Amendment No. 3 deals with the role of the commissioners once they have delegated their functions. We have no basic problem with the fact that the commissioners have to delegate their functions, but we do believe that having delegated those functions, they need to control what happens after they have delegated. That is what Amendment No. 3 is about. When the commissioners delegate under Clause 14(1)(b) to a committee, that committee can include commissioners and officers, but it can also include outsiders. It is the latter category that potentially causes the problem.
If there are outsiders on a committee to which functions are delegated and those outsiders are in the majority, we must ensure that the commissioners can control what happens in that committee. If the commissioners are delegated to a person rather than a committee under Clause 14(1)(c), other provisions kick in by virtue of subsection (4). First, the commissioners have to monitor the exercise of the delegated function and, secondly, the delegate has to comply with the directions of the commissioners. Therefore, Amendment No. 3 provides a mirror of subsection (4) and repeats these two provisions for committees controlled by non-HMRC people.
This concern is not entirely fanciful because it is clear that committees can be comprised wholly or mainly of outsiders. In Grand Committee we talked about an audit committee that would be comprised wholly of outsiders and I do not suggest for a moment that audit committees would be a problem. However, the Act does allow virtually all the functions apart from very limited restrictions that apply to old Inland Revenue functions which are laid out in the clause. Therefore, all of the existing Customs and Excise functions and the vast majority of the old Inland Revenue functions can be delegated to a committee and that committee can be wholly or mainly comprised of non-HMRC people. That is what concerns us.
The theme of confidentiality also drives Amendment No.4. We were pleased that the Government amended the Bill in another place to ensure that there was a declaration of confidentiality for commissioners and their staff, but because the way in which both the Inland Revenue and Customs and Excise now work has changed over time and more contractors are involved in the operations, there is a concern about how those involved in the private sector organisations are aware of the confidentiality requirement. I accept that the duty of confidentiality applies to people who deal with taxpayer information: the issue is how do we make sure that they are aware of their obligations?
Amendment No. 4 would ensure that people are aware of their obligations and it is designed in a way that does not force HMRC into a straitjacket. It can either use the declaration route or something similar. It would give the commissioners discretion. When we debated this matter in Grand Committee, the noble and learned Lord said that he would consider further what might be done about that category of person, so I am hoping that the noble and learned Lord will be able to respond positively to the thought behind the amendment. I beg to move.