John Healey (Financial Secretary, HM Treasury; Wentworth, Labour)

The clause increases the rate of excise duty charged on still wine in line with general inflation. The duty on sparkling wine is unchanged. Wine accounts for about 28 per cent. of total alcohol duty receipts. The increase, with the VAT, is equivalent to1p on a glass of wine and 4p on a bottle of wine. It is necessary, as is the measure on beer, to maintain this important source of revenue to support our investment in public services.

I am also aware that there are concerns in the wine trade, which argues that the demand for wine is beginning to weaken. We recognise that and that the wine trade plays an important part in our economy. However, we need to maintain our revenue and support for public services. The increase is modest and is in line with inflation only. It does no more than maintain the real value of the revenue from that part of the alcohol duty regime, so I commend the clause to the Committee.

Paul Goodman (Shadow Minister (Childcare), Treasury; Wycombe, Conservative)

Again, we have no quarrel about what is proposed in this clause, although we note the wine trade’s concerns, to which the Financial Secretary referred.

I have a question that arises from the point made by the hon. Member for Falmouth and Camborne about beer, champagne and the World cup. I am sure that the Financial Secretary will be able to give us a better insight into the Chancellor’s thinking than I can; if he cannot, perhaps the Economic Secretary could. I assumed that the Chancellor’s thinking was that there would be good reason for people to drink more champagne than beer because of what would happen in the World cup. That drew my attention to a curious point that arises because the Chancellor said,

“in anticipation of World cup success this summer, I am freezing duty on champagne, and on British sparkling wine.”—[Official Report, 22 March 2006; Vol. 444, c. 297.]

He did mean World cup success for the England team, did he not?

Julia Goldsworthy (Shadow Chief Secretary To the Treasury, Treasury; Falmouth & Camborne, Liberal Democrat)

Again, I have no real issue with the clause, but I recognise the points that have been raised by various hon. Members about the differential impacts that different types of alcohol can have on antisocial behaviour and the negative impacts that they can have on health. Does the Treasury have any plans to work with the Department of Health to examine the differential impacts of different forms of alcohol? Will differential pricing be considered as a way of affecting behaviour?

John Thurso (Caithness, Sutherland & Easter Ross, Liberal Democrat)

In case the Minister might wish to make reference again to International Wine and Spirit Competition Ltd, may I declare an interest? I am the chairman of the company.

John Healey (Financial Secretary, HM Treasury; Wentworth, Labour)

I did not want to prolong this debate. I thought that I had responded to the points, but more emerged. I congratulate the hon. Member for Caithness, Sutherland and Easter Ross (John Thurso) if that is indeed a company that he chairs. I am glad to have been able to pay tribute to it. I assume that he would have done so anyway, but I am glad that I did just in case.

May I say to the hon. Member for Falmouth and Camborne that we work closely with the Department of Health on some of the concerns that exist for all of us about the impact of excessive drinking and the antisocial behaviour, aggression, violence and damage that often flow from it? Tax is often a blunt instrument. We have not been convinced that using alcohol duties would be an effective way of trying to reduce the harms caused by excessive alcohol consumption. That is not a feature of Government policy and in my judgment the case for it to be has not been made.

I say to the hon. Member for Wycombe that the Chancellor is extremely well informed about football. The fact that Scotland has not qualified for the World cup finals means that his loyalties can be completely and undividedly behind England in this World cup. I believe that he made that clear in an interview that he gave this morning on GMTV.