Author Archives: davidhencke

Why charging for Freedom of Information requests will be utterly wrong

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Freedom of Information: Charges will put it under threat

This blog was written for the London School of Economics British politics and policy website (the link is http://bit.ly/H7C8lD) and is now up on the site. I have reproduced it here for my followers who may miss it  at the LSE.

It must be very tempting in these times of austerity for government to introduce charges for freedom of information (FOI) requests. Tempting it might be but it would be utterly wrong.

Giving evidence to the Commons Justice select committee’s post legislative inquiry into the FOI Act, I got the strong impression that some Conservative MPs might want to do this. The example of the Republic of Ireland which has introduced charges for requests, internal reviews and appeals to the Information Commissioner, has provided an excuse.

The fact that the new act has been a resounding success with the public, journalists and also private businesses is not a reason to introduce charges. My reasons for not going down this road are not such much to do with limiting the public’s right to know – although as Ireland has shown – this would be the inevitable consequence. They are more fundamental.

As a taxpayer I am obliged – I have no choice – to fund public services from my income. Therefore if I wish to know whether my money has been spent wisely and people have taken the right decisions – I should have the right to ask questions and ferret for information. As a journalist rather than a private citizen I have more time to do this – it is part of my job – and the information I discover can be communicated to thousands, if not millions, of people.

As one recent example showed – the disclosure under FOI that Ed Lester, the chief executive of the Student Loans Company, had found a legal way to avoid tens of thousands of pounds of tax – it can even lead to alerting ministers to something they were unaware.

To introduce charges would in effect be double taxation. I would be charged once for providing the service and again if I wished to find out what officials and ministers had done with my money. This is why I believe it is unacceptable.

A more subtle variant of charging is a suggestion that private citizens still receive the free service but commercial organisations like the media, private firms and official bodies paid the cost of the request – which could be anything up to £600. Again it would unfair and also unworkable. Businesses, law firms and the media – unless they are near bankrupt – pay their share of taxes to the government and again would be charged twice for seeking to find out how and why their money was spent.

It would also be completely unworkable to run such a two tier system. There is nothing to stop me as a journalist, or indeed any business person, asking a friend to put in a FOI and getting it sent to their address. And there is no way officialdom could find out, unless they subject every private requester to a ninth degree inquisition every time they asked a public body for information.

It would be a nightmare scenario for the public sector to police and make officials extremely unpopular with the general public. It might even lead them to face legal complaints, such as falsely accusing individuals of avoiding charges.

What is required urgently is an extension of the freedom of information act to the private sector when it provides public services. The government has an active policy of encouraging private providers – whether charities, mutual or commercial companies – to provide public services. Francis Maude, the Cabinet Office minister, in an address to the Policy Exchange think tank said that turning state provided services into mutuals owned by the staff might indeed be as widespread as privatisation of state industries in the 1980s Thatcher government.

At present the mechanism for extending FOI to new bodies is rather cumbersome – requiring a designation under the Act by ministers – usually following a consultation period. This is woefully inadequate to cope with a major shift from public to private sector providers in Whitehall, local government and the NHS. One simple solution would be to include a standard clause in any private sector provider contract saying that if the company accepted public money to run a public service they would automatically be subject to FOI requests about that particular service.

No doubt they would be a howl of protest from the business community about new burdens and costs to running the service, but given the multi million pound size of most contracts it would be a small price to pay. And if it was a standard contract it would mean that there would be a level playing field for contractors bidding for the work. It could also be confined only to the services they provided in the public sector and not to normal business contracts.

This would bring within the scope of FOI private train operators and bus companies who take taxpayers subsidies but are at the moment outside the act. It would also encourage these bodies to provide a more efficient service since they would have an incentive not to encounter the wrath of the travelling public every time they failed to provide a public service.

The public could also question and challenge the companies when they cut service provision to prove they had a case and also ask for detailed policy on protecting public safety. Similarly, it would provide the public with some protection as the NHS expands the use of private hospitals for operations as they are outside the scope of the act.

The act does require an overhaul in this area. But MPs on the committee should resist the temptation to call for charges to use the act as this would be unfair to the general public and to taxpayers. The right to demand information on services you are required to pay for without being charged is a fundamental human right that should be non-negotiable, even in the present financial climate.

Website passes 100,000 views

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This website in just over two years has now hit the 100,000 mark – 100,130 to be precise if you must know. This is far higher than I expected but then I didn’t intend to write over 100 blogs in the same period.

The home page itself has had over 16,000 hits. But for the record the six most popular stories are the tale on Blair’s donors getting 6,5 per cent interest on millions of pounds of loans to Labour (4324 hits); the abortive attempt to criminalise bloggers in Barnet (3433); the armchair audit of Brian Coleman, Barnet Tory councillor and chair of London fire brigade (2843); the Ed Lester tax scam (2785); Francis Maude’s ” House of the Rising Spads” (2702) and the  privatised London fire company Assetco facing a  financial crisis (2592).

 The most popular pic on the site- believe or not – is a joint of roast beef -used to illustrate the true blue Tory rebels fighting Cameron ( an amazing 20,000 views).

 Special thanks to the many people who boosted these figures including Guido Fawkes site, Political Scrapbook, Broken Barnet (Mrs Angry ),Mr Mustard,Liberal  Conspiracy,the London Fire Brigades Union,Political Betting, the Guardian and many others.

So far this year the site has had over 15,000 hits – compared to 17,000 for the whole launch year 2010. Interesting times.

Is the BBC the British Tax Avoidance Corporation?

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BBC now in row over paying 3,000 people through personal service companies

The BBC has disclosed that around 3000 people on the Corporation’s books are paid through personal service companies – the same system used until banned by the Treasury by Ed Lester, the Student Loans Company chief, to avoid paying tax or national insurance at source.The full story is in Exaro News at http://www.exaronews.com It comes from a Freedom of Information request by David Mowat, the Conservative MP for Warrington,South and only covers part of the picture.
Altogether the BBC across the globe has 20,000 directly paid employees and 12,000 freelancers – 3,000 of them through personal service companies.
The figures are an underestimate since it does not include many of the BBC’s commercial companies and all of BBC’s talent – defined by them as ” people who appear in presenting or journalistic roles on our television, radio and online.”
So none of the high paid presenters will be in this breakdown nor will be people employed on many of the BBC’s commercial activities. Nor are people supplied through Reed Personnel who can choose to be paid through a personal service company, and BBC has decided to keep their numbers secret.
This means the figure must be much, much higher. A breakdown provided by the BBC – suggests that more than half the 3,000 are taking less than £26,000 a year, which suggests that they are genuine freelance. Another 1300 or so earn over £26,000 – 318 over £50,000 – and of these five earning over £150,000 and 31 over £100,000.
The BBC insist that none of them are permanent staff and like the government point out that none of them are being paid illegally.
A BBC spokeswoman said:”In the main they are hired to do specific jobs for a fixed period of time such as directing, editing and other craft skills. When a person is contracted in this way it is their responsibility to organise their tax arrangements directly with the HMRC. This is entirely in keeping with HMRC regulations and is standard practice across broadcasting and many other industries.”
However there are other questions to be answered. Why are the BBC not doing the same review as Whitehall in finding out whether all these contracts are genuine? David Mowat is right when says the BBC management should do this.
And why can’t we find out what the BBC Talent is paid – rather than the BBC sheltering behind an exemption through their Freedom of Information Act aimed to protect journalists; sources not disclose their pay – since it is paid by the licence payer.
Also rather disturbingly two prominent journos (one ex BBC)have told me the BBC tried to encourage them to be paid through personal service companies when they did not want to do it. Is this pressure from the BBC to avoid having to pay national insurance and encouraging possible tax avoidance. We should be told.

How the Student Loan tax scandal broke

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Here is a short video produced by Exaro showing how I got hold of the original story and the repercussions that followed. For those interested in this you can view it here.


It also partly a tribute to Whitehall sources who decided this scandal had to stop and  a warning to ministers how clever some Whitehall people are in slipping stuff through right under their noses.

Buried in the Budget:Freelance company tax rules ” shake up ” on way

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Almost entirely missed by the press coverage of the Budget this morning, George Osborne, the Chancellor, announced a radical review of  freelance  tax employment rules through what is known as IR 35.

Not mentioned in his speech – the changes were hidden away in the full Budget document. The full story of this change written by Alison Winward  and Frederika Whitehead is on the Exaro news website  at http://www.exaronews.com.

For those worried by the changes to the IR 35 rules   the official Treasury document uses the dreaded word simplification – the same phrase used by the Chancellor to impose a ” Granny Tax ” – a  future loss of  income for 4.5 million pensioners  by freezing tax allowances for most of  those who have  incomes above the state pension. Like pensioners this could affect millions of people.

The full section in the Treasury  reads:

 ” Personal service companies and IR35 –

 The Government will introduce a package of measures to tackle avoidance through the use of personal service companies and to make the IR35 legislation easier to understand for those who are genuinely in business.

This will include: strengthening up specialist compliance teams to tackle avoidance of employment income; simplifying the way IR35 is administered;

and subject to consultation, requiring office holders/controlling persons who are integral to the running of an organisation to have PAYE and NICs deducted at source by the organisation by which they are engaged. (Finance Bill 2013)”

Basically Hmrc are giving a warning that the  wheeze that enabled Student Loans Company chief Ed Lester to hold one official position in Whitehall, will be banned everywhere. It will also effect local government, the NHS and now the private sector, as people won’t be able to claim it as freelance earnings through a  personal services company. They will have to go through PAYE and pay national insurance.

There is at least a year’s grace before this happens – as legislation is planned for next year’s finance bill – and implementation could be delayed until 2014.

In the meantime the small print announces a crackdown from Hmrc on freelances who use this method. The revenge of Danny Alexander, chief secretary of the Treasury, who missed the whole Ed Lester arrangement when he personally approved all high paid Whitehall staff, looks like being rather more widespread than people anticipated.

Student Loans Chief Ed Lester’s personal company bites the dust

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An idyllic scene at Temple Mill Island, which used to be the home of Ed Lester's personal service company.

Student Loans Company chief executive, Ed Lester, is closing down his personal service company after the furore over the revelations of his tax arrangements.

 A notice in today’s London Gazette reveals he and his partner Dolores Hawkins have applied to Companies House to have the firm called Placepass struck off the register.

Full details of the story are on the website http://www.exaronews.com  but suffice to say the company has been around for 14 years during the time Mr Lester worked for the Office for Government Commerce, NHS Direct and Motability and has had various home addresses from Cambridge to London Docklands.

The firm was used  as a ” tax efficient” way for the chief executive  to funnel his £182,000 pay and pension package and his £28,000 in expenses from the Student Loans Company. It was based at his home on Temple Mills island on the River Thames at Marlow, Buckinghamshire. The island is a gated community.

Ed Lester’s decision is interesting . The story of his tax arrangements  is already causing alarm among thousands of other people working for government departments, agencies ,the NHS and local government. The chancellor, George Osborne, is also looking at changing the tax laws covering this in tomorrow’s budget. It will be complicated and people need to watch for the small print in the Budget statement to find out what will happen.

Reported to HMRC:The £100,000 a year Treasury minister too poor to pay an intern

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David Gauke MP, the Treasury minister who wants his intern to work for free for at least six months

Today the website graduatefog reports that David Gauke has been reported to HM Revenue and Customs for being in breach of the minimum wage legislation for offering an unpaid ” training post” in his constituency. As readers of this blog know this is not the first time he has had advertised for a six month unpaid vacancy. So perhaps HMRC should take other recent appointments into consideration.+
Since this blog appeared Mr Gauke has attacked as ” morally repugnant” people who pay cash to builders, cleaners etc. if they beleive it is part of tax avoidance. But presumably this does not arise for his interns – as they work for free anyway.

After a Budget that gave  tax cuts for the rich and pay freezes and job losses for the poor, step forward, David Gauke, Exchequer Secretary to the Treasury, forced to answer questions on the pasty tax U turn today. He is the man who will oversee the tax cuts in the new finance bill and has overall responsibility for HM Revenue.and Customs. He is also in charge of policing the minimum wage when unscrupulous employers avoid paying staff ( you couldn’t make this up)

His big contribution to help Britain  moving is to offer one new personal job at his constituency office in Rickmansworth, Herts. There is only one problem. You need to either have rich parents ( who will give you an allowance) or a lot of inherited wealth.  There is no pay and you must be Tory inclined( and obviously believe working for free is a good Tory policy)

The advert is here. http://bit.ly/AlHBho

As a minimum condition you must work for him for  nothing for six months  if not a year or more and you better have at your own expense, learnt advance computer skills ( doesn’t sound that Mr Gauke is computer savvy).
As it says: “Duties will include administration, basic correspondence, diary management, fundraising, campaigning and related tasks. The intern will also have the opportunity to work one day a week in the Westminster office.”

Now I understand as his constituent that Mr Gauke is very hard up. He only has an income of just over £100,000 a year – with his £98,750 salary and he claims from the taxpayer a London living allowance of £3379.15 a year ( desperate problem for MPs having to pay for higher London prices except for the taxpayer paid subsidised food in Parliament)

Funnily enough his expenses paid by the taypayer for the last financial year come to almost the same £98,680.93 as his salary including some £78,000 on staff ( presumably in Westminster rather than Rickmansworth), another £9000+ on accommodation and £10,000+ on administration. So the poor man only has £200,000 going through his accounts.

Then there are his two homes to maintain by Tory standards well below any mansion tax level. But  poor man,since this terrible crackdown on  Mps expenses he has had to lose  such a lot.  He did grab £15,000 a year  in mortgage interest payments ,a  quarterly £687 maintenance charge and car parking fees- all paid  from the  taxpayer on his Westminster Bridge Road apartment in London which he paid  £285,000 in 2007.  Mind you he has had a £30,000 rise in his income since the coalition came to power.

Incidently none of this latest expenses information is on his personal website – which  on this issue doesn’t appear to have been updated since 2009. No doubt this will be done free of charge by his new employee.

What one might have expected from a government with one million young people on the dole – is that Mr Gauke might have just gone down to the Watford or Hemel Hempstead dole office- and given a leg up to some Tory inclined youngster on the dole. Or he might  like many other Mps in his party just decide to pay a minimum wage to one of the newly unemployed graduates. But obviously paying £6 an hour would send him and his wife to the bankruptcy courts. For Mr Gauke, it is not Greed is Good  but Exploitation is Excellent.

Perhaps as a resident of Berkhamsted in his constituency we should launch an appeal for the cash stricken Treasury minister or send food parcels to his new recruit so he can at least survive on an egg sandwich.

Internaware  who campaign at @internaware against exploiting interns are not impressed. Gus Baker said: “Revenue and Customs have set up a hit squad to enforce the minimum wage for interns and yet the minister in charge is refusing to pay the people in his own office.

“David Gauke… is also putting an opportunity out of the reach of the vast majority of young people who can’t afford to work for free.

“At a time of high youth unemployment when young people desperately need to demonstrate experience on their CVs, this is completely irresponsible.”

Mr Gauke is very comfortable with this. He told BBC News which followed this up : “It’s advertising for a post for volunteers. Lots of people want to do it. It’s good experience.

“It involves visiting my local Conservative Association, getting some experience of Westminster.

“I think that’s perfectly reasonable and those that have had the experience of working there have enjoyed it and found it very good experience.”

Anyway for those who want to tell him what they think his e-mail at Parliament is gauked@parliament.uk  and the constituency office address for food parcels is Scotsbridge House
Scots Hill, Croxley Green,Rickmansworth Hertfordshire WD3 3BB.

Cameron’s Nightmare Legacy: Brutalised Britain

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The London Spring - creating the brutalised society that could come to fruition by all out privatisation pursued by people like Brian Coleman

London Spring (click on this link for the full theatre programme and venue)

Image a Britain where everything is privatised and the masses impoverished and brutalised. This is background to my partner in crime and fellow author Francis Beckett’s new play, The London Spring, now on at the Etcetra Theatre in the Oxford Arms,Camden.

Set in a transit lounge at Waterloo Station where wealthy Russian, American, Australian and Chinese tourists arrive in the UK it depicts the arrival of Michael, (Mike Duran) a naive but wealthy US medic, who is totally unaware of what a moral cesspit this country has become.

In a series of literally bruising encounters he learns that the privatised police force has to be regularly bribed to provide him with any protection. His suitcase will be nicked at the earliest opportunity, he will have bribe the competing down and outs just to go to the loo and if he steps out in the street to cross Hungerford Bridge he is likely to be mugged and robbed. His only safe way around London is in a tourist coach where he is carefully shepherded and protected by guides.

The picture is of country welcoming rich tourists and health tourists to see its sights, stay at its posh hotels and get state of the art medical treatment. But they are kept well clear of the locals.The Royal Free hospital in Hampstead ( which can already take 49 per cent private patients under Andrew Lansley’s reforms) is now owned by an American owned insurance company and only treats foreign patients and wealthy Brits.

 The play is also an unrequited if a little improbable love affair between the American and down on her luck British trained doctor, Catherine (Suzanne Kendall). There is a superb performance from down and out revolutionary Trot, Jack (Michael Yale) who is both menacing and  a good ranter. And Danny Kennedy, the security officer is a believable privatised Mr Plod.

 It perhaps no coincidence that Francis lives in the London Borough of  Barnet – or Broken Barnet as prolific and hard hitting blogger Mrs Angry calls it on her site – which is the Tories’ flagship authority for planning to privatise everything. In the real world it has already had a private security force, the now bankrupt MetPro, whose officials took secret photographs of its residents attending a  council meeting approving cuts and has even been accused of driving around in fake police cars. They did not accept bribes though I have known private security officers in Britain accept bribes to allow people to park in private car parks when they can’t find anywhere else to park.

Its leading figure Brian Coleman, who harangues single mums, doesn’t believe in anyone else’s human rights and is on record in saying there is nothing that can’t be privatised, might be quite at home in this new brutal Britain. 

The play ends with a demonstration growing across London as tens of thousands gather in Trafalgar Square knowing the authorities ( no doubt  with Mr Coleman as chair of the privatised emergency services for the capital) will shoot demonstrators.

 Fanciful you might think, but the play is running in a week when on  BBC Newsnight Lord Lawson is calling for the retirement age to be raised to 80 and the right-wing Institute of Economic Affairs wants the old age pension to be phased out and people forced to save from their meagre wages or starve.

 Go, see this while it is on this weekend and next week. Perhaps Francis should invite Brian Coleman to see the nightmare results if his wet Tory dream goes wrong.

Margaret versus the mandarins

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Margaret Hodge: Standing Up for MPs' and the public's rights

Watch out for a major speech by Margaret Hodge, chair of the Commons public accounts committee, at Policy Exchange in London this Thursday on the accountability of Whitehall to Parliament.

This is going to be a historic moment for the relationship between MPs and mandarins and I am not expecting the doughty chairman of Parliament’s most powerful committee to pull any punches. I also expect it to ignite a big debate.

 It is also important moment for people who believe that Parliament is just a talking shop. This is because it will show that MPs want action on the way our taxes are spent and even more so on who pays their taxes.

 It is also about the honesty and integrity of Dave Hartnett, the head of the Inland Revenue (HMRC), and his attempt to get away with telling lies to MPs on a deal with one of biggest bankers, Goldman Sachs.

The story of this dispute is published today by Exaro News at http://bit.ly/zHz7pP or on the Exaro News website http:// www.exaronews.com .

 Suffice to say it reveals a massive tussle between Lord O’Donnell, the former Cabinet Secretary and Mrs Hodge over whether civil servants are accountable to MPs or ministers – going to heart of the matter of whether MPs can stand up for us as taxpayers.

 Lord O’Donnell ,who wrote the letter days before he retired ,has accused the Public Accounts Committee of  publicly humiliating a senior law official at the revenue by making him swear on the Bible before giving evidence. He talks of widespread anger in Whitehall and in the legal profession about this.

 But he ignores the reason – that the man’s boss, Dave Hartnett, had misled Parliament over a sweetheart tax deal he negotiated with Goldman Sachs saving them possibly billions in tax. He pretended it was nothing to do with him.

 This is why people should back Margaret Hodge, her committee which includes very equally strong minded MPs like Tories Richard Bacon and Stephen Barclay in standing up for MPs and the public’s rights.

 Thursday will light the blue touch-paper at Policy Exchange. If there are any seats left go and watch and hear. It’s free.

Revealed: Lansley’s simply crazy commissioning guide for your operation

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Lansley's latest complicated NHS Commissioning diagram:Uploaded with help of Political Scrapbook

Commissioning-Intelligence-Model-v13

 Feeling ill and need to see your doctor. Well here’s a bit of draft helpful advice under the Lansley reform measures.  Click on the link above and  get a big surprise. Just a simple commissioning guide so the NHS can smoothly run to help meet David Cameron’s ” NHS is in my DNA ” pledge.
This was sent to me as part of the big response to the NHS London board  diagram of how the NHS will look which I published on Sunday night. I can verify  its contents and it comes from @nhs_supporters and  the respected and informed  Health Service Journal. It makes interesting bedtime reading.
This appears to lay out a few guidelines. By the time they have answered all these questions I suspect you might be dead. Notice that GPs will have to send in monthly accounts and that a lot of computer programmes (more waste on IT) will be employed to work out the mix of services. It sound a nightmare to me.
But I am sure you will be eternally grateful to the huge cut in bureaucracy needed to answer all these points. Have a good time at your doctor’s surgery. Or alternatively why not e-mail Mr Lansley himself on lansleya@parliament.uk and ask him to go through the process with you. He claims to have spent five years thinking all this up. Pity he didn’t bother to tell the voters at the election.