Treasury confirms VAT bill for single fire and police services

UNISON Scotland has received confirmation from the Treasury that if the single fire and police services are established as proposed by the Scottish Government they will lose the current VAT exemption (known as s33 status). This means Scottish taxpayers will have to foot an additional bill of around £26m for the police and between £4m and £10m for the fire and rescue service.

The consequences for the police alone will result in a further 800 police staff posts being lost with major consequences for policing in Scotland. This is on top of the 2000 posts to be lost in ACPOS estimates.

The Financial Memorandum to the Police and Fire Reform Bill states that “the Scottish Government is currently liaising with HMRC regarding whether the service could be given s33 status” and ministers have indicated that they continue to lobby the Treasury on this point.

However, Treasury Minister David Gauke MP in a letter to UNISON states “The eligibility criteria for Section 33 are set out in HMRC’s published guidance and the Scottish Government was aware of them when formulating the current reforms”.

UNISON Scottish Organiser Dave Watson said:

“The Scottish Government has held out the prospect of resolving the VAT exemption throughout the Bill process. It turns out that they knew at the outset that this would not be the case.

“UNISON has argued that you could have a single police force established as local government joint board, funded through a precept and retain s33 status. Of course that would mean less direct ministerial influence over the police, but it would strengthen local democratic accountability.”

ENDS

For further information please contact:
Dave Watson, Head of Bargaining and Campaigns Scotland – 07958 122409

Note to editors

1. UNISON is Scotland’s largest trade union representing over 162,000 members working in the public sector in Scotland, and represents police staffs in Scotland.

2. Other documents giving analysis of the Police reform process and the campaign for a balanced modern police force – rather than cutting thousands of police staff jobs – are available on the UNISON Scotland website:

  • UNISON Scotland Evidence to Scottish Parliament Committees on the Police and Fire Reform (Scotland) Bill published in Feb 2012 is available on our website
  • Evidence to Justice Committee:

https://unison-scotland.org.uk/response/Police&FireReform_SPJusticeCtteEvidence_Feb2012.pdf