§ 2.50 p.m.
§ [The Question was as follows:
§ To ask Her Majesty's Government how much out of the money contributed by the British public in a year to charity they estimate will be diverted to the Treasury by the operation of the selective employment tax.]
§ LORD SHEPHERDMy Lords, I regret that this information is not available. There is no central record of staff employed by charities; indeed, there is not a complete record of all charities. It does not necessarily follow, of course, that all of the selective employment tax paid by charitable organisations will have been found from money contributed by the British public to charity. Many of these organisations have income other than public contributions.
LORD SALTOUNMy Lords, I thank the noble Lord for his Answer. I wonder whether the Government would accept a tentative figure of £1 million as the amount of public money that will go to the Treasury from these charities by the operation of this tax. If so, do the Government realise that the generosity of the British public to their charities is an annually recurring miracle to the people who administer these charities? And are the Government not aware that, as soon as the public realise that by means of this selective employment tax the money they are giving is diverted partly 884 to the Treasury, there is a great danger of that generosity drying up altogether? I could give the Government proof of that from the terms of legacies and such like which are known to me. Will the Government consider this point?
§ LORD SHEPHERDMy Lords, I would first endorse what the noble Lord has said in regard to the very great work these charities do and the great support the public give them. As the noble Lord may know, there are now 80,000 registered charities in this country. Some of them are not all that we normally think of as being charitable organisations—I am thinking in terms of the Red Cross and cancer research. Certainly the Chancellor of the Exchequer has received many approaches in this matter. I am not cognisant of what he will finally decide to do. I think we shall have to wait until the Finance Bill and the Ministry of Labour Bill are presented to Parliament: then we shall see what the Chancellor has in mind. Even then, this House and the other place will be able to put their views, no doubt very strongly, on this important matter.
§ LORD FRASER OF LONSDALEMy Lords, may I ask the noble Lord to remind the Chancellor of the Exchequer that the major charities such as the British Legion, the Royal National Institute for the Blind and St. Dunstan's are all registered by their local authorities. They have stood up to be counted and are therefore easily found; as are the other 80,000 registered, as the noble Lord has said. Therefore the Chancellor's interim defence of his position, that it was impossible to discriminate, will not hold water. Will the noble Lord also tell the Chancellor that these charities help the Government and thereby the Treasury by doing a lot of good work for the nation?
§ LORD SHEPHERDMy Lords, I fully accept what the noble Lord has said. It is true that there are a number of charities that spring readily to mind; but there are also those others which, as I have said to the noble Lord, Lord Saltoun, do not fall within what we readily understand as charities, and at this stage it is not all that easy to be able to discriminate between one and the other. But this matter is being looked at. I could not possibly give any promises; it would be dangerous and foolish for me to do so; but I can undertake that the views which have been 885 expressed this afternoon will be conveyed to my right honourable friend.
§ LORD DERWENTMy Lords, will the noble Lord explain a little further what he means by "funds belonging to charities which have not been subscribed to the charities". I think he said something like that in his first Answer: that charities have funds which have not been subscribed by the public.
§ LORD SHEPHERDMy Lords, I do not think I said quite what the noble Lord has attributed to me. I suggested that there are some charities that do not fall within what most of us understand as being charities—the Red Cross, the British Legion and such like. I believe there are also nearly 35,000 educational charities which are quite different in character from those I have mentioned.
§ LORD CONESFORDMy Lords, do the Government intend to supply to the beneficiaries any of the services they are compelling the charities to abandon or curtail?
§ LORD MITCHISONMy Lords, is the noble Lord aware that just past Swiss Cottage he will find a lot of property, belonging to a charity. Eton College, from which they draw rents. Those rents do not come from the public?
§ LORD SHEPHERDMy Lords, I thank my noble friend for that illustration of one of the aspects of this matter.
BARONESS SUMM ERSKILLMy Lords, would my noble friend not agree that too large a portion of bequests is absorbed by the administrative expenditure of a charity? Would not the Chancellor's decision solve this problem?
§ LORD SHEPHERDMy Lords, I do not think it would quite solve the problem. In some respects it would perhaps accentuate it, in the sense that this added impost on what the noble Lady has referred to as an abnormal share of the contributions made by the public to those charities. I realise that this is a matter of great interest in this House, and one in which we on this side naturally share. But I have said that all points that have been made will be considered by the Chancellor of the Exchequer. When the Finance Bill and the Ministry of Labour Bill are published we can perhaps have 886 a more fruitful discussion than is possible in the meantime, putting points which must be largely hypothetical.
LORD SALTOUNMy Lords, I should like to thank the noble Lord for his very sympathetic answers; but I should like to ask him one question. Are the Government prepared, in the event of this very delicate plant being frosted, suddenly to undertake the work of the charitable organizations—which must have an income of from £50 million to £100 million a year? That is the problem I think the Government are facing.
§ LORD SHEPHERDMy Lords, all I would say is that I will take the noble Lord's point and see that it is passed to my right honourable friend.
§ LORD MOYNEMy Lords, would the noble Lord allow me to add to his list of points for consideration that of the housing charities, since the one to which I belong, for instance, will have to spend an additional £5.000 a year because of this tax on porters and others? Does the noble Lord not agree that this amount—I am trying to put this into the form of a question—would otherwise go into bricks and mortar? That, of course, depends on the constitution of the charity; but I assure him it is so in our case. Is not the effect of the tax regrettable, and will he put 'the housing charities into his list for consideration?
§ LORD SHEPHERDMy Lords, I congratulate the noble Lord on the point he has made in the form of a question. I will take up this point, together with the others.
§ LORD CONESFORDMy Lords, does the Government's exclusion of educational charities from the charities for which they have more sympathy mean that it is their deliberate intention to compel the educational charities to curtail or stop their services?
§ LORD SHEPHERDMy Lords, I think it would be wrong to develop this Question into a debate. All I would ask the noble Lord to do is to read carefully what I have said. If he will do that, he will find that what I have said cannot possibly bear the construction he has placed upon it.