Commissioners for Revenue and Customs Bill

Part of the debate – in the House of Lords at 7:45 pm on 5th April 2005.

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Photo of Lord Goldsmith Lord Goldsmith Attorney General, Law Officers' Department, Attorney General (Law Officers) 7:45 pm, 5th April 2005

My Lords, I will first take Amendment No. 3 because that looks, as the noble Baroness explained, at the position of monitoring and control by the commissioners of committees on which neither commissioners nor their officers sit as a majority.

I can clarify the arrangements for her. She is right to note that the Bill makes a different provision between that where there is a delegation to another person and that to a committee that is established. However, as far as monitoring is concerned, which is the first of the noble Baroness's issues, the procedures will be the same. Those committees established by the commissioners will be under the direct supervision of the commissioners and monitoring will be part and parcel of that supervision. In particular, under Clause 12(1)(b), the commissioners are required to make specific arrangements for the conduct of the proceedings by their committees. Therefore, as far as monitoring is concerned I can assure the noble Baroness that the monitoring aspect will be dealt with.

However, there is a difference so far as the directions of the commissioners are concerned. That is an important distinction because there will be some committees—an audit committee is the best example—where it is important that the committee has independence in its actions. As I described in my letter to the noble Baroness of 2 March, senior committees of the HMRC will include as members,

"persons who are neither commissioners nor staff nor officers of HM Revenue and Customs", that is, non-executive directors.

HM Revenue and Customs is committed to establish an audit committee. In accordance with best corporate governance practice, membership would be restricted to only non-executive directors, so that the whole point is that this committee is independent of executive directors. Therefore, to provide in that situation that the committee should be subject to the directions of the commissioners would go against that necessary independence. That is the fundamental reason for the difference between the arrangements that are in place.

Having said that, I am sure that the noble Baroness will also see that, in relation to all the functions delegated to their committees, the commissioners will remain accountable for the work that is delegated. Therefore the proper performance by those committees of their activities can be assured.

I turn to Amendment No. 4. I said that even if I would not consider what further should be put into the Bill, I would at least consider what more I could say about the position on confidentiality, and I am happy to put that position on the record. It has been absolute common ground from when I made my opening speech on Second Reading that we agree about the paramount importance of taxpayer confidentiality, and the importance therefore of ensuring the awareness of confidentiality obligations. Let me therefore spell out the safeguards. I have already said what they are on several occasions, but lest there be any misunderstanding, I shall repeat them again.

The requirement in Clause 3 is for new officers and commissioners of the department, but the other obligations of confidentiality imposed by the Bill—the statutory duty of confidentiality backed by the criminal sanction—will apply to non-executive directors and those acting on behalf of the department, not just to regular staff. So those obligations are there. That message is made clear to anyone first gaining access to confidential information and is supported by further periodic messages from managers and others for so long as they are in contact with the information.

I shall take that a stage further. Non-executives will sign contracts with the departments which will contain acknowledgements of the duty of confidentiality. As for contractors, who could be IT support staff, consultant security staff and so on, there will be a number of safeguards appropriate to the circumstances. First, access to confidential information will be limited to business need. Access to information services will be available only when it is necessary and important to the job to be done. For example, security staff will not need or be given any access to taxpayer-confidential information, and in the main nor will those working in IT support, so there will be no need for those contractors to make any specific declaration of confidentiality.

Secondly, when the department judges it necessary, it can compel every person working for a contractor to sign an undertaking of confidentiality. That will be written into all the contracts of those working under contract. The department may not consider it necessary in all cases. One would not, for example, think that those contractors who were making travel bookings needed to make such specific declarations of confidentiality. But the ability will be exercised when it is needed.

Thirdly, a confidentiality clause will be written into all contracts at the company or service provider level.

I hope that that answers the substance of the noble Baroness's point. It is slightly churlish of me to draw attention to a technical error in the drafting of the amendment, but I had better do so, because it refers to,

"officers of Customs and Excise", when previous versions correctly referred to,

"officers of Revenue and Customs".

But I hope very much that we need not trouble about that, because I hope that we have reassured the noble Baroness about the substance of the two amendments to persuade her that we are entirely in agreement on what we are trying to achieve, that there is enough to achieve those objectives and that she need not press either of her amendments to a Division.