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Lord Bruce of Donington: My Lords, can the noble Lord inform the House whether our fellow member states in Europe are liable for the same tax on their bells under the sixth VAT directive? If that is the case, does he envisage certain difficulties arising in the city of Rome? Before this matter is finalised, will the noble Lord give the House an assurance that he will take into account the views of one of the country's leading campanologists, namely, the noble and learned Lord, Lord Hailsham of Saint Marylebone, who is well skilled in the ringing of bells?
Lord Mackay of Ardbrecknish: My Lords, I say to the noble Lord, Lord Bruce of Donington, that I realised that there would be some peals of laughter during the course of this exchange. Introducing my noble and learned friend Lord Hailsham of Saint Marylebone is going even further than I anticipated when trying to assess the direction this Question would take. As regards the serious matter of the sixth directive, everyone is subject to its rules. It fully safeguards our position and that of all member states concerning the existing position of their VAT rates. For example, those items which we have zero-rated will continue to be so rated. The noble Lord asks about Rome. As that city is in Italy, I can say that in that country there is a reduced rate of VAT of 4 per cent. on buildings. That can be continued for exactly the same reason as we can continue with our reduced rates. However, neither we nor any other member state can alter the way in which these reduced rates are dealt with without the agreement of all our colleagues.
Baroness Cox: My Lords, I declare my interest as a very humble campanologist. Is my noble friend aware that the ancient art and science of bell ringing is a tradition unique to this country? Is he aware that many people regard it as a precious tradition and that everything should be done to help preserve it? Therefore, can my noble friend accept that the openness of his reply as regards the current situation may be welcomed by the campanologist fraternity? Can he confirm that the current exemptions on new bells and the fitting of new bell frames will remain in place?
Lord Mackay of Ardbrecknish: My Lords, I can say that we appreciate the point made by my noble friend. Certainly, in England, the tradition of bell ringing is a long and honourable one. It is one of the joys of the English countryside. It may be something like piped bands. A field or two between one and the source of the sound can actually improve it. It is an important tradition and we accept that. In order to allow for existing commitments and fund raising to continue, the Customs have made a concession to delay the implementation of any changes to VAT liability until January 1996 and to allow two years for orders placed by then to be commenced. Guidance will be widely publicised.
The Lord Bishop of Norwich: My Lords, is the Minister aware that church bells cannot ring unless church towers are kept in good repair? Is he further aware that that is made extremely difficult for us because we pay to the Government in VAT on church repairs more than twice the amount of money we receive from the Government through English Heritage? Is the Minister also aware that an enormous number of people of all political persuasions and nonenot least in this Houseregard the situation as little short of scandalous?
Lord Mackay of Ardbrecknish: My Lords, I understand from the debate to which I replied earlier in the year that the right reverend Prelate and others share that feeling. I have to say to him that I do not believe that the Church can be excused its responsibility to pay its share of taxes just as everyone else and every other organisation have to do. In conjunction with English Heritage we have ensured that £104 million goes to that body as government grant-in-aid and that £10 million of it is channelled to historic churches and another £4 million to cathedrals. We believe that that is the correct way to go about the matter. If it is a listed church and what is taking place is defined as "alterations", such costs are not liable to VAT.
Lord Eatwell: My Lords, does the Minister agree that to accede to the request of the noble Lord, Lord Boyd-Carpenter, for a tax cut, however worthy, would be inconsistent with the Government's declared goal of cutting government borrowing, especially at a time when it is running at a higher level than last year?
Lord Mackay of Ardbrecknish: My Lords, we have certainly got quite a long way away from the original Question about bells. I am surprised that the noble Lord, Lord Eatwell, could not think of a question about bells and had to divert from that subject. This Government are, and always have been, very keen to make sure that we match our spending and taxing. One of the firm objects of the Government is to keep borrowing and spending under control. As regards spending, I hope that we can have the support of the Opposition when we come to some of the things we have to do to control spending. However, in the legislation which I have brought to your Lordships' House this Session I have not noticed that support.
Lord Mackay of Ardbrecknish: My Lords, part of the discussion is related to the difference between alterations and repairs and maintenance. In fact, the statutory instrument to which I referred earlier tries to clarify that along with the recent judgment of the High Court in the case of the Windflower Housing Association, which ruled that an alteration resulting from repair and maintenance works did not qualify for zero rating. Between that judgment and the redefinitions in the statutory instrument, we hope to be able to make clearer the difference between alterations and repairs and maintenance.
Lord Williams of Elvel: My Lords, I am most grateful to the noble Baroness for that slightly obscure Answer. Does she mean that the Government associate themselves with the Minister's comments and their tenor? If that is so, will she please say so openly? If that is not so, will she indicate that the Government are prepared to apologise for the Minister, not only to Camden Council, which was the original object of the attack, but also to Save the Children Fund; to the Home Office, which increased the grant; to the Bangladeshi community, and indeed to the President of the Save the Children Fund, Her Royal Highness the Princess Royal?
Baroness Miller of Hendon: My Lords, the noble Lord has presumably not appreciated the fact that those remarks were made by the Conservative Party Chairman at the Conservative Party conference. He made them as a Chairman of the Conservative Party. It is right that the noble Lord should know that the organisation concerned has not sought an apology.
Baroness Jeger: My Lords, would it be possible for the noble Baroness to convey, on behalf of many of us in this House, the message that it might be educational and courteous if the chairman, who is also a member of the Cabinet, were to pay a visit to that organisation, following the example of the Princess Royal? Surely that is not beneath the understanding of the Minister concerned.
Lord Harris of Greenwich: My Lords, is not the noble Baroness aware that a member of the Cabinet has abused a local authority and an organisation which is doing extremely valuable social work? Is it not appropriate that, through her, he apologises to Parliament and to the organisations concerned, which, as the noble Baroness indicated, have behaved with remarkable restraint? Is it impossible for any member of the Government ever to offer an apology when they make such a ludicrous statement as that made by Dr. Mawhinney?
Baroness Miller of Hendon: My Lords, the chairman was making the point that Labour local authorities oftenin fact nearly alwaysput political correctness before common sense. If the noble Lord wants examples of that, I can write to him with reams and reams of such examples.
Lord Campbell of Alloway: My Lords, in view in particular of what the noble Lord, Lord Harris of Greenwich, has just said, if it is that the Government should apologise, is this really the forum in which it is appropriate to seek any such apology?
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