Clause 20 - penalties
Child Trust Funds Bill
10:45 am
Mr David Laws (Yeovil, Liberal Democrat)
No. I will deal with that in a moment. It is not every day that we suggest that the Government have been too weak in giving themselves the power to impose a fine of only £300. We have suggested instead that the penalty could be greater than that and may increase up to £3,000.
We tabled the amendment only to be ruthlessly outflanked by the hon. Member for Tatton, who not only wanted to allow the penalty to be raised from £300 to £3,000, but would give the Inland Revenue the option of a period of imprisonment for a term not exceeding one year. It would be appropriate for the Minister to say whether she wants to take on powers of imprisonment. I am a little bit concerned about the hon. Gentleman's proposals.
As I understand it, clause 21 makes it clear:
''It is for the Inland Revenue to propose a penalty under section 20.''
Perhaps I have got that wrong. It seems as though the hon. Gentleman would give the Inland Revenue the power to imprison people, which is something at which even the Prime Minister and the Home Secretary would baulk, or perhaps not. We wait to see whether the Government will table their own amendment, which may have an even more draconian effect and send people away to some offshore island to do hard labour. I am not sure whether I would go as far as the hon. Member for Tatton. He will speak to his own amendments in a minute.
There is a question whether the £300 penalty is sufficient. I also question whether it is proportionate, considering that a penalty of £3,000 has been allowed under subsection (2). I acknowledge that the higher penalty is for the providers; presumably, the Government consider that a higher penalty is appropriate for them because they would have a greater ability to pay. However, the clause says that account providers would be subject to the £3,000 penalty for fraudulent and negligent claims. It seems disproportionate that under subsection (1) there is the power to impose only the £300 penalty on somebody who wilfully intends to defraud the Exchequer on opening a CTF account, or withdrawing money from one, whereas under subsection (2) somebody who merely makes a negligent claim can be subject to a £3,000 penalty.
I hope that the Minister will consider that tough liberalism approach, and the potential benefits to the Exchequer of the additional fine income that would result, which I am sure she would be able to spend in many interesting ways.