The perils of pandering to PricewaterhouseCoopers

Margaret Hodge: A principled stand against corruption of politics by corporate influence.

Margaret Hodge: A principled stand against corruption of politics by corporate influence.

This is something that broke while Yr Obdt Srvt was still recovering from a recent illness, but is still worth covering because Labour really needs to understand the danger of association.

Margaret Hodge, Labour’s chair of the Commons Public Accounts Committee, broke ranks to warn the Shadow Cabinet against accepting – shall we call it – “help” from accounting firms like PricewaterhouseCoopers on Friday. She said it was “inappropriate” and she was right to do so.

It’s the political equivalent of accepting “help” from the Mafia – you end up in their pocket, owing them favours.

According to the BBC, Labour MPs including Ed Balls (Shadow Chancellor) and Chukka Umunna (Shadow Business Secretary), along with Rachel Reeves (Shadow Work and Pensions Secretary) have received more than £540,000 in research assistance from the firm in the past 18 months alone.

PwC is one of the ‘Big Four’ accountancy firms – the others are Ernst & Young, KPMG and Deloitte – who also advise the Conservative-run Treasury on tax policy. It should not be beyond anybody’s wit to see there’s a clear conflict of interest if the firm is advising both Labour and the Tories on tax policy.

Furthermore, PwC – if not all the others as well – is known to advise businesses on ways they can legally avoid paying tax. This means that, while working for the government, they are actively campaigning to hinder its effectiveness at collecting revenue that is due to it and using that money for the good of the UK as a whole.

Labour’s official line is that “PwC have provided long standing support to all three major political parties on a non-party basis, as happened for the Conservatives and Lib Dems before the last election. Given the complexity of government and that opposition parties do not have significant access to civil servants, the support provided by organisations such as these helps ensure that there is better scrutiny of government policy.”

PwC said its staff provided “limited and fully disclosed technical support to the main political parties” but added: “We do not develop policy on their behalf.” Staff on secondment might make “observations on the improvement of legislation or proposed legislation”, the firm added in a statement.

Isn’t this exactly the problem? Staff make “observations”, and before we know it, all our political parties are carrying out PwC policy instead of their own.

If Labour was serious about getting the advice it needed, then it would be employing advisers who have nothing to do with any of the other political parties. That’s the way it has to be. Anything else courts betrayal of the public.

Then there would be no opportunity for these firms to create embarrassment when their activities “promoting tax avoidance” on an industrial scale were revealed by the Public Accounts Committee

PwC said it disagreed with the Public Accounts Committee report (it would, wouldn’t it?) and denied claims by Mrs Hodge that the firm had misled her committee when its executives gave evidence in January 2013. Who do you believe?

Mrs Hodge herself told BBC Radio 4’s The World At One: “You have to be very, very careful when you’re in opposition whom you take money from”.

Absolutely correct.

This is why Vox Political supports the removal of all private company advisors from government. The private sector has no place in decisions about public services.

That is why we have a Civil Service.

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3 Comments

  1. Gazza February 8, 2015 at 10:21 pm - Reply

    Mike,

    Have a gander at : http://www.bbc.co.uk/news/business-31248913

    Remember of course the Refraim “We’re all in it together”
    More like – “Austerity for the Poor, Bags of money for the Rich… As it should be in this fair and pleasent land for the Rich, eh Wooster!”

  2. chriskitcher February 9, 2015 at 11:13 am - Reply

    Spot on Mike. The problem is that the more politicians denigrate the Civil Service the greater the flow of able people to these firms. It’s obvious that such firms do not do this out of altruistic motives, so all politicians need to look at the Behavioural Code for local government members.

  3. Joan Edington February 10, 2015 at 12:39 pm - Reply

    I’m surprised we have a Civil Service left. Since the aim is to destroy the state, it is not an organisation that the Tories feel at all relevant.

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