HC Deb 30 June 1966 vol 730 cc2242-63

Section 7 (1) of the Finance Act 1959 (which disallows rebates on heavy oils used as fuel for vehicles whether or not such oils are used to propel the vehicle) shall not apply to fuel used by self-propelled items of constructional machinery at such times as the constructional machinery alone is operating and the vehicular or propulsive characteristics are effectively immobilised or removed; so that fuel used by the power unit on driving static machinery shall be subject to rebate.—[Dr. Bennett.]

Brought up, and read the First time.

Dr. Bennett

I beg to move, That the Clause be read a Second time.

The last sentence of the new Clause summarises the issue as clearly as could be. The words run: so that fuel used by the power unit on driving static machinery shall be subject to rebate. The new Clause refers to an anomaly, although it is an anomaly which has occasionally been denied. It is that contractors are forced to use road-taxed fuel for certain forms of machinery which are not in themselves propulsive.

In early times, this whole subject presented no problem, because in a vehicle of moving or mobile construction machinery, there would be one engine to drive the vehicle and another engine, carried on the vehicle, to operate the other machinery. The most common example is the turning of a hopper for liquid concrete.

Since the early days, design has developed in an obviously satisfactory direction in so far as there has been a considerable economy, and nowadays one power unit can work both the propulsion of the machinery and the machinery itself when it is stationary. It is obviously a much more efficient proposition in every way. But, alas, this concept has offended against the neat dichotomy of the Treasury's thinking according to which one engine cannot be both propulsive and constructive.

Two years ago, my hon. Friend the Member for Ilford, North (Mr. Iremonger) moved a new Clause to the then Finance Bill on something like these lines, and I would like briefly to refresh the Committee's recollection. The Clause then moved involved the use of a gadget which had to be operated from outside the vehicle. This gadget would lock the brakes on and, at the same time, open a valve which would supply rebated fuel to the engine. Before the vehicle could hoist its anchor and move again, that process had to be reversed, again from outside the vehicle.

This gadget was a good idea which was welcomed at the time by the Customs and Excise, but it was rejected by the Treasury as tending to create hybrid vehicles and also in some way tending to encourage "fiddles" with rebated fuel. I cannot regard those objections as very substantial, but I do not propose to press that.

This Clause seeks to obtain an equitable solution for such versatile vehicles, still without retrogression, of duplicate power units. What I seek to establish in the Clause is that mobile units of construction machinery shall, in future, be so effectively immobilised when on site that, in the opinion of the Treasury, they are no longer vehicles at all, but static construction machines. As such, they may run on rebated fuel, whatever the form of power unit actuating them. This immobilisation may need to be extensive, amounting to the removal of the wheels of the vehicles, if necessary, and the mounting of the whole affair on jacks or spuds operated mechanically or hydraulically with, if necessary, the complete isolation of the power unit from the transmission which would be used as a vehicle.

Subject to the conditions which the Treasury might lay down about immobili- sation, units of building machinery, when not mobile and when not even vehicles for the time being, should be permitted to run on rebated fuel, whatever the location of the engine actuating the machinery. I feel sure that it is not beyond the wit of man, still less of the Treasury civil servants, to be able to ingest this concept and materially to free the construction industry from an impost which is as expensive as it is absurd, being thoroughly incongruous in the setting of tidy administration.

If this anomaly is not removed, either or both of two things will happen. First, such dual purpose machines will be forced again to duplicate their engines, doubling costs and becoming a drain on our national resources. Alternatively, under the beneficent provisions of Clause 7, to which I addressed a few words of welcome earlier in our debates on the Bill, a way will have to be found of separating the machinery from the vehicle when on site, still duplicating the sources of energy, but, at the same time, saving on the cost of licensing the locomotive element. Both these are clumsy expedients, as unsatisfactory to the industry as to the revenue. The new Clause can obviate all these undesirable developments and reduce building costs.

The arguments in support of a similar Clause moved two years ago were worthily supported by hon. Members on both sides of the Committee, not least by the distinguished right hon. Member who now presides over the deliberations of the House of Commons as Speaker. I hope that the Government will accord to the new Clause the serious consideration it deserves and improve the Finance Bill with a small but worthy measure of reform.

Mr. R. Gresham Cooke (Twickenham)

I support my hon. Friend the Member for Gosport and Fareham (Dr. Bennett), who moved the Clause with such skill and wit. It is perfectly obvious that technical machinery can be found for separating the two fuels and ensuring that the engine that works the construction machinery does not use the fuel which is used by the engine that makes the vehicle run on the road. Technically, this little problem can be solved.

Anybody who has been on a building site and who has watched these construction engines running, using fuel at a very expensive rate and at a rate of tax of 3s. per gallon, must be alarmed to think that the fuel which is really intended for running on the road should be used for building work, thereby increasing the cost of construction. I hope that the Treasury will heed this argument, because this is the sort of small thing which can be clone to reduce costs and to help the building industry. I am sure that, now that we have such a modern-minded Government, they will be the very first to adopt this sort of plan.

5.45 p.m.

Mr. Peyton

I want to refer the Financial Secretary to the remarks of so discriminating an authority as the present Speaker who, when he was back bencher, expressed, with a brevity of speech which I am sure he would now even more strongly commend, the reasons for not imposing this injustice upon the industry concerned. I refer hon. Members to column 501 of the Committee stage of the Finance Bill on 10th June, 1964.

I am the first to appreciate the fact that one does not normally in common sense call the attention of Ministers to speeches made by their counterparts in a previous Administration and expect them to be impressed. On the other hand, I feel that things are different when dealing with Customs and Excise matters because, just as Isaac found it difficult to tell whether he was dealing with Jacob or with Esau, so ordinary Members of Parliament find it extremely difficult to distinguish between Financial Secretaries or Economic Secretaries or other Treasury Ministers when they know full well that the voice is that of the Customs and Excise, not always expressed in the most dulcet and attractive of tones. I speak as one who is by no means a convinced admirer of that great establishment.

I feel entitled to remind the Financial Secretary of something said by a former Economic Secretary on this subject in 1964, on the occasion to which I have referred: It is a difficult and real problem to make sure that the later and more highly developed methods of building, or of mixing concrete, or anything else, are not penalised by the tax system. This difficulty has been languishing in the bosom of the Commissioners of Customs and Excise for some time now, and, patient though I am, I am beginning to think that this process might perhaps have borne fruit, though I realise that in hoping this I may be rashly optimistic.

The then Economic Secretary went on to say this: It is clear that, as time goes on Then comes an immortal phrase. I certainly do not wish to be in any way offensive to my hon. Friend the Member for Farnham (Mr. Maurice Macmillan), but it is a splendid phrase. It finds itself enshrined in Government statement after Government statement. He said: It is clear that, as time goes on, matters of this sort will have to be constantly in our minds."—[OFFICIAL REPORT, 10th June, 1964; Vol. 696, c. 502.] To those of us who are familiar with this kind of jargon, this is a very special brand of consideration. We all know full well what happens when a Minister says that he will bear something in mind. We know full well that it is going in one ear and will not be arrested in its process out of the other one. This consideration was to be something rather special, because my hon. Friend said that it would have to be "constantly", ever-present, in the minds of the Government. We know very well that the unfortunate victim for the time being, in the case I am quoting the then Economic Secretary, is only there to do the will of the Customs and Excise; so in saying this he is really saying, "This problem is constantly in the mind of the Customs and Excise".

I support my hon. Friend the Member for Gosport and Fareham (Dr. Bennett), who very modestly and briefly moved the Amendment. I hope, without a great deal of confidence, that the Financial Secretary will be able to produce on a golden platter the proof that all my worst suspicions are unfounded and unfair and that the Commissioners of Customs and Excise have, from their long travail, borne fruit and shown some result from the state of having had this problem constantly in their minds.

Mr. MacDermot

Perhaps Jacob II may be allowed to intervene and adduce the arguments which the hon. Member for Yeovil (Mr. Peyton) will no doubt think were written by the hand of Esau. As the hon. Member for Gosport and Fareham (Dr. Bennett) said, this is a proposal which goes back some way and has some history behind it. It is the British Ready-Mixed Concrete Association with which we are particularly concerned, because an ingenious person has devised a mechanism which, it is claimed, is foolproof and would ensure that the rebated oil could be used only for a purpose which in itself would not attract the duty. This is what the case is based on.

Originally, this matter was raised in 1963 by Sir Peter Roberts, with the then Financial Secretary, with a negative result. It was then raised in the debates on the Finance Bill which have been quoted by the hon. Member for Yeovil, when the hon. Member for Ilford, North (Mr. Iremonger) raised the matter on a new Clause, and the then Economic Secretary put forward the arguments refuting it. I do not know whether it has since been constantly in his mind. I confess that it has not been constantly in my mind, although it was in my mind before I saw the new Clause because the matter was raised with me some time ago. I looked into it carefully, as did the former Economic Secretary, with sympathy.

A perfectly valid point was made by the hon. Member for Twickenham (Mr. Gresham Cooke) when he said that when one has technical progress of this kind it should be possible to adapt Customs law, if one reasonably can, to take into account the technical progress being made. I say at once that I approached the matter sympathetically, but that I had to reject it, as I must advise the Committee to do, basically for the same reasons given by the Economic Secretary in 1964.

To summarise the reasons that were given two years ago, they are, first, that the concession would destroy the clear-cut line of distinction which is drawn by the present arrangements. It would be extremely difficult to control against abuse and if we granted it we believe that we would be bound to grant concessions in respect of many other types of vehicle which would be at least as difficult to control.

I appreciate that these are not the sort of arguments which appeal to the Committee. I do not know whether they will become more attractive if I explain them, but it is my duty to do that. The vehicles which are permitted at the moment to use rebated oil are vehicles which are entitled to do so at all times. Those vehicles are listed in Section 200 (6) of the Customs and Excise Act—such vehicles as mobile cranes and those which are not used on the public roads and which have no road-fund licences in force in respect of them. There is a clear-cut distinction based on the character of the vehicle.

If a vehicle is excepted, its fuel tank may contain rebated oil. And if it is not excepted, it is an absolute offence for rebated oil to be taken into the tank which supplies the propelling engine. It is a clear-cut matter which can easily be checked. There is one exception to this, on which arguments are sometimes based, which is that of the travelling fairground showman. But there are two special conditions which overcome the difficulty of controlling these vehicles. They are the conditions that the vehicle must be totally immobilised by the disconnection of the transmission shaft to the rear wheels and that the rebated oil would in no circumstances be put into the fuel tank, but be fed into the engine from a separate container not mounted on the vehicle. The Customs officer can see at a glance whether or not the regulations are being observed.

The practical difficulty about the ingenious fuel selector device which has been invented is that I think it must be accepted that what one ingenious engineer can devise another ingenious engineer can find a means of circumventing; that it would require expert appraisal of the machine to be satisfied that there was no evasion going on. And even if the machine was examined before the device was installed, there would be no protection and guarantee against subsequent tampering. A simple and ready check on the spot by Customs officers would not be a guarantee against evasion and they would not have the necessary special technical engineering knowledge and skill to see whether the device had been tampered with in any way to enable evasion to take place.

I do not think that anyone would argue that, for the purpose just of making an Amendment of this kind to the law, one could expect the Customs and Excise to go to all the expense and uneconomic use of manpower to recruit especially skilled and expert staff for this purpose. But even if there were the expert staff available, there would still in many cases be the inherent difficulty in proving that any malfunctioning of the device was due to some deliberate act of the vehicle operator—some deliberate act such as broken pipes, jammed levers, snapped linkeages, and so on, which can always be claimed to be due to accident, or to badly fitted or badly maintained devices, which can be blamed on the maintenance mechanic.

Thus, from the enforcement point of view, even if enforcement proceedings were taken no more than a nominal penalty would be imposed.

Mr. Peyton

Before the hon. and learned Gentleman leaves that point, as he mentioned the possibility of metering the non-propulsion part of the vehicle, could there not be a device which would show clearly the amount of fuel which had been used for non-propulsion purposes—construction purposes, or something else—so that a rebate could then be paid alter the fuel had been used?

Mr. MacDermot

I imagine that there would be built into the system a metering device of that kind. However, these things can also be interfered and tampered with.

On the question of repercussions, the Amendment refers solely to vehicles in the constructional sphere, but if we were to accept this principle we do not feel that we would be able, in equity, to refuse making similar concessions to a host of other vehicles. Engines are used for other mechanical purposes, such as in garbage vehicles for pressing down the refuse, fire engines of one sort or another and ambulances for moving part of the vehicle when the vehicle is not moving on the roads, ice-cream vans and mobile refrigerators which have additional moving parts when the vehicles are in motion or stationary, and a host of other vehicles, including mobile workshops and Land Rovers, many of which are equipped with a power take-off for driving saws, winches and other equipment. These are some of the difficulties that would arise, and they are not theoretical difficulties.

Revenue evasion by misuse of rebated oil in road vehicles is already a serious problem and, with the serious differentia- tion in the duty—3s. 3d. on the one hand and 2d. on the other—there is a big incentive to dishonest persons to seek to evade it. In view of these arguments, we are compelled to the conclusion that, even with this ingenious device, it would be putting the Revenue at too great a peril to accept the Amendment, and for that reason I must advise the Committee to reject it.

Mr. Peyton

It may be entirely my fault, because I did not express my ideas clearly, that the hon. and learned Gentleman did not understand what I was saying. However, I must say that I did not understand his reply, either.

I am suggesting that there should be a meter, which could be approved by the Customs, attached to all such vehicles and which would clearly show—and presumably such a meter could be made proof against "fiddling"—the amount of fuel that had been used for purposes other than propelling the vehicle along. I gathered from the hon. and learned Gentleman's reply that that point had not been considered. If it has not been, I think that the time has come when it should receive proper consideration.

Any reasonable person—and I include myself—would admit that there is a genuine difficulty here. For any Government to get into the position of hampering the use of modern devices and techniques of construction for tax reasons is the highest form of folly. I hope that the Government will do everything that they can to avoid being put into that very prejudicial and unwelcome position.

6.0 p.m.

I would ask the Financial Secretary, particularly, whether he would make absolutely clear whether the possibility of attaching meters to show the amount of fuel which has been used for non-propulsion purposes has been investigated. I cannot help feeling that that line is probably the most fruitful and hopeful that there is available.

I am sure that we are all very sympathetic to the Financial Secretary. He has had an extraordinarily long night and is getting towards the end of what to him must be an inconceivably long-drawn-out experience. I am sorry to have to inflict one more point upon him. He has been extremely courteous this afternoon and has not once given cause for complaint, which makes me all the more reluctant to press him now.

I hope that, in turn, he will press the Commissioners to disturb their arrangements slightly and see whether something cannot be done, instead of putting Treasury Ministers in the embarrassing position of constantly having to say "No.". I appreciate that the Commissioners are in a world of their own. They say that it is impossible, untidy, and an inconvenience, and would make their arrangements unworkable. The Commissioners expect their word to be acceptable to generations of Treasury Ministers and, after them, the House of Commons. I do not think that it is. The Financial Secretary is in a very difficult position in that most of the time-honoured phrases have already been used. He has walked round them with some skill today. But the matter has been constantly in the minds of the Commissioners for a long time. They ought to explore accurately the possibilities of putting right an extremely unsatisfactory situation.

Mr. MacDermot

I can assure the hon. Member for Yeovil (Mr. Peyton) that replying to his arguments is like a habit-forming drug. Far from wilting under it, and feeling that I am coming to the end of my tether, I look forward to several hours more of debate with him. If he has any refinements to propose to this ingenious device, we and the Customs and Excise will be very glad to consider them.

However, I do not feel that any firm solution to the problem lies in the provision of a meter of the kind that the hon. Gentleman is suggesting. What we are considering is not the honest man. There is no problem with him. We are concerned with the dishonest person, who may not be the owner of the vehicle and who is seeking to make some money "on the side" by tampering with such a device.

If a meter is put up as an obstruction for him, I imagine that it will be no great difficulty for him to tamper with it so that it does not work and then to claim, in the way that I have indicated, that it was not his fault, he did not do it, but found it like that. One would not be able to pin responsibility in any way that would constitute an effective deterrent.

I do not think that we can profitably discuss these technical matters. I will gladly consider any further proposals which the hon. Gentleman may put forward.

Mr. Peyton

I do not wish to be tedious, but the point is not whether I, as an inexpert Member of Parliament, should produce means of doing this. It is for the Commissioners of Customs and Excise themselves to explore it. The Financial Secretary shakes his head, but that is the issue between us, and it is what I always find so very objectionable.

Mr. MacDermot

The Customs and Excise Board is not composed of skilled engineers. It is not for its members to devise mechanisms to help people to solve the problem. It is for those who are engineers to do that. However, we will consider any proposals put forward.

Mr. Peyton

I am sorry, but this is where we get down to the difference in attitude. The Customs and Excise Board sits there in a sort of sovereign splendour, independent and untouched by the real embarrassments which it causes to far too many people. I would never envy the Financial Secretary, because he is put there to defend that reactionary body, as a member of the Government devoted utterly to the cause of progress; yet here he is condemned to defend a position of utter reaction.

The Customs and Excise Board says that these mundane pedestrian affairs are nothing to do with it, and proposes to shrug off as being of no concern to it the embarrassments which it causes to others. I do not find that attitude of mind acceptable. I readily concede that its members are no more engineers than I am, but I cannot see that a body of that august nature, with all its powers and resources, cannot find an engineer whom they might consult.

Dr. Bennett

May I remind my hon. Friend that I mentioned in my original remarks that the Commissioners of Customs and Excise are on record as having approved this gadget. It is the Treasury, apparently, which does not approve of it.

Mr. Peyton

I am sorry. I missed that part of my hon. Friend's opening remarks. Perhaps the Financial Secretary can clear this up. It would be unreasonable for us to ask him to commit himself, the Treasury or the Customs and Excise to finding a satisfactory device, whether or not one is presently available. I believe that the Commissioners and the Treasury, if they are responsible, might be encouraged to take a more constructive attitude and realise that the present effect of the tax which they are imposing is one of great embarrassment to other people—the users of these machines.

I hope that the Financial Secretary will be able at least to go so far as to say that between now and Report, the Commissioners of Customs and Excise and the Treasury, whichever is responsible, will stir themselves and find out whether there is any possibility of making use of a metering device. All the electricity and gas consumed in the country is measured by meters. We find these meters in every house in the land. It is not easy to "fiddle" them, otherwise it would be done far more regularly and successfully. Interference with a meter, which could remain the property of the Customs and Excise, could be visited with heavy penalties.

I cannot see why we should not stir the Commissioners out of their present lethargy and get them to investigate the possibilities of remedying what is a major inconvenience and a considerable injustice.

Mr. MacDermot

I wish to intervene again merely to say that I deprecate strongly the remarks which the hon. Gentleman has made about the Customs and Excise. It is not our tradition in the Committee to attack civil servants. As Ministers, we are responsible, and I would only invite the hon. Gentleman to discuss with my predecessors in office, and others who have held office in the Treasury, the terms that he has used in relation to the Board of Customs and Excise. I can assure him that they are very wide of the mark. I say no more about that.

With regard to the hon. Gentleman's invitation to me, I rest on what I have said. We have a different attitude about where the responsibility lies. I am open to be persuaded to the contrary, but I do not believe that the solution to this problem can be found by a mechanical device, for the reason which I have given.

We know that sometimes it is possible to deal with fuel with a marker device, but, by the nature of the thing, one cannot use a remedy of that kind here. This is the difficulty.

Mr. Patrick Jenkin

Until now our proceedings have gone along in a very happy atmosphere, but if I might continue my hon. Friend's biblical allusion, a cloud no bigger than a man's hand has appeared on the horizon.

Mr. MacDermot

It came from behind the hon. Gentleman.

Mr. Jenkin

The Financial Secretary says that it came from behind me. On the contrary, it came from that side of the Committee. The Financial Secretary's uncompromising reply to the reasonable case put forward by my hon. Friends is, I think, the first rift in the lute that we have had this afternoon.

I cannot believe that this is as difficult as the right hon. Gentleman is making out. Whether the hand that has appeared on the horizon is the hand of Esau, I do not know, but it appears that the right hon. Gentleman's brief is directed to the point of the mechanical device which was the centrepiece of the argument addressed to the Government two years ago by my hon. Friend the Member for Ilford, North (Mr. Iremonger).

As I read the Clause, it has been drawn specifically to avoid any reference to that device. In a sense the point has been taken that the Commissioners of Customs and Excise do not believe that it is practicable to operate a system of duality on the basis of the device which was the centrepiece of the argument two years ago. The Clause contains the words and the vehicular or propulsive characteristics are effectively immobilised or removed. Those words seem to make it clear that my hon. Friend the Member for Gosport and Fareham (Dr. Bennett) is envisaging something different, and when he addressed the Committee he made it clear that the vehicle would have to be immobilised either by being jacked up or by being attached to the ground in such a way that the propulsive characteristics of the machine, the transmission linkage, was in some way completely by-passed, and there was no possibility of the main motive unit being used for propelling the vehicle. In those circumstances, it would be used only for propelling the constructional machinery, and thus the rebated fuel would be used.

I believe that my hon. Friend's arguments are very strong and reasonable. After all, the case on which the Clause is based is not that the classification, to use the words of the Financial Secretary, would destroy the line of distinction which has hitherto been the guide-line on which the Customs and Excise operated. The line of distinction on which the Customs and Excise has operated has been rendered out of date. It is no longer relevant. Modern technical advance, which brings considerable advantages to those who use it, has come on the scene, and has to that extent rendered this line of distinction on which the Customs and Excise has been operating no longer of use.

One therefore has to go back to the principle of the distinction which has been drawn when rebated and non-rebated fuels should be used, which is broadly this, that where oil is used in a vehicle or transportation, for load-carrying purposes on the highway, then unrebated fuel must be used. In all other cases rebated fuel may be used, and this is the basis of the distinction for many of the pieces of constructional machinery which are used with rebated fuels.

6.15 p.m.

Instances have been given to the Committee this afternoon of such things as mobile cranes. In discussing this matter with the trade association concerned, I have been given examples of mobile generators, mobile compressors, and machinery of that sort which is regarded primarily as a constructional machine. The fact that it happens to get from place to place along the road is ignored, and the rebated fuel is used.

On that principle, it is clear that when a mobile concrete mixer is standing at a building site—and it may be there for some hours—and its drum is turning, this is a use which has nothing to do with transportation, and it is at that point that the line must be drawn, and it is to that point that the argument must be directed.

The strength of the case for it is tthe point that was put very clearly by my hon. Friend the Member for Twickenham (Mr. Gresham Cooke) who referred to the in- creased buildings costs which are involved in using fuel that is taxed at 3s. 3d. for driving labour-saving machinery, modern technological machinery that is used for building and for putting up all sorts of construction work, and so on. This increase in costs is something which one would have thought the Government would have wanted to stretch every nerve to avoid, particularly at a time when, inevitably, for reasons which it would be out of order to discuss, construction costs appear to be rising very rapidly indeed.

The Financial Secretary, so far from giving the impression of a man who is stretching every nerve to be helpful, gave the impression of a man who was stretching every nerve to try to find reasons why it could not be done, and this is what my hon. Friend the Member for Yeovil (Mr. Peyton) was complaining about when he made his critical remarks about the rejection of this idea.

We cannot lie supine under an attitude which is prepared to scratch around to find any argument why this obvious allowance should not be made.

The Financial Secretary gave us a long list of other vehicles in respect of which a similar situation might arise, and why, therefore, there would be strong pressure to give a comparable concession. None of the vehicles listed by the right hon. and learned Gentleman is in anything like the same category as the mobile concrete mixer which, so far as my researches go, is the only one which gives rise to a serious problem, the only one in respect of which the money involved in turning the machinery—the machinery being substantial and heavy—is significant in terms of extra tax.

One source which I contacted, and which attempted to put a figure on this, said that with a concrete mixer this could amount to about £300 a year. When one remembers that this sort of figure is equivalent to the whole maintenance costs of a reasonably new vehicle, that it is the sort of figure which is attributable to the whole of the rest of the fuel consumed in a year, one begins to realise the magnitude of the cost. If one said that it was between one-seventh and one-eighth of the total annual cost of operating the vehicle, one would not be wildly wrong. These things operate within wide variations because of the nature of the jobs on which the vehicles are engaged, but the fact that there is something substantial in it, so far from being a reason for not doing something, is a reason for trying all the harder to do something about it.

The very unhelpful attitude of the Financial Secretary contrasts unfavourably with the attitude adopted by his predecessor—my hon. Friend the Member for Farnham (Mr. Maurice Macmillan), who replied to the debate on the previous occasion and went out of his way to say over and over again, "We would dearly like to be able to do this, and it is only because of technical difficulties that we cannot". I got the impression from the Financial Secretary that that was not his attitude. His attitude was that it could not be done for many reasons, which he gave to the Committee.

I cannot feel that this is the right approach to deal with a modern technological advance in an industry which has recently been abused up hill and down dale for not advancing sufficiently swiftly in technology and not making the maximum use of the new inventions and developments which are available. It has been accused of being behind the times, and of relying on old-fashioned methods. One has only to use one's eyes to see the extent to which this device has rapidly replaced the concrete-mixing machine on individual sites to realise what value it has to the building industry. To have a large, static concrete mixer on the outskirts of a town, with large supplies of the necessary aggregates, delivering ready-mixed concrete to sites all over the town, is an efficient way of operating.

That the Government, with their claims to improve the productivity and efficiency of this industry, should appear to be so reluctant to do anything to improve the situation, must be very disheartening to the industry. We must protest about this. Unless the Financial Secretary is prepared to be more forthcoming I must advise my hon. Friends to press the matter to a Division and to join my hon. Friend the Member for Gosport and Fareham in the Division Lobby in favour of the new Clause.

Mr. Gresham Cooke

I want to leave one thought in the mind of the Financial Secretary. No doubt he will be constantly thinking of this subject during the coming year, ready for the debate which we shall have next year if the new Clause is not accepted. Alarmed by the idea put up by the Customs and Excise authorities that if he gives way on the question of the concrete-mixing machine he would have to give way on dust carts, fire engines, Land Rovers and the rest, he has refused to accede to our request. Surely it would be desirable to give way in respect of those machines. As a ratepayer I should like to know that the dust cart operating in Westminster was running on rebated fuel. Similarly, if my house was on fire I should like to know that the fire engine that came to put it out was operating on rebated fuel. A farmer using his Land Rover with a power take-off would be helped if he could use rebated fuel.

The fact that there are other applications should induce the Financial Secretary to say that during the next 12 months the Treasury and the Customs and Excise authorities ought to bring this concession into operation, in view of the productive benefit it would bring to the nation.

Mr. MacDermot

I am sorry if I gave the impression that I was any less anxious or willing to help to find a solution to this problem than was my predecessor the hon. Member for Farnham (Mr. Maurice Macmillan). When he was Economic Secretary. I have read the report of his speech in that debate and I am willing to adopt every word he said, including those at which criticism was directed, and to stand by them. The arguments which I have used are the same as he used. I elaborated them rather more fully than he did because, as two years have elapsed, I thought it right that we should explain more fully what the difficulties are.

It is the duty of the Committee to safeguard the Revenue, for the protection of the taxpayer. All that I would say is that the arguments put forward do not appear to provide adequate protection against abuse of the kind which we know exists and for which there is a strong incentive. The difficulty is that if abuse takes place it will take the form of driving the vehicle on the road with the rebated fuel. I want to know whether there is any way in which a Customs and Excise officer, with his ordinary common sense, intelligence and skill, would be able, on a spot check of such a vehicle, effectively to determine whether an abuse had taken place and, if it had, whether that abuse was deliberate. Unless he could establish that he would not get the kind of determination by a court which operates as an effective sanction or deterrent against the kind of people who would want to abuse this concession. That is the essence of the problem.

If I have carried the Committee with me in the argument that this is a valid problem, and that this is the test which must be satisfied before we can make this concession within that framework, I shall gladly receive any representations made by any hon. Members, and look in detail into any proposals that may be made.

Dr. Bennett

I appreciated the sympathy and courtesy with which the Financial Secretary answered the debate. My appreciation, however, inevitably turned to a profound disappointment. I say that in sorrow and not in anger. What absolutely baffles me is this pathological preoccupation with smugglers. I know that preventive men are supposed to be against smugglers. We are all against sin, but the Treasury of today—if we do not make any reference to the King's Beam House—sees the smuggler under every truck.

The Financial Secretary has expressed himself in identical terms to the Chief Secretary in his preoccupation, a few nights ago, with the hovercraft, when he referred to it as the ideal smuggler's vehicle—the noisiest, draughtiest, windiest and wettest vehicle in any surroundings! The Financial Secretary, by his answer today, shows that the Government's view is unchanged. He has only added a certain amount of material. The Government's view is essentially unchanged. The issue that I have brought up today on the new Clause, however, is much broader than that which was raised two years ago.

In his answer the Financial Secretary did not say one word which was relevant to any new material, or to applications which have been made since the debate two years ago. There are new points which obviously present themselves, one of which I mentioned in my original exposition of the New Clause, namely, that immobilisation should be made com- plete, if necessary, by the partial dismantling of the vehicle, as happens with a fairground vehicle, which I understand has the Treasury's approval. I am not talking about a gadget with which so much play was made in the brief so unfortunately compiled for the Financial Secretary.

6.30 p.m.

Secondly, there is talk in the new circumstances of a separate tank apart altogether from the vehicle. The Financial Secretary drew attention to the fact that spot checks could easily miss the question whether any fiddle was going on if there were a separate tank, as is used in some fairground vehicles. This would certainly make spot checks quite easy, but all this talk about fiddling seemed to me to be terribly misguided. It is not irrelevant but it is misguided. It is putting the fiddle before the bow. The fiddler will fiddle just the same, whether he has one, two or three tanks, or whether he has a Mini or a truck. He will put the stuff in the fuel tank if he wants to fiddle, and the fact that a gadget came up two years ago makes no difference to a fiddler's fortunes. He will fiddle just the same.

The Financial Secretary brought up the question of electrical and other vehicles. Fair enough. They are mostly electrical, mostly distinguished by having a very small part of their power output directed to the machinery which they carry. Therefore, I do not think that the load on them in having power takeoff for driving their internal machinery is serious. As far as I can make out on the Treasury's view, we always return to the war on the Land Rover with a power take-off. There is the fiddling farmer, perhaps whom the Treasury is hunting. The Land Rover with a power take-off, as we see it today, is not a vehicle that has been totally immobilised or partially dismantled. If the Treasury wants to be strict enough in the degree of immobilisation upon which it insists, surely we could find common ground in this matter.

In the light of the deplorable brief which the self-respecting Financial Secretary has been asked to plough through, I must ask my right hon. and hon. Friends to go into the Division Lobby against the Government.

Question put, That the Clause be read a Second time:—

The Committee divided: Ayes 117, Noes 178.

Division No. 84.] AYES [6.33 p.m.
Alison, Michael (Barkston Ash) Griffiths, Will (Exchange) Osborne, Sir Cyril (Louth)
Allason, James (Hemel Hempstead) Grimond, Rt. Hn. J. Page, Graham (Crosby)
Atkins, Humphrey (M't'n & M'd'n) Gurden, Harold Page, John (Harrow, W.)
Balniel, Lord Hall, John (Wycombe) Pardoe, John
Batsford, Brian Hamilton, Michael (Salisbury) Pearson, Sir Frank (Clitheroe)
Beamish, Col. Sir Tufton Harris, Frederic (Croydon, N.W.) Percival, Ian
Bell, Ronald Harvey, Sir Arthur Vere Pike, Miss Mervyn
Bennett, Dr. Reginald (Gos & Fhm) Heath, Rt. Hn. Edward Pink, R. Bonner
Biffen, John Heseltine, Michael Pym, Francis
Black, Sir Cyril Higgins, Terence L. Rossi, Hugh (Hornsey)
Body, Richard Hirst, Geoffrey Sharpies, Richard
Boyd-Carpenter, Rt. Hn. John Hordern, Peter Shaw, Michael (Sc'b'gh & Whitby)
Boyle, Rt. Hn. Sir Edward Howell, David (Guildford) Silverman, Sydney (Nelson)
Braine, Bernard Hunt, John Sinclair, Sir George
Brinton, Sir Tatton Hutchison, Michael Clark Smith, John
Brown, Sir Edward (Bath) Irvine, Bryant Godman (Rye) Stainton, Keith
Bruce-Gardyne, J. Jenkin, Patrick (Woodford) Steel, David (Roxburgh)
Buck, Antony (Colchester) Jennings, J. C. (Burton) Tapsell, Peter
Bullus, Sir Eric Jones, Arthur (Northants, S.) Taylor, Sir Charles (Eastbourne)
Burden, F. A. Joseph, Rt. Hn. Sir Keith Taylor, Edward M. (G'gow,Cathcart)
Chichester-Clark, R. Kaberry, Sir Donald Taylor, Frank (Moss Side)
Cooke, Robert King, Evelyn (Dorset, S.) Thatcher, Mrs. Margaret
Costain, A. P. Kirk, Peter Thorpe, Jeremy
Craddock, Sir Beresford (Spelthorne) Knight, Mrs. Jill Turton, Rt. Hn. R. H.
Crawley, Aidan Lewis, Kenneth (Rutland) Vaughan-Morgan, Rt. Hn. Sir John
Crouch, David Lubbock, Eric Vickers, Dame Joan
Dean, Paul (Somerset, N.) McAdden, Sir Stephen Wainwright, Richard (Colne Valley)
Deedes, Rt. Hn. W. F. (Ashford) Mackenzie, Alasdair (Ross&Crom'ty) Walker-Smith, Rt. Hn. Sir Derek
Elliot, Capt. Walter (Carshalton) Macleod, Rt. Hn. Iain Ward, Dame Irene
Errington, Sir Eric Maddan, Martin Webster, David
Eyre, Reginald Marten, Neil Wells, John (Maidstone)
Fisher, Nigel Mathew, Robert Whitelaw, William
Fletcher-Cooke, Charles Mawby, Ray Wills, Sir Gerald (Bridgwater)
Foster, Sir John Maxwell-Hyslop, R. J. Wilson, Geoffrey (Truro)
Gilmour, Ian (Norfolk, C.) Maydon, Lt.-Cmdr. S. L. C. Wylie, N. R.
Glover, Sir Douglas More, Jasper Younger, Hn, Georgo
Goodhart, Philip Morgan, W. G. (Denbigh)
Goodhew, Victor Nabarro, Sir Gerald TFLLERS FOR THE AYES:
Grant, Anthony Weave, Airey Mr. R. W. Elliott and Mr. Blaker
Gresham Cooke, R. Nott, John
Griffiths, Eldon (Bury St. Edmunds)
Abse, Leo Doig, Peter Howie, W.
Anderson, Donald Donnelly, Desmond Hughes, Rt. Hn. Cledwyn (Anglesey)
Archer, Peter Driberg, Tom Hughes, Emrys (Ayrshire, S.)
Ashley, Jack Dunn, James A. Hughes, Hector (Aberdeen, N.)
Atkins, Ronald (Preston, N.) Dunwoody, Mrs. Gwyneth (Exeter) Hughes, Roy (Newport)
Atkinson, Norman (Tottenham) Dunwoody, Dr. John (F'th & C'b'e) Hunter, Adam
Bacon, Rt. Hn. Alice Edwards, Robert (Bilston) Hynd, John
Barnes, Michael Ellis, John Irvine, A. J. (Edge Hill)
Benn, Rt. Hn. Anthony Wedgwood English, Michael Jackson, Peter M. (High Peak)
Binns, John Ennals, David Janner, Sir Bamett
Bishop, E. S. Ensor, David Jeger, George (Goole)
Blenkinsop, Arthur Evans, Albert (Islington, S.W.) Jeger,Mrs.Lena(H'b'n&St.P'cras,S.)
Booth, Albert Faulds, Andrew Jenkins, Hugh (Putney)
Boston, Terence Fitch, Alan (Wigan) Johnson, Carol (Lewisham, S.)
Bowden, Rt. Hn. Herbert Fletcher, Raymond (Ilkeston) Jones, J. Idwal (Wrexham)
Braddock, Mrs. E. M. Fletcher, Ted (Darlington) Judd, Frank
Bray, Dr. Jeremy Floud, Bernard Kenyon, Clifford
Brooks, Edwin Foley, Maurice Kerr, Mrs. Anne (R'ter & Chatham)
Brown, Rt. Hn. George (Belper) Fraser, John (Norwood) Kerr, Dr. David (W'worth, Central)
Butler, Herbert (Hackney, C.) Fraser, Rt. Hn. Tom (Hamilton) Kerr, Russell (Feltham)
Butler, Mrs. Joyce (Wood Green) Gardner, A. J. Leadbitter, Ted
Cant, R. B. Gray, Dr. Hugh (Yarmouth) Lee, Rt. Hn. Frederick (Newton)
Carter-Jones, Lewis Grey, Charles (Durham) Lee, Rt. Hn. Jennie (Cannock)
Chapman, Donald Griffiths, Rt. Hn. James (Llanelly) Lipton, Marcus
Concannon, J. D. Hamling, William Luard, Evan
Cousins, Rt. Hn. Frank Hannan, William Mabon, Dr. J. Dickson
Cronin, John Harper, Joseph McBride, Neil
Crosland, Rt. Hn. Anthony Harrison, Walter (Wakefield) MacColl, James
Davidson, Arthur (Accrington) Hazell, Bert MacDermot, Niall
Davies, Dr. Ernest (Stretford) Heffer, Eric S. Macdonald, A. H.
Davies, Harold (Leek) Herbison, Rt. Hn. Margaret McGuire, Michael
Davies, Robert (Cambridge) Hooley, Frank McKay, Mrs. Margaret
Dewar, Donald Horner, John Mackenzie, Gregor (Rutherglen)
Diamond, Rt. Hn. John Howarth, Robert (Bolton, E.) Mackintosh, John P.
Dickens, James
Maclennan, Robert Palmer, Arthur Silkin, S. C. (Dulwich)
MacPherson, Malcolm Pannell, Rt. Hn. Charles Silverman, Julius (Aston)
Mahon, Peter (Preston, S.) Park, Trevor Silverman, Sydney (Nelson)
Mahon, Simon (Bootle) Parker, John (Dagenham) Slater, Joseph
Mallalieu, E. L. (Brigg) Parkyn, Brian (Bedford) Snow, Julian
Marquand, David Pavitt, Laurence Spriggs, Leslie
Mason, Roy Pearson, Arthur (Pontypridd) Swain, Thomas
Mellish, Robert Pentland, Norman Taverne, Dick
Mikardo, Ian Perry, Ernest G. (Battersea, S.) Thornton, Ernest
Millan, Bruce Price, Thomas (Westhoughton) Tinn, dames
Miller, Dr. M. S. Price, William (Rugby) Tomney, Frank
Mitchell, R. C. (S'th'pton, Test) Redhead, Edward Walden, Brian (All Saints)
Molloy, William Richard, Ivor Wallace, George
Moonman, Eric Roberts, Goronwy (Caernarvon) Watkins, David (Consett)
Morris, John (Aberavon) Roberts, Gwilym (Bedfordshire, S.) Wellbeloved, James
Moyle, Roland Robinson, W. O. J. (Walth'stow, E.) Whitaker, Ben
Neal, Harold Rodgers, William (Stockton) Willey, Rt. Hn. Frederick
Noel-Baker, Francis (Swindon) Roebuck, Roy Williams, Alan Lee (Hornchurch)
Ogden, Eric Rogers, George Williams, W. T. (Warrington)
Oram, Albert E. Ross, Rt. Hn. William Willis, George (Edinburgh, E.)
Orbach, Maurice Rowlands, E. (Cardiff, N.) Winnick, David
Orme, Stanley Ryan, John Zilliacus, K
Oswald, Thomas Sheldon, Robert
Owen, Dr. David (Plymouth, S'tn) Short, Rt.Hn.Edward (N'c'tle-u-Tyne) TELLERS FOR THE NOES:
Page, Derek (King's Lynn) Short, Mrs. Renée (W'hampton,N.E.) Mr. Charles R. Morris and
Paget, R. T. Silkin, John (Deptford) Mr. R. W. Brown.