Category Archives: Uncategorized

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

Posted on by

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

Posted on by

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.

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

Posted on by

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.

Revealed: Whitehall angst and a KPMG U-turn on Lester’s tax affairs

Posted on by

ImageNew e-mails and financial advice put up today on the Exaro news website (http://exaronews.com) reveal more of the background surrounding the extraordinary decision to grant Ed Lester, the chief executive of the Student Loans Company, an arrangement when he was not taxed or paid his national insurance at source.

It shows that senior civil servants were really uneasy about the deal. In one e-mail, Daniel Jenkins of the Department of Business, Innovation and Skills legal department wrote: “Applying the tests of employment status, I wonder whether it is possible for a CEO to be anything other than an employee/office-holder, given the degree of integration into the company which he presumably needs to carry out his duties.”

In another e-mail Michael Hipkins, then a BIS appointee to the SLC board writes:

“The risk, which nearly the whole interim industry currently runs, is that a contract for ‘supplying an individual’ is deemed to be an employment contract, rather than a commercial contract for services. So it appears there is a risk, and there is a judgement whether the risk is worth running.

“For my part, I note that when the terms of the interim CEO’s remuneration were cleared with Treasury, they raised no objection to the form of the contract, nor that there was an agency acting as intermediary.”

“It looks as if the company would be running no greater a risk than any other company employing interims on consultancy contracts; and the fact that the Treasury raised no objection to the proposed arrangement in the case of the CEO must mitigate that risk further.”

But the angst is nothing to the role of KPMG, the auditors and advisers to the SLC, who gave contrary advice in the space of a month.

 First they said – as subsequently was proved right by Chief Secretary to the Treasury,Danny Alexander’s decision to cancel the deal,- that no office holder could be a  limited company.

 Then they changed their mind saying; HMRC “may agree on a concessionary basis”, under a provision known as the extra-statutory concession, A37, to override the rule that all company office-holders must pay tax and national insurance.

It said that Lester’s pay can then be treated as “income of Penna (who acted as the recruiting agency for Ed Lester) for corporation-tax purposes and not income of EL for income-tax purposes.”

KPMG said that the SLC should make no expenses or bonus payment direct to Lester, but only through Penna to his personal company, otherwise it would invalidate any concession.

Even more interesting  given the developing furore over this issue the memo reveals that KPMG had done this before.

 It said KPMG “have been successful in the past in agreeing with HMRC that the concession can be extended to circumstances similar to the arrangements in place here. However as this is a concession (rather than a statutory provision) there is no guarantee that HMRC will agree that the concession  applies in this case given the agency and personal service company arangements in place.”

The next questions in this saga will be who else has benefitted from this arrangement and what George Osborne, the chancellor, proposes to do to close this loophole in the budget this month. The full story is revealed in four new articles on the Exaro website.

Save FOI: Putting the case to MPs

Posted on by

 I am giving evidence to Mps on the House of Commons Justice Committee on Tuesday as part of their inquiry into the future of freedom of information. I shall be there alongside three  other journalists – Martin Rosenbaum from  BBC News, Doug Wills, from the Evening Standard, and David Higgerson, from Trinity Mirror Regionals. I shall be there on behalf of the National Union of Journalists, who have put a submission to the committee and as someone who regularly uses FOI for both my blog and for Eaxro News, the investigative news website.

We will be asked a wide range of questions on FOI. If any  journo or blogger has any point that they think should be raised about FOI you can put a comment upon this site. Please keep any comment short and succinct. I don’t promise to be able to raise everything but it would  be good to know of any burning issues which may have escaped me.

The hearing starts at 11.15am and will be broadcast live  on the internet and will also be saved for other broadcasts.

Did the former Cabinet Secretary unwittingly sanction “tax avoidance”?

Posted on by

Gus O'Donnell: Tax avoiders friend in Whitehall? Pic Courtesy: Daily Telegraph

The huge  row following the disclosure  of the tax  ” avoidance” arrangements for Ed Lester, chief executive of the Students Loans Company, has concentrated on how government ministers approved the arrangement.

Not highlighted was the role of the then Cabinet Secretary, Gus O’Donnell, recently retired on an index linked pension and getting £300 a day for every day he turns up as a newly ennobled peer.

Documents released to me under the Freedom of Information Act reveal that Gus O’Donnell when he heard Lester was not going to be on the pay roll of the Student Loans Company rightly demanded an ” urgent clarification “. He also insisted on an explanation about the ” costs to the Exchequer” of the arrangement. He was then sent a detailed document which showed that if he was paid through an agency it would cost less than if he was on the staff. Details of  the document are published tonight on the Exaronews website (www.exaronews.com)  and also detailed in a story by Rajeev Syal on the Guardian website(http://bit.ly/yWOy7H ).

Basically it is a scam explanation – revealing huge fees (£83,000) to be paid to Penna Consulting, the management firm, who acted as middlemen to pass money on to  his private company – if he was taken on the pay roll. It also suggested that his expenses of £550 a week for a flat and fare would have to be grossed up to cover his personal tax bill if he was on the staff.

Meanwhile the savings side if he was not on the pay roll included a whopping £17,000 to the SLC for avoiding paying the employers national insurance contribution.

 Any cursory glance at these figures by anybody reasonably intelligent would suggest that these were sham calculations and could have been knocked down, particularly the big fee to the agency. Yet the e-mails show Gus was ” content”.

Frankly this is as bad as Danny Alexander, chief secretary to the Treasury, not realising the tax implications of the deal. Here one of the most highly paid people in Whitehall and head of the civil service appears to be oblivious of what he is sanctioning. What does this say of the ability of people at the top or are they so used to paying out such big fees (taxpayers money) that they don’t notice?

I have tried to contact Lord O’Donnell for an explanation but he has not returned my calls. And the Cabinet Office is now sheltering around the fact that Danny Alexander has ordered a review to stop answering questions – even though some of the points I have raised have nothing to do with the review. Senior civil servants seem rather good at covering their tracks – it is probably a key part of their training.

Exclusive: Whitehall tax avoidance “scam” revealed

Posted on by

Flashy Student Loan Co HQ where Ed Lester works without being taxed at source. Pic courtesy BBC

Civil servants could be able to avoid legally paying tens of thousands of tax while working in Whitehall. An investigation by Exaro News and BBC Newsnight based on documents obtained by me through a Freedom of Information request has revealed an extraordinary personal tax deal negotiated by the Student Loan Company for its £182,000 a year Whitehall boss, Ed Lester. The deal is £140,000 salary,£14,000  bonus, £28,000 pension and £28,000 expenses for flight and Glasgow flat.

Documents released by the SLC and the Department of Business,Innovation and Skills reveal that Mr Lester, chief executive,pays no tax or national insurance at source but instead the SLC pay a consulting firm called Penna who pass the gross cash to a personal service company run by Mr Lester and a partner. This arrangement was approved by HM Revenue and Customs and the deal was signed off by David Willetts, the universities minister, and Danny Alexander, chief secretary to the Treasury.

As a result instead of paying tax at the top rate of 50 per cent – the company is likely to only have to pay corporation tax at the government’s new lower small company rate of 21 per cent and minimal national insurance. Mr Lester has declined to discuss the matter with Newsnight or Exaro News.

Full and extensive details are revealed in a series of articles on the Exaro News website (http://www.exaronews.com) – behind a pay wall but if you register  it is free for a week – or you can see the film about it on BBC Newsnight.

The investigation has forced Mr Alexander into ordering a  Whitehall wide inquiry to find out how many civil servants are benefitting from the same secret deals.  The reason is that ministers  DONT’ KNOW  and it looks like in Mr Willetts’ case DON’T CARE.  Alexander personally examined each top pay contract and now admits he missed the tax implications of this particular deal.

Whatever his inquiry reveals this arrangement looks to me on a par with all the recent scandals involving banker’s bonuses and Sir Fred the Shred’s stripped honours. Basically you as a taxpayer are paying the state to negotiate a deal for a very highly paid  official to avoid tax. This can’t be fair, right or decent to millions of low paid public and private sector workers who are paying a big whack in tax and can’t set up personal service companies – effectively to avoid paying tax. It also has the added insult that the man who has got this deal is pursuing every single student in the UK to make sure they pay every penny back of their student loan.

Dole queues – What dole queues? The huge divide among the unemployed

Posted on by

Dole queues -growing rapidly in Labour, falling in some Tory and Lib seats Pic:courtesy Daily Mail

Ever wondered why with  dole queues at their highest levels since 1996, in many areas pubs and restuarants are heaving, the West End theatres full and motorways crowded with traffic? The answer is provided in an extraordinary analysis by the House of Commons Library of the latest claimant figures released by the government (see http://bit.ly/x6wWxw).

Far from  the picture painted by David Cameron’s infamous slogan ” We are in it together” the United Kingdom is as divided over who is on the dole and who isn’t as it is over bankers’ bonuses and public sector worker pay freezes. And it is not just the differences between the disproportionate numbers of young people-under 24- on the dole and an older generation in work.

It is  the fact that across  the nation the number of people claiming job seekers’ allowance is now dividing area against area and becoming party political. Put it simply the government – whether it intended to or not – is dumping on areas that voted Labour and leaving many coalition seats- Liberal Democrat and Conservative alike – completely unscathed from the grim dole reaper. In fact -taken year on year in some Tory and Lib Dem seats unemployment claims are, believe it or not, actually FALLING.

Am I making this up?  No it is all in the report. The Commons library report looks at dole claimants and breaks them down by constituency -taking as its base the economically active – those aged between 16 and 64 – and working out how many people in the constituency are unemployed.

It then ranks them all. The top 15 dole  constituencies-with the exception of three- are all Labour seats. And the other three are in Northern Ireland. The bottom 15 are all Conservative or Liberal Democrat. And the difference is stark . In Labour held Birmingham,Ladywood, – the Number One seat for dole claims- more than one in five people are claiming. In Liberal Democrat held West Aberdeenshire and Kincardine, the figure is 1 in 100 and falling for the long term unemployed.

Among prominent politicians John Redwood and David Cameron both have miniscule numbers on the dole- and the overall jobless claims are falling in Redwood’sconstituency despite a rise in youth unemployment. While Liam Byrne, the shadow works and pension secretary, and ex union leader Jack Dromey have some of the highest. There is more on this in an article by me and Rajeev Syal on the Guardian Society website (see http://bit.ly/xvUv8M ) and by me in Tribune (http://bit.ly/z3dAhM).

Perhaps it can be best illustrated by comparing Liam Byrne constituency with Chris Grayling, the Secretary of State for Works and Pensions.

Liam Byrne’s Birmingham Hodge Hill  seat has the second highest number of dole claimants in the UK with 7257  claiming benefits – 1750 for over a year – and a rise of 723 – 250 on the long term register.

Chris Grayling in Epsom and Ewell has  1007 on the dole – an increase of 44 in a year – with a rise of just 5 people out of work for a year -to just 135.

No wonder perhaps the dole queues do not have the same resonance for the Tories  as Labour. Tory Mps’ surgeries are hardly going to be packed with desperate people looking for jobs – but Labour Mps are going to be overwhelmed. It also has a political impact and might be one reason why Labour is not capitalising on the recession- simply because in some areas it does not exist.

The most interesting point is that Lord Young’s much criticised statement about people never having it so good – is actually true in some Tory areas.

Labour is going to have try much harder to get the point of the horror of the dole queues across to a wider general public – because as it stands the Tories seem to have manipulated a recession that concentrates almost entirelyon their constituencies and affects mainly their voters.

Blog review 2011: Who came, saw and commented

Posted on by

The WordPress.com stats helper monkeys prepared a 2011 annual report for this blog.

Here’s an excerpt:

This blog was viewed about 67,000 times in 2011. This compared with 17,000 in 2010 – the year the blog was launched.Click here to see the complete report.

Exclusive: Francis Maude’s secret gold plated banker’s pension

Posted on by

Francis Maude: The man with the gold plated pension. Pic courtesy: The Guardian

Armchair audit is  raising its sights. As well as looking as councillors like Brian Coleman, it is now turning the spotlight  on auditing the  seriously wealthy to see if they follow David Cameron’s dictum that we are in it all together.

Francis Maude is the public face for taking on the public sector trade unions and  insisting their low paid members are being offered the best possible  pension terms which anyone in the private sector will be really envious.

But is everyone in the private sector worse off than public sector workers? Not Mr Maude for a start.

He has taken one hit and is about to take another since he rejoined the Conservative led coalition.

His  Cabinet Office minister salary  is £98,740 (includes MP’s salary of £65,738). This is a reduction of £5197 on his Labour predecessor, Tessa Jowell.

It is his pension history which marks the real divide. When he reaches retirement age at 2018 he will be able – unlike his public sector colleagues –  to be able to draw FOUR pensions.

 He will get the state pension – promised by the coalition to reach £140 a week – which will go to everybody.

He will get  TWO public sector pensions – one as an MP and one as minister. Their arrangements are hideously complicated – and not as open as figures available for public sector workers.

As an MP  since 1983 of 28 years standing ( he was out of parliament between 1992-97) by 2015 he will entitled – assuming a virtual wage freeze – to a pension of around £31,000 a year because he has a private sector pension and this taken into consideration to save taxpayer’s cash. Otherwise it would be worth over £46,000.

But while workers will be paying higher pension contributions Mr Maude is able to pay less under this deal. His contribution rate drops from 7.9 per cent to 5.9 per cent.

His minister’s pension by 2015 will be worth over £10,000 a year. His contributions, to be fair, are now 11.9 per cent and will rise to 18 per cent.

This gives him a state pension in excess of £40,000 a year – TEN times the average pension of lower paid civil servants bearing the brunt of the cuts and FIVE times the average civil servant pension. For that matter it is also FIVE times the average teacher’s pension.

But this is by no means the full picture. These calculations  miss out Mr Maude’s private pension – which is a huge elephant in the negotiating room.

 During the period he was out of office Mr Maude was director of  27 companies between 1992 and 2011. Six were dissolved and three went bust.

 But standing out from the lot is a period of over two years from February 1994 to November 1996 when Mr Maude was managing director of  investment bankers,Morgan Stanley, in London and New York.

The accounts are still available at Companies House and the salaries – paid in 1990s money – were stratospheric for directors.

The highest paid director’s salary went from £786,873  in 1994 to £1,234,690 in 1995 and to £1,708, 063  in 1996 – a rise  of well in excess of 100 per cent. And that excludes pension payments.

Mr Maude’s salary is not  identified –  but as MD in two countries – it will be nearer to those  figures – plus a pension to boot.

 The Cabinet Office declined to comment on his private pensions arrangements. But a City management consultant told me:

“It would be inconceivable that Morgan Stanley would not have paid Mr Maude a high pension because it is a much more tax efficient way of paying out money. Often City firms offer pensions equivalent to say 10 years service, rather than three, as a way of giving more money to people when they leave.”

Indeed Mr Maude had a lot of spare cash in 1996. Land registry records reveal that on 1st August 1996 Mr Maude and his wife Christina, bought for cash a large farmhouse and land at  Dial Post in West Sussex.  Property around there with land goes now for sums well in excess of £1m.

Perhaps the time has come for Mr Maude to reveal his true pension status when he is lecturing people to settle for less for life. He is the Government’s Mr Transparency and has released lots of personal data on individual civil servant’s  pay and pensions.

Just this weekend, his boss at the Cabinet Office, Nick Clegg, called for more transparency on top executive pay and perks. Mr Maude could lead by example by revealing the historic facts of his secret pension deal.

 My guess is that he has a private fund worth well over £1m on top of his three other state pensions. Prove me wrong, Mr Maude.

You can of course express your own views – you might feel Francis Maude is worth a mega pension, or you may feel he doesn’t  deserve anything like it.. You can e-mail him on psfrancismaude@cabinet-office.x.gsi.gov.uk .