HL Deb 25 March 1985 vol 461 cc761-2

2.42 p.m.

The Earl of Kinnoull

My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government whether the allowance on luncheon vouchers will be upgraded in line with the present cost of a ham sandwich.

The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Glenarthur)

My Lords, I note my noble friend's suggestion.

The Earl of Kinnoull

My Lords, I thank my noble friend for that indigestible Answer. Is my noble friend aware that the present miserable allowance of 15p a day for the luncheon voucher purchases either one-third of a cup of black coffee without sugar or half a ham sandwich without the ham? Is he further aware that this unreviewed allowance is wholly unfair to the smaller firms, which cannot provide canteens as larger firms do and thus benefit those who work for them? Finally, is my noble friend alert to the fact that because any increase in the allowance for the one million users of luncheon vouchers would come within the existing allowance of benefits in kind, the cost to the Treasury would be very small?

Lord Glenarthur

My Lords, that may be so, but the fact is that there are three main arguments for not increasing the allowance. One is that there is some evidence of abuse, of which my noble friend may or may not be aware; the second is that an increase would discriminate even further against those employees who have no works canteen and who receive no vouchers; and the third is that our aim is to reduce the rate of taxation for everybody.

Lord Kinnaird

My Lords, would the noble Lord not agree that if you give an employee only the price of half a ham sandwich for his lunch there is bound to be abuse?

Lord Glenarthur

My Lords, one of the problems with this question, which has cropped up on numerous occasions over the last few years, is that it always relates to ham sandwiches, which are not always strictly relevant.

Lord Bruce of Donington

My Lords, is the noble Lord aware that his answer is thoroughly unsatisfactory? It was well known at the time luncheon vouchers were originally introduced that obviously they would benefit certain employees who had the facilities, whereas it would not benefit everybody. That has been so from the beginning. Is he aware that the 15p to which his noble friend referred was intended to cover the whole cost of a reasonable luncheon, not merely that of a ham sandwich? Will the noble Lord come off his high horse on this matter and do something constructive about it?

Lord Glenarthur

My Lords, I note the noble Lord's remarks, but I note also that in 1977, when his party were in power, they were asked a similar question and they did nothing about it, either. The concession was originally justified on the grounds that the provision of luncheon vouchers did no more than put employees who have no canteen facilities in the same position as workers who have a subsidised canteen.

Lord Bruce of Donington

My Lords, is the noble Lord aware that his answer should give every incentive to the present Government to do far better than their predecessors? They have very often boasted about that in the past: why do they not boast about it now?

Lord Glenarthur

My Lords, I think we are doing better than our predecessors. The fact is that the situation on this particular issue has not changed since the noble Lord's party was in power.

Baroness Macleod of Borve

My Lords, may I ask my noble friend the Minister whether the recipients and users of luncheon vouchers have to pay income tax on them?

Lord Glenarthur

My Lords, they do not have to pay income tax on the first 15p, and that is what I think this Question relates to.

Lord Wallace of Coslany

My Lords, can the Minister say whether it is true that the Prime Minister's reaction to this question was, "Let them eat cake"?

Lord Glenarthur

My Lords, I do not think I have anything to add to what has been said or not said by my right honourable friend the Prime Minister.