Report to Organisations for Disabled on Increase in Vat

Part of Orders of the Day — Finance Bill – in the House of Commons at 11:15 pm on 14th July 1981.

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Photo of Mr Alf Morris Mr Alf Morris , Manchester Wythenshawe 11:15 pm, 14th July 1981

I beg to move, That the clause be read a Second time.

The right hon. Member for Wanstead and Woodford (Mr. Jenkin), since he became Secretary of State for Social Services two years ago, has missed no opportunity to stress how important charities are in helping the needy. In speeches galore, he has told one captive audience after another how much he looks to voluntary help to fill the gaps in the Welfare State.

Not to be outdone, the Prime Minister has gone much further than her right hon. Friend. Indeed, heaping praise on the volunteer in a speech to the Women's Royal Voluntary Service earlier this year, she gave it as her view that the State's welfare role should simply be to fill the gaps in charitable provision. She said: The statutory services are supportive, underpinning where necessary, filling the gaps, helping the helpers". For the spotlight thus to shine on the importance of charities and the voluntary help they provide is, of course, very cosy for a Government who are busy shooting holes in the Welfare State. The Prime Minister said she recognised that it is right for the Government to help independent voluntary bodies financially". For even better measure, she enthusiastically told the WRVS that the voluntary movement is at the heart of all our social welfare provision". The clear implication of that speech, with all its high-minded talk of the "privilege" of giving voluntary help to those in special need, is that the Government's policy of cutting State provision for the poor and the vulnerable is not only justified but even desirable and long overdue.

With a Prime Minister so strongly in their favour, how, then, have the charities been getting along under the present Government? The answer has to be that most of them have never had it so bad. In fact, many are in grave financial difficulties and some, even among the best known, have had to cut services to the people they exist to help as the only alternative to going broke.

Listen briefly to the words of Maureen Rose writing in Community Care after the Prime Minister's speech to the WRVS: Voluntary and charitable organisations might be expected to be full of optimism about their future, with the recent deluge of ministerial statements apparently emphasising their importance. She went on: The true picture, however, is one of depression, uncertainty and cutback, with financial crisis looming closer for many. When their actual position is contrasted with the current Government theme of enthusiasm for the voluntary movement, the mood sharpens to anger and bitterness. To make sure that the Government knew of their plight, major charities for the care of disabled people joined others in writing to the Chancellor of the Exchequer to give him facts and figures. At the same time they urged him to give them some relief from the intolerable burdens he had imposed on them by doubling VAT.

The charities that approached the Chancellor included the Spastics Society, the National Society for Mentally Handicapped Children and Adults, the Royal National Institute for the Blind, and the Royal National Institute for the Deaf. But the Secretary of State not only rejected their plea; he refused even to see a deputation. His rebuff was to organisations of and for disabled people which, by common consent, make a most valuable contribution to the well-being of many of the most needy people in Britain today. Between them they are being made to carry an entirely unacceptable burden of VAT. The Spastics Society alone paid £250,000 last year, and every penny of it was intended not for the Chancellor but for charity.

In consequence of the ravages of inflation, of the doubling of VAT and of other increased burdens—for example, the Spastics Society is worse off by £30,000 per annum in consequence of the Chancellor's further increase in petrol duty—the charities are closing down homes and day centres, meals-on-wheels facilities, advisory and other important facilities and services for disabled people.

Mr. Tim Yeo, the director of the Spastics Society, in commenting on the Chancellor's priorities, reacted bitterly for the charities as a whole when he said that the Government does not care that charities are struggling to maintain their services in the face of crippling burdens that they should not have to bear. Nevertheless, he and his colleagues were not prepared to give up the fight. Writing in protest to the Prime Minister, they told her that the doubling of VAT had compelled them to reduce their services and of the hardship that had been caused to the people they exist to help. They went on to tell the right hon. Lady that unless the burden of VAT was reduced, further cuts in their services would be unavoidable. This in turn, they said, would make more people dependent on local authority services at a time of cuts in the help that local councils could offer.

Tim Yeo, explaining now the particular difficulties of the Spastics Society, told the Prime Minister: The Government must realise that we are in a very serious financial position with our highest deficit ever of £823,000. Big cuts in our services to some of the nation's most severely handicapped men, women and children have had to be made. Yet as local authorities cut back, we are needed more and more. The Prime Minister's reply was as negative as that of the Chancellor and totally inconsistent with her statement to the WRVS that it is right for the Government to help independent voluntary bodies financially. After all, in the approach they made to her the charities were asking not for financial help from the Government but simply that the Treasury should take its hand out of their till.

Roger Hadley, of the Voluntary Services Unit, has commented that the Government are strong on rhetoric and weak on practical help for charities, while Brian Rix of the National Society for Mentally Handicapped Children and Adults has said: We are running a service for charity and we are being clobbered. The Prime Minister's much-vaunted "support" for charities is seen as humbug by some of their most distinguished administrators. Much apart from helping him who sacrifices to help others, the Government's policies are mugging the Good Samaritan himself.

It is not too late, even now, for the Government to think again about the new and extremely onerous burdens they have placed on charities, not least on those of and for disabled people. In urging them to do so, I am asking no more than that they should match precept with practice. At the very least, they should accept the modest terms of the new clause, which I have pleasure in commending to the House.