Part of the debate – in the House of Commons at 12:04 am on 2 February 1993.
Andrew Smith
Shadow Spokesperson (Treasury)
12:04,
2 February 1993
I shall not detain the House long, but I should like to echo the point raised by my hon. Friend the member for Denton and Reddish (Mr. Bennett). It is clearly important that the drafting of the orders is right and we are indebted to the Select Committee on Statutory Instruments for drawing the error to our attention. I take the Paymaster General's assurance that the matter will be put right.
As I understand the orders and what the right hon. Gentleman said, they amend the personal reliefs from customs duty to remove from relief those goods purchased by travellers from other European Community member states who will now be catered for in another order, but leave in place the previous allowances for travellers arriving from outside the Community.
The orders are part of the general change that we welcome, opening up opportunities for members of the public to derive some personal benefit and enjoyment from the operation of the single market. For many millions of our citizens, such changes do more in an immediate sense to give meaning to the European Community and the freedom of movements of people and goods than many of the economically and constitutionally grander principles and declarations of the Maastricht treaty.
The second order, which applies to permanently imported goods, has the same effect on people importing belongings when moving house, honorary decorations, awards, goodwill gifts, inherited goods and certain goods ancillary to specified visiting forces. It also reflects the commendable achievement of the Community in making it as easy as possible for people to move home from one Community member state to another, thereby rendering the old reliefs redundant except for those moving to the United Kingdom from beyond the European Community.
We welcome the orders, but I wish briefly to press the Paymaster General on the staffing consequences for Customs and Excise services, which we touched on briefly in last week's Maastricht debate on the harmonisation of indirect taxation.
It is generally accepted that the creation of open border crossings for EC citizens and the fact that excise goods will no longer be taxed at the frontier enormously increases the scope for smuggling. I am talking not about cross-border shopping, which the Paymaster General has already estimated could cost £250 million per year, but about smuggling for resale on the black market. Given the relatively high excise duties on some items in the United Kingdom, the potential financial gains to smugglers are enormous. For example, I have heard that one container shipment of Spanish cigarettes alone could net £30,000 or more in profit.
In regard to the numbers of excise staff, I understand that the board's management plan for 1991 made an allocation of an additional 248 staff for the extra inland work arising from the single market, but following the 1991 autumn statement, this was reduced to 178 staff. That is not many staff, given the potential scale of the problem and the shift to inland scrutiny that the single market necessarily involves. There must be literally hundreds of thousands of potential outlets for smuggled goods.
Secondly, the small increase in staff for inland scrutiny must be set against an overall reduction in staff in the service. I understand that the projected outturn for Customs and Excise staff for the current financial year is 27,800 staff years, of which 2,200 are on excise work, as compared with 28,400 for 1991–92 in the board of management report, of which 2,300 were on excise work. Notwithstanding the allocation of 178 staff to which I referred, the excise department has fewer staff to undertake what is undoubtedly a far more difficult job. The same arguments apply to customs staff, for whom the 1992–93 projected outturn is 9,900 staff, compared with 11,000 for 1991–92.
Those are serious issues and I want a clear assurance from the Paymaster General that they will be kept under the closest review, that staff numbers and the extent of smuggling will be carefully monitored, and that, if it becomes apparent that additional staff are needed, the Government will not hesitate to appoint them, for the public would have it no other way.