, Trevor (Derbyshire, S.E.)|
|Bacon, Miss Alice||Howarth, Robert L. (Bolton, E.)||Parker, John|
|Beaney, Alan||Hughes, Emrys (S. Ayrshire)||Parkin, B. T.|
|Benn, Rt. Hn. Anthony Wedgwood||Irvine, A. J. (Edge Hill)||Pavitt, Laurence|
|Bessell, Peter||Irving, Sydney (Dartford)||Perry, Ernest G.|
|Boston, T. G.||Jackson, Colin||Prentice, R. E.|
|Bottomley, Rt. Hn. Arthur||Janner, Sir Barnett||Pursey, Cmdr. Harry|
|Bowden, Rt. Hn. H. W. (Leics S.W.)||Jay, Rt. Hn. Douglas||Rankin, John|
|Bowen, Roderic (Cardigan)||Jeger, George (Goole)||Redhead, Edward|
|Boyden, James||Jeger,Mrs.Lena(H'b'n&St.P'cras,S.)||Rees, Merlyn|
|Bray, Dr. Jeremy||Jenkins, Hugh (Putney)||Reynolds, G. W.|
|Brown, Rt. Hn. George (Belper)||Jenkins, Rt. Hn. Roy (Stechford)||Richard, Ivor|
|Brown, R. W. (Shoreditch & Fbury)||Johnson,James(K'ston-on-Hull,W.)||Robinson,Rt.Hn.K.(St.Pancras,N.)|
|Buchan, Norman (Renfrewshire, W.)||Johnston, Russell (Inverness)||Rodgers, William (Stockton)|
|Butler, Herbert (Hackney, C.)||Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)||Rogers, George (Kensington, N.)|
|Butler, Mrs. Joyce (Wood Green)||Kerr, Mrs. Anne (R'ter & Chatham)||Rose, Paul B.|
|Corbet, Mrs. Freda||Lawson, George||Rowland, Christopher|
|Crosland, Anthony||Leadbitter, Ted||Shore, Peter (Stepney)|
|Crossman, Rt. Hn. R. H. S.||Ledger, Ron||Short, Rt.Hn.E.(N'c'tle-on-Tyne,C.)|
|Dalyell, Tam||Lee, Rt. Hn. Frederick (Newton)||Short, Mrs. Renée (W'hampton.N.E.)|
|Davies, Harold (Leek)||Lee, Miss Jennie (Cannock)||Silkin, S. C. (Camberwell, Dulwich)|
|Diamond, John||Lever, Harold (Cheetham)||Slater, Mrs. Harriet (Stoke, N.)|
|Dodds, Norman||Lewis, Arthur (West Ham, N.)||Solomons, Henry|
|Driberg, Tom||Lipton, Marcus||Soskice, Rt. Hn. Sir Frank|
|Dunnett, Jack||Loughlin, Charles||Steel, David (Roxburgh)|
|Edwards, Robert (Bilston)||Lubbock, Eric||Stonehouse, John|
|English, Michael||McBride, Neil||Strauss, Rt. Hn. G. R. (Vauxhall)|
|Ennals, David||McCann, J.||Summerskill, Hn. Dr. Shirley|
|Ensor, David||MacColl, James||Swingler, Stephen|
|Finch, Harold (Bedwellty)||MacDermot, Niall||Taverne, Dick|
|Fletcher, Sir Eric (Islington, E.)||Mackie, George Y. (C'ness & S'land)||Thomson, George (Dundee, E.)|
|Fletcher, Raymond (Ilkeston)||Mackie, John (Enfield, E.)||Tomney, Frank|
|Floud, Bernard||Mallalieu,J.P.W.(Huddersfield,E.)||Walden, Brian (All Saints)|
|Foot, Sir Dingle (Ipswich)||Marsh, Richard||Walker, Harold (Doncaster)|
|Foot, Michael (Ebbw Vale)||Mason, Roy||Wallace, George|
|Ford, Ben||Mayhew, Christopher||Weitzman, David|
|Freeson, Reginald||Mellish, Robert||Whitlock, William|
|Garrett, W. E.||Mikardo, Ian||Willey, Rt. Hn. Frederick|
|Garrow, A.||Millan, Bruce||Williams, Mrs. Shirley (Hitchin)|
|Ginsburg, David||Molloy, William||Williams, W. T. (Warrington)|
|Grey, Charles||Morris, John (Aberavon)||Winterbott[...]m, R. E.|
|Griffiths, Rt. Hn. James (Llanelly)||Mulley,Rt.Hn.Frederick(SheffieldPk)||Wyatt, Woodrow|
|Gunter, Rt. Hn. R. J.||Murray, Albert||Zilliacus, K.|
|Hamilton, William (West Fife)||Newens, Stan|
|Hamling, William (Woolwich, W.)||Noel-Baker, Francis (Swindon)||TELLERS FOR THE AYES:|
|Harper, Joseph||Noel-Baker,Rt.Hn.Philip(Derby,S.)||Mr. Brian O'Malley and|
|Hazell, Bert||Ogden, Eric||Mr. W. Howie.|
|Healey, Rt. Hn. Denis||Oram, Albert E. (E. Ham, S.)|
|Alison, Michael (Barkston Ash)||Box, Donald||Clark, William (Nottingham, S.)|
|Allan, Robert (Paddington, S.)||Boyd-Carpenter, Rt. Hn. J.||Cooke, Robert|
|Amery, Rt. Hn. Julian||Brinton, Sir Tatton||Cooper-Key, Sir Neill|
|Atkins, Humphrey||Brooke, Rt. Hn. Henry||Cordle, John|
|Balniel, Lord||Brown, Sir Edward (Bath)||Crawley, Aidan|
|Barber, Rt. Hn. Anthony||Bruce-Gardyne, J.||Crowder, F. P.|
|Batsford, Brian||Bryan, Paul||Curran, Charles|
|Bennett, Sir Frederic (Torquay)||Buck, Antony||d'Avigdor-Goldsmid, Sir Henry|
|Bennett, Dr. Reginald (Gos & Fhm)||Bullus, Sir Eric||Dean, Paul|
|Berry, Hn. Anthony||Buxton, Ronald||Deedes, Rt. Hn. W. F.|
|Birch, Rt. Hn. Nigel||Carr, Rt. Hn. Robert||Doughty, Charles|
|Bossom, Hn. Clive||Chichester-Clark, R.||Emer[...]y, Peter|
|Errington, Sir Eric||Hunt, John (Bromley)||Ridley, Hn. Nicholas|
|Eyre, Reginald||Iremonger, T. L.||Ridsdale, Julian|
|Fletcher-Cooke, Charles (Darwen)||Irvine, Bryant Godman (Rye)||Roberts, Sir Peter (Heeley)|
|Foster, Sir John||Joseph, Rt. Hn. Sir Keith||Roots, William|
|Fraser, Ian (Plymouth, Sutton)||Kershaw, Anthony||Scott-Hopkins, James|
|Gardner, Edward||King, Evelyn (Dorset, S.)||Sinclair, Sir George|
|Gilmour, Ian (Norfolk, Central)||Lancaster, Col. C. G.||Smith, Dudley (Br'ntf'd & Chiswick)|
|Glover, Sir Douglas||Langford-Holt, Sir John||Summers, Sir Spencer|
|Glyn, Sir Richard||Longbottom, Charles||Talbot, John E.|
|Goodhew, Victor||Loveys, Walter H.||Taylor, Edward M. (G'gow.Cathcart)|
|Grant, Anthony||McLaren, Martin||Thompson, Sir Richard (Croydon,S.)|
|Gresham-Cooke, R.||Macleod, Rt. Hn. Iain||Thorneycroft, Rt. Hn. Peter|
|Grieve, Percy||Marples, Rt. Hn. Ernest||Turton, Rt. Hn. R. H.|
|Griffiths, Eldon (Bury St. Edmunds)||Maude, Angus||van Straubenzee, W. R.|
|Griffiths, Peter (Smethwick)||Meyer, Sir Anthony||Vickers, Dame Joan|
|Gurden, Harold||Mills, Stratton (Belfast, N.)||Walker, Peter (Worcester)|
|Hall, John (Wycombe)||Miscampbell, Norman||Walker-Smith, Rt. Hn. Derek|
|Harris, Reader (Heston)||More, Jasper||Walters, Dennis|
|Harvey, Sir Arthur Vere (Macclesf'd)||Mott-Radclyffe, Sir Charles||Ward, Dame Irene|
|Harvie Anderson, Miss||Munro-Lucas-Tooth, Sir Hugh||Weatherill, Bernard|
|Hastings, Stephen||Neave, Airey||Webster, David|
|Hawkins, Paul||Page, R. Graham (Crosby)||Whitelaw, William|
|Heald, Rt. Hn. Sir Lionel||Peel, John||Williams, Sir Rolf Dudley (Exeter)|
|Heath, Rt. Hn. Edward||Pickthorn, Rt. Hn. Sir Kenneth||Wilson, Geoffrey (Truro)|
|Higgins, Terence L.||Pitt, Dame Edith||Wood, Rt. Hn. Richard|
|Hill, J. E. B. (S. Norfolk)||Prior, J. M. L.|
|Hirst, Geoffrey||Pym, Francis||TELLERS FOR THE NOES:|
|Hornby, Richard||Quennell, Miss J. M.||Mr. R. W. Elliott and|
|Hornsby-Smith, Rt. Hn. Dame P.||Rawlinson, Rt. Hn. Sir Peter||Mr. Geoffrey Johnson Smith.|
|Howe, Geoffrey (Bebington)||Redmayne, Rt. Hn. Sir Martin|
§ Clause ordered to stand part of the Bill.