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Viscount Bridgeman: I am sure that the whole Committee will be very grateful to the noble Lord for his comprehensive explanation of the thinking behind Partnerships UK. We shall study his remarks very carefully. In the circumstances, I beg leave to withdraw the amendment.
Lord Higgins: I rise to speak to the Question whether Clause 20 stand part of the Bill. This clause is concerned with value added tax. I am always concerned about any amendment to VAT legislation. A long while ago I had the interesting task of steering the original VAT legislation through the other place.
Lord McIntosh of Haringey: The simple answer is that it has not been certified as a money Bill, which is a matter for the Speaker rather than the Committee. As to the purpose of the clause, I should make clear that it does not make any changes to VAT legislation; it would be impertinent to do so. It ensures that government departments comply with the relevant accounting standard for VAT, which is the Statement of Standard Accounting Practice 5. This treatment is set out in Resource Accounting and Budgeting and has been endorsed by the Financial Reporting Advisory Board. It is only to make sure that the new system of accounting applies across all the areas of government accounts, which include VAT, that this clause is necessary.
Lord McIntosh of Haringey: Let me see if I can. This enables departments to account for VAT in the same way as other bodies and in accordance with standard accounting practice. The proposal to account for practice VAT in accordance with Statement of Standard Accounting Practice 5 is already included in Resource Accounting and Budgeting and I refer the noble Lord, Lord Higgins, to this manual of which I know he has received a copy. It has been agreed with the Financial Reporting Advisory Board.
In practice, the VAT element of the departmental income is appropriated in aid but doing so would require it to be accounted for gross, thereby making compliance with the Statement of Standard Accounting Practice 5, which requires netting-off of VAT, impossible. So that is what SSAP5 does. It requires netting-off of VAT and we want to make sure that we comply with that.
Lord Higgins: That has a strangely distorting effect on the expenditure of certain departments, in particular as far as health departments are concerned, but I will read with care what the Minister said. It may be he would wish to add to it or perhaps write to me about it.
The noble Lord said: In moving Amendment No. 33 I shall speak also to Amendments Nos. 35, 36, 38, 39 and 41, which are all technical drafting amendments. I first speak to Amendments Nos. 33 and 35. Section 37 of the 1866 Act is utterly obsolete (it says here). It has been included in the list of repeals (Schedule 2) since the first draft of the Bill. However, uniquely among the provisions repealed by the Bill, its repeal has not been formally set out elsewhere in the Bill. Instead, reliance has been placed on a phrase in Clause 27 that the repeals include "enactments that are no longer of practical utility".
We have decided that, for the sake of consistency, Section 37 of the 1866 Act should be repealed explicitly and this is done by Amendment No. 35. This means that the phrase in Clause 37 about "enactments that are no longer of practical utility" becomes redundant as no repeals in the Bill are now dependent on it and so it can be deleted. This is done by Amendment No. 33. That is very sadI like enactments that are no longer of practical utility.
Amendment No. 36 refines the interaction between the general audit provisions of the Bill and the audit of NAO's own accounts. The current wording of the Bill applies Clause 6 in its entirety to the audit of NAO's own accounts. That is inappropriate because the other parts of Clause 6 are not relevant to NAO's situation. The amendment, therefore, limits the application to Clause 6(1) together with Clause 23(2). NAO is content with that change.
Amendment No. 39 amends the Tax Credits Act 1999 to bring it into line with the Bill. The reference to "account" rather than "accounts" occurs because the Bill removes references to Bank of Ireland accounts.
Amendment No. 41 expands a change to the Food Standards Act 1999 to include a reference to the paragraph heading as well as the text of the Act, bringing it into line with another similar reference. I beg to move.
I share the Minister's sadness that the part of Clause 27(2), which includes enactments that are no longer of practical utility, should be deleted, even though he made specific provision for the particular enactment, which he thought was no longer of any practical utility. I have only one question for him: is he 100 per cent sure that there are no other enactments which are no longer of practical utility?
("( ) Before specifying a body in an order under subsection (3) the Treasury shall, where they think it appropriate, consult the National Assembly for Wales.").
Page 15, line 33, at end insert
(" . Section 37 (unstamped vouchers) shall cease to have effect.").
Page 17, line 3, leave out ("section 6") and insert ("sections 6(1) and 23(2)").
Page 17, line 11, at end insert
("The Health Service Commissioners Act 1993 (c. 46)
17A. In paragraph 11(1) of Schedule 1A to the Health Service Commissioners Act 1993 (Welsh Commissioner: accounts) for "no later than five months after the end of that financial year" there shall be substituted "no later than 30th November of the following financial year".").
Page 17, line 17, leave out ("(6)") and insert ("(7)").
Page 17, line 18, at end insert
("Tax Credits Act 1999 (c. 10)
. In section 5(2) of the Tax Credits Act 1999 (deductions before payment under section 10 of the Exchequer and Audit Departments Act 1866) for "accounts" there shall be substituted "account".").
Page 17, line 18, at end insert
("The Government of Wales Act 1998 (c. 38)
18A. The Government of Wales Act shall be amended as follows.
18B. In section 96 (Auditor General for Wales: miscellaneous) after subsection (7) insert
"(8) If the Treasury designate the Assembly in respect of a financial year for the purposes of section 10 of the Government Resources and Accounts Act 2000 (whole of government accounts), the Auditor General for Wales shall carry out the audit required by section 10(2)(c) of that Act.
(9) Where the Treasury make arrangements with the Assembly under section 10(8) of that Act, the Auditor General for Wales shall carry out the audit required by section 10(8)(c)."
18C. In the following provisions (which require the submission of accounts to the Auditor General for Wales) for "no later than five months after the end of that financial year" substitute "no later than 30th November of the following financial year"
(a) section 97(4) (Assembly),
(b) paragraph 6(1) of Schedule 6 (Chief Inspector of Schools in Wales),
(c) paragraph 6(1) of Schedule 7 (Forestry Commissioners), and
(d) paragraph 10(1) of Schedule 9 (Welsh Administration Ombudsman).
18D. After section 101 (examinations by Comptroller and Auditor General) insert
"Whole of Government of Wales accounts.
101A.(1) This section applies in respect of a financial year for which the Treasury make arrangements with the Assembly under section 10(8) of the Government Resources and Accounts Act 2000 (whole of government accounts: consolidation of Welsh accounts).
(2) The Assembly shall prepare a set of accounts for the group of bodies which provide information to the Assembly in accordance with the arrangements under section 10(8).
(3) Accounts prepared under this section may include information referring wholly or partly to activities which
(a) are not activities of bodies falling within subsection (2), but
(b) appear to the Assembly to be activities of a public nature.
(4) The accounts shall contain such information in such form as the Treasury may direct.
(5) The Treasury shall exercise the power under subsection (4) with a view to ensuring that the accounts
(a) present a true and fair view, and
(b) conform to generally accepted accounting practice subject to such adaptations as are necessary in the context.
(6) The Assembly shall send accounts under this section to the Auditor General for Wales.
(7) The Auditor General for Wales shall examine accounts sent to him under this section with a view to satisfying himself that they present a true and fair view.
(8) Where the Auditor General for Wales has conducted an examination of accounts he shall
(a) certify them and issue a report, and
(b) send the certified accounts and the report to the Assembly.
(9) A person who acts as auditor for the purposes of section 10(2)(c) or (8)(c) of the Government Resources and Accounts Act 2000 shall give to the Auditor General for Wales such information and explanations as he may reasonably require for the purposes of this section.
(10) The Assembly shall by order specify dates by which the duties under subsections (6) and (8)(b) shall be performed.
(11) Before making an order under subsection (10) the Assembly shall consult the Auditor General for Wales."").