Orders of the Day — Finance Bill

Part of the debate – in the House of Commons at 7:33 pm on 30th April 2002.

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Photo of Mark Field Mark Field Conservative, Cities of London and Westminster 7:33 pm, 30th April 2002

It is a great honour to represent the City of London and to be speaking today for the first time on a Finance Bill. Times have changed from a bygone era, even on this day when many of us have dressed in our best suits for the event in Westminster Hall earlier today. Back in the post-second world war era, it was apparently de rigueur during Budgets and Finance Bill debates for Members of Parliament—in those days there were two representing the City of London—to wear large black top hats. My association deputy chairman, Jacob Rees-Mogg, the son of Lord Rees-Mogg, offered to borrow such apparel, but I decided that discretion was the better part of valour, at least on this occasion.

The more disparate nature of financial services in this era, certainly since the big bang in 1986, means that the City can no longer be said to speak with a single voice. In any event, my duty is to the residential population—the 6,000 residents within the square mile of the City of London. None the less, it is a great honour to be able to say a few words tonight on the Finance Bill as it affects the financial services and the business community.

My own record is as a small business man and I probably express the view of many who have a background in business in lamenting the detachment between the business and political classes—something that has been mentioned many times in recent years. I wish to speak briefly on two main aspects—enterprise and globalisation. It has been a much-vaunted if somewhat overspun goal of this Government to promote enterprise. Those words were used by the Chancellor of the Exchequer, and by the Chief Secretary earlier this afternoon.

I serve on the Standing Committee considering the Enterprise Bill, which is why I could not be here throughout today's debate, for which I apologise. That legislation is flawed in its rather overbearing regulation on merger controls and cartels, as well as in its somewhat simplistic analysis of the reform of insolvency law.

The Chancellor's instincts, as manifested in the sheer size of the Finance Bill, are all too often to complicate and meddle in taxation. As my hon. Friend Mr. Bercow made clear, the Bill is 488 pages long with 140 clauses and 39 schedules. It is a Budget for the most enterprising among the accountancy profession, but perhaps not for many more.

It would be unfair and churlish not to recognise that the Budget contained a number of positive changes, which manifest themselves in the Finance Bill. I support the cut in capital gains tax, from which I have benefited, having sold a business within a few months of entering the House. I also support many of the venture capital trust changes, which allow a merger and wind-up without losing the tax benefits. My hon. Friend Mr. Flight has become something of an expert on that issue, and I am sure he will refer to it in his comments later. Rob Marris rightly identified the credits that will be available for research and development, which are also to be supported.

Equally, there has been a downside for British business. All in all, we have had a tax-raising Budget and those taxes have been on jobs, making people more expensive to employ, with an attack on the oil industry and on foreign companies. I appreciate that the debate on national insurance contributions will take place at greater length tomorrow, but surely it would have been far better to have scrapped employers' national insurance and to have increased corporation tax rates. That would have simplified matters for companies, cut the compliance bill and encouraged employers to employ people.