Row over end of Home Computing Initiative

The Conservatives have launched a campaign to save the scheme that enabled employees to loan a home computer through their workplace.

The Chancellor, Gordon Brown, took a decision in his Budget to scrap the Home Computing Initiative. It was a scheme that enabled employees to loan a home computer through their workplace, paying for it in monthly instalments, tax free. Employees could receive a computer, with no credit check, for as little as 99p per day.

Shadow Chancellor, George Osborne said: "I'm writing to the Chancellor asking him to reverse his decision - we have also set up a special website and online petition to help people lobby the Government. This Initiative has helped 300,000 low income families get connected to the digital age.

"In the last two days I have spoken to the CBI, the TUC and a number of employers. All agree that the Chancellor is making a huge mistake."

Undermining initiative

The Treasury came in for criticism that the scrapping of the scheme would undermine the Government's own initiative to encourage computer literacy and that it had 'U-turned' on the DTI's promotion.

The DTI had heavily promoted the Home Computing Initiative as a means of improving productivity in the workplace and boosting home learning.

The DTI's website had a special section, which has now been removed, devoted to encouraging take-up of the HCI. It claimed that: The real beauty of HCI schemes is that they have the potential to improve performance in almost every area of the organisation. As well as traditional drivers - reducing costs, increasing profitability - they can also contribute to more recent imperatives such as corporate responsibility, individual learning and workplace development.

After the Budget, the Treasury issued a statement that those people already using the HCI would not be affected and gave a small window, until April 6, for take-up.

The Treasury said: "Following the Chancellor's budget announcement abolishing the tax exemption on the provision by employers of computer equipment for private use with effect from 6 April 2006, in response to a number of enquiries, HMRC confirm that anybody who has had a computer made available for private use before 6 April 2006 will not be affected by the change.

"If an employee entered into an HCI scheme arrangement with their employer before 6 April 2006, and under that arrangement the employer is committed to provide a computer to the employee, but for reasons beyond their control the employee cannot take physical possession of the computer until 6 April or later, HMRC accepts that the computer exemption will apply to the provision of that computer."

Petition

As part of the Conservatives' campaign against the abolition of the HCI, it is running an online petition.

Shadow Paymaster General Mark Francois added: "Equipping our workforce with decent IT skills is vital to the success of British business in what is now a global marketplace. I'd encourage people to sign our online petition so they can help to try and restore the scheme before it's too late."