Building Repairs: VAT

Lord Swire Excerpts

Thursday 14th December 2023 Lords Chamber

[Lord Swire (Con)]

My Lords—

[Lord Cormack (Con)]

My Lords, I declare an interest as a vice-president of the National Churches Trust and of the Lincolnshire Churches Trust, and one who has been a churchwarden for 36 years. It really is crucial that the Government recognise that the most important group of historic buildings in our country are our parish churches and give them some assistance. The Listed Places of Worship Grant Scheme is coming to an end, as my friend the right reverend Prelate said, and we do not wish to see the parish churches of England crumbling into decay.

[Baroness Penn (Con)]

I absolutely recognise the points that my noble friend is making, but the Listed Places of Worship Grant Scheme is making a real difference to churches, as recognised by the right reverend Prelate. It gives grants covering the VAT on repairs of over £1,000 to listed buildings used as places of worship. It is not coming to an end; it runs until the end of March 2025. Of course, any decisions for the spending review period after that will come in due course.

[Lord Swire (Con)]

My Lords—

[Baroness Finlay of Llandaff (CB)]

My Lords, have the Government undertaken a cost assessment of the number of schools that have asbestos in them and that are also affected by RAAC? They need replacing, because the children in these schools are currently at risk of exposure to asbestos fibres, and the same applies to many hospital buildings. Has there been a comparison of the costs of renovation versus replacement for these public buildings?

--- Later in debate ---

[Baroness Penn (Con)]

I acknowledge the point that the noble Baroness has made. We are doing two things in this area. We have updated the National Planning Policy Framework so that, in determining planning applications, local planning authorities should give significant weight to the need to support energy efficiency and low-carbon heating improvements to existing buildings. Specifically on the practical planning barriers that households can face when they are in conservation areas or listed buildings, in our energy security strategy, published last year, we committed to reviewing the barriers that people in such buildings face. That review is under way and I believe that the outcome will be published shortly.

[Lord Swire (Con)]

My Lords—

[Baroness Pinnock (LD)]

My Lords—

--- Later in debate ---

[Baroness Penn (Con)]

I do not have a figure for the overall cost, but the noble Baroness is absolutely right that it will be important for social housing to help make the transition. A lot of our early support has focused on this housing stock—for example, through the social housing decarbonisation fund—because local authorities will need support to take these measures and because the benefits of greater energy efficiency and lower bills need to be targeted at lower income households first.

[Lord Swire (Con)]

My Lords—

[Noble Lords]

Hear, hear!

--- Later in debate ---

[Lord Swire (Con)]

They tried to silence me.

The right reverend Prelate is absolutely right to raise this issue again, and we should continue to raise it. The Government hid for years behind the fig leaf of the EU, saying they were unable to vary the rate of VAT. We are now out of the EU and this is the time to look at that. If the Government are serious about reusing and refurbishing our stock of older properties, they should look again. We are not asking for any kind of VAT reduction; we are looking for parity. I do not understand the intellectual argument for two rates of VAT—one which clearly discriminates against the built heritage sector. On that subject, I just say to my noble friend that, if she talks to anybody in the heritage sector, as I am sure she does, she will find that the backlog of repairs because of this pernicious rate of VAT is now extremely concerning.

[Baroness Penn (Con)]

I say to my noble friend that we are taking advantage of the flexibilities we have since leaving the EU in reducing rates of VAT. We have announced that the installation of qualifying energy-saving materials in residential accommodation has a zero rate of VAT until March 2027. This support is worth over £1 billion and will help households and charities improve their energy efficiency in buildings and reduce carbon emissions. As I said earlier, we get requests to reduce the rate of VAT across a number of different areas, and we consider them very carefully, but they have to be considered in the context of how much revenue VAT raises. As I said, the total cost of requests across different areas has totalled some £50 billion since we have left the EU.