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Orders of the Day — Finance Bill

Part of the debate – in the House of Commons at 6:54 pm on 20th April 2004.

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Photo of Richard Bacon Richard Bacon Conservative, South Norfolk 6:54 pm, 20th April 2004

Curiously enough, that is the same word as I have written down—the chairman was less than fully convincing. The Government have accepted in their regulatory impact assessment that upfront costs to the industry will be £25 million. On top of that, there are annual costs of £60 million—or £54 million, if one believes the Government's figures. On any count, however, there are significant ongoing costs. The value of the stamp is about £5.48 a bottle, so it should be treated not as a piece of paper but as currency. The Government's proposals have security implications, and there are concomitant security costs.

The Government have made much of the fact that the duty will be frozen for the remainder of this Parliament, but that has no impact on the set-up costs of £25 million that the industry has to find. The proposal raises a number of questions. In his opening remarks, the Chief Secretary referred to the arrangements for deferring duty, which have serious implications for companies' cash flow. It would be helpful if he could tell us when we will have more information, because the Government's proposals for deferring duty are vague, to say the least. The Government have also said that they will "look at" proposals for paying for printing, distribution and security costs, but they have not given a firm commitment, so more detail would be welcome.