HL Deb 21 February 1992 vol 535 cc1443-5

Lord Monson asked Her Majesty's Government:

Why government auctions of property seized by the Customs and Excise, the Official Receiver, the Collector of Taxes etc. are not advertised widely to the general public, with a view to bringing demand into balance with supply and raising more revenue for the Exchequer.

The Parliamentary Under-Secretary of State, Scottish Office (Lord Strathclyde)

My Lords, there is no central agency for government auction sales and each department make its own arrangements. Goods are generally sold by private auctioneers or brokers who are best able to judge supply and demand and provide the most cost-effective disposal. As an incentive to maximise prices auctioneers are paid a percentage of sales and are responsible for all advertising.

Lord Monson

My Lords, I thank the Minister for his reply. Despite his assurance, is it not evident that the present arrangements are amateurish and wholly cost-ineffective? Bottles of Glenfiddich Highland Malt which cost £18.99 in the shops are being sold at auction for £3.33; an electronic typewriter worth £650 for £18; and, as we read two days ago, a Lancashire businessman who owed the Inland Revenue £2,500 had his printing equipment worth £5,000 seized and sold for £45, thereby not merely ruining him but raising less than 2 per cent. of the amount owed to the Inland Revenue.

Lord Strathclyde

My Lords, if the noble Lord has any evidence of impropriety, I shall be delighted to investigate it. Goods are generally second hand. If they have been through the Customs their packaging has often come off and they may sometimes be broken, and that may be why the prices sometime seem to be very low.

Lord Monson

My Lords, is the Minister suggesting that people are being sold second-hand Highland Malt?

Lord Strathclyde

My Lords, no, of course not. I am not aware of the circumstances about which the noble Lord is talking.

Lord Peston

My Lords, we obviously do not have any direct knowledge of this matter, but from what one has read in the newspapers there is at least a suggestion that, worse than impropriety, there is some illegality involved. Has the Minister any information about that? Has anything been reported to his department? Will he at least consider obtaining some information and letting us know about it? I agree that they are only newspaper stories, but they are disturbing.

Lord Strathclyde

My Lords, I agree that there have been some disturbing newspaper stories, but there is no evidence of any wrongdoing or illegality by Customs and Excise or the Inland Revenue. If the noble Lord, Lord Monson, has any information I would be delighted to hear about it.

Lord Boyd-Carpenter

My Lords, does not the noble Lord, Lord Monson, have a good point, in as much as few of your Lordships, or anyone else, ever hear of such sales in advance? We have heard with great interest about the possibility of the purchase of an agreeable stimulant at a modest price. Seriously, is that not an indication that there would be a much better market for those goods if they were fully and professionally advertised, and not left to some government department to muddle with?

Lord Strathclyde

My Lords, I believe that there is some misunderstanding. The amounts about which we are talking are relatively small —between £1 million and £2 million. They are often goods taken by Customs—cars, for instance. They are given to local auctioneers who then have the responsibility of advertising when the auctions are to take place. They are paid a percentage, and so it is clearly in their interests to obtain the maximum price. There is no central agency to look after the sale of government-seized goods, because that is regarded as being the most inefficient way of doing it.

Lord Ennals

My Lords, will the Minister agree to notify those noble Lords who have taken part in this exchange of the dates and places of the sales so that we may obtain cut-price goods?

Lord Strathclyde

My Lords, most auctions provide an opportunity to obtain cut-price goods. I am happy to see whether I can provide a list of where those auctions take place.

Lord Renton

My Lords, are not many of the goods which are auctioned in this way goods which were seized from people who went bankrupt or companies which went into liquidation? What happens to the proceeds of the auctions? Should not they be used to reduce the indebtedness in respect of which the goods were seized?

Lord Strathclyde

My Lords, that is generally true, but the Government, in the shape of the Inland Revenue, have first call on any available funds.

Lord Monson

My Lords, the Minister said that the goods in question are worth only £1 million to £2 million. Is he talking about their value or the sale proceeds? On the evidence that I have, the first is between five and 10 times the second.

Lord Strathclyde

My Lords, the goods are sold at auction, which I believe is generally recognised as the best way to reach the market price.

The Earl of Kinnoull

My Lords, is there a minimum duty on auctioneers to achieve what, in their terms, is the market price? Do they, for instance, have to advertise at least once before they organise a sale?

Lord Strathclyde

My Lords, no. Generally auctioneers put the goods into general sales which they advertise in their own way. In some sales there are reserve prices, a point which is not generally understood.

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