§ 2.35 p.m.
§ LORD TAYLORMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
§ [The Question was as follows:
§ To ask Her Majesty's Government what is their estimate of cost to the Hospital Service of the proposed fuel oil tax, and how it is proposed that this extra expenditure should be met.]
§ LORD NEWTONMy Lords, the cost of this tax to the hospital service cannot at present be accurately calculated, but it is likely to be of the order of £¾million for England and Wales. It will be met from the Exchequer as part of hospital running expenses and the Government are considering the implications for hospital budgets of this and other factors affecting costs.
§ LORD TAYLORMy Lords, does that mean that in fact the allowances to hospitals for the maintenance costs will go up by an appropriate amount, so that the new tax will not result in a diminution of real spending for hospital services?
§ LORD NEWTONMy Lords, the Government are now considering whether or not there should be a further allotment of funds, and the hospitals will be told as soon as possible. But this particular cost cannot be considered in isolation: it must be taken together with other changes in costs which have occurred.
§ LORD TAYLORNevertheless, my Lords, will it not inflict a burden, whether considered in isolation or with other items, unless an appropriate amount is allowed for hospital budgets to cover it?
§ LORD NEWTONMy Lords, it depends what the noble Lord opposite means by "burden". This estimated sum of £750,000 is a very small proportion—indeed, it is one-six hundredth—of the total allocation of monies to hospital authorities for their running costs, the total being £447 million.
§ LORD AMULREEMy Lords, does not the noble Lord realise that hospital budgets are run down to the nearest farthing and that, therefore, it will make a big difference?
§ LORD NEWTONDid the noble Lard say that hospital budgets are running down?
§ LORD AMULREENo. What I asked was whether the noble Lord did not realise that the budgets of hospitals at the present time are run down to the nearest farthing, and, therefore, if there is an increase, it will mean that something else has to be dropped.
§ LORD NEWTONMy Lords, this is a very small increase and, as I say, the Government are now considering whether or not there should be a further allotment of funds.
§ LORD STONHAMMy Lords, is the noble Lord aware that this small increase works out at 30s. per year per bed? We have to work in hospitals to 1 per cent. on accuracy of spending. This is not an unimportant matter. Secondly, will guidance be given to hospitals regarding the implications of this tax as between burning solid fuel or oil fuel in the installation of boilers they will be making for the future?
§ LORD NEWTONMy Lords, I should not like to answer the second question without notice. As regards the first question, I hope that I did not suggest that it was an unimportant matter: I said merely that it was not a very big matter, taken in the context of the total allocation to hospitals to cover their running expenses.
§ BARONESS SUMMERSKILLMy Lords, would not a simple solution to this problem be not to levy this tax on hospitals?
§ LORD DERWENTMy Lords, is not this tax burdensome on the whole community, quite apart from hospitals?
§ THE EARL OF LONGFORDMy Lords, could we have an answer to the question put by my noble friend Lady Summerskill?
§ LORD NEWTONMy Lords, in answer to my noble friend behind me, first, it does fall on all consumers of these heavy oils. With regard to the noble Lady's question, I think she will probably remember from her own experience how Government accounting works. And perhaps I should also remind your Lordships that there was until 1947 a tax on these heavy oils of 1d. a gallon—it is now 2d. a gallon—and it was taken off then, according to the thin Chancellor of the Exchequer, only because there was a severe shortage of coal and the Government wished to encourage switching over to oil.