HL Deb 26 November 1970 vol 313 cc239-43

3.23 p.m.

THE MINISTER WITHOUT PORT-FOLIO (LORD DRUMALBYN) rose to move, That the Draft Selective Employment Payments Variation Order 1970, laid before the House on 3rd November, be approved. The noble Lord said: My Lords, the purpose of the Order is to add play production to the list of activities under Section 2 of the Selective Employment Payments Act 1966 eligible for refund of selective employment tax. The reason for the Order is that when eligibility under the Selective Employment Payments Act was extended to film production, along with three other activities, in 1969, representations were made to the then Government that to be fair it should also be extended to the live theatre. The then Chancellor of the Exchequer announced in his Budget Statement that he accepted the case for extending refund to the production and staging of plays, and the late Mr. Iain Macleod welcomed this announcement on behalf of the then Opposition. It was not, however, proposed that the managing of theatres should become an eligible activity. As a result of the consultations we have had with the theatre industry, it has become clear that some theatre managements at least are actively engaged in play production and that these managements will meet the conditions set out in this Order.

May I say a word about the scope of the Order? The Order is so drafted as to allow refund in two broad categories of activities: first, those involved in the production of a play or ballet for performance in a place which is solely or mainly used for the presentation of plays or ballets; secondly, activities involved in the production of a play or ballet in a school or other similar educational institution where the production is connected with its educational activities. The word "production" has been used because it signifies all the activities integral to the translation of a script into life before an audience. It includes not only acting but also the work of lighting technicians, make-up staff, designers, wardrobe staff and so on. I should also remind your Lordships that for an establishment to qualify for refund, it must not only be engaged in the activities specified in this Order, but also pass two further tests laid down in the Selective Employment Payments Act. In the first of these, more than half of the employees working in or from the establishment in question must be engaged in connection with the eligible activities. In the second, not more than half the employees must be engaged in non-qualifying activities. "Non-qualifying" here means office work and the sale of goods.

As noble Lords will have noticed, the word "play" is given the same meaning in the Order as in the Theatres Act 1968. The definition is wide enough to cover opera, musicals, revue, pantomime, ballet and music-hall as well as straight plays, provided that the performance is given by: one or more actors actually present and performing and in which the whole or major proportion of what is done by the person or persons performing … involves the playing of a role. The Order, if approved, will come into operation on December 7 and will apply to selective employment payments in this particular field from that date. The cost to the Exchequer involved would be about £500,000 in a full year.

3.28 p.m.


My Lords, this is one of those happy occasions when we can offer the Minister and the Government both our thanks and our congratulations. We can offer them our thanks for giving effect to a decision taken by a previous Administration, which was announced as long ago as the early part of April and which was accepted by that very distinguished Member of Parliament, the late Mr. Iain Macleod, on behalf of the Opposition at the time. We are therefore grateful to the Government for having, after some delay, brought this Order forward.

I am bound to say, however, that I have tried hard to think of the cause of the delay, but I have not been able to ascertain it. This was a proposal that the live theatre should be helped in the whole of the current fiscal year. The proposal is going to have effect, if your Lordships so approve, on December 7, approximately eight months after the original decision was announced in Parliament—that is to say, two-thirds of the year will have gone by. I understand that it is the pattern of the Government to-day that nothing instantaneous should take place. I see that the noble Lord is amused, but he forgets that there are exceptions to this rule: when one comes to sack a noble Lord in public, for no public reason, then instant government takes place; but I gather that on a matter such as this there is no question of instant government being desirable. Even so, I should have thought that with an Order that is one short paragraph in length, which has been agreed by the two sides and which is helping the live theatre, one might have seen the original desire implemented as far as possible. But, as I have already said, it is not only a question of thanking the Government, who have at last brought this Order forward; it is for us to congratulate them, too, on having had the strength of character to change their minds about selective employment tax.

It is obvious to everybody that to bring in an Order of this kind, making a variation under the principal Act some four months only before the principal Act is due to be removed from the Statute Book, would be a nonsense. Therefore, it is clear to all of us that the Government have wisely recognised the great value of selective employment tax and the revenue which it produces to the Chancellor of the Exchequer, which is so necessary, and have therefore decided that it is appropriate to bring in this variation Order and not to disclose—as I imagine they do not intend to continue on their policy of disclosing next year's Budget—in too precise terms what their intentions are with regard to selective employment tax. I therefore sum up, my Lords, by saying that we offer the noble Lord and the Government our thanks and, for the reason I have given, our congratulations.


My Lords, may I ask my noble friend what will be the position of the major orchestras who do a great deal of playing abroad and, I suppose, in this way would come under the heading of "invisible exports"? Will they obtain repayments or not?


My Lords, I rise to add my congratulations. The introduction of this Order is a great relief to many of us who have been concerned with the work of artists, although my noble friend—a former friend in another place although not always my friend in the Treasury—has said that there has been a delay which has caused some anxiety. Of course, we are all united in rejoicing that this very modest measure, not involving very great sums of money, should be agreed among us. When we are talking about subsidy to the Arts, I do not think we realise the extent to which a contribution is made by the talented young. I think we are all agreed that we cannot have subsidised theatre unless the commercial theatres are also in a healthy condition. So I am entirely delighted that this small measure, for which some of us fought so hard in another place in the last Parliament, should be agreed, I gather unanimously, by your Lordships.


My Lords, may I first of all answer briefly the point made by my noble friend Lord Somers. This is an Order which deals with theatres and plays and does not extend to orchestras. I am sorry to have to give him that answer, but, as I pointed out, the whole purpose of this Order is to try to bring the theatre in line with the cinema. May I thank the noble Lord, Lord Diamond, and the noble Baroness, Lady Lee of Asheridge, for the way they have received this Order. They had to find something to criticise, and I think the noble Lord put his finger on the one thing that possibly might have been criticised, and that is the delay. But he will realise that, in order to have got this matter in motion sooner, it would have been necessary to lay the Order almost immediately we came into office. Surely, he must know that a new Government would wish to have their own consultations. That being so, it would have been very difficult even to get this Order going by November 7, or a similar date. The claims are made monthly and the appropriate date now is December 7. I do not think, in spite of what the noble Lord said, that there has been any undue delay.

As to the noble Lord's remaining comments, he wisely indicated that he did not expect an answer to them. Even so, I am certain he cannot have it both ways. If he is criticising us for a delay of a month or two one way, then surely he must admit that the theatres would be glad to receive payment for some time, however short that period might be.

On Question, Motion agreed to.