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War Widows: Reimbursement Of Tax

Volume 591: debated on Tuesday 30 June 1998

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2.52 p.m.

Whether they will reimburse British ex-prisoners of war, their war widows or dependants, with the present day value of tax deducted from pay due to them while in captivity.

My Lords, the assessment of prisoners of war for income tax was conducted in accordance with the normal rules, which provided that when service personnel were serving abroad their service pay was assessed to United Kingdom income tax. Service personnel continued, of course, to serve and to be paid while in captivity. The Government have no plans to refund the tax deducted.

My Lords, I thank the Minister for that reply. I am sure he is aware that without taxpayers the Chancellor of the Exchequer would not have been able to give £300 million to those who have suffered strife for the past 30 years in Northern Ireland. Is the Minister aware that the amount that was deducted from the pay of the officers imprisoned in Germany and in Italy during the past world war—there were about 8,000 of them—amounted to about £1.8 million, or £37.5 million in today's terms, and that in Stalagluft III, which was an RAF camp, the officers provided financial help to the other ranks to the tune of up to about £2 million in today's terms? Can the Minister explain why, unlike our wartime allies—that is to say, America, Australia, New Zealand, Canada, the former Rhodesia and South Africa—who promoted their officers, paid pensions and increased those pensions and did not deduct any tax from their pay, we did the exact opposite? Why is it—

My Lords, this is my third question. I believe that I am allowed three supplementary questions. Do Ministers believe that the electorate, especially former prisoners of war, their widows and dependants, feel that Ministers are telling the truth when they stand by the Cenotaph and say, "Lest we forget"?

My Lords, the noble Lord is, of course, right that a considerable sum was deducted from prisoner of war officer pay. When it was deducted wrongly—in the sense that camp pay turned out not to have been paid either during or after the war—refunds were made at repatriation. It was also the case—although this probably occurred too late and too slowly—that camp pay could be repatriated during the course of the war to dependants under arrangements organised by the protecting power.

As regards the noble Lord's question about comparisons with other countries, I acknowledge that there were differences. But the government policy on the deduction of income tax from service pay was publicly announced by the then Chancellor of the Exchequer in 1943. It was well known throughout the period of the war and the period after the war when repatriation took place.

My Lords, is the noble Lord aware that speaking only for myself, I find his Answer wholly satisfactory?

My Lords, I am grateful to the noble Lord, and particularly grateful knowing of his experience in the war.

My Lords, speaking on behalf of the War Widows Association, if there should be any chance at all of money coming back to some of these ladies—they are few in number after 53 years—does the Minister agree it would be a happy day for them to have a present from their husbands 53 years on?

My Lords, of course it would, but the noble Baroness is as well aware as I am from her distinguished service as the president of the War Widows Association that the pay records of service personnel were destroyed some years after the war. Even those who have objected to the Government's policy and were dissatisfied with the review which was announced last year have never thought it possible that there should be individual restitution.