VAT on Air Ambulance Fuel Payments

Rory Stewart Excerpts

Wednesday 11th July 2012 Commons Chamber

[Mark Pawsey]

I shall support the motion, but I am putting to the House the contrary view, which is about the unique nature of our air ambulance services.

On the basis of the quote I have just read out, we should applaud the sense of public duty displayed by the air ambulance that covers the area I represent.

[Rory Stewart (Penrith and The Border) (Con)]

I warmly applaud the idea that there should be a strong focus on charitable fundraising, but the challenge we in Cumbria face is that the North West Air Ambulance is attempting to fundraise in exactly the same areas as the Great North Air Ambulance. They are both presenting themselves as the sole Cumbrian provider. We therefore have paid fundraisers fighting on the doorsteps, as it were, to get contributions from Cumbria’s very small population of 500,000 people. Does my hon. Friend agree that we will need a more disciplined approach to fundraising if these wonderful institutions are to flourish and survive?

[Mark Pawsey]

I accept that point of view. There needs to be some control. We do not want one air ambulance to be competing with another for what we all accept are limited funds. That takes us back to my point about co-operation and interoperability. There may be a case for interoperability not only between air ambulances, but between air ambulances and other emergency services.

Those who support the charitable structure are concerned that it is not very many steps from a grant to offset VAT on fuel to the full nationalisation of the service, and the absorption of air ambulances into the ambulance service more generally. There might be some hon. Members in the Chamber for whom that would be a desirable move, but I believe that it would materially change the unique basis on which the service is delivered. It was interesting that it fell to the right hon. Member for Wentworth and Dearne (John Healey) to describe the air ambulance as probably one of the best examples of the big society.

There are other ways besides a VAT exemption in which the air ambulance can effect substantial savings. I argued in the Westminster Hall debate about the need for air ambulances and other emergency services to share assets. Earlier this week, I spoke at a Royal United Services Institute conference on the future operations of blue-light air assets. RUSI has produced research papers drawing attention to the fact that there is no co-ordination of air assets at this stage nationally or across agencies. If we investigate asset sharing we could effect savings that would be significantly in excess of the amount of savings that could be produced by reducing the costs of fuel.

[Rory Stewart]

On that specific point, one challenge we face in Cumbria is that mountain rescue finds it easy to co-ordinate with the police and the RAF, particularly when Sea Kings are involved, but very difficult to co-ordinate with air ambulances. Air ambulances appear to be reluctant to give information to mountain rescue as a standard operating procedure. Interoperability is a challenge, but I would suggest that it is a particular challenge with air ambulances.

[Mark Pawsey]

I certainly accept that point. One of the challenges for us, which is one reason why we have formed the new all-party group, involves trying to make the links that allow such interoperability. There is no point in having unused air ambulance assets dotted around parts of the country when they are badly needed in other areas. The point of an air ambulance is that a helicopter can move quickly between areas and provide such support.

A wide range of figures have been mentioned. The Association of Air Ambulances says that air ambulance charities across the country collectively generate an income of £46 million, with an average spend per helicopter of £843,000 and an average mission cost of £1,229. I accept that all those sums need to be raised through fundraising and that any savings that could be achieved would be welcome, but the cost of VAT on fuel needs to be seen in the context of some of the other significant costs, which put the total amount paid on VAT in perspective.

I fully support the motion’s tribute to our air ambulance services. They are worthy of more praise than they receive and I am glad that we have had the opportunity to pay tribute to them. I hope, however, that I have been able to put the cost of VAT on fuel in perspective and to suggest other, better ways of saving money through more efficient co-ordination of helicopter assets between air ambulance and emergency services. I hope that I have raised the concerns that the granting of a concession such as that asked for in the motion could be the start of a change to the unique method of funding our air ambulance services which involves the enthusiastic and active participation of volunteers up and down our land.