§ The Minister for Housing and Planning (Mr. Nick Raynsford)
I beg to move,That, for the purposes of any Act resulting from the Greater London Authority Bill, it is expedient to authorise the making of provision for or in connection with the imposition of charges to corporation tax (including corporation tax on chargeable gains) on bodies or persons to which property, rights or liabilities are transferred or granted by or under the Act.This is a technical matter, but, lest I should be misinterpreted, I shall briefly explain for the benefit of the House why it is required. It is needed to authorise the tax-neutral transfer of property, rights and liabilities being made under the Bill. We will consider the clauses that will effect the transfers in the course of our consideration.
§ Mr. Wilshire
I am grateful to the Minister for that explanation. However, when I hear someone talk about a tax-neutral transfer, it suggests to me that tax will be payable although it will be the person receiving whatever is transferred who pays it, rather than the person making the transfer. Even though the transfer is described as tax-neutral, somebody will have to pay tax. How much tax are we talking about? Someone must have worked out what will be transferred, so it would be helpful to know how much tax will be due. I assume that the tax to be paid will be corporation tax at the normal rate that all businesses pay, and I hope that the Minister will confirm that. Then we will know roughly how much somebody will have to pay.
As I understand it, when the resolution refers to "bodies or persons", it is talking about public bodies and public persons, although I am not sure what a public person is. In any case, the activity will take place in the public sector. If I am correct, the public body or public persons who have to pay the corporation tax once they have assumed the liability will have to get that money from somewhere. Again, I would be most grateful if the Minister would confirm that, once the bodies or persons have been given a tax liability, they will have some form of precepting power—that is, that once they know how much tax they must pay, the bodies or persons will send the matter back to the GLA, which will raise council tax to meet the bill.
If my analysis is correct, will the Minister say how much extra council tax will be payable by the people within the GLA area, so as to give effect to the resolution, when and if the House passes it?
§ Mr. Forth
Although in one sense I am grateful to the Minister for Housing and Planning for taking the initiative and giving the briefest of explanations about this rather complex matter, I am also rather puzzled. That same Minister told us earlier that he was here only in some slightly odd advisory capacity, that he was no longer the Minister responsible for the substance of the measure that we are considering today, and that he had no knowledge of or input into the amendments tabled today. I am therefore surprised that he has come to the Dispatch Box 500 and purported to explain to the House elements of a Bill for which he has no responsibility and to which he has made no recent input.
§ Mr. Bercow
My right hon. Friend paints a very depressing picture of the Government's lack of respect for the institution of the House of Commons. If the Minister's position is as my right hon. Friend has described, is he not about as much use to our deliberations today as a bicycle without a wheel?
§ Mr. Forth
My point is that I am genuinely confused about today's proceedings. The Minister did us the courtesy earlier of explaining why he was not responsible for the Bill and how he had had no part in the amendments under consideration. Now, however, he appears at the Dispatch Box as a Minister of the Crown and explains a key element of the Bill to the House.
We must get clear in our minds the relationship between the two Ministers—the Minister for Housing and Planning, and the Under-Secretary of State for the Environment, Transport and the Regions, the hon. Member for Streatham (Mr. Hill)—who are now sitting on the Front Bench. Who knows what about what, and who does not? Who has responsibility for what, and who has not? As I pointed out earlier, the Minister for Housing and Planning is playing a key role in a political campaign outside the House, on behalf of someone who has a direct interest—
§ Mr. Deputy Speaker
Order. The right hon. Gentleman must make it clear to the House how his remarks relate to the Ways and Means resolution.
§ Mr. Forth
That is quite simple. The Minister for Housing and Planning was the Minister who tried to explain the Bill when he set out his role today. I am offering him the chance to give a final explanation to the House before he resorts to silence—but I see that the hon. Member for Ilford, South (Mr. Gapes) wants to tell us.
§ Mr. Mike Gapes (Ilford, South)
Does the right hon. Gentleman recall that we spent 100 hours considering the Bill in Committee? He contributed to many of those hours. At the end of our deliberations, my hon. Friend the Minister received unanimous congratulations from members of the Committee on the way in which he had conducted proceedings.
§ Mr. Raynsford
I had thought that I made my position clear in my earlier statement to the House, but perhaps I should repeat it for the benefit of the right hon. Member for Bromley and Chislehurst (Mr. Forth). Since 30 September, all responsibility for policy matters relating to the Bill, including new amendments tabled since that date, rests with my hon. Friend the Under-Secretary. However, 501 as the right hon. Gentleman well knows, I have been associated with the Bill for most of its existence, including the many hours of debate devoted to it in the House and in Committee. Given the size and complexity of the Bill, it seemed sensible—and courteous to the House—to make available that expertise and experience in this debate.
Modesty has never been one of the greatest characteristics of the right hon. Member for Bromley and Chislehurst, but I must tell him that we are dealing today with issues that were clear as points of principle when the Bill was first published.
Essentially, we are dealing with transfers from public sector bodies. The purpose of the resolution is to ensure that simply because of reorganisation within the public sector, a liability for tax does not arise that would not have arisen if the previous public sector framework had existed. As I said, we will deal with each of the individual transfers when we come to them.
An illustration may be helpful. One obvious area is transfers from English Partnerships or the Commission for New Towns to the London development agency. Because of English Partnerships' role in reclaiming land and encouraging development, when that land is sold it will have a liability to pay tax on the proceeds, but it can offset against that the cost of reclamation and other work. Lords amendments Nos. 522 and 525 will ensure that any expenditure incurred by English Partnerships or the Commission for New Towns in developing assets such as land for reclamation or regeneration can be offset against any tax payable on the proceeds of sale of that land by the LDA. That is the point—to achieve a tax-neutral position, which would exist but for the fact that a new public sector framework had been created.
There is no sinister purpose—it is a policy objective that was clear from the outset, when I was responsible for the Bill. Therefore, I hope that the right hon. Member for Bromley and Chislehurst will accept that it is proper for me to answer on that point.
§ Question agreed to.
That, for the purposes of any Act resulting from the Greater London Authority Bill, it is expedient to authorise the making of provision for or in connection with the imposition of charges to corporation tax (including corporation tax on chargeable gains) on bodies or persons to which property, rights or liabilities are transferred or granted by or under the Act.