The legal challenge to the government’s imposition of VAT on school fees has returned to the High Court over arguments of parliamentary privilege.

A half-day hearing, before Dame Victoria Sharp, Lord Justice Newey and Mr Justice Chamberlain, centered on a National Audit Office 2024 report on special educational needs which the government argues is part of a parliamentary proceeding and thus cannot be used in evidence. The claimants argue they do not need to rely on it, or other reports, but that, as matter of principle, NAO reports should not be treated as parliamentary material.

David Manknell KC, for the speaker of the House of Commons, said: ‘Those that work for NAO must be able to present reports without regards to the fact that it might be used in this context, in particular in litigation. They must be able to provide entirely frank conclusions and not be inhibited by the thought there [are] processes other than parliamentary scrutiny of reports.’

Asked why those presenting the report would be inhibited given that they are not subject to any liability, Manknell said: ‘We would of course hope that it would not [lead to liability] but the possibility that there is going to be judicial process would inevitably have a chilling effect.’

Lord Newey said this would make an NAO author 'sound feeble'. They would not be worried about criticism in the Daily Mail but about 'potential criticism in the court’, he said. 

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Lord Pannick, for the claimants, told the court ‘privilege does not apply’. He added that the ‘distance my friend seeks to draw, with respect, is wrong’. 

In written submissions, Pannick said: ‘The claimants do not seek to impugn matters raised in parliament, or to throw into question the matters of fact in those materials. Rather, the claimants are entitled to refer to that material to give the court the full picture relevant to proportionality.’

Pannick told the court, the ‘question is whether the ability to refer to the NAO report is likely to impact adversely on the core or essential business of parliament’. NAO reports are ‘frequently relied on in courts, with no complaint from the speaker’, he said.

Jeremy Hyam KC, for the claimants, said there was ‘no substance’ to the defendants’ ‘chilling effect' argument. He described the government's argument as 'an opportunistic one’ as the facts in the NAO report are not in dispute.

Sarah Hannett KC, for the government, replied that it is 'regrettable that [the issue of parliamentary privilege] was not raised sooner’. 

Judgment was reserved.

 

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