HC Deb 04 March 1999 vol 326 cc1197-8
2. Mr. Bob Russell (Colchester)

If he will amend the VAT regulations to give a nil rating for maintenance work to Royal National Lifeboat Institution boathouses. [72414]

The Financial Secretary to the Treasury (Mrs. Barbara Roche)

I am sure that the whole House will join me in congratulating the Royal National Lifeboat Institution on its 175th anniversary. The RNLI has a wide range of reliefs for goods and some services relating to lifeboats. The United Kingdom can apply zero rates to a specified range of goods under a provision of the sixth VAT directive. Under that provision, the UK cannot be forced to give up any of its existing zero rates, but cannot introduce any new ones.

Mr. Russell

I join the Minister in congratulating the RNLI. It is a happy coincidence that today is that anniversary. May I suggest to the Minister that it is unfair to put VAT on saving lives at sea? For every person saved in the past year, the VAT cost was £110. That may be a drop in the ocean in terms of the Chancellor's expenditure, but perhaps that money could be better spent. After all, it comes from voluntary donations from the public. The VAT that the Chancellor collects is the equivalent of the cost of 13 new inshore lifeboats. Will the Minister consider introducing a nil rate for organisations engaged in saving life? If she wanted to, she could find a way through the red tape.

Mrs. Roche

I hope that the hon. Gentleman was listening to my earlier reply. I remind him that the RNLI is already given a great deal of help. VAT zero rate relief is available for new boathouses, new lifeboats, and tractors and other equipment for launching and recovering lifeboats. The repair and maintenance of lifeboat equipment are also approved.

The Government take charities and giving to charities seriously. That is why the Government give charities almost £2 billion each year, including some £200 million VAT relief. That is a record of which we are extremely proud.

Mr. Alan Simpson (Nottingham, South)

The Minister will know that the sixth VAT directive also allows the variation of VAT rates in relation to social housing projects. Will she look again at the relief that has been given so far on home insulation products—

Madam Speaker

Order. This question relates directly to the RNLI.

Mr. Charles Wardle (Bexhill and Battle)

Why should British people who want to maximise their support for the RNLI or, for example, church repairs, be thwarted simply because European Commission officials want a neat and tidy common VAT regime and oppose selective zero rating? Which comes first: the wishes of British people doing good work in their communities, or Brussels?

Mrs. Roche

I am amazed by the hon. Gentleman, but experience should perhaps teach me not to be. That comes as something of a cheek from a member of the previous Government, who broke their election promise by putting VAT on fuel when they said they would not, leaving this Government to cut it. We have kept our promises; they did not. Clearly, he does not understand the sixth directive either.

Mr. Michael Clapham (Barnsley, West and Penistone)

When my hon. Friend considers the RNLI's VAT position, will she also consider education action zones and ensure that they are put on the same footing—

Madam Speaker

Order. I am not having hon. Members abuse questions in that way.

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