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Mr. Peter Bottomley: For the benefit of those who may be drafting amendments for the Government to consider, may I refer them to the happenstance that, last year, each Government amendment was out of order? Care should be taken this time to make sure that amendments are in order so that they can be discussed.

Mr. Beith: That would be a great help, and I am sure that the Minister has taken the hon. Gentleman's intervention on board and that he, like us, will learn from last year's experiences. The Bill is not just about energy conservation strategy, although as my hon. Friend the Member for Christchurch and others have stressed, that is needed and the Bill can provide important parts of it. It is also about generating local initiative, enthusiasm and partnerships between the public and private sectors on an informed and cost-effective basis. The very process of gathering information for the studies that are required by the Bill can enable local authorities to harness the enthusiasm of industry, home owners and landlords and contribute to local informed debate so that people can see what could be achieved by investment in energy conservation. If that is carried out locally, it will be the most effective way forward. I think that the Government now recognise that.

We must reduce the demand for energy and we can do that by improvements that enable those who are most vulnerable to have warmer homes at lower cost. The Bill will enable us to map out the route to that destination. I am delighted that it has made such good progress.

Question put and agreed to.

Bill accordingly read a Second time, and committed to a Standing Committee, pursuant to Standing Order No. 61 (Committal of Bills).

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Energy-Saving Materials (Rate of Value Added Tax) Bill Order for Second Reading read.

1.59 pm

Mr. Alan Simpson (Nottingham, South): I beg to move, That the Bill be now read a Second time.

I shall be brief, mainly because the Bill contains only three substantive clauses, and is remarkably modest and sensible. Although there are only three main clauses, there are four areas in which its aims can be identified. They are: to stimulate home insulation work; to generate employment in the home insulation industry, which is especially labour intensive; to complement the Home Energy Conservation Bill, which has just received its Second Reading; and to make coherent the use of taxation as part of the Government's environmental and energy conservation policies.

Clause 1 requires the Secretary of State to draw up a list of energy-saving materials or products to be covered by the Bill. Clause 2 reduces the rate of value added tax on such materials to one that is no higher than that applying to VAT on domestic fuel and power. May I draw hon. Members' attention to the list? Clause 1(2) distinguishes the products which are to be automatically included: "all such materials or products which are used solely for the purpose of improving the energy efficiency of buildings." I am grateful to the Association for the Conservation of Energy, which set out the type of materials that it thought would be included automatically in that list. Its list includes domestic heating controls, draught-proofing materials, loft insulation, cavity wall insulation, hot water tank jackets and low-emissivity glazing. The association has also advised me that it was important to give the Secretary of State additional powers of discretion to include in the Government's list items whose primary purpose is to contribute towards improvements in energy efficiency in buildings, but which also have auxiliary purposes, and I gladly took that advice in drafting clause 1(3). The list could, with time, be varied. The key point is that, once the Minister had exercised the duty to produce a list and the discretion to include additional items, an adjustment in the level of VAT that applied to those items would automatically follow.

Although it is a strange experience for me, I must acknowledge a debt of gratitude to the former Chancellor of the Exchequer, the right hon. Member for Kingston upon Thames (Mr. Lamont). In his Budget speech on 16 March 1993, the then Chancellor voiced for the Government a new principle of taxation. He felt that it was important to set the principle down, before the House, as one that ought to apply for the 21st century. The former Chancellor said:

"For the first time, the rate of VAT on domestic fuel and power will be the same as that charged on goods like loft insulation material, which improve energy efficiency. This will bring to an end the current anomaly, which makes nonsense of any attempt to use the tax system to improve the environment."--[ Official Report , 16 March 1993; Vol. 221, c. 183.]

The former Chancellor pursued an impeccable logic--it is transparent nonsense to tax goods that save energy more heavily than we tax energy consumption--and I am deeply grateful to him for making us face that stark

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reality. There is no point in having environmental or energy conservation policies that are moving in one direction, when the weight of the tax system pulls in the opposite direction. It cannot be in the Government's interest to hold a view the de facto consequence of which acts as a disincentive to people to pursue energy efficiency measures such as insulating their homes to reduce their energy bills. We must take the former Chancellor at his word and accept the Government's new logic, and simply apply it to correct the anomaly that exists today. Although the House decided to reduce VAT on domestic fuel bills to 8 per cent., VAT on home insulation materials remains at 17.5 per cent.

Mr. Nigel Evans (Ribble Valley): The hon. Gentleman said that VAT on fuel had been reduced to 8 per cent. What happened was that the second tranche of VAT was not implemented. Does he agree that, had it been implemented, it would have been extremely difficult to bring the rate back to 8 per cent., which could have been done only with the agreement of other EU countries?

Mr. Simpson: It would have been difficult, but not impossible. Although we decided to keep VAT on domestic fuel at 8 per cent., the anomaly which the former Chancellor identified in terms of the gap between the tax on energy-saving materials and the tax on energy use remains. The purpose of the Bill is to try to pursue the logic of the former Chancellor's argument and remove the tax anomaly we face today.

Mr. Mike Gapes (Ilford, South): Does my hon. Friend agree that it would be sensible for the Government to look seriously at that problem, because the logic of the position described by my hon. Friend is that we should try to create a taxation regime that assists energy conservation while helping the poorest people in society?

Mr. Simpson: Absolutely. That compelling point of logic will have to intrude on all aspects of our taxation policies in the coming years. Moreover, as I said in the earlier debate, if the Government raise the tax on energy use, it is the poorest people who will have the least scope for exercising elasticity of demand in terms of the fuel they use. For those at the lowest end of the income scale, raising taxes on fuel use is demand inelastic. We must find ways to give low-income households easier access to energy-reducing materials to make their homes more energy-efficient.

Although my proposals involve a cost, huge benefits stem from directly targeting our resources into areas where they will have the greatest environmental impact. My hon. Friend the Member for Ilford, South (Mr. Gapes) was right to make that point. I am grateful to the Association for the Conservation of Energy for doing some work for me in calculating the total costs that are likely to stem from the Bill, if the Government give it the support that it should receive. Before deciding about the Bill, hon. Members will want to know the scale of costs that they are letting the Government in for. ACE said: "The initial effects would be an estimated loss to the Treasury of less than £10 million per annum. This does not, however, account for the estimated 10 per cent. increase in sales of energy efficiency goods which would result.

The ultimate effect would be a reduction in the net loss to the Government of £2 million to £8 million per annum."

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A maximum loss of £8 million, but possibly as little as £2 million, shows that the cost element is minute. To put it in the context of the revenues the Government currently receive from VAT alone, that reduction would amount to a 0.02 per cent. loss from total VAT revenues of £38.9 million in 1993-94.

That minute cost would eliminate an absurd anomaly in the tax system. It would stimulate at least a 10 per cent. growth in sales of energy-saving materials, and would contribute about 10 times that amount to improving the quality of life for those who suffer the blight of fuel poverty. It would generate its own contribution to the energy saving targets set out in the Home Energy Conservation Bill and the Government's conservation measures.

I urge hon. Members to support the Bill, which is simple, logical and overwhelmingly positive, in terms both of its limited cost and of its important impact.

2.10 pm

Mr. Bernard Jenkin (Colchester, North): This is a rather sad little debate because the hon. Member for Nottingham, South (Mr. Simpson), who has gained the privilege of such a position in the private Members' ballot that he now has the opportunity to discuss his Bill on the Floor of the House, has proposed the Energy-Saving Materials (Rate of Value Added Tax) Bill.

I share the objective as enunciated by my right hon. Friend the Member for Kingston upon Thames (Mr. Lamont), the former Chancellor of the Exchequer, that it is sensible to tax the materials for energy saving at the same rate as we tax energy or vice versa. I voted for that principle in the House before Christmas. It is the hon. Member for Nottingham, South and his party who have voted for the current inconsistency. I suppose that that inconsistency would be excusable if we had a reasonable remedy to put that matter right. The Bill does not offer a consistent remedy, however, because the hon. Gentleman made absolutely no mention of the problems faced because of what has been agreed under the sixth VAT directive.

The Bill might have some validity if it contained the words, "This Bill shall come into force notwithstanding the European Communities Act 1971." As someone who has devoted a little time to such difficulties, I would be quite tempted to vote for the Bill just to see what would happen. It would be interesting to see whether Ministers implemented a policy that they had been instructed to implement by Parliament, which they knew to be in contravention of European Community law. It would be interesting to see whether Ministers responded to Parliament or to European Community law. If they responded to Parliament, it would be interesting to see how the European Community institutions reacted. Would they respect the decision of our sovereign Parliament or attempt to tell us that our sovereignty has been, in the words of Helmut Kohl, "consigned to the boot"?

What would be most interesting is whether, if there was a conflict between Ministers and European institutions, which was to be decided by the courts, our own courts upheld the most recent action of Parliament--the passage of the Bill promoted by the hon. Member for Nottingham, South--or whether they gave precedence to a preceding

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Bill. They would thereby implement what many of us suspect may be happening by slow process of attrition: that this Parliament is slowly becoming bound by the decisions of previous Parliaments. For all those reasons, I think that this is curious ground to fight on.

Mr. Simpson: I am slightly confused about the argument that the hon. Gentleman makes, and I should be grateful if he clarified it. I well recognise the long arguments that he has attempted to bring before the House about the relative powers of the House and the European Community, and the arguments that he has repeatedly tried to make about the sovereign authority of the House. I was confused because I wanted to clarify whether he is now saying that the measure that I have brought before the House cannot be supported because it would put us in conflict with European policies, or whether he is saying the opposite, that it should be supported because it reasserts the authority and sovereignty of the House and, as such, is a measure that should command the support of the whole House.

Mr. Jenkin: The hon. Gentleman anticipates what I intended to say in the closing moments of my speech--that, however tempted I might be to test that specific aspect of Parliament on the Bill, the Bill is inconsistent and inappropriate, because it would have been logical to require VAT to be increased to the full rate of 17.5 per cent. I have no idea what the future will hold; perhaps we shall have to leave that for some future Government, of whatever hue. The pattern of taxation in all developed countries is moving away from taxation on income towards taxation on expenditure and, if we want to achieve our targets, perhaps that is what we shall have to do, in the fulness of time.

The Bill exposes completely the hypocrisy of Opposition Members who, like the hon. Member for Ilford, South (Mr. Gapes), argue constantly for greater European integration and more qualified majority voting and for unthinking acceptance of a single European currency. Mr. Gapes rose --

Mr. Jenkin: If I malign the hon. Member for Nottingham, South, I apologise, but the hon. Member for Ilford, South certainly fits into that category, and I give way to him with immense pleasure.

Mr. Gapes: I do not want to divert the debate to other subjects. We are in danger of moving away from the subject of energy conservation, and it would be wise if we had a proper debate at another time rather than discuss other subjects. But I wish to object to the words, "unthinking acceptance of a single currency" and simply register that that is not my position.

Mr. Jenkin: I am encouraged. I shall not be drawn down that path; I simply note that it is the policy of European Community institutions to move towards fiscal harmonisation as a means of achieving economic and monetary union, and the Bill is in direct conflict with that. I am surprised that the hon. Member for Nottingham, South received much encouragement from his colleagues, because Conservative Members know that they want to drag us down that path.

In any case, I urge rejection of the Bill because of its inconsistent approach to taxation policy.

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2.17 pm

Mr. Richard Spring (Bury St. Edmunds): I applaud the sentiments behind the Bill--the desire of the hon. Member for Nottingham, South (Mr. Simpson) for energy conservation and his wish to concentrate the emphasis on the matter. I understand the desirability of that. However, in this morning's debate, that was discussed highly constructively.

There are significant problems in the Bill. The most significant problem is the issue of an intermediate rate of VAT. I speak with some experience of that matter. The town of Newmarket is in my constituency. For many years, the bloodstock industry argued strongly in an attempt to reduce the rate of VAT payable on the sale of bloodstock to a level comparable with that of the Republic of Ireland and of France. I felt, at the time, that that was wholly wrong and argued with members of the industry, because I believe that it is important that this country does not go down the route of having countless different levels of VAT. The complications of that from a fiscal and administrative point of view are enormous.

There are many worthy causes. Every hon. Member knows of constituents who have an interest in a particular subject and are pleading for a lower rate of VAT. The VAT rate of 8 per cent. on domestic fuel came about as a result of events with which we are all familiar--it is an exceptional case that arose as a result of a vote in the House. In all my experience of dealing with the difficult problems of the bloodstock industry, one message came through loud and clear. If we have different levels of VAT, we shall open a can of worms for many people. It would present difficulties for the Treasury and the administration of the country's fiscal and tax-raising systems.

My hon. Friend the Member for Colchester, North (Mr. Jenkin) mentioned the sixth VAT directive, of which I have experience through my negotiations on behalf of the bloodstock industry. A European Union list gives scope for reduced VAT levels on certain goods and services. But the blunt truth is that energy-efficient goods are not included on the list. I hope that the hon. Member for Nottingham, South heard that. The heart of the Bill is incompatible with European law. It will not be possible in practice to obtain a lower rate of VAT for energy-efficient goods and services. If the provision became law, it would result in a clash between the British Government and the European Union. There were many blood-curdling negotiations about what should be included on the reduced list originally and I can assure the hon. Gentleman that that list is unlikely to be changed in any way.

Mr. Paul Boateng (Brent, South): Does the hon. Gentleman accept that other states of the European Union already have different rates of VAT for different products and services? Why should not we in this country ensure that energy conservation is not penalised by tax as it is at present?

Mr. Spring: The hon. Gentleman misunderstands. I entirely support the British Government's position. Given the great difficulties with intermediate rates of VAT that we have seen on the continent, it is right to have two rates of VAT: zero and 17.5 per cent.--it makes for good administration. After a considerable amount of negotiation and after agreement among the European

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member nations about its scope, a list was drawn up of possible goods and services that would attract reduced VAT. Energy-efficient goods and services were not on the list. I am sorry to have to disappoint the hon. Member for Brent, South (Mr. Boateng).

Mr. Paul Tyler (North Cornwall): Is the hon. Gentleman saying that, notwithstanding the vote of the House last month, he proposes that VAT on fuel should be increased to 17.5 per cent? That is the logic of his position.

Mr. Spring: The hon. Gentleman misunderstands. A specific technical point defeats the essence of the Bill. It is not possible for us to go to the European Union and ask for a separate rate of VAT on energy-efficient goods. That proposition lies at the heart of the Bill and it is a flaw in the Bill. I am not here to argue whether it would be good or bad were we to be allowed to take that action under European law. But I have stated the position, which is precisely the point made by my hon. Friend the Member for Colchester, North.

Mr. Jenkin: The hon. Member for North Cornwall (Mr. Tyler) does not understand the sixth VAT directive that we have agreed. One is not allowed to reduce VAT rates of below 15 per cent., only increase them. One is allowed to reduce VAT rates only if they are already above 15 per cent., and then only to the rate of 15 per cent.

Mr. Spring: I am grateful to my hon. Friend for further clarifying the position.

I applaud the sentiment behind the Bill--to encourage good practice in energy conservation. As we heard in this morning's debate, a plethora of measures have been sponsored by the Government on different levels to achieve that end--good practice in energy conservation and the reduction of heating bills. That is happening in practice at the moment.

Mr. Simpson: I am not sure whether we can resolve the matter in the Chamber this afternoon. While drafting the Bill, I checked whether it was within our legal competence to propose a measure that reduced the level of value added tax on home insulation products from 17.5 per cent. to 8 per cent. I was told very clearly that the measures set out in the Bill are perfectly legal and are within the sovereign powers of the House to decide. That is the ruling that I received on the specific point with which the hon. Gentlemen are taking issue.

Mr. Spring: I do not think that it is fruitful to bandy interpretations of the sixth European Community value added tax directive. However, I was not called the bloody boring Member for bloodstock by a Treasury Minister because I was not involved directly in this area of concern and activity. I believe that I am correct, and if the hon. Gentleman looks more carefully at the issue, he will realise that.

I am concerned about the talk of a "definitive list" of materials in the preamble to the Bill. How would the list be derived and what are the bureaucratic implications of such a list? While I understand and sympathise with the Bill and the sentiment behind it, for the reasons that I have enunciated, I believe that it is flawed and therefore essentially unacceptable.

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2.26 pm

Mr. Nigel Evans (Ribble Valley): I am glad to be able to contribute to the debate. As my hon. Friend the Member for Bury St. Edmunds (Mr. Spring) said, it is immaterial whether we think that it is a good or a bad measure. I think that the hon. Member for Nottingham, South (Mr. Simpson)-- I understand that he is a good pro-European--will be somewhat relieved if the Energy-Saving Materials (Rate of Value Added Tax) Bill, although well- intentioned, gets no further today. Even if we passed the Bill, we would be prevented from reducing the rate of value added tax by the sixth European Community VAT directive.

Mr. Jenkin: It is very important that hon. Members assert that we are able to legislate on anything because we are a sovereign Parliament. However, the measure would bring us into conflict with European Community law, with all its attendant consequences, which may not be desirable in this case.

Mr. Evans: Of course we can pass any legislation that we like. However, if we were to go to the European Union and say, "By the way, we've decided to reduce the rate of VAT to 8 per cent. on this list of energy conservation items," the Union would say no. That would be the end of it and we could not implement the measure.

The legislation is fraught with problems. In the past, we had more than two rates of VAT. We now have the zero and 8 per cent. rate of VAT, and in the past we had a normal rate and a luxury goods rate as well. Perhaps the hon. Member for Nottingham, South is suggesting that we should go back to the days when we had three levels of VAT: a zero rate, a middle rate of perhaps 8 per cent. and another rate. If we pass the Bill today, there is nothing to say that we could not reintroduce a luxury goods rate of VAT.

I wonder whether the legislation is a precursor to the Labour party's change of attitude towards VAT. I bandied words with the hon. Member for Lewisham, Deptford (Ms Ruddock) in an earlier debate, and I suspect that I will do no better now than I did then in trying to tease out of her the Labour party's policies on VAT or any other issue. The legislation may be a precursor to the Labour party introducing a range of levels of VAT on certain goods. Newspapers are zero-rated, and there were arguments for and against that. The same is true of young children's clothes. Food was mentioned time and again. I wonder whether the Labour party has it in mind to introduce an 8 per cent. rate on food. We know already how sensitive Labour is, after it made the faux pas the other day in respect of public school fees, when one Labour figure intimated that Labour was seriously considering imposing VAT on public school fees. It was only a matter of moments before--

It being half-past Two o'clock, the debate stood adjourned. Debate to be resumed upon Friday 27 January.

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Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday 27 January.



That Mr. George Mudie be discharged from the Committee of Public Accounts and Mr. Mike Watson be added to the Committee.-- [ Mr. Bates. ]



That Mr. Nicholas Brown be discharged from the Select Committee on Broadcasting and Mr. John Battle be added to the Committee.-- [ Mr. Bates. ]

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Brent Irish Centre

Motion made, and Question proposed, That this House do now adjourn.-- [Mr. Bates.]

2.30 pm

Mr. Ken Livingstone (Brent, East): It gives me no pleasure to raise this subject, because a valuable public resource and a major contribution to the Irish community in London is facing either closure by the Charity Commissioners or, more seriously, the arrest and imprisonment of many of the leading figures who administer the organisation day to day.

Although many of the people to whom I shall be referring are members of the Conservative party in an individual capacity, I do not suggest for one moment that events at the Irish centre in Brent are in any way a general slur on the Conservative party either nationally or locally. One is dealing with individuals who have gone beyond the bounds of acceptable public behaviour in their conduct of financial affairs when in receipt of public money and in dealing with value added tax returns.

I shall not go into detail because police and Customs and Excise investigations are currently under way and the Charity Commissioners are also investigating the matter, but I will try to bring home what has occurred-- not that I can do much to aid those investigations, but to flag up out of all the chaos the fact that the centre should be preserved because it has been the recipient of large sums of public money from both Labour and Conservative Administrations and because it makes a valuable contribution and could make an even more valuable one to London and Londoners.

The centre was established in 1983 following a grant from the Greater London council. Until 1991, apart from the occasional rows that normally occur in voluntary organisations, things went fairly well. Problems started in 1990, when Brent had a hung council. A capital grant was proposed for essential works, including access for the disabled and elderly who required a lift, and for a library and facilities for the performing arts. The whole package was costed at £231,000. Brent council agreed to pay £137,000, with £94,000 to come in matching funds from the Irish centre itself.

Brent council then underwent a change of control to a Conservative majority and three Conservative members were appointed to the centre's management committee: Councillors Alan Wall, Jack Sayer and Cormack Moore. There were also management changes. Mr. Brendan Mulkere became company secretary and Mr. Murray, vice-chairman of the local Conservative association, became chair.

The situation began to deteriorate when the council changed its controls on expenditure and waived its conditions on the grant. Instead of a report from the Brent Irish centre to the council and other normal council procedures, it was accepted that in future the council would be happy if there was simply a report to the leader of the council. Anyone with any local government experience will know that it is unusual to bypass the committee system. Sadly, the money did not go to the agreed areas: the lift was never installed, the library never appeared and the changing rooms for the artists were never built. Instead, the organisation--a registered charity-- installed a new bar, following the demolition of a brand new fitted kitchen, and removed the existing facilities for the disabled.

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At this point, one might have assumed that councillor Blackman, the leader of the council, and the three councillors on the committee might have raised a query and drawn the council's attention to the matter. At least one could assume that the money had been spent, but it depends on how one looks at it. Councillor Blackman was told by Mr. Mulkere, the secretary of the association, that £205,575 was spent on the works. That, of course, leaves £25,000 over, 60 per cent. of which would--under normal council procedures-- have been returned to Brent council.

Mr. Mulkere never had the £94,000 matching funds in the first place, however, so the work had gone ahead under a false prospectus. The council was never told that, although the three councillors who were on the management committee were, of course, aware of it as they were present when all this was revealed. We need to know whether they reported this to the council.

One might perhaps be happy if one could assume that £205,575 had actually been spent. Sadly, once again it depends on who one talks to. The lowest tender for the works came from Lynch Contracts Ltd. at £134,584. There is a remarkable discrepancy between that figure and the sums which we were told were needed for the work. Instead of accepting the lowest tender, Mr. Mulkere persuaded the committee to have a system in which a site manager would manage the contract on a day-to-day basis, while employing direct labour and buying materials as required.

I cannot imagine any public authority regarding that as a satisfactory way of overseeing the safe conduct of public money. The limited records and the day-to-day passing back and forth of money open up the prospect of massive VAT fraud and evasion which one would not have to accept if a proper firm had come in and done the job under a proper contract.

The scheme also gave Mr. Mulkere day-to-day control over the process because of his ability to influence the site agent. In reality, we had a situation where Mr. Mulkere on occasions asked contractors for personal loans, which he subsequently repaid using Brent Irish Cultural and Community Association money and Brent Irish centre cheques. It was remarkable that Mr. Mulkere's day-to-day control gave him a position in which he was able to do that and I do not believe that councillors ever accepted that situation in the first place.

We must now look at what was spent. The architect, John Stokes, and the site agent, Mike Moran, both estimated that the cost of the work was between £130,000 and £140,000. Mr. Mulkere and the three councillors on the committee who were party to all this went on to tell the council that £205,575 had been spent. It seems remarkable that when the architect and site agent both said that £140,000 tops had been spent the council was nevertheless told that more than £200, 000 has been spent.

Many of the invoices which exist are not necessarily genuine and the police and Customs and Excise have seized them and are investigating. I hope that their investigations will be carried out as speedily as possible, before the centre closes as a result of all the mismanagement that has gone on.

A particular instance in which Mr. Mulkere got a personal loan from a supplier of material was when he asked the supplier of the wood beam being used for a personal loan. That loan was eventually repaid by a

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cheque from the Brent Irish centre totalling £8,477.29. The situation trundled on, and there was no report to the council. On 29 May 1992, the general management committee had a meeting. Mr. Mulkere and the three councillors were present, and an extra £120,000 which was needed for further works was discussed. A month later, on 23 June, when Mr. Mulkere formally approached the council leader, Bob Blackman, the figure had risen to £180,000--a remarkable £60,000 inflation in just four weeks. Did the three councillors notice that? Did they warn Councillor Blackman? Did they alert council officers to the discrepancy? Did anyone object?

Some members of the management committee did indeed object to what was happening-- and they were expelled from the committee. On 9 July 1992, the committee voted to expel three members--breaking its own rules under section 7 of its articles of association by failing to give 42 days' notice.

On 30 November 1992, Brendan Mulkere managed to get three new groups added as members and thus added votes on the management committee. On 17 December, a committee member was excluded on the ground that she had been replaced by another delegate from the organisation that she represented. She circulated a letter pointing out that she had joined the committee at the personal invitation of Mr. Mulkere and that, to her knowledge, the organisation that she was alleged to represent did not exist. She is the individual who made the loan to Mr. Mulkere to which I referred.

On 6 March 1993, expelled members wrote to Councillor Blackman raising the question of the financial integrity of the operation. They received no reply from him. On 3 April, Councillor Wall called for an emergency general meeting to deal with "subversive people". John Murray, the chair of the BICCA and vice-chair of the Conservative party said:

"Those members who have acted against BICCA's interests must be removed."

Financial integrity should not have been against the interests of the Brent Irish centre.

On 28 May, Councillor Sayer moved the acceptance of three new organisations and Councillor Moore gave notice of the suspension of four existing organisations, the Irish Mental Health Forum, two Irish language groups and the Irish Interest Group, which has campaigned locally on fares to travel to denominational schools, anti-Irish racism and citizenship issues.

On 1 July 1993, Councillor Moore moved the expulsion of four groups, claiming:

"democracy will be in action tonight."

Five of the new organisations which had been added to support Mr. Mulkere voted for the expulsion, although many of them are not known for their activities in the Irish community. Three councillors--the fact that they are Tories is irrelevant--voted for the expulsion, including the treasurer, who had no right to vote at the meeting. Brent council's chief executive had now been alerted to the problem by a letter from the National Association of Local Government Officers on 22 April and by former expelled members of the Irish centre. The chief executive asked for an explanation. Brent's quantity surveyor eventually produced a report, which is cause for genuine

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concern. Brent's auditor, who was answerable within Brent council to the chair of the relevant committee, which was chaired by Councillor Wall, came under tremendous pressure with endless phone calls from the members concerned. He came to the conclusion that he did not need to interview the site agent or the architect and did not need to look into the personal loans that I have mentioned. Needless to say, the report is of little use.

Eventually, on 15 March 1994, the auditor's and quantity surveyor's reports were passed to the director of education. As I have said, the auditor had not fulfilled a role that would have been useful. Two days later, on 17 March, at the St. Patrick's day celebration, Councillor Blackman announced at the Brent Irish centre that he would propose additional grants of £70,000 to the centre, although the applications for the grants had arrived after the closing date determined by Brent council and should automatically have been ruled out of order and left to be considered in subsequent years. The following week, on 22 March, the grants committee agreed the additional grants.

On 27 March, Brendan Mulkere wrote to Bob Blackman, telling him that he wished to vary the purpose for which the grant had been awarded--a pretty rapid change of mind--with £36,000 to be spent on capital building works, many of which were the works which were supposed to have been carried out with the grant made available three years earlier but which had not been done. He said:

"if building works are to be completed within a month the money must be released immediately."

The remaining £34,000 was to be spent along similar lines to the original application, although it would be "a great help" if the funds could be released straight away as well, and not phased in over a year as would be the case for most organisations.

On 30 March, the director of Brent's voluntary sector team wrote to the Irish centre reminding it that

"the grant awarded cannot be used for any other purpose other than stated in your original application form."

On 5 April, the treasurer of the Irish centre wrote to the director of Brent's voluntary sector team, outlining the "revised budget" for the use of the £35,000 revenue grant, with £20,000 now to be spent on building works, £4,000 on refurbishments and the rest on activities and a printer.

On 6 April, Brendan Mulkere wrote to the director of the voluntary sector team, outlining the revised budget for the use of the £35,000 revenue grant, with £20,800 now to be spent on Mulkere's salary and £14,000 for an administrator's salary--although there is no administrator. The original application had included expenditure of £12,000 on "consultancy".

On 7 April, Charles Wood, the chief executive of Brent, received a letter from the Charity Commissioners, informing him that they were making inquiries into the centre and requesting information on grant aid. It was not dealt with. On 18 April, the Charity Commissioners wrote again, saying that they would like the information that they requested to be supplied, but there was no speed on the part of Brent to make that information available.

On 19 April, the director of the voluntary sector team, Mr. Eric Lye--a frequent drinker at the Irish centre--wrote to the people who had complained about misuse of public funds, but did not give the full information that he had available, although Brent's chief executive had said that it could be in the public domain.

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