Here is the bird’s-eye view of someone who has attended a number of standing committee debates and thus been able to see how our tax legislation is reviewed. The Finance Bill has finally made its way through parliament. The first and second readings and the committee stage have been completed, the report stage and the third reading duly followed, and Royal Assent finally occurred on 28 July. What does this process involve? Is it any more than politicians producing hot air? The first and second readings take place in the House of Commons and do not normally include detailed discussion of the clauses, likewise the report stage and the third reading. It is at the committee stage that MPs consider the Bill’s clauses and nearly all the amendments. Apart from the few, more political, clauses taken in the committee of the whole house, this happens in the standing committee. This committee met twice a week, with morning and afternoon sittings. The debate on each clause would comprise a debate on each amendment to the clause and then a ‘stand part’ debate, in which it is considered whether the clause should be part of the Bill. Most amendments were tabled by the opposition. The amendments could be tabled because of a genuine grievance or as a way of making a point. In order to move an amendment, a committee member stands up and makes a speech ‘moving’ the amendment. A member of government then replies. Apart from Dawn Primarolo, the other Labour members of the committee had little material to contribute to the debate. The government’s reply is normally read from a piece of paper drafted by the Inland Revenue or another member of the government’s team of advisers. A frequent reply is that the opposition amendment is ‘defective’, e.g. it would not work or would have unintended consequences. This can be a convenient way of avoiding addressing the point. After the government reply, other members stand up and speak, typically asking the government questions. MPs have a habit of continuously interrupting each other, and a large number of questions often accumulate before the government answers. While the opposition is making these points, the government’s advisers are busy scribbling replies on paper, which is handed to the relevant minister. The minister then stands up and reads these replies. Or, if there are none, the original reply is repeated. Occasionally ministers reply on their own, in which case their ability to add value depends upon how technical the issue is. The advisers sit very close to the government. Pieces of paper can be passed easily to ministers. The opposition’s advisers, typically volunteers, must sit with members of the public at the far end of the committee room, far from the opposition team, so passing papers during the debate would be difficult. The government has the Revenue and the Civil Service at its disposal. During a debate, the government would probably have experts ready to assist in replying, giving the government an advantage. Much of the subject matter is technical and, without help, MPs struggle. The government’s majority in the main House of Commons is reflected in the composition of standing committees. Therefore, all opposition amendments are defeated if the opposition pushes for a division, and all government amendments are passed. This procedure is repeated for every clause and by the close of the committee stage, the Bill had been subject to a number of government amendments, every opposition amendment had been rejected, and numerous pages of Hansard had been filled with reports. Although case law, namely Pepper v Hart, means ministers’ comments in Hansard may be used to help interpret ambiguous legislation, the fact that most replies are drafted by the Revenue suggests Hansard is unlikely to contain anything beyond what the Revenue has already publicly stated. Thus is our legislation made. The reader can judge how much independent scrutiny it gets. – Anthony Stobart is a tax manager at Deloitte & Touche.
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