HL Deb 27 June 2000 vol 614 cc879-90

(" .—(1) For paragraph (a) of subsection (4) of section 4 of the Social Security Contributions and Benefits Act 1992 there shall be substituted—

"(a) the value, at the date when it is obtained, of a right to acquire shares in a body corporate obtained by the earner as a director or employee of that or any other body corporate,".

(2) After that subsection there shall be inserted—

"(4A) The value referred to in subsection (4)(a) shall be taken to be the difference between the amount that a person might reasonably expect to obtain from a sale of the right in the open market immediately after it was obtained and the amount or value of the consideration (other than the performance of any duties in or in connection with the office or employment by reason of which the right was granted) given for the grant of the right.

(4B) Subsection (4)(a) shall apply to rights obtained after 5 April 1999 if and in so far as those rights have not been exercised or released before 19 May 2000."

(3) Where subsection (4)(a) of that section (as substituted) applies to any rights obtained after 5 April 1999 but before this section came into force, the contributions in respect of those rights become due on the date on which this section comes into force but shall be treated as bearing interest from the date on which the contributions would have become due if this section had been in force on the date when the rights were obtained.").

The noble Lord said: My Lords, I apologise for raising a technical and complicated issue late at night. However, I suppose that I would need also to apologise for raising it earlier in the day when even more Members would be bored by it.

This amendment, along with Amendment No. 135, concerns national insurance contributions paid on share options granted to employees as a part of their remuneration packages. As I am sure noble Lords know, this is a common practice among the staff of e-commerce dot.com companies and other businesses involved in the IT world. Indeed, I believe that the practice is pretty much universal among the more senior employees. Perhaps I should declare an indirect interest here. I have a son-in-law who works for an IT company and receives share options as a part of his remuneration package.

Until 6th April 1999, no NICs were payable on share options forming part of a remuneration package even though they were, particularly in high-tech businesses, an important part of that package. I believe that the Government rightly regarded that as a loophole which needed to be closed. They went about it in a way that has subsequently raised a number of problems. For options granted on or after 6th April 1999 the Government imposed Part I NICs on gains from the exercise of the share options except where they were exercised as part of an Inland Revenue approved scheme. That meant that not only did an employee have to pay the primary contributions for NICs—in many cases that was probably not an important factor because many of the employees had earnings in cash above the upper earnings limit and therefore had nothing extra to pay—but also that the employer had to pay secondary Class I contributions on which there is no upper earnings limit.

If one imposes NICs on an option when it is exercised, at the date of the grant the employer is going to be very uncertain indeed both about the date at which he will have to pay the secondary contribution and the amount to be paid. But under accountancy rules he has to make provision for future liability to pay NICs on the options. The accountants insist on what might be called a gloomy view of the liability being undertaken.

A company called QXL, which provides auctions on the Internet, had to make provision in its last year accounts for future liabilities for secondary NICs on options of £11.6 million. This was on a total turnover for that year—not profits—of £6.9 million. The consequences for the ability of a company in that position to raise money from the market is very obvious indeed.

In Clause 78 the Government have taken some steps to deal with the problem. They did so by introducing at Committee stage an extremely complicated amendment. The identical Clause 82 deals separately with the same situation for Northern Ireland businesses. The Government introduced these amendments at very short notice.

The main purpose of these amendments is to allow employers, by agreement with their employees, to transfer the liability for secondary contributions on the share option gained to the employees so that they pay both the primary and secondary contributions. That applied to agreements entered into after 19th May. One can see, in that situation where the employee is offered the choice between paying the secondary contribution himself or getting no option at all, that it is going to be pretty easy to reach agreement.

At Committee stage I did not object to the amendment, but I said that if there were going to be problems I would expect to hear from those who were concerned about the government amendments. Indeed, that is exactly what happened. I was approached by QXL and also by a well known public relations firm representing a number of major clients in the e-commerce world. I saw them and I was persuaded that they had a case which required discussion and which was a proper matter to raise in your Lordships' House. I should say that the amendment was drafted by me and has not been discussed with the businesses concerned.

It is, I think, agreed by firms in the e-commerce world that the government amendments in Clauses 78 and 82 are an improvement on the status quo. But there are two serious complaints. First, the amendments provide no relief from the unexpectedly large liabilities for secondary contributions incurred by those granting options since 6th April 1999. Those liabilities are unexpectedly large as a result of the enormous increase in the value of e-commerce shares and, therefore, the value of options which have occurred after April 1999; and although it has declined from its peak earlier this year, it is still a long way above what it was in April 1999.

The second complaint by those companies was that the effect of the transfer of liabilities for secondary contributions from employers to employees is to create an effective tax rate of 47 per cent on gains, even taking into account the fact that, for tax purposes, the secondary contributions will be allowed as expenses against tax before the tax liability is computed. So there is an effective tax rate of 47 per cent, taking income tax and NICs together. In the view of those companies, that is likely to discourage the mobile and very expert workforce required in businesses of that kind from taking jobs in the United Kingdom, and it may lead some of the companies to move their operations abroad. The companies are highly mobile. They can, of course, set up in virtually any part of the world that they choose.

The amendment seeks to deal with both those problems. It proposes that the NIC liabilities are to be charged on the value of the option rights when the option is granted and not when it is exercised. That will leave the liability for secondary contributions with the employer, but on a much smaller amount and on a more easily ascertainable basis, not on an open-ended basis as to the ultimate liability.

The amendment proposes, secondly, that the new basis of calculation will be made retrospective, subject to a liability to pay interest. It seems in principle fair to charge the NICs on the option value at the date of the grant because that is the value of the remuneration package when it is paid, and it seems that it is perfectly legitimate to treat the subsequent increase in value of an option as something in the nature of a capital gain, on which NICs are not charged. It is obvious that an option has a value, even if the option is to buy shares at a price at, or even above, the level at which those shares stand at the date when the option is granted. It is a one-way bet: if it is not in your interest to exercise the option, you do not have to; if it is, you can exercise it. The amendment also preserves the liability for secondary contributions on the employer, which seems to us to be the place where it belongs.

I have to say that I was subsequently approached by another company, NTL, which is also in the IT business and which prefers the Government's formula to the formula in my amendment. So it is clear that there is no consensus in the world of high-tech. It may be that the issue could be solved by giving a right to elect to pay either on the value of the option at the date of the grant or to transfer the liability to the employee and base i1 on the gain on the exercise of the option.

I think that everyone in this world is agreed that it is desirable that this extremely high, unforeseen liability which has arisen as a result of the great increase in the value of Internet shares over the past 14 months should be brought back to more manageable levels because of the serious effect that these outstanding and wholly unpredictable liabilities will have on the financial situation of high-tech companies.

I would normally have tabled the amendment in Committee but had no opportunity to do so, so I have brought it forward for discussion now. Have the Government considered charging NICs on the value of the option at the date of the grant? If so, why was that option rejected in favour of the alternative that they have adopted? Are the Government prepared to give some relief to companies that have incurred high and unpredictable liabilities for future NICs that they would not have done, had they granted options under the formula that will take effect from 19th May? I beg to move.

Lord Higgins

My Lords, the House will have felt a sense of déjà vu when the noble Lord moved his amendment because in the previous welfare Bill we encountered considerable problems regarding the IT industry, the danger of people going abroad and so forth.

Like the noble Lord, I have also had correspondence from qxl.com and NTL.

Baroness Hollis of Heigham

My Lords, they cancel each other out.

Lord Higgins

As the noble Baroness says; we will have to consider which end of the argument we favour. Perhaps the quickest way for the Minister to reply would be to say she agrees or disagrees with qxl.com or NTL. Having said that, there is considerable overlap and concern.

There may be implications, as last year, for the international mobility of companies. The evidence seems a little conflicting because there may be problems with the American accountancy system as well as of taxation in this country. It is unfortunate that this issue has arisen late in the day, although that is in no sense the Government's fault. We will see what arrives in our e-mail—no doubt in droves—between now and Third Reading.

There is concern that the Government's proposals do nothing to address historical liabilities on existing share options, which need to be taken into account. One of the companies says that it is illogical and unfair that employers will have to pay national insurance on the price of the shares they grant when they will only benefit from an increase in the value of the shares; and that employees will face an unfunded tax liability, which would be particularly regressive for employees new to share ownership. Similarly, employers who have yet to move into profit will face unfunded tax burdens. Clearly, when share prices go up and down this is a very difficult situation overall. The noble Lord, Lord Goodhart, was inclined to refer to share prices going up but they can also go down. At the moment prices are going up and down like a yo-yo. The exact moment when the tax charge hits may be of considerable significance. The charge may arise at a time when the price goes up but the individual may have to pay it at a time when the price has reduced. This is a simple matter, and I hope that the noble Baroness is able to explain it in words of one syllable.

Baroness Hollis of Heigham

My Lords, I want to be very careful in what I say. Obviously, one is considering certain liabilities, quite apart from jokes about company representations cancelling out each other. Having given a reasonably full reply—this is a matter of concern which noble Lords were unable to debate at Committee stage—I am happy to repeat the offer, if it is of assistance, of a further meeting before Third Reading between officials and the noble Lords, Lord Goodhart and Lord Higgins, to pursue the matter in a way that we cannot on the Floor of the House. Because the amendments were tabled rather late noble Lords were unable to debate the matter fully in Committee.

I start by explaining briefly the purpose of the Government's position. I shall then explain why I recommend that the House reject the amendment moved this evening. Some background may be helpful. Noble Lords will be aware that my honourable friend the Financial Secretary has been consulting employers with a view to finding a technical solution to a problem that has arisen in relation to national insurance contributions on share option gains. Since 6th April 1999 gains made by employees when they exercise unapproved share options granted after 5th April 1999 are subject to Class 1 NICs. This means that the NICs charge is now on the same basis as income tax through PAYE.

This has caused a number of problems for employers. Companies have informed us that, while they can plan for NICs on regular pay, it is more difficult for them to plan on share option gains, particularly where the share price behaves like a yo-yo, as the noble Lord, Lord Higgins, suggested, as in the high-tech sector of the economy. Employers are required to make a provision in their profit and loss accounts for the accruing NIC liability, based on the market value of the shares at the relevant accounting date. The need to make this provision can make some companies technically insolvent. Exposure to an unpredictable NICs liability can also mean that some companies miss their performance targets. When that happens the market response can be devastating.

Class 1 national insurance contributions consist of a primary contribution which is payable by the employee and a secondary contribution which is payable by the secondary contributor, who in most circumstances is the employer. Current social security legislation provides a statutory bar to prevent employers from recovering any part of their secondary Class 1 liability from the employee. The government amendment introduced in Committee strengthens that protection for the employee, but at the same time introduces an exception for NICs arising on share option gains.

The government amendment does three things. First, it allows employers and employees to reach an agreement that a secondary contributor (usually the employer) may recover from the employee some or all of the secondary NICs in respect of rights to acquire shares. I emphasise that it is the employer and that it is voluntary. Secondly, as an alternative, the employer may make an application for approval of an election to the Board of Inland Revenue. If approval is obtained, the employer and employee can jointly elect to transfer all or some of the liability to pay the secondary NICs on the share option gain to the employee. Elections can be made only after the Inland Revenue has given its approval to the form of the election and the accompanying arrangements for securing that the NICs liability transferred to the employee is paid.

The ability to transfer the liability has been proposed as a direct response to representations made to the Financial Secretary during the consultation exercise. We have worked with several high growth companies to introduce a solution which will overcome accounting difficulties for companies that report in the United States that would otherwise arise if the employer simply recovered the NICs.

Thirdly, our amendment strengthens the existing statutory bar that prevents the employer recovering any part of the secondary NIC in respect of all forms of earnings (subject to the new exception for share options). It extends protection to the employee by ensuring that the person liable to pay the Class 1A NICs (on benefits in kind) or Class 1B (on PAYE settlement agreements) cannot recover his liability from the employee. I emphasise that the amendment that the Government introduced at Committee puts in place a solution that a number of companies have requested, and we are meeting those requests. The Government have consulted widely on this solution, and it is clear that many companies to whom we have spoken are eager to set up such arrangements.

The merit of this solution to companies is that it can eliminate or neutralise the need to make a provision for the accruing NIC liability in their accounts. It can remove the difficulties on the employer's cash flow caused by the need to pay NIC based on an unpredictable share price and the uncertainty caused by not knowing when the employee will exercise the option. The Government's proposal will allow the NIC liability to be moved to the employee who has control over when the option is exercised and who will have funds or shares which can be sold to meet the liability.

Noble Lords asked in Committee whether an employee who agreed to take on the responsibility for the secondary NIC would still be required to do so if the option had gone "underwater". I can confirm that the employee would not be required to pay NIC on the exercise of such an option as the employee would not make a gain in the circumstances where he has to pay more for the shares than he could buy them for on the open market. Indeed most employees would not exercise the option in such circumstances.

The amendment we introduced in Committee will help to attract business and jobs to the UK and help UK companies compete in the global market. It goes towards meeting the Government's aim of a fairer NI system by ensuring that NICs are paid on share options and not treated more favourably than other forms of remuneration. It is also cost neutral on the National Insurance Fund.

10.30 p.m.

Lord Higgins

My Lords, perhaps the noble Baroness could slow down just a little.

Baroness Hollis of Heigham

My Lords, I thank the noble Lord. I deal now with the amendment tabled by the noble Lord, Lord Goodhart, and the noble Earl, Lord Russell. As I mentioned to the House earlier, social security legislation currently provides a statutory bar to prevent employers from recovering any part of their Class 1 liability from the employee. The first effect of this amendment would be to ensure that Class 1A (NICs liability on benefits in kind) and Class 1B (NICs liability on PAYE voluntary settlement agreements) would remain excluded from this statutory bar. I am sure that I can count on support from all sides of the House in suggesting that we do not want to leave the employee exposed in this manner.

The second effect of this amendment would be to move the NICs charge from the exercise of unapproved options to the "intrinsic" value of the options at the date of grant. This would mean that employees and employers would have to pay NICs regardless of whether the options are eventually exercised or if the value of the shares were to fall. So NICs would have to be paid purely on the expectation of a realisation of value and not a tangible gain in value; the NICs payable would not reflect the gain that the employee actually made.

M any high growth companies have told us that they grant share options because they are unable to offer competitive cash salaries, particularly when they start up in business. This amendment would mean that these companies would face an NICs charge when they grant: options to employees—at the time when they are least likely to be able to pay. We see a number of difficulties with the noble Lord's proposals. First, employees would be required to pay NICs at the time they receive the option. This could mean that they have to pay at a time when they have insufficient cash to meet their liabilities. Currently, employees can sell some of their shares when they exercise their options to meet their liabilities.

Secondly, we would go back to the position that existed for NICs pre 6th April 1999, and so take the NICs charge back out of alignment with the income tax charge through PAYE. This will mean that PAYE and NICs will have to operate on two different figures. Employers said at the time that this caused considerable administrative problems.

Thirdly, the amendment will increase administrative costs for employers and the Inland Revenue, due to the added complexity of accurately valuing options over shares at the time of grant—and there is considerable difficulty in identifying a method that would allow this to be done accurately. Employers would be required I o operate a valuation model such as that provided in the Black Scholes Model. These models do not always easily apply themselves to high growth and unquoted companies. It will mean that options will have to be valued at grant for NICs purposes and again at exercise for income tax purposes—in other words, what happens when one disjoins them. Currently a valuation for income tax through PAYE is also acceptable for NICs.

Fourthly, the position that existed prior to 6th April 1999 will re-open an avoidance route that was used by companies, particularly in the City, to pay large bonuses to directors, and other highly paid employees, free of NICs. Any proposal to scale back the current NICs charge and charge it at grant brings with it the opportunity for new forms of avoidance.

Fifthly, the effect of this amendment would be that employees and employers who are paid in cash would pay more NICs than employees and employers where share options form an integral part of the remuneration package. The Government believe that that is unfair. I thought the noble Lord, Lord Goodhart, too, felt this was unfair, given his remarks at Committee stage.

Sixthly, the effect of this amendment would reduce income to the National Insurance Fund. The amount is difficult to predict because it is based on the volatility of the share price, but our provisional estimate is that it is likely to cost the National Insurance Fund in the region of £350 million a year. This could also result in a move away from bonuses paid in cash to share options and some substitution of cash pay with share options. If this were to happen the loss to the National Insurance Fund could be multi-millions. This could also affect employees' entitlement to contributions-based, earnings-related and work-related payments such as statutory sick pay or statutory maternity pay.

Finally, perhaps I may mention, after those six compelling arguments, a small technicality, which is that the amendment as drafted will not apply to Northern Ireland legislation, where NICs would remain payable on the exercise of unapproved options.

Lord Goodhart

My Lords, I was well aware that it did not apply to Northern Ireland. It was simply that in this age of saving paper I decided to save some by not putting down an amendment which would have been in identical terms, would have been equally long and would have applied to Northern Ireland, because the main purpose was to raise this for discussion. Any discussion relating to Great Britain applies in exactly the same terms to Northern Ireland.

Baroness Hollis of Heigham

My Lords, I knew that it could not possibly have been an oversight or a technical deficiency, but that it was a wisely considered and considerably reflected-on decision not to introduce into the House an amendment that was defective, knowing it that would have to be withdrawn. I congratulate the noble Lord, Lord Goodhart, on exhibiting his drafting skills in order to ensure that he has good grounds for taking back his amendment, given that he has conceded that he has good grounds.

I have advanced six reasons. It was worth putting those on the record because they are important issues. It is clear that different companies are coming from different perspectives, as illustrated by the fact that one company, QXL, was unhappy with this and another company, NTL, supported the proposal. We believe that they cancelled each other out.

For all those reasons—and I hope because of the very full answer I have been able to give tonight since we could not do this at Committee stage—I would ask the noble Lords to withdraw their amendments.

Lord Goodhart

My Lords, I am very grateful to the Minister for the full and detailed answer which she gave. It is clearly right that we should have had this discussion tonight because it is a most important issue. It will affect a large number of companies in what is a very important sector of our economy. It will involve many hundreds of millions of pounds. Having listened to the explanation which the Minister gave, I must say that my initial reaction to it certainly is that NTL is correct and QXL is wrong on this, that the Government's proposals are more in the interests of both the Government and the companies involved in this field than the alternative I put forward, which is to charge NICs on the value at the date of grant.

However, one aspect remains with which the Minister did not deal in great detail. It is now clear that the form in which this legislation was introduced in 1999 has created very serious problems. There are important drawbacks for companies which granted options between 6th April 1999 and 18th May 2000.

It could be said that those companies did not need to grant options, but in many cases options were granted pursuant to a contract of employment entered into earlier or have become so central to this sector of the economy that companies would have been unable to employ people without. I know that NTL did not grant options during that period, but it is clear that some companies did.

In that case, would it not be possible to consider giving some form of relief against the excessive liabilities faced by the companies which granted options during that period?

Baroness Hollis of Heigham

My Lords, for obvious reasons, including the fact that the subject is beyond my normal range, I should be loath to give any such assurances. However, I repeat in good faith the offer I made to arrange a meeting with the noble Lords, Lord Goodhart and Lord Higgins, to discuss the issue with the relevant officials. They will be able to have a much more informed discussion than I could possibly have at this time of night on a subject that is technical but none the less of major significance to the companies involved.

Lord Goodhart

My Lords, I am grateful and should provisionally like to accept that invitation. I should like to discuss the matter with those who briefed me on the subject in order to see whether they believe that there is an issue worth debating. I believe that they will.

Lord Higgins

My Lords, we ran into similar technical problems last year with the IT industry and I recall an extensive discussion with the individual groups concerned under the inspiration of the noble Lord, Lord McIntosh. It might be helpful if a similar meeting could be arranged, not least because the representations we are receiving are on both sides.

Baroness Hollis of Heigham

My Lords, no, I would not want to go that far. I am happy to hear their voices through the opinions put by your Lordships, but the constituency of such a meeting would produce major problems. That would not be appropriate. However, I am happy to offer a meeting in order to explore some of the technical issues. If, on reflection, noble Lords believe that questions are unanswered or that there are some partial moves that the Government might make—no commitment as to the outcomes—your Lordships would have the opportunity to pursue them.

Lord Goodhart

My Lords, I am happy to take up that invitation. Provisionally, I shall accept it and, subject to confirmation, I shall contact the Minister accordingly. In view of that, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 78 [Liability of earner for secondary contributions: Great Britain]:

[Amendment No. 135 not moved.]

Clause 79 [Contributions in respect of benefits in kind: Northern Ireland]:

[Amendments Nos. 136 to 138 not moved.]

Baroness Hollis of Heigham moved Amendment No. 139: Page 86, line 7, at end insert— ("( ) In paragraph 8(1)(ia) of that Schedule (power to provide by regulations for repayment in prescribed cases of the whole or a part of a Class 1B contribution), after "part" there shall be inserted "of a Class 1A or".").

On Question, amendment agreed to.

Lord Higgins moved Amendment No. 140: Page 86, line 14, leave out ("with 6th April 2000") and insert ("on 6th April of the year after the date of commencement of this Act, or, if this Act comes into force on various dates, the earliest of those dates,").

The noble Lord said: My Lords, I rise briefly to move the amendment. The group of amendments is related to contributions in respect of benefits in kind in Northern Ireland. I am not sure whether a similar passage appears in—perhaps I may have the Minister's attention.

Baroness Hollis of Heigham

My Lords, I was taking advice from my learned friend, the noble Lord, Lord McIntosh.

10.45 p.m.

Lord Higgins

My Lords, this requires very little learning. It is an extremely simple point in one sense in that it appears to introduce retrospectively the provisions of Clause 79, which is concerned with national insurance contributions in respect of benefits in kind for Northern Ireland. It states: This section shall have effect in relation to the tax year beginning with 6th April 2000 and subsequent tax years". However, it is already mid June. I am not in the least clear as to why this particular measure is so urgent that it should be backdated to 6th April 2000. I do not believe that that would be the normal practice. Similarly, Amendment No. 141, which refers to subsection (8), states: Regulations made by statutory instrument under any power conferred by virtue of this section may be made so as to have retrospective effect in relation to any time in the tax year in which they are made". I have the greatest difficulty in recollecting any piece of legislation which sets out in terms that it will have retrospective effect. That is something which, generally speaking, we are reluctant to do unless there is a good reason. However, no doubt the noble Baroness can provide us with one. I beg to move.

Baroness Hollis of Heigham

My Lords, in answer to the noble Lord's last question my friends on the Front Bench refer me to the Sea Fishing Grants (Charges) Bill. Therefore, there are plenty of precedents such as that. I have a long answer and a short answer, but I do not believe that your Lordships want a long answer tonight. The amendments before us relate only to Northern Ireland. Clause 79 mirrors the GP provisions in Clause 75 in Northern Ireland and the NIC scheme is UK-wide. Therefore, my remarks make no specific reference to Northern Ireland.

If the noble Lord, Lord Higgins, is seriously worried about this matter, my brief answer is that, given that we are proposing to arrange a meeting, I shall be happy to add it to the agenda. However, if your Lordships wish me to offer the House a fuller reply at this time of night on the amendment as tabled, I shall be happy to do so; but I suspect that the amendment as tabled is not the substance of the amendment to which the noble Lord spoke, which essentially relates to the Northern Ireland situation. Therefore, I am happy to read into the record a reply to the amendment as tabled, but it would not be a reply to the speeches made. It may be that, in the light of those circumstances, the noble Lord would prefer to put the matter on the shopping list for our meeting.

Lord Higgins

My Lords, I am puzzled as to why the noble Baroness's answer does not refer to the speech which I made. The normal procedure in this House is that it should. However, so far as concerns the amendment, I believe that what I said was exactly the same as what the amendment does; namely, it queries why there should be a retrospective effect. However, if the noble Baroness's reply does not seem relevant, perhaps it would be easier if she wrote to me and, if necessary, we can consider the matter at Third Reading—assuming that no one votes me down in trying to do that. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 141 not moved.]

Schedule 9 [Repeals and revocations]:

Baroness Hollis of Heigham moved Amendments Nos. 142 to 145:

Page 156, line 9, column 3, leave out ("paragraph 3(2)") and insert ("paragraphs 3(2) and 8(1)(i)").

Page 156, line 16, column 3, at end insert-
("In Schedule 1, paragraph 19(2).")
Page 156, line 30, column 3, leave out ("paragraph 3(2)") and insert ("paragraphs 3(2) and 8(1)(i)").
Page 156, line 37, column 3, at end insert-
("In Schedule 1, paragraph 22(2),")

On Question, amendments agreed to.

Clause 87 [Commencement and transitional provisions]:

Baroness Hollis of Heigham moved Amendment No. 146: Page 96, line 16, leave out (", 9, 11 and 12") and insert ("and 9 to 12").

The noble Baroness said: My Lords, I shall be extremely brief. This is a straightforward technical amendment which allows Schedule 5(10) to be brought into force on a date to be specified by commencement order instead of on the date of Royal Assent. Again, I suggest that your Lordships accept it. I beg to move.

On Question, amendment agreed to.

[Amendment No. 147 not moved.]