Examination of Witnesses (Questions 160
WEDNESDAY 24 MARCH 1999
and MR BILL
160. One last question, Chairman, if I may.
In your December 1998 memorandum, paragraphs 19 to 21, you describe
a range of future plans based on additional staff resources. Can
I ask you three questions emerging from that fact. The first is
what progress can you report under that heading of enhanced programme
of visits so far. The second question, given the seriousness of
the problem and the potential returns, would it not have been
more appropriate and cost-effective to have deployed additional
staff resources rather than redeployed them? The third one is
what areas of other activity have you redeployed them from in
(Mr Norgrove) The new resources for this particular
area are additional to what would otherwise have been the normal
complement for Northern Ireland Collection. This is a decision
which I could take to give Northern Ireland an extra six staff
for this particular problem. They have come from the departmental
part, as it were, rather than from the Northern Ireland part.
All such additional operational activity we try to finance from
non-operational work if we possibly can in the Department. In
other words, the backroom support on the corporate side has been
relentlessly plundered over the years and increasingly so for
the efficiency savings which we can release into the operational
area and that has been true on this occasion.
161. So you have reallocated financial and
human resources according to problems?
(Mr Norgrove) That is right because this is a
higher risk area than some of those areas from which we could
make efficiency savings.
162. To what extent, if at all, have you
thought of approaching Government for arguing for further resources?
(Mr Norgrove) Along with other Departments we
conducted a Comprehensive Spending Review last year and Ministers
took decisions, as you know, last December which explored a wide
range of options including different resourcing levels. All options
relating to increased activity, let us say in the excise area
or the VAT area or on drugs, were put forward and were considered
by Ministers. So the resources levels are something that Ministers
would expect the Department always to be updating them on but
of course decisions on resourcing levels are for Ministers.
Mr Hunter: We could
pursue that for quite a time but we will leave it at that.
Chairman: It is possible
we are into injury time in the sense that we may have a Division
fairly shortly. I know Mr Beggs wants to ask a supplementary question.
163. Have you been able to confirm the anecdotal
information we receive from time to time that tanks are being
built into trailer units for the concealment of diesel on which
duty has not been paid and that these tanks can be drawn off or
switched off from within the cab of the unit?
(Mr Norgrove) The fuel can be drawn off from the
cab. Yes, we do have evidence of that and I have seen with my
own eyes such modifications to vehicles, yes, indeed it is happening.
(Mr Logan) The only thing I would add there is
that is today, there will be other things tomorrow. The only way
is for us to improve our intelligence. I think that through our
intelligence we are getting sufficient information now to identify
such patterns but then we have to gather further evidence before
we can act.
(Mr Norgrove) Just a precision, if I may, on that
last one, it is not so much duty free or duty unpaid we are talking
about there, the duty is born in the Republic, as we have been
discussing all along, but not the proper duty of the UK.
164. The information has come to me it is
agricultural diesel on which no duty is paid at all but because
the tank supplying the unit has duty paid, at the first sign of
intervention or detection the illegal fuel can be switched off
so that the proper fuel is running through the engine when detection
is taking place.
(Mr Norgrove) Yes, we do have evidence of that.
Again it is not quite duty free, as it were, it has borne a rebated
duty. Is this anecdotal or hard evidence, Bill?
(Mr Logan) I am sorry it has taken so long to
tell the Committee that I did the Road Fuel Testing job back in
the 1970s and identified such things back then which were in effect
isolated cases. I think, yes, there will always be that sort of
case. We have had some evidence of it in the Province and I think
Heather probably knows the national scene better than I do.
(Miss Massie) Yes, I think one particular circumstance
in which this happens is that particularly refrigerated vehicles
are allowed to use rebated fuel, red diesel or agricultural diesel,
to operate the refrigeration units. Therefore, they are legally
entitled to carry small quantities of rebated fuel so they will
have two tanks, one for rebated fuel and one for fully duty paid
fuel. It is the switching between the two tanks that you have
been told about and certainly we have evidence of that happening.
Mr Beggs: Thank you.
165. There are occasions when I conclude
these particular sessions by asking whether there are any questions
which you are surprised we have not asked. I will phrase it slightly
differently on this occasion: is there any information you think
we ought to have which we have not acquired as a result of the
questions we have asked?
(Mr Norgrove) A couple of things leap to mind,
if I may, Chairman. First, if I may, can we put some more precision
on an answer we gave you earlier which related to one of the first
questions about the system which operates between the Republic
when movements of goods are under duty suspension to the United
Kingdom. If I may ask Miss Massie to describe that?
166. Of course.
(Miss Massie) If I could possibly clarify that.
The question you are asking was whether we would be informed by
colleagues in the Republic if a movement was due to take place
of duty suspended product between the Republic and the Province
and my understanding is that we would not be routinely notified.
What in fact happens is that the product is accompanied by documents
which have to be receipted to demonstrate that the goods have
arrived and that duty has been paid in the Province and that if
those receipts are not received by colleagues in the Republic
they will then investigate and through mutual assistance we would
look into it. But there are a number of different procedures for
the movement of goods and I will clarify them, if I may, together
with the other information that I promised to provide.
167. Would that also include movements of
duty paid diesel which would be taxed at the lower rate of the
(Miss Massie) If an individual wanted to move
legitimately a quantity of duty paid product then clearly they
would want to recover the duty they had paid in the Republic and
in order to be able to do that they would have to demonstrate
evidence that they paid duty in the United Kingdom before they
could claim the repayment from the authorities in the Republic.
168. Because I do recall from a prior existence,
this is a prior Northern Ireland existence rather than a Customs
and Excise existence, the fact that there were occasions when
either side of the border, because I acknowledge what Mr Norgrove
said at the beginning that smuggling can occur in both directions,
we would in fact have a conversation with our opposite numbers
in the Republic about co-operation on particular issues at particular
times. Can I just press you as to whether there is anything else
in terms of co-operation with the south which it would be helpful
to have which you do not currently have?
(Miss Massie) I will turn to colleagues to cover
that. In my response, just to be absolutely clear about what I
was talking about, I was talking about the documentary procedures
which are in place for the movement of goods. As far as co-operation
is concerned obviously that is a slightly different matter relating
to individual circumstances.
(Mr Logan) This is from memory, I have not got
the detail to hand, but the question was asked on 12 January in
our discussion then about any instance of an importer or someone
bringing duty paid from the south into the north and there had
been no instances.
169. I will press my question. There are
no current instances of the United Kingdom Government seeking
help from the Republic because they feel they are not currently
receiving it? That is not a criticism of the Government of the
Republic; I can remember exactly the same questions of help coming
northwards to us.
(Mr Norgrove) I am aware of none, Chairman.
170. If there are no further questions we
thank you most warmly for your help. It has been a pleasure to
have you appearing before us.
(Mr Norgrove) Thank you very much, Chairman. Could
I just add one very small point. It is that the results that we
have given you to update the earlier memorandum of our successes
take us up to the end of February. It is a dynamic position. We
are out there doing things even as we speak and any announcements
of impending successes had I been able to tell you about them
today I would have done and if they come up in the immediate future
that is not intended as a discourtesy to the Committee, it is
just that we were not in a position today to describe them to
Chairman: I can remember
from the time when I was Minister that I might well have been
the last person to hear about any Customs and Excise successes
so I would not regard it in any way disrespectful to us if you
do not tell us in advance. We shall be delighted to see the news
of them when they occur. Thank you very much.