§ 8.14 p.m.
§ THE MINISTER OF STATE, HOME OFFICE (LORD STONHAM)
My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
§ Moved, That the House do now resolve itself into Committee.—(Lord Stonham.)
§ On Question, Motion agreed to.
§ House in Committee accordingly.
§ [The EARL OF LISTOWEL in the Chair.]
§ Clause 1 [Determination of annual scheme for bookmakers' levy]:
LORD STONHAM moved Amendment No. 1:
Page 1, line 14, leave out ("by the 1st November preceding") and insert ("six months before")
§ The noble Lord said: I beg to move Amendment No. 1, and with this Amendment I should like to discuss No. 3. These two Amendments, which go together, have two effects. The effect of the first Amendment 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 by the 1st October preceding the beginning of the period in question—not the 1st November, as at present provided in the Bill. The second Amendment 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 will be useful for bookmakers—indeed, useful for everybody—to be able to estimate well in advance what their future levy commitments will be, so that if they wish the bookmakers can regulate their business accordingly. It follows from 1124 this 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 the bookmakers adequate notice of the amount of the levy. Ideally, a full year's notice ought to be given. Clearly, that is not going to be possible, either for the current year or for the ninth levy period, beginning on April 1, 1970. It has, however, been represented to the Government (and we accept this) that November 1, which is provided for by the Bill is later than necessary even in relation to the ninth levy scheme.
§ In these circumstances, the first Amendment, in effect, substitutes October 1 for November 1. That is the best we can do at the moment, although it is not much. The second Amendment gives the Secretary of State power to amend that date by statutory instrument. The proviso contained in the second Amendment ensures that the Bookmakers' Committee and the Levy Board have as a minimum 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 the 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. I hope your Lordships will agree that these Amendments are sensible and in the interests of all concerned. I beg to move.
§ On Question, Amendment agreed to.
§ LORD MOWBRAY AND STOURTON moved Amendment No. 2:
Page 2, line 11, at end insert—
("() The Secretary of State when in accordance with this section he is determining a new scheme or directing that the current scheme shall continue shall consider—
§ The noble Lord said: I beg to move Amendment No. 2, standing in my name 1125 and that of my noble friend Lord Derwent. We feel that this Amendment gives effect to what the Government of the day in 1961 had in their original Act in relation to the bookmakers. I am not going into this Amendment in great detail, because it has been debated heavily in another place, and we have gone over the points on our Second Reading. Basically, it puts back into this Bill what was contained in Part I of the Betting, Gaming and Lotteries Act 1963, in Clause 27(5)(a), (b) and (c)—and paragraphs (a), (b) and (c) are exactly what I have put down in this Amendment. So when in another place the Minister concerned informed my right honourable friend Sir David Renton that he considered the drafting was bad, my right honourable friend, to my mind fairly truthfully, said that he thought this was something of a slur on the Parliamentary draftsman, not to mention the two Houses of Parliament of that time. So what is before your Lordships here is nothing new; it is something which was in the earlier Act.
§ The point has been argued that this reference to "capacity to pay," which is really the crux of the matter, is unnecessary. The Home Secretary has taken on himself in this Bill various extra tasks in place of what have been loosely called the "Three Wise Men". We do not understand why he should not be able to have these three paragraphs in as a guideline. As I see it, it does not hurt him, it does not hinder him, it does not obstruct him in any way to have them in. If I thought they did anything to hinder him, I would be the first to agree that they were perhaps unnecessary. But they do not do anything; they will merely give comfort to the bookmakers that the Home Secretary will have to consider these things.
§ You will notice that we have omitted from the wording of the 1963 Act the two words which also prefaced paragraphs (a) to (c): "and compare". We felt that a duty to compare would lead to certain anomalies which were possibly not easily understood; because what was he to compare with what? He was not told that. So far as contributions are concerned—referred to in paragraph (a)—the Secretary of State, advised by his advisers, will easily be able to find plenty 1126 of fruitful suggestions as to where the money should be spent. But I do not think it is unreasonable for us to ask that when considering how the money shall be spent—and heaven knows! there are always so many things where money can be spent wisely in this matter of encouraging the horseracing industry—he should be required to consider the capacity of the people who will pay.
§ These smaller bookmakers are unhappy about these words being taken out. They have been in the Act, and have never caused any trouble. I know we are told that this is not necessarily a matter of payment out of profits; that it is the intention of the Government and the Levy Board that this should be a levy which will be passed on to the—I hesitate to use the word—consumer, to the punter. In fact, it will be an extra levy of 10s. in every £100. I do not think that whether it is taken out of profits or turnover really matters: the Home Secretary is still able to consider the bookmakers capacity to pay.
§ I am a very ignorant person in these fine matters of keeping books; I have never been able to beat the bookmakers in my life, and I do not suppose I ever shall. But I know that the noble Lord, Lord Stonham, is extremely expert in these matters. He is frequently quoted in another place as being expert in these matters—though I believe that he himself pointed out that a £100 bet is probably immediately laid off to the extent of £80, so that £100 turnover is promptly a £180 turnover, and so it goes on. I can see the permutations to which this can lead. If this were all, I cannot see that the Secretary of State is being asked to do too much in having to consider the bookmakers' capacity to pay. These words have been in before; they have been debated before; the Bookmakers' Association want them. I do not understand why they cannot be in now, because if they were in at least it does not bind the Secretary of State: they merely ask him to consider. I hope that the noble Lord the Minister will be able to accept these very simple suggestions. I beg to move.
§ 8.25 p.m.
§ LORD GOODMAN
I want to intervene for a very brief moment to say that, despite the immensely persuasive way in 1127 which this Amendment has been presented, I hope for a number of reasons that the Government will not accede to it. First, it is by no means the case that this Amendment has caused no trouble. Anyone acquainted with recent events is well aware that it has caused an enormous amount of trouble. Secondly, the fact that similar words have been in the previous Act, and that it may be wounding to Parliamentary draftsmen and to both Houses of Parliament to suggest that they ought not to have been there, does not in my view alter the completely incontrovertible fact that the words are open to endless difficulties of interpretation. One has only to look at them:… the capacity for the time being of bookmakers to make contributions for such purposes".Which bookmakers? Rich bookmakers or poor bookmakers? Efficient bookmakers or inefficient bookmakers? Provident bookmakers or improvident bookmakers? Bookmakers who gamble themselves or bookmakers who eschew gambling? The words are totally incapable of being construed.
Anyone who addressed his mind to what capacity of what bookmaker he had to take into account in relation to these words would be totally defeated and would retire to a desert island. I think the words are incapable of meaning. There are obviously attractions about the idea of introducing into any fiscal Statute or provision a consideration of whether a man is capable of paving the tax. Unfortunately, however attractive the idea may be, it seems to me an impossibility to introduce such a consideration, for it would mean that all taxing legislation would come to a rapid end. For these reasons, it would be quite impossible and completely useless to introduce these considerations. I say that without any at all to the bookmakers, a most worthy section of the community but certainly not deserving of the very special consideration that would be introduced by preserving these words.
§ LORD STONHAM
I am most grateful to the noble Lord, Lord Mowbray and Stourton, for moving this Amendment, for three reasons. The first is that it enabled him to describe me as an expert in beating the bookmakers. I do not 1128 know why I have earned that title. I can only think it is because I never try to beat them; I do not bet. That is the only way I know of beating the bookmakers. The second reason is that it brought forth from him a marvellous phrase, the phrase being "what has been loosely called 'the Three Wise Men'". I have been conjuring my imagination to understand how you can call three wise men "loose". The third reason was that it has brought forth a two minute tour-de-force from the noble Lord, Lord Goodman, which has left me with virtually nothing to say. Such being the way of Ministers, that will not stop me from speaking for seven or eight minutes, although I know my noble friend, Lord Bowles, feels unhappy about it. I am thinking, however, about the bookmakers, and I consider they are entitled to an account of the Government's views on this particular subject. As the noble Lord, Lord Mowbray and Stourton, said, what is before us is not new; it has been before us before—indeed, I could add "several times", because a similar Amendment was before the Committee in another place, was inserted into the Bill and was taken out again by the Government at the Report stage.
Clause 1 of the Bill transfers the responsibility for determining the scheme to have effect for raising the levy, when there is a dispute between the bookmakers and the Levy Board, from the independent members of the Board to the Home Secretary. Under the Act, when the independent members of the Board make this determination they are required to "consider and compare" all three of the factors set out in the Amendment, namely, the needs of racing, the capacity of bookmakers to pay and the capacity of the tote to pay, and I quote, "in the light of that consideration and comparison", to make their determination. Under the present Bill no similar obligation is imposed on the Secretary of State to consider these factors. The effect of the Amendment would be to impose such an obligation on him. It is not appropriate to retain this requirement in transferring the responsibility for determination to the Secretary of State. As guidance to persons exercising an independent function who were not answerable to Parliament or to any Minister, the requirement has a certain utility; in particular it served in existing legislation 1129 to draw attention to the need to compare the resources of the bookmakers on the one hand with those of the Totalisator on the other—one is only about 5 per cent. of the other. But this guidance is unnecessary when the function is transferred to a Minister, particularly since the very nature of the determination requires him to take account of these considerations. I emphasise this point to the noble Lord.
The fact that the guidance was unnecessary would not of itself make it essential to oppose this Amendment, although it is always a good principle to avoid burdening the Statute Book with unnecessary verbiage. But the objections to this Amendment are stronger than that. The Bookmakers' Committee have made great play of the "capacity to pay" provision in their dispute with the Levy Board, claiming—although they have not put their claim to the test in the courts—that a levy based on turnover rather than profit cannot take account of "capacity to pay" and is, therefore, illegal. Of the two possible bases of calculation profits allow considerable latitude of interpretation whereas turnover allows none.
The noble Lord, Lord Goodman, stated almost every variation except one. He did not mention the crooked bookmaker and the straight bookmaker, but, apart from that, he demonstrated how utterly impossible it is to follow "capacity to pay" as an objective guide to the amount that the bookmakers should pay, whereas turnover is an objective guide. Although it is possible that laying off, and that kind of thing, may operate, with the original £1 stake circulating, the vast total turnover which we are considering, something of the order of £800 million a year, gives room for that kind of circulation. There is no evidence that the calculation of the levy by reference to turnover has failed to take account of capacity to pay. But during the past year the bookmakers have relied heavily on this argument, and large numbers of bookmakers—I think stupidly—have withheld their declarations so that contributions are seriously in arrears. In practice, therefore, what is claimed to be a safeguard has been used as an obstructive device.
The one way that the noble Lord can help to destroy—I am sure that this is 1130 not his hope—what we in this house all have at heart to assist the sport of racing is to support the bookmakers in this particular matter. There is no need for me to pursue it. We have been entirely fair in this matter, and if there should be a dispute the Home Secretary will take an objective view. He will take into consideration all the factors which ought properly to be considered. We ought not to encumber him with the kind of fetters which this Amendment would impose.
I should like to leave this last thought with the premier Baron of all England. It is that over the years the Tote have contributed rather more than 30 per cent. of the levy, although their share of the betting turnover is less than 5 per cent. We are not asking bookmakers now, nor are we likely to ask them in the future, to make a contribution which they cannot afford, but we are asking for a contribution which they can afford to pay for the benefit of racing as a whole, from which they, more than anyone, most certainly must benefit. I ask the noble Lord to withdraw the Amendment.
§ LORD MOWBRAY AND STOURTON
I am grateful to the noble Lord, Lord Stonham, for his lucid explanation as to why he feels unable to accept the Amendment. Before withdrawing the Amendment, I would draw attention to one or two points. The first is to assure the noble Lord, Lord Goodman, that I are well aware of the trouble which this Amendment has caused. If I have not been aware before of the strength of the Jockey Club lobby, I am now well aware of it. The whole point of my Amendment has been answered in basic terms by the noble Lord, Lord Stonham, in a reasonable and satisfactory fashion. I still feel it to be upsetting that neither House of Parliament has been able to think of some way of satisfying the Association of Bookmakers. I accept that the present Secretary of State, and Ministers such as the noble Lord, have every intention of being fair, and there is no conceivable Secretary of State in the offing on either side who would not be fair. Nevertheless, the Bookmakers' Association and book-makers in general are far-sighted people, and they know that although this generation of politicians is reasonable and decent, they do not necessarily know what 1131 will be the position in 25 years' time when their sons may be running their bookmaking businesses. We wanted to put in these words in order to give some guidance to a future Home Secretary who might not be as well-disposed as is the present Secretary of State.
I accept that there have been occasions when the words "capacity to pay" have been used for disruptive actions. I also accept that one or two of the bookmakers who have not paid are using the phrase "capacity to pay" as a delaying tactic for not paying. But it is a pity that we have not been able to think of something to cover this matter. I end by adopting what was said by my honourable and learned friend, Sir David Renton, in another place, that the powers to raise levy should be described in such a way that justice not only is done, but is seen to be done by those who pay. I beg leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ Amendment moved—
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.")—(Lord Stonham.)
§ On Question, Amendment agreed to.
§ Clause 1, as amended, agreed to.
§ Clause 2 agreed to.
LORD STONHAM moved Amendment No. 4:
After Clause 2 insert the following new clause:
§ Levy Board's costs on appeal by bookmaker against assessment to levy
§ ".—(1) The following subsection shall have effect where, under section 28 of the Act of 1963 (assessment of individual bookmakers to 1132 levy), a bookmaker appeals in respect of an assessment notice issued by the Levy Board in his case, and the appeal, having been referred to a tribunal established under section 29 of that Act, is either dismissed by the tribunal or abandoned by the bookmaker.
§ (2) If the tribunal thinks it just that the bookmaker should make a payment towards expenses appearing to it to have been reasonably incurred by the Levy Board in connection with the appeal, the tribunal may certify accordingly and the Board shall he entitled to recover from the bookmaker as a debt due to them the amount specified in the certificate."
§ The noble Lord said: Subsection (6) of Section 29 of the Betting, Gaming and Lotteries Act 1963 enables the appeal tribunal to award a bookmaker his costs against the Levy Board where his appeal against his assessment is successful. The section includes no comparable provision enabling the Levy Board to receive their costs from the bookmaker when he abandons or loses his appeal. I am sure that that omission must be offensive to the sense of justice of all Members of the Committee, and the purpose of this Amendment is to put the Levy Board on the same footing as the appellant. It provides that where a bookmaker appeals to the tribunal and then either abandons or loses his appeal, the tribunal may fix a figure representing the reasonable costs of the Levy Board incurred in connection with the appeal, so as to enable the Board to recover that sum from the unsuccessful appellant. I am quite sure that this is a necessary Amendment which accords with our sense of justice. I beg to move.
§ On Question, Amendment agreed to.
§ Clauses 3 and 4 agreed to.
LORD GOODMAN moved Amendment No. 5:
After Clause 4 insert the following new clause:
§ Amendment of Section 24 of Act of 1963 as to appointment of members of Levy Board
§ ".—(1) In consequence of the amalgamation of the Jockey Club and the National Hunt Committee, section 24 of the Act of 1963 (constitution and membership of Levy Board) shall be amended in accordance with this section.
(2) In section 24(2), for paragraphs (b) and (c) (which provide for two members of the Board to be appointed by the Jockey Club and one by the National Hunt Committee) there shall be substituted the following:—
'(b) three members shall be appointed by the Jockey Club (incorporating the National Hunt Committee)'.
§ (3) In section 24(3) (duration and terms of membership and removal of members) for the words 'subsection (2)(b) or (c)' there shall be substituted the words 'subsection (2)(b)'.
§ (4) In section 24(4) (temporary substitute members)—
- (a) for the words 'the National Hunt Committee' there shall be substituted the words'(incorporating the National Hunt Committee)'; and
- (b) for the words 'subsection (2)(b), (c), (d) or (e)' there shall be substituted the words 'subsection (2)(b), (d) or (e)'.
§ (5) Any person who at the passing of this Act is, or acts as, a member of the Levy Board by virtue of appointment under section 24(2) or (4) of the Act of 1963 by the Jockey Club or the National Hunt Committee shall be deemed to have been appointed by the Jockey Club (incorporating the National Hunt Committee).".
§ LORD STONHAM
Will the noble Lord consider discussing Amendment No. 6 together with Amendment No. 5?
§ LORD GOODMAN
Yes, I think that will be convenient, as Amendment No. 6 is entirely consequential on No. 5. Amendment No. 5 is, I imagine, one of the least controversial Amendments ever to be introduced into either House of Parliament. It is entirely clear from the text what it is designed to do. Very briefly, before the amalgamation of the Jockey Club and the National Hunt Committee, the Jockey Club had two members on the Levy Board and the National Hunt Committee had one. As they have now amalgamated it is desired that the amalgamated body should have three members. That seems to me incontrovertible in logic and in arithmetic, and I commend the Amendment to the Committee. I beg to move.
§ LORD KILMANY
I rise only for a moment to support the Amendment. Perhaps I should declare an interest, though not a financial one, because I am one of the members of the Levy Board. I was 1134 appointed as a representative of the National Hunt Committee and I am really speaking against my own interest in supporting the Amendment, because as things stand I believe I could continue indefinitely as the member of the Levy Board appointed by the National Hunt Committee, because there is no National Hunt Committee to appoint anybody else to take my place. That would obviously be unsound, so I cordially support the Amendment which leaves the position exactly as it was in the original Act. For all material purposes, there will be three representatives of the racing authority and in practice two of the three will concentrate principally on Jockey Club affairs, while the other one of the three will concentrate on National Hunt affairs.
§ On Question, Amendment agreed to.
§ Clause 5 agreed to.
§ The Title:
§ LORD GOODMAN: I beg to move Amendment No. 6.
Line 5, at end insert ("and to amend section 24 of the said Act of 1963 with respect to the appointment and removal of members of the last mentioned Board.").—(Lord Goodman.)
§ On Question, Amendment agreed to.
§ Title, as amended, agreed to.
§ House resumed: Bill reported with the Amendments.