HC Deb 10 May 1966 vol 728 cc209-10
36. Mr. Peyton

asked the Chancellor of the Exchequer if Professor Kaldor's recent assurances to the Economic Research Council on the taxation of close companies were made with his authority; and if he will make a statement of Government policy on this matter.

47. Mr. Turton

asked the Chancellor of the Exchequer why Professor Kaldor specifically agreed with the Economic Research Council that the question and answer given on 22nd February, 1966 on cash earmarked by close companies for expansion should be on the record.

Mr. Callaghan

Yes, Sir. At the function referred to Professor Kaldor repeated the Government's view of Section 77 of the Finance Act, 1965, which had been previously stated in the House by my right hon. Friend the Chief Secretary and there was, therefore, no reason to regard it as confidential.

Mr. Peyton

Would not the Chancellor agree that it is wholly wrong for civil servants to usurp the functions of Ministers and make statements particularly on tax policy? Would he not also agree that this applies particularly to Dr. Kaldor who seems to many of us to be more of a politician than an economist, and whose advice when taken has only too often been attended with disastrous and unhappy consequences?

Mr. Callaghan

I am sorry that the hon. Gentleman cannot make more of it than that. As I have already explained, Professor Kaldor was saying nothing that was new. It had already been made clear in this House. So far as I can see, the hon. Gentleman is only pursuing a rather unworthy vendetta which besmirched the benches opposite for a considerable period 18 months ago.

Mr. Turton

In view of the reply, will the right hon. Gentleman now withdraw or apologise for the unwarranted attack he made on the journalist who reported the meeting of the Economic Research Council when it was agreed that prearranged questions should be on the record?

Mr. Callaghan

There seems to have been some misunderstanding about the nature of this occasion, and, although no harm was done on this occasion, I propose to review the circumstances in which officers of my Department address bodies of this sort, in order to avoid this kind of questioning with its effect on those concerned.