DETERMINATION OF ANNUAL SCHEME FOR BOOKMAKERS' LEVY (Hansard, 26 March 1969)

§ The Under-Secretary of State for the Home Department (Mr. Elystan Morgan)
I beg to move, That this House doth agree with the Lords in the said Amendment.
Mr. Deputy Speaker, perhaps it would be for the convenience of the House if, with this Amendment, we considered Lords Amendment No. 2, in page 2, line 23, at end insert: (7) The period of months specified in subsection (2) of this section may be varied by order of the Secretary of State substituting, in relation to any levy period beginning after the date on which the order comes into force, a different period, whether longer or shorter, but not longer than fifteen months: Provided that where the effect of an order is to increase the said period of months, the order shall not be made so as to come into force later than three months before the beginning of the increased period. (8) The power of the Secretary of State to make an order under subsection (7) of this section shall be exercisable by statutory instrument and include power to vary or revoke the order by a subsequent order."

§ Mr. Deputy Speaker (Mr. Harry Gourlay)
If there is no objection, so be it.

§ Mr. Morgan
The two go together. The effect of the first is to require that if agreement cannot be reached about a scheme for a levy period a report of the circumstances must be made to the Home Secretary six months prior to the beginning of the period in question, and not 1st November as provided at present. The second gives the Home Secretary power to vary the date by Statutory Instrument.
The levy payable for a levy period depends on betting transactions in the previous financial year. Whatever method is adopted for calculating a levy, it would be possible for bookmakers to be able to estimate well in advance what their 1717 future levy commitments will be so that they can regulate their business accordingly.
It follows that it is in the bookmakers' interests that a disputed scheme should be reported to the Home Secretary as early in the year preceding the levy period as possible so that he can determine the scheme soon enough to give bookmakers adequate notice of the amount of levy. I am sure that right hon. and hon. Members will agree that, ideally, a full year's notice should be given.
Clearly, that will not be possible, either for the current year or for the ninth levy period beginning 1st April, 1970. However, it has been represented to the Government, and the Government accept, that 1st November, in Clause 1(2), is later than necessary even in relation to the ninth levy scheme.
In those circumstances, the first Amendment in effect substitutes 1st October for 1st November, and the second gives power to the Secretary of State to amend that date by Statutory Instrument.
The proviso contained in the second Amendment ensures that the Bookmakers' Committee and the Levy Board have at least three months' notice of any change so as to give time for their consultations. The date cannot be amended so as to make it arrive before 1st January in the calendar year preceding the commencement of a levy period, since practical convenience can hardly require the Secretary of State to commence his task earlier than that.

§ Sir David Renton (Huntingdonshire)
On the face of it, the greater flexibility which these two Amendments would provide seem to give some advantage, at any rate, to the Home Secretary. It can potentially mean that the bookmakers and the Levy Board will have less time to amass the huge amount of statistical detail that will be required, to collate it, to consider it, and to try to reach agreement upon through the Bookmakers' Committee. To that extent the advantage of flexibility, on the one hand, may be offset sometimes by a bit of pressure on the bookmakers, on the other.
The House needs to understand the true position regarding what the hon. Gentleman said about the levy scheme for any particular year—which we know 1718 from the original Act starts on 1st April each year—being based upon, as he put it, the "previous financial year". I wonder whether that is really quite right.
Perhaps I may illustrate it in this way. Let us take years 1, 2 and 3. Assuming that year 1 is the relevant financial year and year 3 is the year of the levy scheme to which it relates, then the previous financial year is nearly two years before the levy scheme. If that is so, these Amendments are acceptable. But if the relevant years are years 1 and 2, not years 1 and 3, these Amendments would be quite unacceptable. I hope that the hon. Gentleman will forgive my ignorance in pressing him to clarify that point. So long as that point is clarified, my advice to my hon. Friends would be to accept the Amendment.
But for the timetable which the Government have imposed upon us, I should have wished to move at least one Amendment to the second of these Amendments. However, it would be out of order for me to discuss this because, in our wisdom, we have decided not to put down any Amendments.
If I remember rightly, in order that the eighth levy scheme may come into force before the beginning of the next levy period, which starts on Tuesday next, 1st April, it is necessary for the Bill to receive Royal Assent tomorrow—and, goodness knows, that leaves little enough time for the Levy Board to notify the bookmakers before the beginning of the levy period. If we had put down Amendments tonight, we might have jeopardised the opportunities of the Levy Board for notifying the bookmakers in time.

§ Mr. John M. Temple (City of Chester)
My right hon. and learned Friend may not be aware that the Levy Board has already given notification to the bookmakers in advance of the Bill becoming law. So the bookmakers already have that information.

Sir D. Ronton
I am obliged to my hon. Friend. In some circumstances, anticipation of the passing of an Act of Parliament is to be deprecated, but in these particular circumstances tonight, if it be the fact, as my hon. Friend has pointed out, that these bookmakers have already been notified, it may be that the few days that remain are sufficient. We 1719 know that there was a dispute about this. If the early notification which gave rise to the dispute is to be challenged in these circumstances, it would be ridiculous. We might have been justified in moving the Amendment which I had in mind but which it would be out of order for me to mention. At any rate, if the hon. Gentleman will confirm that my understanding of the timing as between the financial year and the levy scheme is as I stated, then I should advise my hon. Friends to accept the Amendment which the hon. Gentleman moved and the Amendment which goes with it.

§ Mr. Elystan Morgan
With the leave of the House. I should like to comment on one point mentioned by the right hon. and learned Gentleman, namely, the meaning of the term "previous financial year" to which I alluded.
The levy is, in practice, fixed by reference to the bookmakers' figures for the year preceding the year in which the levy is paid. This has always been so. The Bill does not bring about any change whatsoever in that situation.

§ Sir D. Renton
Perhaps I may have the leave of the House to speak again. I am no wiser than I was before. The hon. Gentleman has now used the word "preceding" instead of "previous". I think that it is much simpler to use the terms first, second, and third years. The levy period and the financial year almost coincide. It is 1st and 5th April in each year, so there is really nothing in it. I cannot believe that a levy scheme for the year beginning, say, 1st April, 1969, is to be based upon the bookmakers' returns for the financial year ended 5th April, 1969. It must be based upon the figures for the year ended 5th April, 1968. Surely that is commonsense. It is practical necessity. However, it needs to be clarified. In view of what the hon. Gentleman has said and in view of what was said by the noble Lord, Lord Stonham, in another place where, again, the words "previous financial year" were used, we have a right to clarification.

§ Mr. Elystan Morgan
All I can say is that the Bill does not bring about any change in the law in that respect.
1720 Whilst the right hon. and learned Gentleman was speaking a second time I was trying to read up the relevant sections in the Betting, Gaming and Lotteries Act, 1963. It is clear that when deciding upon a levy scheme the Board must make its decision upon the best available knowledge of the financial circumstances prevailing about the incomes of bookmakers.

§ Sir D. Renton
There is no mention of the financial year in the 1963 Act. Because of that I felt obliged to press the hon. Gentleman for clarification. I hope that he will clarify the matter.

§ Mr. Morgan
I concede that. That is the conclusion to which I came. The principal Act does not refer to any previous period. But it is obvious that in fixing the amount of levy for any period—and this is something about which the right hon. and learned Gentleman and his hon. Friends have argued so eloquently—the Levy Board must pay regard to the financial circumstances of bookmakers at the time. It is absolutely necessary that it should pay regard to those financial circumstances. The financial circumstances years past would have no relevance. It cannot prognosticate, and therefore it is obvious that the period which is relevant is the period immediately preceding the time when the Board comes to that decision.

§ Mr. Temple
It is perhaps unusual, but I should like to come to the rescue of the Under-Secretary of State because it seems to me that what he has indicated is a fact of life of the racing year. One is almost bound to look at the year previous, because only after a considerable time lag will the figures be available in a sufficiently collated form to enable the Board to form the fullest judgment with regard to the establishment of a levy for the succeeding year.
I think that my right hon. and learned Friend the Member for Huntingdonshire (Sir D. Renton) was right when he mentioned years 1, 2, and 3, but possibly he was slightly misunderstood by the Minister. I think the effect is that in year 3 the levy scheme will be based on what one might term technically year 1 figures. I believe that this will be acceptable to 1721 the Bookmakers' Committee. In the circumstances, I think that the amendment is reasonable, and I wish it well.