Amendment of the Law

Chris Leslie Excerpts

Wednesday 15th September 2010 Commons Chamber

[Chris Leslie (Nottingham East) (Lab/Co-op)]

I want to make a couple of specific points about the motion. Although I accept that the Minister has said that the Finance Bill will be quite narrow in scope, there are a couple of provisions in the motion that suggest that there could be an opportunity for the Treasury to introduce a series of other measures. The Minister, as is the practice now, tried to set out the context in which the Finance Bill would be set, and obviously the Opposition completely disagree with the Government’s approach.

It is quite clear that a strong dollop of dogma has been introduced into the Government’s financial strategies. Rather than sensibly and prudently address the deficit, the Government are going far further, far faster than is necessary, which is having a dilatory impact on the economy at large. However, that is a debate for another day.

The specific element of the motion that I want to address is item No. 6, the “Collection of income tax on payments”. Senior officials from the Minister’s Department have been giving evidence to the Treasury Committee this morning about the significant concern that has been expressed by many of our constituents about problems with the pay-as-you-earn system in collecting income tax that is owed, perhaps when miscalculations were made. Some reports suggest that 1.4 million people owe about £2 billion, which is an average of £1,400 each.

There is significant concern across the country and I am glad that the permanent secretary and his colleagues have given a concession today about the interest elements being waived, in part, when sums above £2,000 are owed. That prompted me to look carefully at some of the regulations that the Minister has introduced, and I noticed that he laid statutory instrument No. 1879—the Taxes and Duties (Interest Rate) Regulations 2010—which sets out that an individual who owes money to Revenue and Customs has to pay interest on it at 3.5%, but if HMRC owes money to an individual it will pay only the absolute, basic minimum, which I think is 0.5%. That disparity is controversial and many people find it difficult to understand why, in all fairness, there is not a two-way street. I wanted to use this opportunity to highlight this issue; I have prayed against that statutory instrument and I hope that we will find time to debate it.

In general, will the Minister iterate an apology from his Department about what has been happening with the PAYE arrangements? Will he also undertake that concessions will be given on the interest owed on any sums to try to make it a little easier for those who face an unexpected bill to bear that cost?