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Written Statements

Volume 405: debated on Friday 16 May 2003

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Written Ministerial Statements

Friday 16 May 2003

Northern Ireland

Boundary Commission

The Parliamentary Under-Secretary of State for Northern Ireland
(Mr. Desmond Browne)

The Parliamentary Constituencies Act 1986, as amended by the Boundary Commissions Act 1992 requires that the Parliamentary Boundary Commission for Northern Ireland undertake periodical reviews of constituencies in Northern Ireland. The Commission are required to submit a report to the Secretary of State for Northern Ireland not less than eight or more than twelve years from their last report. The previous report was submitted in June 1995. The next report must be submitted by 2007 at the latest.The Secretary of State for Northern Ireland has been notified by the Boundary Commission for Northern Ireland that they will be commencing their fifth general review of parliamentary constituencies as of today.

Home Department

Annual Report

I have today, with the Chief Secretary to the Treasury, laid before Parliament the Home Office's Departmental Report 2002–03 (Cm 5908). Copies are available in the Vote Office, Library and on the Home Office website. The Report describes the work of the Home Office to build a safe, just and tolerant society. It sets out our Public Service Agreement targets and describes performance against them. The Report explains how we are delivering better public services, sets out how the Home Office is organised to deliver and provides performance information. It provides financial data for the years 1998–99 to 2005–06 and summarises the Home Office's response to PAC Reports over the last year.

Treasury

Savings And Investment Plans

The Government have decided to allow a wider range of investments to be accepted into ISAs and PEPs. In future all UCITS will be accepted as qualifying investments for ISAs and most UCITS will be qualifying investments for PEPs. We will be bringing forward amending regulations to achieve this shortly.This change to ISA and PEP investment qualification responds to the replacement by the FSA of different categories of pooled funds (such as securities schemes and warrant schemes) with a single category of "UCITS schemes". This follows the implementation by the FSA of the UCITS Amending Directive on investment powers.Given the wide range of investments allowed to a UCITS scheme, not all UCITS schemes can be allowed into the stocks and shares component of an ISA, or into a PEP. To maintain the distinction between cash-like equities (which can be held in the cash component of an ISA) and other equities (which can be held in the stocks and shares component of an ISA, and in a PEP), the Government have proposed a test to distinguish between cash-like and other UCITS schemes based on the proportion of capital which an investor could be certain or near certain of receiving from their investment. Investments that would return at least 95 per cent. of the investor's original capital would be eligible for the cash component of the ISA—lower returns of the original capital would be eligible for the stocks and shares component of the ISA, and the PEP.This proposal has been welcomed by the industry as simple and workable. We will be talking to them further about the detailed arrangements.The overall result is that ISAs and PEPs will become an even more flexible savings and investment as they will be able to accept a wider range of investments.

National Insurance Contributions Deficiency Notices

The decision to suspend National Insurance Contributions deficiency notices for the years 1996–97 was taken five years ago in 1998 by the Contributions Agency, when it was part of the then Department for Social Security.No Minister was consulted or informed of this decision at the time the decision was taken in 1998. In fact, Ministers were informed of this decision in March this year.As soon as Ministers were informed, I instructed the Inland Revenue to publish a statement on their website informing people of this suspension, which they did on 5 April 2003, and I informed the House of Commons by written answer on 11 April.In addition, I took action to:

protect the position of those who choose to make voluntary contributions by suspending the six year rule;
ensure that the six year rule will run from the beginning of this financial year so that people affected have the same amount of time to make contributions as they would have had if they had been informed earlier;
freeze the contribution rate at the rate that would have applied at the time, so no one has to pay more than they would have to at the time;
ensure that people receive a consolidated deficiency notice to enable them to make an informed decision.

I have been informed that the Contributions Agency took the decision to suspend issuing deficiency notices as a result of the serious problems they were experiencing in the introduction of the NIRS2 computer system, dating back to 1996. It was intended to be a temporary measure to clear the backlog of work created by these problems, but no plan was ever put in place to resume issuing them.

As the Inland Revenue statement of 5 April, and my written answer of 11 April said, to ensure that no-one missed out from being able to pay voluntary National Insurance contributions for the years from 1996–97, I immediately instructed the Inland Revenue to extend the normal six year time-limit in which voluntary contributions can be made.

Under the normal rules, the latest deadline for payment for 1996–97 would have been 5 April 2003. However, as I announced in April, because deficiency notices were not sent out the April deadline will not apply.

We have therefore stopped the clock on the time limit for payment, and the six years will start from the beginning of this financial year. So for the years 1996–97 to 2001–02, people will have up to 5 April 2008 to fill in any gaps in their National Insurance record if they wish. Everyone will be given as much time to pay as they would have had if the notices had been issued in the normal way.

In addition, as we said in April, I have instructed the Inland Revenue that anyone affected must be allowed to pay their voluntary contributions at the rate that would have applied in the year that their contributions were deficient, rather than the current rate.

The Inland Revenue will publish details shortly of how it plans to issue deficiency notices in respect of the years since 1996–97. These notices will tell people if they have any missing contributions in those years, and what they can do to fill the gaps in their contribution record if they choose to do so.

I also announced in April that each individual affected will be sent a consolidated deficiency notice for any years since 1996–97 in which they may have made insufficient contributions, rather than a succession of separate notices, so that they could make an informed decision as to whether it was in their interests to pay voluntary contributions.

These notices will not be a demand for payment, but will inform people that they have the option to pay voluntary contributions in order to make up their contribution record if they choose to do so.

Historically speaking, in the years prior to 1998, when deficiency notices were issued only about 4 per cent. of these resulted in people choosing to make voluntary contributions.

In addition, the pension rights of those caring for children and receiving Child Benefit, and those who care for a dependent relative at home and receive Carer's Allowance, are protected. Credits are automatically awarded when people claim incapacity or unemployment benefits. None of these groups will need to pay any voluntary contributions.

When I was informed of the full extent of this issue, I immediately asked the Inland Revenue to carry out an inquiry into why the decision to suspend the issue of deficiency notices was taken, why ministers were not consulted or informed at the time, why the issue of deficiency notices was not resumed after the NIRS2 computer system was stable, and why ministers were not informed for six years.

The inquiry will report by end of this month.

I will continue to keep the House fully informed of any further information on this matter.

Deputy Prime Minister

Annual Report

The Chief Secretary to the Treasury and I are pleased to present the first Annual Report of the Office of the Deputy Prime Minister for 2003 to Parliament. It sets out our achievements since the Office of the Deputy Prime Minister was set up on 29 May 2002.The aim of the Office of the Deputy Prime Minister is to achieve thriving, inclusive and sustainable communities. The aim and associated objectives and delivery targets were developed during the Spending Review 2002. The issues that we deal with affect the lives of everyone and are crucial to building the healthy, prosperous and safe communities we seek.During our first year, we have made good progress. A key achievement has been the publication of

Sustainable Communities: building for the future—a long term programme of action, backed by substantial resources of £22 billion, to improve housing and communities across the country. Progress has been made in all our other areas of responsibility: housing, planning, local and regional government, regional policy, devolution, neighbourhood renewal and social inclusion. We are also strengthening our capacity to deliver and establish effective working relationships with all our partners.

We also recognise that many of the problems we seek to tackle are deep rooted and much more remains to be done in the years ahead. We remain focused on delivering thriving, inclusive and sustainable communities in all regions.

Health

Food Standards Agency

The Food Standards Agency's Departmental Report Spring 2003 was laid before Parliament today.Copies will be placed in the Library.