Category: Press Releases

The press release issued by HM Treasury on 27 July 2001.

A joint HM Treasury/DTI consultation on the European Commission proposal to create a European Co-operative Society was published today.

The proposal consists of a Regulation setting out the framework for a new pan-European institution, which could operate across Member States on the basis of registration in one Member State, and a draft Directive concerning employee involvement in each institution.

Welcoming the publication of the consultation document, Economic Secretary Ruth Kelly said:

“We are seeking comments on all aspects of the draft proposals for a European Co-operative Society, to inform the policymaking process going forward.  The co-operative movement is known for its diversity, so I hope that a wide range of consultees will respond, to enable Government to take account of all the different perspectives and needs.”

The press release issued by HM Treasury on 25 July 2001.

The first stage of the Green Technology Challenge to offer tax relief to businesses investing in environmentally friendly technologies was today launched by Financial Secretary Paul Boateng.

Following the announcements made in this year’s Budget about reductions in fuel duty for greener fuels, the Government is also inviting further proposals for pilot projects under the Green Fuel Challenge.

The Green Technology Challenge

Many environmental improvements by businesses require investment in technology. In recognition of this and in line with its aim to protect the environment, the Government today published a consultation document inviting businesses and environmental groups to suggest specific environmental objectives, together with technologies to help achieve these, that should be considered for enhanced capital allowances.

The Government has already introduced enhanced capital allowances for energy-efficient investments, helping businesses to directly reduce their energy use, as part of the package of measures made available alongside the climate change levy, and the consultation document launched today builds on this.

The Green Fuel Challenge

The Green Fuel Challenge aims to help and encourage industry to develop practical alternative environmentally-friendly fuels.  Building on the reductions in duty rates for road fuel gases announced in the Budget, the Government is now inviting applications from those seeking exemptions or reductions from excise duty so that pilot  projects can be established to assess the benefits of new, greener fuels such as hydrogen, methanol, bioethanol and biogas.

Together, these initiatives represent an important response by the Government to work with business to help them tackle, and reduce, the environmental challenges facing modern society.

Financial Secretary Paul Boateng said:

“As the Prime Minister said in his speech to World Wildlife Fund Confederation earlier this year, the interests of business, technology and environmental protection go hand-in-hand.

The Green Technology Challenge aims to encourage, promote and reward green action and facilitate the diffusion of new technologies. It is not just about making the most of the best technologies available today, but about helping industry to develop the next generation of environmentally friendly technologies. 

Allied closely to the GTC, the Green Fuel Challenge builds on the shift to greener fuels encouraged by this Government. Virtually all of the petrol market is now taken by ultra-low sulphur petrol thanks to our policy of duty incentives, and there is a growing market for road fuel gases, again encouraged by duty differentials and helped by companies such as Safeway which are converting their lorry fleets and providing real local air quality benefits as a result. The prospect of securing the environmental benefits of a further move towards greener fuels is very exciting, and the Government is ready and eager to help accelerate that process.

I am delighted today to launch our invitation to business and environmental groups to participate in these Green Challenges. I strongly encourage all those with innovative ideas in this area to come back to us with imaginative proposals.”

The press release issued by HM Treasury on 24 July 2001.

The Treasury has awarded the Office for National Statistics £28.2 million to develop a statistics service to improve neighbourhood renewal, it announced today. The Neighbourhood Statistics Service will provide more localised data necessary to implement the Government’s strategy for combating social exclusion.

A cross-Government ministerial group will be established to act as the driving force for delivery of the information service.  Ruth Kelly MP, Economic Secretary to the Treasury, will chair the ministerial group. She said:

“Combating social exclusion is a major priority for the Government. To be effective in this we must have the most accurate and detailed information possible. Comprehensive local information is essential for pinpointing employment, drug and housing blackspots. This will enable us to identify disadvantaged neighbourhoods within relatively small areas, allowing us to target our efforts where they are most needed.

“The service will also track socio-economic trends and changes over time.  With improved data, national and local government and other service providers will be better able to design and to target policies, and to identify potential problems early.”

Len Cook, National Statistician and Head of the Office for National Statistics said:

“This resource will enable me to put into action plans to improve significantly the provision and availability of information for small areas in a way that has not been possible up to now.  Working with many partners across the public and private sector, we will put in place a range of developments which will transform the information infrastructure of this country.”

Lord Falconer, Minister responsible for the Neighbourhood Renewal Strategy said:

“To deliver the right solutions for a neighbourhood’s specific problems, it is vital that we have accurate and detailed information at our disposal. By funding a comprehensive new data system, which seeks to improve both the statistics available and ensure their consistency, we will produce an effective tool to underpin the renewal work going on across the Government – bridging the gap between the poorest places and the rest of the country.”

The press release issued by HM Treasury on 23 July 2001.

More than £45 million worth of value for money improvements is expected to be achieved in the next 18 months as take up of the Government  Procurement Card  (GPC) increases across central Government, Andrew Smith, Chief Secretary to the Treasury announced today.

This is in addition to the £25m saved in its first three years of operation, using the GPC for processing low-value transactions and putting in place a new impetus to encourage a switch from paper-based systems to electronic processing.

The Government also announced plans today to widen the scope of the GPC as part of its commitment to e.commerce, by allowing higher value capital items and service transactions to be paid for by GPC.

Andrew Smith, Chief Secretary to the Treasury said:

“The Government Procurement Card is thriving and making a real difference to the way Government is doing business. The increased take-up in the use of the Card makes good business and environmental sense.”

Peter Gershon, Chief Executive of the OGC, tasked with driving forward the use of the GPC within civil central Government, said:

“Huge strides have already been made by government in adapting to new electronic techniques.  Use of the GPC is entirely consistent with this vision.  and increases efficiency both for Government and for its suppliers.”

The GPC, managed by the OGC in conjunction with VISA and its member banks, is seen as a catalyst for change among Government buying professionals as it challenges the status quo and encourages suppliers to operate in a more efficient and cost effective way.

The Government is keen to meet its environmental objectives. Environmental benefits have also continued to grow as the GPC has eliminated the use of paper requisition forms.  This has saved 13 tonnes of paper in the first three years of the programme, increasing to 50 tonnes during the next 18 months.

The drive towards greater efficiency eliminates the costs incurred in traditional paper transactions and moves forward the Government’s electronic agenda.

Most suppliers of low value goods and services to Government now accept payment via GPC.  This is good news for Departments who are looking to ramp up their GPC programmes.  Since its launch in 1997, civil servants using the GPC have conducted more than 923,000 low-value transactions

The GPC Card is used by Government Departments to purchase a wide range of goods and services including lower value goods and services including office stationery, building maintenance and repairs, IT consumables and temporary staffing requirements.

The GPC is a Government-branded VISA card. It is similar in its use and features as the card in most people’s wallet or purse and is designed for ease of use by the cardholder.

Current spend on the GPC is over £100m and is expected to reach a cumulative figure of £300m by the end of 2002. This represents over 2.4m transactions per year.

The press release issued by HM Treasury on 23 July 2001.

Estimated savings of £100 million have been realised as a result of central Government applying electronic techniques to the processing and payment of procurement goods and services, Andrew Smith, Chief Secretary to the Treasury announced today.

The savings have been secured following the switch to electronic methods used in raising process orders through telephone, fax and e-mail, and through invoices paid through BACS system and the Government’s own procurement card.

Speaking about the savings, Andrew Smith said:

“The savings achieved from the government’s electronic agenda alone shows that scope within the Government’s procurement business is huge.

Doing business electronically makes practical commonsense and demonstrates the high level efficiency gains that can be achieved by encouraging Departments to adapt to the new developing ways of doing business, the electronic way.”

Peter Gershon, Chief Executive of the Office of Government Commerce, whose Department was tasked to drive forward the use of the Government Procurement Card in central Government said:

“As a catalyst for change, the OGC is demonstrating that it can make a real difference in the way the civil central Government moves forward in driving efficiency in Government procurement. 

It is no longer acceptable to keep faith with old manual systems and processes. Instead we must apply modern and electronic techniques to procurement activities where it adds best value. There is scope for adding real value here.”

The savings represent the latest developments in the Government’s commitment to increase the use of electronic methods of procurement within central Government for raising and payment of transaction orders.

In answer to a Parliamentary Question from Barbara Follett MP (Stevenage) on 20 July 2001, Andrew Smith said:

“There have been £100 million in value for money gains over the last three years as a result of applying modern electronic techniques to central civil Government procurement. 

Our objective was to purchase ninety per cent of low value goods and services electronically by March 2001. Recent measurements by the Office of Government Commerce indicate that at present approximately half of low value transactions are conducted electronically.  Work is continuing to realise additional benefits through means such as increased use of the Government Procurement Card and the replacement of antiquated IT systems with more modern ones.”

Auto-fax, email, EDI, web-enabled online ordering and payment, electronic cataloguing and the use of purchase cards make up the types of transactions that have led to savings.

On a basis of a survey of Heads of Procurement, there are seventy five per cent more electronic transactions now than three years ago.  Savings were calculated on the basis of this percentage increase in electronic transactions and the resulting savings from reduced process costs.  Industry benchmarks indicate a process cost saving of £65 per end-end-procurement transaction.  Government procurement savings are derived from the GPC data.

The press release issued by HM Treasury on 19 July 2001.

A consultation was launched by the Chancellor of the Exchequer, Gordon Brown, today. It sets out the Government’s strategy for modernising the corporate tax system, the policy objectives underpinning the reforms made since 1997, and takes forward the Government’s proposals on the taxation of returns from companies’ substantial shareholdings. The consultation document proposes an exemption for capital gains arising on the disposal of companies’ substantial shareholdings.

The Chancellor said:

“Four years ago, we set out our central economic aim of achieving high and stable levels of growth and employment. In the last Parliament, we put in place reforms to achieve macroeconomic stability and to promote work.

“In our second term, we have set ourselves the target of creating a new Britain based on enterprise for all. The UK has long been a hub for global business. There are many factors that make the UK particularly attractive, including our sophisticated financial markets and our strong trading links with all parts of the world. To ensure this remains the case, it is essential that the corporate tax system keeps pace with changes in the global business environment.

“In 1997, we started the process of reform of the corporate tax system. Our reforms centred on a tax system with low tax rates combined with a broad tax base, removing tax distortions and eliminating unnecessary rigidities that imposed administrative burdens and unwieldy structures on business.

“The consultation launched today focuses on the next stage of these reforms with a new relief for corporate capital gains to facilitate the process of restructuring and reinvestment, helping business to take advantage of emerging global opportunities. This is another essential step towards a more modern, more flexible and efficient tax system that will provide the stability that business needs to invest for the future.”

This consultation document:

•  confirms that the Government is committed to ensuring that the UK remains a very attractive location for business, and sees corporate taxation as a key element;
•  sets out that, within the general tax framework, the Government is committed to keeping taxes on business as low as possible and ensuring that the tax system reflects the realities of the modern business environment, and details the key principles for corporate tax
  reform – business competitiveness and fairness;
•  explains, as announced at the Budget, how a capital gains exemption for companies’ substantial shareholdings might work if introduced as part of the UK tax system;
•  identifies the substantial attractions that the Government sees in the proposed capital gains exemption approach;
•  explains how a parallel exemption for dividends might work, but also identifies the problems with such an approach, concluding that the Government feels that the current system based around a credit approach offers a better way forward;
•  indicates that the Government does not plan to restrict interest deductibility as part of the proposed reform of company gains or the possible exemption for dividends; and
•  announces a review by the Inland Revenue of the coverage and effectiveness of links with business on administrative matters, focusing in particular on feedback channels from larger businesses into the operational policy making process.

This consultation will help ensure that the UK remains an attractive location for business by creating the best possible environment for long-term business investment both in and from the UK.

The press release issued by HM Treasury on 19 July 2001.

The Treasury today published an updated and improved National Asset Register (NAR), providing for the first time a comprehensive list and valuation of all assets owned by Government Departments and their executive agencies.

The Government is breaking new ground with this updated NAR, by including valuations of all assets and detailing changes in asset holdings since 1997. The UK is a world leader in this area of public accountability. No other country publishes a list of everything it owns and what it is worth.

The NAR is a key tool in the management of these public assets, and shows that during 1999-2000 alone £1.3 billion worth of surplus assets were disposed of, unlocking resources that can be used more productively elsewhere. The total value of the assets listed was £274 billion at the end of the 1999-2000.

Welcoming publication of the NAR, Chief Secretary Andrew Smith said :

“Government Departments are responsible on behalf of the public for significant assets. It is essential that these are managed as effectively as possible, to deliver value for money or to free up resources which can be better used elsewhere.

The new NAR is central to this process. It is unparalleled. It is the most ambitious property inventory compiled in this country and the first such publication in the world. It is a clear, tangible benefit from the recent financial reforms of public finances, based on the introduction of resource accounting and budgeting principles.

Resource accounting and budgeting measures, for the first time, the full costs of holding and using assets. Departments will have to meet these costs rather than being encouraged to overlook them as under previous arrangements, giving a clear incentive to dispose of costly non-productive assets. 

This will focus the minds of public sector managers on getting the best value from the assets they are responsible for, and will make them more clearly accountable for their stewardship. The NAR shows the progress already made in improving asset management, and is a clear mark of our continuing commitment to better public finances.”

Examples of Departmental disposals of surplus assets include:

• FCO disposed of almost £50 million of surplus land and buildings since 1997, including properties across Europe, South America, Asia and the Middle East.
• Highways Agency disposed of £162 million of surplus roads and land and buildings.
• MAFF disposed of over £210 million of surplus assets in 1999-00 alone, including sale of Hurworth House for over £10 million.  MAFF expects sales income of £26 million in the next two years.
• MOD disposed of £234 million of assets in 1999-00, including Duke of York headquarters (£47m), Stanbridge Communication Centre (£17.5m) and Deepcut Barracks (£10m).
• LCD disposed of almost £6 million of assets in 1999-00, including Uxbridge County Court (£3.7 million).

The press release issued by the HM Treasury on 16 July 2001.

HM Treasury today issued revised advice to financial institutions on their dealings with persons and businesses domiciled in Antigua and Barbuda, following the introduction of improved regulation there.

Commenting on the announcement, the Economic Secretary to the Treasury, Ruth Kelly, said

“In recognition of regulatory improvements I have today revised the advice given to UK credit and financial institutions on their transactions and business relationships involving Antigua and Barbuda. We no longer believe that UK financial institutions need pay special attention to their dealings with persons or institutions domiciled in Antigua and Barbuda. From today UK financial institutions should apply normal due diligence procedures appropriate to transactions from jurisdictions that are not members of the Financial Action Task Force.

No system is perfect, and there is still significant room for improvement in Antigua. The UK Government will therefore continue to provide technical assistance to help the Antiguans meet the highest international standards in fighting money laundering. If implemented properly, we believe that Antigua and Barbuda has the mechanisms in place to guard against criminals taking advantage of its off-shore and on-shore financial systems.

The UK Government will continue to monitor the situation in Antigua, and will re-issue its original warnings if it believes that the new systems are not working properly.”

Foreign Office Minister, Baroness Amos said

“I welcome the decision to lift the advisory and congratulate Prime Minister Bird and the government of Antigua on the progress made in improving its legislative and regulatory regime in the international fight against money laundering.  We look forward to continued close co-operation with Antigua in this fight.”

The revised guidance is being sent out through the Joint Money Laundering Steering Group, and is available on the British Banking Association website.

NOTES FOR EDITORS

1.The UK issued its original advisory to UK financial institutions in April 1999, following legislative changes to the anti-money laundering laws in Antigua and Barbuda that weakened the capacity of that jurisdiction to deal effectively with money laundering, and put the offshore sector there at risk from criminals. A copy is available from this website.

2.  Since then the Government of Antigua and Barbuda has undone many of the more detrimental legislative changes. Further improvements are planned. The Government has also taken steps to ensure the independence of the off-shore financial services sector regulatory authorities, and has strengthened the capacity of the financial intelligence unit to handle suspected money laundering cases.

3.These improvements were sufficient to ensure that Antigua and Barbuda was not listed by the FATF as a non-cooperative jurisdiction in the fight against money laundering. Details of this exercise are available on the FATF link below.

The press release issued by HM Treasury on 13 July 2001.

The tax on punters will be abolished three months ahead of schedule on the first weekend in October, the Financial Secretary Paul Boateng announced today.

Gordon Brown announced in his March Budget that by January 1, 2002, the current tax on betting stakes would be replaced with a tax on bookmakers’ gross profits, a radical reform which means Britain’s bookmakers will end the deductions they currently charge punters, and look to grow their domestic and international business from a UK base.

Since the Budget announcement, rapid progress has been made both by the bookmakers in re-locating their off-shore operations to the UK and by Customs in preparing to switch to the new system. The Government has therefore decided to bring in the reforms to betting taxation a full three months early.

The new system will now be introduced on Saturday, 6 October.

Financial Secretary Paul Boateng said:

“The old tax on punters has been in place almost unchanged since 1966. But we realised it was not going to work in the 21st century and would mean UK-based bookmakers losing out on the global betting market. Our reforms mean punters will get tax-free betting, bookmakers will see increased turnover, and both racing and Government revenues will share in the benefits.

It’s a good deal all round. We’re therefore delighted to bring it in more than three months ahead of schedule. This demonstrates our ability to deliver real reforms with speed and efficiency – years ago, it would have been inconceivable to introduce these sorts of radical reforms, let alone push them through so quickly.”

Today’s announcement received a huge welcome within the betting industry.

John Brown, Chairman of William Hill, said:

“The Government is to be congratulated on the speedy implementation of the Chancellor’s initiative. We will be ready on the day for every bet we take worldwide to come back the UK.”

Bob Scott, Chief Executive of Coral Eurobet said:

“This will be the biggest day in the history of betting. I would like to applaud the Government not only for having the vision to introduce this revolutionary tax but also for the speed with which they have acted. This represents a major investment by the Government in the betting industry, and one we will demonstrate has not been misplaced. For customers, bookmakers, the racing industry and the Government, this is a win-win-win-win situation.”

Alan Ross, Managing Director of Ladbrokes, said:

“Every betting customer should thank the Government and put the date of October 6th into their diary as this marks the beginning of a new era for the industry. The decision today is a real boost to the betting industry and means that the significant increases in turnover, employment and international reach promised by tax-free betting will happen even sooner than anticipated.”

Tom Kelly, Director General of the Betting Office Licensees Association, said:

“This announcement is excellent news for punters and the betting industry alike. We are looking forward to a new era of deduction-free betting and the British punter getting the best deal in the world.”

Warwick Bartlett, Chairman of the British Betting Offices Association, said:

“Today’s announcement means the British punter will be able to bet tax-free for the first time in 33 years. The onus is now on the betting industry to deliver and make the UK a centre for global gambling. We have already received enquiries from the US, Canada, Australia, Japan, the Netherlands and Sweden from bookmakers interested in coming to the UK as a result of the introduction of a gross profits tax.”

The Gross Profits Tax

In Budget 2001, the Government announced that – following extensive consultation and analysis – the current General Betting Duty of 6.75 per cent on total stakes would be replaced by 1 January 2002 with a 15 per cent tax on bookmakers’ gross profits, defined as the difference between the stakes laid with them and the winnings they pay out.

This reformed tax structure makes it possible for bookmakers to absorb the tax and to end the 9 per cent ‘deduction’ that they currently charge punters. It therefore makes it possible for them to develop their domestic and international business from an onshore base, competing from a position of strength in the growing global market for telephone and internet betting.

Since the Budget announcement, Customs have been working with the bookmakers to make the necessary systems changes needed to implement the reforms, and those UK-based bookmakers with off-shore operations have been relocating them to the UK. Thanks to the rapid progress made, it will be possible to introduce the system from Saturday, 6 October, 2001.

Tax-free betting from October 6

Among the sporting events taking place on the first weekend of tax-free betting are the Prix de l’Arc de Triomphe at Longchamp, one of Europe’s premier horse races, always the subject of racing and betting interest from around the world, and England’s final World Cup Group match at home to Greece.

The international interest in these events reinforces one of the key objectives of the reforms, which is to enable UK-based bookmakers to target an increased share of the growing global market for telephone and Internet betting.

Customs will continue working with the betting industry to make the changes required prior to implementation. They will also shortly be conducting a series of seminars for bookmakers to explain how the new system will work.

The press release issued by HM Treasury on 12 July 2001.

Economic Secretary Ruth Kelly today announced that the Financial Services Authority (FSA) will become the statutory regulator under the Financial Services and Markets Act 2000 (FSMA) with effect from midnight 30 November 2001.

Speaking at a business breakfast this morning with FSA Chairman Sir Howard Davies and key industry and consumer players Ruth Kelly said:

“My predecessor made a commitment that N2 – the date for the commencement of the main provisions of the Financial Services and Markets Act 2000 – would be no later than the end of November 2001. I am delighted to honour that commitment today.

“FSMA will, for the first time, unite a wide array of legislation and supervisory bodies under one statutory regulator. The FSA will be a single point of contact for firms. Alongside this will operate the Financial Ombudsman Service to deal with customer complaints. This will bring much needed clarity, certainty and transparency to the industry and consumers alike.”

The Treasury will shortly be making the statutory instrument which allows firms? authority under old law to do financial services business to be “grandfathered” across into permissions to do equivalent business once FSMA commences. Ruth Kelly said:

“FSA powers to consider applications from financial services firms to modify their grandfathered permissions; grant new permissions; and other matters including waivers from the new FSA rules, will commence on Monday 3 September.”

Sir Howard Davies , welcoming these announcements, said:

“N2 has been a long time coming.  But the advantage is that there has been time to prepare properly.  We will be ready to switch on the new regime at the end of November, thanks in large part to the invaluable co-operation and patience of firms, their trade associations and consumer groups.”