International Development (Official Development Assistance Target) Bill

Debate between Lord Bruce of Bennachie and Lindsay Hoyle

Friday 12th September 2014 Commons Chamber

[Mr Tom Clarke]

I think that the House should calm down and examine exactly what the right hon. Gentleman is saying; it is factual. Judith Hart believed in the dispersal of civil service jobs. She headed what was then the Department for Overseas Development. East Kilbride became the headquarters for the United Kingdom, working in tandem with Victoria. It stands to reason that if Scotland is foolish enough—I do not believe it will be—to vote for independence, those jobs will simply be lost because they are serving a much bigger united—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. We must have shorter interventions. There are many Members still to speak, and it is helpful to all if we can have short interventions, quick answers and Members carrying on with their speeches.

[Sir Malcolm Bruce]

All I will say is that a Scottish agency of similar efficiency would require only a fifth of the jobs that are currently based in East Kilbride.

I want to conclude by saying two things. The first is about the Independent Commission for Aid Impact, which reports to the Select Committee that I have the honour to chair. I believe that ICAI has become an established and useful body that holds DFID to account—I know that Ministers find it uncomfortable. Although it is appointed by Ministers, it is accountable through the Select Committee to Parliament. I believe that that arrangement could usefully be enshrined in law. I say in passing that there are some concerns that, as ICAI moves to its second phase and has been reassessed, there may be some compromise of its independence, albeit not intentionally.

Putting ICAI’s independence in statute and ensuring that it operated as an independent body, reporting through Parliament to DFID, would be an essential component of ensuring not only that we delivered the 0.7% and that justifications for any variations could be independently examined, but also—to make the former Secretary of State’s point—that the quality of what we delivered was continually assessed, so that we did what was best and made it work better. That would be beneficial to all of us. I hope the Government will consider that proposal—maybe my right hon. Friend the Member for Berwickshire, Roxburgh and Selkirk can come to an arrangement about it—because it would be valuable.

One privilege of being the Chair of a Committee such as mine is that I have had many opportunities to visit other countries. I think I have made more than 30 such visits to sub-Saharan Africa, south Asia and other parts of the world to see the work we do, on our own and in partnership with other international organisations, bilateral donors and NGOs. It is transformational and world-class work and something of which this country can be proud. We lead the world in what we do and the effectiveness with which we do it, and that is understood and appreciated wherever we go. We have fantastic, dedicated staff working in those places, sometimes in extremely difficult and challenging conditions. As a country, we have every reason to be proud of what they do. This Bill stands up, as people have said, as a great British totem of a country that has engaged in what poverty reduction really means, is committed to it and is absolutely clear that we will go on delivering on our obligations in future, regardless of what anybody else does, but also as a beacon to others, so that they are a little ashamed of what they have done and perhaps respond to our challenge.

Finance (No. 3) Bill

Debate between Lord Bruce of Bennachie and Lindsay Hoyle

Tuesday 3rd May 2011 Commons Chamber

[The Chairman of Ways and Means (Mr Lindsay Hoyle)]

The Committee is grateful for that explanation.

Clause 7

Increase in rate of supplementary charge

[Malcolm Bruce (Gordon) (LD)]

I beg to move amendment 13, page 2, line 36, leave out ‘for “20%” substitute “32%”’, and insert

‘after “a sum equal to 20% of its adjusted ring fence profits for that period”, insert “increasing by 1 per cent. for every $5 by which the reference hydrocarbon price exceeds $75 subject to a maximum rate of 32%”.’.

[The Chairman]

With this it will be convenient to discuss the following: amendment 14, page 2, line 36, at end insert—

‘(1A) A reference price will be determined by an independent arbiter agreed jointly between the Government and Oil and Gas UK and will determine separate prices for oil, gas and condensates.’.

Amendment 15, page 2, line 36, at end insert—

‘(1B) The increased charge shall not apply to fields producing more than 90 per cent. gas. Where a field produces oil and gas the charge will be based on the price of oil equivalent taking into account the ratios of oil to gas produced.’.

Amendment 16, page 2, line 36, at end insert—

‘(1C) The supplementary charge may be abated or offset against the cost of investment to increase production.’.

Amendment 2, page 3, line 2, leave out ‘24 March 2011’ and insert ‘30 September 2011’.

Amendment 17, page 3, line 2, after ‘2011’, insert

‘and before 30 September 2012’.

Amendment 3, page 3, line 4, leave out ‘24 March 2011’ and insert ‘30 September 2011’.

Amendment 18, page 3, line 4, after ‘2011’, insert ‘or 30 September 2012’.

Amendment 4, page 3, line 8, leave out ‘24 March 2011’ and insert ‘30 September 2011’.

Amendment 19, page 3, line 8, after ‘2011’, insert ‘or 30 September 2012’.

Government amendments 11 and 12.

Amendment 5, page 3, line 27, leave out ‘24 March 2011’ and insert ‘30 September 2011’.

Amendment 20, page 3, line 28, after ‘2011’, insert ‘or 30 September 2012’.

Amendment 10, page 4, line 7, at end add—

‘(11) The Chancellor shall produce, before 30 September 2011, an assessment of the impact of taxation of ring fence profits on business investment and growth including an assessment of the long-term sustainability of oil and gas exploration in the North Sea.’.

Clause stand part.

[Malcolm Bruce]

The purpose of this group of amendments is to persuade the Government to engage with the oil and gas industry to ensure that no major new investment opportunities are lost. I will explain the purpose of the main amendments, and I very much hope that Ministers will respond in a constructive way, because these are intended to be constructive proposals.

The Government are on record as saying that they understand the need for stability in the fiscal regime, and the Chancellor has described this as a Budget for growth. It is worth saying, however, that in contrast to the cautious way in which the Government have applied new taxes to banks, which have squandered our resources to the extent that many of them had to be nationalised, it is quite harsh to apply a marginal rate of tax of 82% to our single biggest industry. It is an industry that invests in real infrastructure and real engineering, and it takes risks in regard to weather, geology, exchange rates and cost unpredictability, as well as taxation.

I accept that the current spot price of Brent crude, at $125 a barrel, allows for unforeseen profits, at least for some fields. However, that does not apply to gas fields or to fields with large quantities of associated gas and, as Ministers will know, that is not the price that many operators actually realise, as they often contract their production at an average well below the spot peak.

I say in passing that the link between the oil tax changes and the fair fuel stabiliser are tenuous. Many of the companies operating in the North sea have no retail division, and there is no direct connection between their returns and the pump price. Also, the Government are themselves the recipient of a windfall. According to the Library brief and, I think, the Red Book, North sea profits are running at between £1.5 billion and £1.9 billion per annum over the next four years. That is additional revenue that was not anticipated in the pre-Budget statement in November. The Government have also received a VAT windfall on pump prices, averaging about 6p a litre. However, my point is not that there is no case for additional contributions from North sea operators and field shareholders. I do not take issue with the Government about that. My point is that this should be done after proper consultation and taking due account of the complex character of the mature North sea industry.

I have monitored the industry for 40 years. Indeed, 40 years ago this September, I started work as research and information officer for the North East Scotland Development Authority. Towards the end of that year, 1971, BP announced the successful commercial test of a well, which turned out to be the discovery of the Forties field. However, it is interesting to note that, believing that it had reached the end of its useful life, BP sold the Forties field to Apache in 2003. Since its acquisition of the field, Apache has greatly enhanced recovery from Forties and sees long-term potential for its development. It is worth noting that Apache has been one of the most vigorous critics of the Government’s policies, and that it questions whether its investment will be fully committed or realised.