Nick Palmer (PPS (Malcolm Wicks, Minister of State), Department for Business, Enterprise & Regulatory Reform; Broxtowe, Labour)

That is an interesting point, but there is an essential difference between pension contributions and charitable ones. Pension contributions are, in effect, deferred income. If we, as individuals, have more immediately available income because tax rates go down, it is a rational and individual choice as to how much of that we choose to put into our pension funds. Whether we do, or do not, we are profiting directly. Charitable contributions are slightly different. Topping up our charitable contributions requires a separate decision. If we do not, do so the default position is that we profit but the charity loses. In the case of pension funds, we profit either way.

Basically, I welcome the principle that we need to consider the issues more widely. I am sure that the Financial Secretary will respond more fully to the specific point made by the hon. Gentleman, but HMRC has to protect itself against the possibility that the charity is unknowingly submitting a claim that is not valid—for instance, because the person who made a contribution to the charity is not a standard rate taxpayer.

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