§ Mr. Simon Hughes
To ask the Secretary of State for Education and Science (1) what is his policy in relation to making adjustments to the volume of block grants to universities to reflect any significant changes to the taxation liabilities of universities;
(2) whether the present vote provision for 1989–90 in respect of grants to universities was calculated to take account of changes in value added tax regulations now proposed to take effect in that year; and if he will make a statement.
§ Mrs. Rumbold
The provision for universities for 1989–90 announced in the public expenditure White Paper (Cm. 612) includes a compensating adjustment in respect of the impact on universities of the introduction of VAT on new construction from 1 April 1989. Changes lin taxation arrangements do not automatically lead to changes in public funding; they will be taken into account as appropriate in reaching decisions on the level of provision for universities, which are not deficit funded.