Clause 1. — (Selective Employment Premium.)

Part of Orders of the Day — Selective Employment Payments Bill – in the House of Commons at 12:00 am on 20 July 1966.

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Photo of Mr Jack Diamond Mr Jack Diamond , Gloucester 12:00, 20 July 1966

The hon. and learned Gentleman approaches all these arguments with objectivity and intelligence and he cannot say that his withers are unwrung, for he is just as much impressed by the argument as I am. The deduction to be drawn from the figures is that the likelihood is that there will be vast numbers of firms within each Order which will present no problem at all. He is saying that there may be some which present a problem. There has been one. We have invited correspondence and complaints, but we have come across only one.

7.30 p.m.

This is not conclusive evidence, but it is an indication, in that one would have thought that if there were many people falling into this category there would have been complaints and letters. As every hon. Member knows there has been an enormous number of letters, but only one complaining about this. If the anomaly which the hon. and learned Gentleman the Member for Darwen (Mr. Fletcher-Cooke) has in mind is the anomaly relating to the establishment, which comes later, then we would be only too glad to deal with it later. There are ample methods in the Bill, and Amendments proposed to be inserted, if the Committee agrees, which will get rid of this kind of anomaly.

I have given the reason why we thought it right to have a differential tax in terms of the premium, and I have indicated why we think that it will assist, to some extent, the existing imbalance, and why it will have a great effect, we hope, on our manufacturing industry, which is a source of increasing productivity and exports. As the Committee knows, 85 per cent. of our exports are manufactured goods or, putting it the other way round, 25 per cent. of what we manufacture is exported, but it is only 25 per cent. because a large percentage of what is manufactured is also import substitutes. An import substitute serves just as valuable a purpose as it does as an export. I have indicated why we think it is valuable, and I have tried to demonstrate that we shall keep the whole of the Bill under review.

No one would claim, before a new tax is implemented, that one knows what its final effects are to be. What is certainly the case is that all indications are that this kind of righting of the imbalance is overdue and will serve a useful purpose, and that the anomalies have nothing to do with the premium, but with the classification, which is a different issue. I hope that the Committee will not feel it necessary to press this matter to a Division.