It might help the House if we could encourage the Financial Secretary to the Treasury, who has dragged himself away from the Finance Bill Committee, to tell us what he intends to proceed with in relation to insurance companies and building societies as the reason for tabling ways and means motion No. 4. His explanation so far has been brief to the point of absence, and I hope to encourage him to tell us what he proposes.
In the Finance Bill Committee, we are already dealing with proposals in relation to building societies which are a constitutional and taxation outrage. It would be advantageous to know whether the Financial Secretary has anything similar in mind for insurance companies and friendly societies. In the case of building societies, the Government intend to secure, by retrospective legislation, a piece of blatant double taxation. If that is what they have in mind for other bodies also, we should know about it at this stage. I hope that the Minister will tell us what the ways and means motion is for.
That contribution from the hon. Member for Berwick-upon-Tweed (Mr. Beith) should not go totally unchallenged. There is clearly an issue of principle in clause 50. In 1985, the Government said that there would be no extra revenue. I doubt that similar circumstances will apply—
I am dealing with that, Mr. Speaker, if I may develop my sentence. If the paragraph changes and I go wrong, I shall rely on you to intervene.
As I was saying, I cannot believe that the Government would do the same thing twice on insurance companies or anyone else, and I believe that the Government will be thinking again about the previous experience and we shall not have any serious worries. I cannot seriously believe that £90 million could be given to the members of one building society and £250 million withheld from members of other building societies. Therefore, I hope that the House will be reassured, if not today then on some other occasion, by my hon. Friend.
I am confident that my hon. Friend the Member for Eltham (Mr. Bottomley) will be wholly reassured when the matters which he has raised come to be considered in detail in Committee.
The hon. Member for Berwick-upon-Tweed (Mr. Beith) asked what the purpose of the resolution is. My explanation of the measures in moving them reflected the desire of the House to deal with the matters with some expedition. The resolution is to cover the new clause that we shall be introducing to change the tax rules for general annuity business and the amendment that we shall table shortly that changes the definition of a friendly society's tax exempt business. Both those proposals were announced on Budget day.
General annuity business will be taxed in broadly the same way as basic life assurance business. The investment return accruing for the benefit of annuitants and prospective annuitants will, after relief for expenses and the income element of annuities in payment, be taxed in the hands of the life office. The resolution is needed to cover that charge. We propose to remove the restrictions preventing friendly societies from issuing small taxable policies because some businesses will be classified as taxable business. The resolution is needed to cover that tax charge.