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Christopher Booker's notebook
(Filed: 29/01/2006)

High Court rules a loss is not a profit

Just occasionally this column can report that some saga of bureaucratic insanity has come to a happy ending, and where this involves the intervention of a wise judge, his common sense deserves to be lauded to the skies. Such was the news on Friday when Mr Justice Lightman ruled in the High Court on the extraordinary case, reported here more than once, whereby the Inland Revenue threatened disaster to hundreds of charities by its bizarre interpretation of the EC's law on VAT.

Martin Graham, an enlightened property developer, has for more than a decade expressed his love of opera by staging high-class productions of Mozart and Wagner in a small, purpose-built Palladian opera house in the garden of his home in Longborough, the Cotswold village where he grew up. Any surplus from the ticket sales has been distributed to a range of admirable national and local charities.

In 2001, however, the Revenue decided that, since Mr Graham had agreed to underwrite any losses made by the Longborough Festival Opera, this gave him a "pecuniary interest" in its activities. They could not accept - as they eventually argued to a VAT tribunal - that his readiness to pay for its losses was any different from him wishing to walk off with its profits. Profit and loss must legally be regarded as identical.

Under the EC's Sixth VAT directive, therefore, the opera company was ruled to be no longer a charity. Not only must it charge VAT of 17.5 per cent on all its ticket sales, it must also stump up 100,000 for the VAT it had failed to charge its audiences since it opened its doors.

The issue at stake here was of such importance that it led to a legal battle of nightmarish complexity, taking up thousands of man-hours and hundreds of thousands of pounds. And when, last year, the tribunal found for the Revenue, its ruling threatened many other charities with a similar disaster.

Fortunately Mr Graham was determined and rich enough to be able to take the tribunal's ruling to the High Court where, as I wrote last summer, he hoped "to find a judge who lives in the real world". Sir Gavin Lightman, it turns out, was just such a man. On Friday he trenchantly dispatched the Revenue's arguments that profit and loss are the same back to the limbo where they belonged.

Mr Graham was able to celebrate Mozart's 250th birthday with that victory for common sense his persistence so richly deserved.

Made up our mind, Darling?

Alistair Darling, our Transport Secretary, last year announced that he wanted a "debate" on whether motorists should be charged by the mile (or the kilometre) for using Britain's roads. What he has not told us is that his officials are already in "close" talks with Satellic Traffic Management, a subsidiary of Deutsche Telekom, about the technology needed to run such a toll system, using the European Union's proposed Galileo satellite system (for further details see www.eureferendum. blogspot.com).

For some years, there has been little secret about the EU's plans to use Galileo for this purpose, charging motorists for road use via an electronic box fitted to every vehicle. Satellic itself proudly reveals that the UK is one of eight EU countries now actively considering a system which, by 2020, could be turning over 250 billion a year, part of which could provide the EU itself with a welcome addition to its own income.

As one analyst puts it, the key will lie in whether the technology can be developed to the point where it will satisfy "governments aiming to fill their satchels at minimum cost". The only mystery is why Mr Darling should pretend to want a "debate" when it seems the issue is already well on the way to being decided.

Scotland's turbine army calls for new hordes of pylons

Do our ministers, one wonders, actually know anything about the monstrous ranks of wind turbines that they wish to see festooning our countryside and our coastal waters? Lord Sainsbury, junior energy minister, seemed taken aback when he learned in the Lords last week that the 236 turbines planned for an immense installation off the coast of North Wales will be 546ft high - taller than the Blackpool Tower. A similar forest of 270 giant towers is proposed to dominate the approaches to the Thames estuary (bringing to their developers a hidden subsidy, at current prices, of 180 million a year).

Lord Sainsbury's ministry, the Department of Trade and Industry, was even more alarmed to learn from National Grid that, in Scotland, the thousands of turbines to be built the length and breadth of the country will entail so many new power lines and pylons that there is a 10-year waiting list for connection.

The present capacity of Scotland's grid is 10 gigawatts, and the proposed turbines will require it to carry a further 16Gw. The new pylons for this vastly expanded grid threaten to scar some of the wildest and most beautiful landscapes in Britain. However, the building of them promises to be so expensive that several wind-power companies, asked to put millions of pounds on the table before their turbines are even built, are having second thoughts as to whether to proceed at all.

The day must be fast approaching when it is finally brought home to our ministers that, in opting for this absurdly expensive and inefficient source of power, they have become the victims of a colossal hoax.

(Incidentally, I should qualify my claim last week that the concrete foundations for a giant turbine may weigh 1,000 tonnes, buried 100 feet in the earth. The need for foundations on this scale is unusual. In many cases these figures should probably at least be halved, although this still represents a huge mass of environmentally-destructive concrete.)

So, farewell theme

Writing the jokes at Private Eye last week, I was interested to discover that not one of my colleagues round the desk had ever been up early enough to hear the UK Theme, the music played at 5.30 each morning, which, in its desire to modernise, Radio 4 plans to chop.

I shall miss it because it reminds me of the inimitable contribution made to our national life, in so many ways, by its arranger, the late Fritz Spiegl, in the 60 years after he arrived here from Austria in 1939 (not least the wit he added to the Eye itself).

But increasingly the charm, subtle humour and clever professionalism of Fritz's interwoven medley of traditional British tunes has seemed so jarringly at odds with everything today's smug, amateurish, self-regarding, politically correct, tiny-minded BBC has come to represent - not least the Today programme to which it is a prelude - that they are quite right to drop it.