§ Amendments made:
No. 43, in page 120, line 37, at end insert
'but where rights obtained under a scheme before the withdrawal of approval from the scheme under this paragraph are exercised after the withdrawal, section 47(1)(b) above shall apply in respect of the exercise as if the scheme were still approved.'.
§ No. 44, in page 121, line 18, leave out '(2)—[Mr. Lawson.]
§ Mr. Richard Wainwright
I beg to move amendment No. 45, in page 121, line 18, leave out from 'Act' to end of line 20.
I shall be brief, because the Government have gone a long way to meet the points that were made in Committee. The main purpose of the amendment, in deleting from the schedulewhich has been approved by the Board for the purposes of this Scheduleis to point out that until the Government issued a welcome press release a few days ago hon. Members had little idea of what the board would or would not approve and what the criteria would be.
That was causing great concern to employees who had been subscribing to SAYE schemes in recent years, fully within the terms embodied in the Bill, and who looked like being denied the fruits of their savings. That would have been a gross inequity and a great discouragement to SAYE schemes.
I give an unreserved welcome to the recent announcement by the Inland Revenue that the Government would table amendments today, and I welcome those amendments. However, the schemes could suffer if the SAYE savings being accumulated towards the purchase of shares were allowed to bear a low rate of interest. That would be an underhand way of keeping schemes in check, but there seems to be no safeguard against that possibility. I am glad to notice that in the scheme that has been announced as approvable the rates of interest are to be reasonable, both to the taxpayer and to the Treasury. After hearing what the Financial Secretary has to say, I shall be happy to ask leave to withdraw the amendment.
§ Mr. Lawson
I thank the hon. Member for his kind words, particularly about the Inland Revenue press release of 11 July. I am glad that it satisfied him and I hope that in the light of that he will ask leave to withdraw his amendment.
§ Amendment, by leave, withdrawn.
§ Amendments made:
§ No. 46, in page 121, line 44, leave out 'or'.
No. 47, in page 121, line 45, after '1978' insert:
'or retirement on reaching pensionable age within the meaning of Schedule 20 to the Social Security Act 1975 or any other age at which he is bound to retire in accordance with the terms of his contract of employment, then'.
No. 48, in page 122, line 6, leave out from 'that' to end of line 9 and insert:
'where a person who has obtained rights under it continues to hold the office or employment by virtue of which he is eligible to participate in the scheme after the date on which he reaches pensionable age within the meaning of Schedule 20 to the Social Security Act 1975, he may exercise the rights within six months of that date.'.—[Mr. Lawson.]
§ Mr. Lawson
I beg to move amendment No. 108, in page 122, line 11, leave out 'the company issuing the' and insert'a company whose shares are'.
Mr. Deputy Speaker
With this we may take the following amendments:
No. 49, in page 122, line 11, leave out issuing' and insert 'liable to issue'.
Government amendments No. 116 and 109.
No. 52, in page 123, line 13, leave out 'body issuing the shares' and insertcompany liable to issue the shares'.
§ Mr. Lawson
The effect of the Government amendments is to make clear that the provisions of paragraphs 10 and 14 of the schedule relate to the company whose shares are the scheme's shares, even if no shares have, in fact, been issued. The Government amendments meet the point of the amendments in the name of the hon. Member for Colne Valley (Mr. Wainwright).
§ Amendment agreed to.
Amendments made: No. 115, in page 122, line 23, leave out 'and' and insert—
'(aa) if under section 206 of the Companies Act 1948 or section 197 of the Companies Act (Northern Ireland) 1960 (power to compromise with creditors and members) the court sanctions a compromise or arrangement proposed for the purposes of or in connection with a scheme for the reconstruction of a company whose shares are scheme shares or its amalgamation with any other company or companies, rights obtained under the share option scheme to acquire shares in the company may be exercised within six months of the court sanctioning the compromise or arrangement;'.
No. 116, in page 122, line 25, leave out 'the company' and insert
'a company whose shares are scheme shares'.
No. 117, in page 122, line 25, leave out 'Companies Act 1948' and insert
'said Act of 1948 or section 200 of the said Act of 1960'.
No. 118, in page 122, line 30, at end insert
(c) if a company whose shares are scheme shares passes a resolution for voluntary winding up, rights obtained under the scheme to acquire shares in the company may be exercised within six months of the passing of the resolution.'.
No. 51, in page 122, line 45, after 'amounts', insert
(not exceeding £50 a month)'.
No. 109, in page 123, line 12, leave out from 'of' to end of line 13 and insert
'which the scheme shares form part'.
§ No. 110, in page 123, line 26, leave out 'either'.
No. 111, in page 123, line 29, at end insert
(c) shares in a company which is under the control of a company (other than a company which is or would if resident in the United Kingdom be a close company within the meaning of section 282 of the Taxes Act) whose shares are quoted on a recognised stock exchange.'.
§ No. 112, in page 124, line 1, after 'the', insert 'scheme'.
§ No. 113, in page 124, line 8, leave out 'and'.
No. 114, page 124, line 11, at end insert
(c) in a case where the shares fall within sub-paragraph (c) and do not fall within subparagraph (a) of paragraph 16 above, companies which have control of the company whose shares are in question or of which that company is an associated company.'.—[Mr. Lawson.]
§ 6 pm.
§ 'Transitional arrangements
§ 24.—(1) This paragraph shall apply in any case where the Board are satisfied that—
- (a) a person has entered into a certified contractual savings scheme within the meaning of section 415 of the Taxes Act before the day appointed for the coming into force of this Schedule; and
- (b) he has obtained rights under a scheme established before that day to acquire shares in a company of which he is an employee or director (or a company of which such a company has control) using repayments made under the certified contractual savings scheme.
§ (2) Subject to sub-paragraph (3) below, where this paragraph applies repayments and interest paid under the certified contractual savings scheme shall be treated as repayments and interest paid under a scheme approved by the Board for the purposes of this Schedule under paragraph 5(b) above and accordingly may be used for the purchase of shares under a savings-related share option scheme approved under this Schedule.
§ (3) The repayments and interest to which sub-paragraph (2) above applies shall not exceed the repayments and interest to which the participant would have been entitled if the terms of the scheme had corresponded to those of a scheme approved by the Board for the purposes of this Schedule under paragraph 5(b) above; and for the purposes of this paragraph the amount of repayments under the certified contractual savings scheme shall be determined as mentioned in paragraph 6 above.'.
§ The amendment is designed to allow participants in existing save-as-you-earn linked share option schemes to bring their existing SAYE contracts, whether with the Department of National Savings or with a building society, into new approved share option schemes provided that, as participants, they are eligible under the 1980 rules, and to use the proceeds to exercise options granted under the new schemes with the prospect of tax relief. This fulfils an undertaking given by my hon. and learned Friend in Committee upstairs. I commend it to the House.
§ Amendment agreed to.
§ Sir Graham Page
I beg to move amendment No. 1, in page 125, line 13 leave out 'think necessary' and insert 'may reasonably require'.
I refer my hon. Friend to the powerful arguments that I used on a similar amendment earlier.
§ Mr. Lawson
I was not present at the 1814 time, but I recall reading the powerful arguments—they read beautifully—put by my right hon. Friend. However, for the reasons given in Committee upstairs, I do not think that I can accept the amendment. In Committee we accepted my right hon. Friend's suggestion that the information requested should be limited to that which the addressee has or can reasonably obtain. We feel that that should be a sufficient safeguard. I hope that with my assurance that the board will not make requests under this paragraph unless it has good reason for doing so my right hon. Friend will not see lit to press his amendment to a Division.
§ Amendment negatived.