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National Finance

Volume 527: debated on Tuesday 4 May 1954

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Excess Profits Tax (Deferred Repairs)

16.

asked the Chancellor of the Exchequer whether he is prepared to extend beyond 31st March, 1954, the time limit by which repairs deferred from the Excess Profits Tax period must be carried out in order to qualify for relief from Excess Profits Tax.

No, Sir. I would refer the right hon. Gentleman to the answer given by my right hon. Friend to my hon. Friend the Member for Bodmin (Mr. D. Marshall) on 16th July, 1953. My right hon. Friend thought it right to come to a decision at that time so that traders should be in no doubt about the finality of the date, and he is not prepared to vary that decision.

Is there not some real hard ship in this case if it was due to Government action that the repairs were deferred?

The right hon. Gentleman knows that these expenses relate to a tax which itself came to an end in 1946. The original terminal date for these claims was 1949. It has been twice postponed, and I think we must now wind up this tax.

Steel Company Shares (Sale)

17.

asked the Chancellor of the Exchequer how many steel firms have been returned to private shareholders; and how many remain to be disposed of by the Agency.

The Agency have to date completed negotiations for the sale to private shareholders of securities in eight companies, and still retain direct interest in the equity capital of 62 companies.

Can the right hon. Gentle man tell us how much time the Agency has at its disposal in which to return all these firms to private enterprise? Can he say, in particular, how much longer it will be before the English Steel Corporation and Guest, Keen and Nettlefold are returned to private enterprise?

I am sure the hon. Lady will agree that it would be most undesirable in the public interest to speculate about the disposal of particular companies. On the general issue, the hon. Lady may remember that during the debates on the Steel Bill her right hon. and hon. Friends were anxious that we should not rush the matter in order to accelerate sales, thereby not getting adequate prices. I should have thought she ought to be grateful for the way in which the Iron and Steel Agency and my right hon. Friend are conducting this matter.

In view of the obvious failure of the Government's plans to denationalise the steel industry, would it not now be wiser to reconsider the whole matter and repeal the Act?

As that question is founded on a false hypothesis, its conclusion is inevitably even falser.

Earned Income Allowance (Married Women)

18.

asked the Chancellor of the Exchequer what the gain would have been to the Exchequer last year if the first £120 of the earnings of married women had not been exempt from Income Tax.

The estimated cost in 1953–54 of the tax relief on the earnings of married women was £85 million, which includes the cost of the separate set of reduced rate reliefs as well as the wife's earned income allowance of £120. It does not follow, how ever, that the Exchequer would benefit by this amount if the reliefs were with drawn, as many married women might stop working.

Is the Minister aware that the proposal to abolish this relief has now received the support of the Committee set up on tax reform, and, at any rate, the revenue from such abolition would be at least sufficient to meet the cost of providing equal pay in all Civil Service Departments, and even relief for married men without families?

I think that the hon. Gentleman has over-simplified the recommendation of the Royal Commission, but I note his view that further tax should be imposed on married women who work.

The Highlands And North Wales (Assistance)

20.

asked the Chancellor of the Exchequer whether, to assist the problems of areas subject to persistent depopulation, such as parts of the Highlands of Scotland and North Wales, he will consider taking steps to schedule such areas as ones in which a lower rate of Income Tax would-be payable.

Is the Financial Secretary aware that during the last 100 years, while the population of Britain has increased five times, the population of large parts of the country shows exactly the reverse trend and that some places have become derelict? In view of the enormous expenditure contemplated for new towns, does he not think that it would be to the advantage of the whole of the United Kingdom to encourage by all possible fiscal means the population to grow up spontaneously, in places where it is sparse?

My noble Friend knows very well that my right hon. Friend the Secretary of State for Scot land is taking many measures to help the aim which he shares with my noble Friend, but I doubt very much whether a system of differential Income Tax as between different parts of the United Kingdom is a very sensible way to tackle it.

Waterproof Coats (Tax)

21.

asked the Chancellor of the Exchequer whether he will now take steps to authorise a revision of Customs Notice, 78D, in order to deal with the anomaly under which, in the case of double-texture waterproof coats under the D Scheme, tax is more severely assessed on cheaper garments made from cotton than on the more expensive garments made from wool.

Does the generous Financial Secretary not recognise that the trade has discussed this with Customs and Excise officials, who acknowledge that it is an anomaly, and could not the Minister give some other answer than the one he has given, if that is acknowledged?

I certainly do not accept the suggestion which the hon. Gentleman makes that pronouncements of this sort have been made on policy by public officials, but I agree with him that there is a point for consideration here, and it will be considered together with other difficulties over this tax at the next review of the tax.

Why could not the right hon. Gentleman have given that answer in the first place?

Because the one which I gave in the first place was perfectly adequate for the hon. Gentle man.

Can my right hon. Friend give any indication when the next review of this tax will take place?

Government Expenditure

23.

asked the Chancellor of the Exchequer what proposals he has for a closer control of Government expenditure.

My right hon. Friend is examining this question in connection with the review of Government expenditure to which I referred in my answer to my hon. Friend the Member for Orpington (Sir W Smithers) on 27th April.

So far as administrative expenditure is concerned, will the right hon. Gentleman consider better control by this House, and also whether, so far as the more extravagant excesses of State expenditure are concerned, it would not be possible to establish some personal responsibility?

My right hon. Friend, as my original answer indicated, is reviewing the whole subject, and I have no doubt that the particular points which the hon. Gentleman has in mind will not escape attention.

Will it be possible for my right hon. Friend to say when he expects that the Chancellor will be able to make any answer as a result of this examination which is taking place?

Is the Financial Secretary fully satisfied with the Chancellor's economic efforts to date, which reveal that total Government expenditure is more than £1,000 million higher than it was under the Labour Government?

So far as I understand it, the criticism which the right hon. Gentleman has made has been that we have economised too much rather than too little.

National Savings Campaign (Expenditure)

24.

asked the Financial Secretary to the Treasury what functions are performed by the one chief illustrator, three senior illustrators and two leading illustrators who are employed at an annual cost of £5,592 in connection with the promotion of National Savings by the people.

Their main job is to help to produce posters, leaflets and other publications used by the 200,000 savings groups, the local savings committees, the banks, post offices and other organisations which are concerned with the work of the National Savings Movement.

Are these illustrators responsible for the design of the "fritter bug," and is it intended to allow the establishment of similar illustrators in other Departments of the State?

I am afraid that my entomology is not up to answering that question without notice.

While the right hon. Gentleman has described the main activities of these gentlemen, will he confirm whether it is part of their subsidiary activities to paint rosy pictures of the Treasury and what they are up to at the present time?

That work would be so unnecessary that one would not ask anyone to do it.

25.

asked the Financial Secretary to the Treasury the reason for the increase of £108,813 in the outlays of the National Savings Committee.

The main reason for the increase is to meet the cost of a special campaign to increase savings which the National Savings Movement, with the full support of my right hon. Friend, is arranging to carry on towards the end of this year.

Does not my right hon. Friend think that it would be an elementary saving not to expend this additional sum of £108,813 in the outlays of the National Savings Committee, and would it not be better to spend it in stimulating the trustee savings banks and other established organs of savings which cost the Exchequer nothing?

This campaign is designed to enable the National Savings Movement generally, embracing all the savings organisations, to make a special effort to encourage savings, and my right hon. Friend is fully satisfied that the effort in the favourable circumstances of today is well worth the money.

26.

asked the Financial Secretary to the Treasury how much of the estimated increase in advertising by the National Savings Committee is to be expended in commercial television.

Does my right hon. Friend tell me that this important advertising campaign, backed by the illustrators and the additional £108,000 which is to be spent, is ignoring the possibilities of commercial television?

Nothing is being ignored, but perhaps I had better not anticipate today's debate.

Would not the best saving be to spend no money upon commercial television?

That question does not arise out of the original Question, but I could not disagree with the right hon. Gentleman more.