Tag Archives: Chancellor

Sunak announces furlough scheme replacement. Is it any good?

After he served up this little howler – and pushed up Covid-19 infections massively, Rishi Sunak needs to make a good impression with his plan to replace the furlough scheme for jobs affected by Covid-19. Has he managed it?

Tory Chancellor Rishi Sunak has announced a new “job support scheme” to replace the “furlough” programme he has been running since lockdown began in March.

This new scheme will run for another six months until the end of April 2021.

What is it?

A six-month scheme starting on November 1.

To be eligible, employees must work a minimum of 33 per cent of their normal hours.

For the remaining hours not worked, the government and employer pay one-third of the wages each.

So employees working 33 per cent of their hours will receive at least 77 per cent of their pay.

Where will employers get the extra money?

According to BBC News:

Sunak announced a “pay as you grow” scheme for businesses which took government guaranteed loans during the crisis.

“Loans can now be extended from six to ten years nearly halving the average monthly repayment,” he said.

They can also move to interest only payments or suspend payments if they are “in real trouble” for up to six months.

He said no credit rating will be affected.

Coronavirus Business Interruption Loans will also be extended for up to 10 years.

There will also be a new loan scheme in January, the chancellor says.

He is also extending the scheme for self-employment on “similar terms” to the existing job support scheme.

The scheme is mainly for small and medium-sized firms. Only large firms that can prove they have been harmed by Covid will be eligible for the Job Support Scheme.

What about VAT?

Sunak is also cancelling the planned increase of VAT from five per cent to 20 per cent, which was due to come into effect in January.

Instead, the lower rate of five per cent will remain until 31 March next year.

Viable jobs?

Sunak said the new scheme is intended to support “viable” jobs only – and that should ring alarm bells:

Of course – Tories being Tories – certain extremely rich people are enjoying the continuation of their own subsidies at the same level:

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Rishi Sunak thinks taking cash from the starving poor is the way to pay for Covid-19

Remember this? It led to a huge rise in Covid-19 infections. Now Sunak is planning to make the poor pay for his mistakes.

The absolute state of this.

The Chancellor who told us to “eat out to help out” – triggering an exponential increase in Covid-19 infections that led to new restrictions – is now trying to work out how the UK will pay for his government’s mistakes.

And of course he isn’t going to ask the filthy-rich corporates who have made a fortune while the crisis has been happening to pay a bit more.

No – he wants to grind you further into the dirt:

Rishi Sunak has looked at a freeze on benefits and public sector pay to fight the spiralling cost of the coronavirus crisis, it is reported today.

Sources failed to rule out the crushing blow to millions of workers and the poorest – just a few years after long austerity freezes finally ended.

The Chancellor is also said to be trying to persuade Boris Johnson to suspend the “triple lock” on pensions, reports the Mail on Sunday – amid fears it will artificially rise due to the economic turmoil.

So he’ll freeze wages and benefits at a time when his boss Boris Johnson’s international law-breaking Brexit is likely to cause massive price increases on basic food items.

And he wants to freeze pensions as well, to put the pensioners who were left after his government’s Covid-19-fuelled cull into the same predicament.

It has all been about protecting the super-rich, of course. The lockdown that was supposed to kill off Covid-19 didn’t, because Sunak, Johnson and their gang wanted to get us all back to the coalface, making money for the big corporate bosses who donate to the Tory party.

Now, despite the fact that this corporates have increased their riches steadily over the course of the pandemic, Sunak still doesn’t dare tap them to help pay for the results of their government lackeys’ efforts to keep them in gravy.

And this creep was supposed to be the great white hope of the Conservative Party?

Source: Rishi Sunak ‘considers freezing benefits and wages’ to pay for Covid crisis – Mirror Online

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Yes, it is more ‘meal deal’ than ‘new deal’ – but Sunak’s summer statement isn’t ALL bad

Rishi Sunak: his job could be hanging on the result of this plan. Shame it has already been sabotaged by his boss Boris Johnson.

It didn’t matter what Rishi Sunak was going to say in his summer statement because Boris Johnson, Matt Hancock and the other Tories had already sabotaged it.

Sunak’s objective is to save jobs while the UK works through the post-Covid recession, but his problem is that his colleagues’ insistence on easing lockdown means the Coronavirus isn’t over yet – no matter what Johnson says.

In this nation of shopkeepers (as Napoleon had it), if we want to keep people in their jobs, we need to keep spending money into – and through – the economy. That means going out and paying for things.

But the number of new infections in the UK is high – and will remain so, while Johnson insists on helping the virus infect other people by opening pubs, schools, and whatever else he’s planning next.

That means people are going to be reluctant to resume normal patterns of social consumption.

It’s going to be difficult in the extreme to restore confidence after these Tory blunders. After schools and pubs, Johnson can claim it is our social duty to go back out and spend until he is redder in the face than the gammons he represents, but the public will only hear him telling us to go out, catch the virus and die.

That’s the second hurdle that Sunak faces; thanks to Johnson, public trust in the claims of politicians is at an all-time low, being worsened all the time by his insistence on lying whenever the mood takes him and refusing to apologise when his lies are exposed.

So the ending of the furlough scheme in October is directly counter-productive; watch the number of redundancies increase when that month comes round and try to tell me I’m wrong.

The offer of a £1,000 “jobs retention bonus” is likely to fall similarly flat. The conditions are that employees must be carrying out proper work, and be paid at least £520 per month – the lower limit of National Insurance payment – and it seems unlikely that many employers will be able to manage this.

Similarly, the VAT cut from 20 per cent to just five per cent to help out restaurants, pubs, cafes, B&Bs, hotels, theme parks and cinemas may only have limited success. Who’s going to go, if there’s a chance they’ll catch a fatal disease?

Sector-specific stimuli such as this are a good idea – don’t get me wrong – and this would work if the number of Covid infections was much lower than it is (in England, at least) – and if more people were interested in wearing face masks, perhaps (how would that work, when they’re eating food?) – but as I’ve already mentioned, Johnson has put a stop to that with his ridiculous blunderings.

And the already-infamous “meal deal” voucher, offering 50 per cent of the cost of meals for everybody eating out between Monday and Wednesday, throughout August, may go hungry for customers. Here’s the reason:

On the other hand, raising the threshold for stamp duty from £125,000 to £500,000 might conceivably be a good idea, if it stimulates construction work as people are encouraged to buy new homes.

Possibly best of all the measures laid out in the statement was a scheme to create jobs for young people, subsidising six-month work placements for people aged 16-24.

If this is used to re-skill the workforce – actually preparing the UK for future opportunities – then it has enormous merit.

But I can see employers using it as a cheap alternative to the workers they already have. Why take just £1,000 over three months to keep on your current workforce when the Tories will give you a teenager for twice as long and pay all of their costs?

So my initial verdict is that this is final proof of the Conservative government’s economic illiteracy; they really couldn’t run a p***-up in a brewery.

But it would be wrong to pre-judge a plan that hasn’t gone into practice yet.

The sad part is that this may break Sunak but Johnson will laugh it off, no matter how disastrous the result.

Source: Coronavirus: Chancellor Rishi Sunak unveils £30bn plan to save jobs – BBC News

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Will employers be able to pay Sunak’s furlough demand?

Rishi Sunak: his plans for his furlough scheme are optimistic, to say the least.

These people are mistaken:

But they’re not very far off the mark!

Tory Chancellor Rishi Sunak had said that he would make an announcement about the furlough scheme – in which the government pays 80 per cent of employees’ wages while they are unable to work, in exchange for employers agreeing not to end their contracts – today, May 12.

And he had been expected to say that the government could no longer pay that proportion of wages and would be reducing it to 60 per cent.

Something stopped him.

Was it the argument that John McDonnell put forward – that on top of Boris Johnson’s plan to ease the lockdown, announced on Sunday, this would be an obvious attempt to starve employees back into work, even though they would probably catch the coronavirus there?

Was it the point that many employees simply cannot go back, because their jobs are still not considered safe enough – by the government itself?

Was it the suggestion that cutting down the amount furloughed workers are being paid would turn the coronavirus crisis into the UK’s worst disaster in a century – made that way by the Tories and on their watch?

It won’t have been the thought of tipping more people into poverty; Tories have no problem with that at all.

In This Writer’s view, he was probably persuaded by the thought that too many employees would be adversely affected – and would make this clear in no uncertain terms. Tories are constantly concerned about public relations.

So instead, he has extended the 80 per cent wage payment subsidy to August, with a demand that the government contribution will be reduced from that date and employers will pay into it as well.

He has said nothing about how large the employer contribution will be – meaning all he has done is added more uncertainty to the coronavirus crisis.

And where are the employers going to get the money?

Sure, Sunak said employers would be able to bring furloughed workers back part-time by then – but he cannot guarantee that.

Indeed, considering the lunacy that followed Boris Johnson’s announcement that some people should go back to work from yesterday (May 11), it seems likely that the UK will be well into its second wave of coronavirus infections by then.

And employers have been paying the overheads on property, equipment and so on, for months.

It seems Mr Sunak has made a few highly-optimistic assumptions.

Won’t it be humiliating for this Tory Chancellor if he turns out to have got his sums wrong?

  • I’d like to hear from employers: what do you think of Rishi Sunak’s declaration?

Source: UK furlough scheme extended by four months – BBC News

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Chancellor’s ‘jam tomorrow’ package for the self-employed is worse than useless now

Rishi Sunak: still discriminating against the self-employed? Why not just bring in Universal Basic Income? Then we can all relax.

How kind of Rishi Sunak to announce aid for self-employed workers who are likely to lose money because of the coronavirus crisis – except he didn’t did he?

He made a vague promise that we (This Writer is self-employed) might be able to get a grant of up to 80 per cent of our profits, which is taxable, up to a maximum of £2,500 per month – but not until at least the beginning of June, more than two months from now.

Oh, but we can claim Universal Credit in the meantime – except we can’t, because thousands upon thousands of people are queuing online and on the phone and the Department for Work and Pensions simply can’t cope with the deluge. We will lose valuable time just trying to announce that we want to claim, and even more in the processing of that claim.

Employees of companies who signed up to the government’s scheme for them can get their money straight away. Why not the self-employed?

Is this some back-handed attack on people who actually contribute to the economy on their own initiative?

Here’s a visual representation of the way Sunak and the Tories expect us to live:

It has already attracted flack.

Shadow Chancellor John McDonnell said the delay was unacceptable: “If people cannot get access to the scheme until June it will simply be too late for millions. People need support in the coming days and fortnight. Asking people to rely on Universal Credit when more than 130,000 people are queuing online will be worrying to many people, so there is a real risk that without support until June the self-employed will feel they have to keep working, putting their own and others’ health at risk.”

Stephen Timms, chair of the Commons Work and Pensions Committee, pointed out that a wait until June simply isn’t practical: “Few will have enough in the bank to tide them over until then, so they’ll have to rely on Universal Credit in the meantime. The Committee heard yesterday that that system is already buckling under the pressure of half a million new claims. The Government must now do all it can to shore it up, so people get the money they need, and quickly. And the Advance, payable up-front to those who need it, should be made non-repayable.”

Sunak said devising a scheme had been “difficult” and it would be “operationally complicated” – but this has attracted no sympathy from anybody who knows anything at all about it.

It’s the biggest advert for implementing a Universal Basic Income scheme – in which everybody will receive enough money to support them, regardless of their circumstances – that the public could be shown.

Sunak and the other Tories have squirmed and dissembled and eventually brought forward scheme after scheme that is incredibly complicated – which means they are likely to go wrong, to the detriment of the people they are supposed to be helping.

UBI is simplicity itself – and has a lot of support:

UBI – it’s simple, it’s popular, and it’s immediate. But Sunak wants to bring in something complicated, slow (if it actually happens at all) and discriminatory. Why not get in touch with him and tell him which you would prefer?

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By discriminating against the self-employed, Sunak is risking coronavirus spread

Rishi Sunak: Why is he discriminating against the self-employed?

Tory Chancellor Rishi Sunak is under pressure to stop discriminating against people who are self-employed – because he putting them at risk of spreading the coronavirus.

Sunak has announced a generous deal for employees who are ‘furloughed’ – kept in employment but unable to work because of the disease-related lockdown – of 80 per cent of their wages, up to £2,500 per month.

Self-employed people get just £94.25 a week in Universal Credit – if they can navigate the “byzantine” application procedure. And they’ll have the same if they have to claim Employment and Support Allowance after contracting the virus.

Only 16 per cent of workers accept that this amount would meet their basic needs.

It is claimed Sunak is risking public health by discriminating against the self-employed in this way, because he is incentivising self-employed taxi-drivers, couriers, other gig economy workers and zero-hours contractors to keep working while ill.

Solicitors Leigh Day were to send a pre-action letter to the government on March 23, on behalf of the Independent Workers of Great Britain union, ahead of issuing proceedings for a High Court judicial review.

The Tories say it is “operationally very difficult” to put in place a scheme for the self-employed, similar to that for employees.

But the Association of Independent Professionals and the Self-Employed (IPSE) says it could be assessed and delivered through the self-assessment tax system that millions of self-employed workers already use.

One thing is certain: the longer this drags on, the more self-employed people will be at risk.

And the more self-employed people come under threat, the more likely it will seem that this is the Tories’ intention.

Source: Rishi Sunak under pressure to bail out self-employed | Politics | The Guardian

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Sajid Javid helped cause the UK’s financial crisis. Why did BoJob make him CHANCELLOR?

I’ve had great fun using this picture of The Collector from Doctor Who in place of Sajid Javid. It turns out that the fictional character is a more honest villain than the new Chancellor.

I seem to be publishing a series on the uselessness of Boris Johnson’s new Conservative cabinet – so let’s discuss Sajid Javid.

The genius Yorkshireman who runs Another Angry Voice showed us that we all have reason to be angry about his appointment as Chancellor of the Exchequer, only a decade after he helped cause the financial crisis that unleashed a decade of pointless Tory austerity on us all.

Before we go on, let us all remember that there was absolutely no need at all for the Tory cuts to public services that we have endured. They have not cut the national debt. And the cuts to the deficit are in spite of the reductions in taxation of the rich that the Tories have insisted on making.

So their entire policy for the last nine years has had no point – other than the persecution of people with less money than the so-called One Per Cent.

Now read this:

Before his move into politics Javid was a banker at Deutsche Bank, where he sold complex financial derivatives called Collateralised Debt Obligations (CDOs).

CDOs were economic alchemy schemes designed to turn toxic bad debts into fake gold-plated investments.

The whole thing defied economic logic… they were junk investments that were bound to implode sooner or later.

If we’re charitable to Javid, then we could argue that he was a clueless dupe, naively selling a load of toxic junk in good faith simply because he was too stupid to investigate the products he was actually selling, and so poorly connected within the CDO industry that he was unaware of the open secret amongst his peers that the products he was selling as safe investments were actually bound-to-fail financial Weapons of Mass Destruction.

The other explanation is, of course, much worse. If Javid was smart enough to realise that the CDOs he was selling were bound-to-fail junk, and he was in on the open secret within the trade that they were certain to implode one day, yet he carried on selling them as safe investments to oblivious customers like other banks, pension funds, local and national governments, and insurance funds as low-risk investment opportunities, then he’s a cynical and duplicitous fraudster.

It’s an excellent argument that Mr Javid is unfit to be Chancellor of the Exchequer. Indeed, it seems shadow chancellor John McDonnell has used it as the basis of his own argument that his appointment is inappropriate … but that is not the subject of the article you are reading now.

So, given that Mr Javid helped cause the crash, why did Boris Johnson make him Chancellor?

In the light of Mr Javid’s record, and of the Tories’ financial policies since May 2010, it seems clear that Mr Johnson sees him as the perfect man to keep those policies going.

Source: Sajid Javid is totally unfit to be Chancellor of the Exchequer

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The Autumn (non-) Statement: Why have there been so few howls of outrage in response?

Over a cliff: The Brexit bus, with all its claims of a new Golden Age for the UK, teeters on the edge. Boris Johnson, in the driver's seat, says: "Boys? I've got an idea."

Over a cliff: The Brexit bus, with all its claims of a new Golden Age for the UK, teeters on the edge. Boris Johnson, in the driver’s seat, says: “Boys? I’ve got an idea.” Then Philip Hammond walks up and pushes bus, Boris and Britain over the precipice.

Probably because there are very few people around with the economic expertise to know that outrage is the proper way to respond.

Philip Hammond’s Autumn Statement – his first real contribution to UK politics as Chancellor of the Exchequer – was a long admission that the Conservative Party has ruined the country, hidden behind an attempt to blame it all on Brexit.

No, Philip; your party’s policies are responsible.

So it seems the UK is going to have to borrow an extra £59 billion – just to cover the cost to the country of Brexit.

This means the claim on the side of the famous red Brexit bus, that we could put £350 million a week into NHS services was definitely a lie. Let’s not beat around the bush any more – it was a lie and the people who made that statement are liars who cannot be trusted with anything.

Oh – but Boris Johnson, one of the arch-liars, is now Foreign Secretary and has a huge responsibility to deliver the best possible exit from the European Union for the population of the UK. Honestly, how do you think that’s going to work out?

We now know there will be less money available for the NHS and other public services than before, due to lower productivity growth (because foreign countries aren’t buying from us) and – yes – lower immigration.

Your wages and prosperity will suffer like never before, because of this. But I bet your right-wing neighbour still thinks immigrant-bashing is a worthwhile activity.

Paul Johnson, of the Institute for Fiscal Studies, has said, “One cannot stress enough how dreadful that is.”

And all as a result of the vote for a Conservative Government last year.

It is worth emphasizing, as many commentators have, the almost-complete failure to mention the National Health Service or provide any more money for it, even though it is in a funding crisis of horrifying proportions. Mr Hammond says announcements about extra funding for the service have already been made, ignoring the fact that his government has not provided enough.

Perhaps one reason for this is the pitiful increase in public investment announced by Mr Hammond, at a time when interest rates are at an all-time low. There will never be a better time to borrow money and invest it in the UK’s infrastructure, but instead we’re getting 0.3 or 0.4 per cent of GDP, in each financial year leading up to 2020 – slightly more than from New Labour in the years before the financial crisis.

This tells us – although Mr Hammond will never say it aloud – that the Conservatives are continuing their squeeze on public services, started back in the dark days of the Coalition Parliament. One might say it is all part of the plan to take everything away from public hands, as started by Margaret Thatcher and her cronies back in 1979 – if only one had the experience and understanding to see that far.

There’s more – we could discuss the hidden policy not to increase fuel duty, that throws out all the economic predictions but gives the Tories a favourable headline in their poodle press; or we could mention the new fiscal rules which set the scene for panic cuts in public investment as we approach the now-fixed (rather than rolling) date for the deficit to be cut back to a new level set by Mr Hammond.

But it is all too depressing, really.

Someone recently said that, with a May as prime minister and a Hammond as chancellor, all we need is a Clarkson for the UK’s government to emulate the former Top Gear presenting team, now relegated to internet TV on their Grand Tour. It is true that Clarkson once considered standing in the 2015 election.

Some might consider that a good idea – a brand behind which to market the UK’s flailing government.

But let’s be honest: Clarkson, Hammond and May were successful because they presented themselves as three petrol-headed idiots.

With May, Hammond and Boris Johnson in the UK’s driving seat, we don’t need any marketing.

We already know they are idiots. Sadly, we also know that their calamities won’t just be television entertainment – we’ll have to live with the consequences.

But the response to the Autumn Statement has been muted. Some have even claimed that John McDonnell was wrong to challenge it by demanding more investment.

This is because we do not – as a nation – know enough about economics. Otherwise we would be on the streets in front of Parliament, right now, demanding a change of direction – or a change of government.

Source: mainly macro: 2016 Autumn Statement

Osborne’s ‘no gimmicks’ budget: How much can we trust?

What hope would the UK have if THIS man continues as Chancellor of the Exchequer after the general election?

What hope would the UK have if THIS man continues as Chancellor of the Exchequer after the general election?

George Osborne will deliver his final budget of the current Parliament on Wednesday and – if it proves to be the last he ever gives – it won’t be a moment too soon.

Ever since his ’emergency’ budget of 2010, which ended the economic growth created by Labour’s Alistair Darling and ushered in three years of economic flatlining, we have had to endure an unending stream of nonsense from this chancer-among-chancellors, this most mini-among-ministers, this least-treasured Treasurer.

Today we heard that he is again attempting to bribe pensioners into voting Conservative, with a plan that encourages them to take out their defined contribution pension annuities for a lump sum – which, it seems likely, will then be used up in short order, leaving the pensioner to fall on the mercy of the state.

It seems to be more short-termism – getting senior citizens to spend, in order to create a minor boost to economic activity now, while storing up problems for the future.

Osborne says no, and told the BBC that it was “patronising” to suggest people might blow the money on an expensive sports car, then come back for more when they ran out of cash.

This is from the Chancellor who, prior to the financial crash, told Gordon Brown repeatedly that bankers could be trusted to run their businesses unregulated; and who, once in government, based his entire economic strategy on a theory that has since been comprehensively trashed.

The Guardian has listed a few more claims that Osborne might make in his Budget speech, along with the counter-arguments. We shan’t bother with the arguments in support of him here – let’s skip to the good parts. Here are the claims – and their debunkings:

The Government’s plan is working – Deficit reduction has been much slower than Osborne forecast five years ago. In his first budget, in June 2010, the chancellor predicted that he would need to borrow £37bn in 2014-5 and that tax receipts would cover day-to-day government spending. The actual figure will be almost three times that, and, when adjusted for the state of the economy, the 2015 budget deficit is expected to be higher than any other EU country barring Croatia, according to Investec.

Britain has the fastest-growing economy in the G7 – Osborne’s account of his stewardship is partial and misleading. It ignores the first two years, in each of which austerity measures knocked one percentage point off growth, resulting in a flatlining economy. Britain’s recovery from the 2008-09 slump has been the weakest of any in the past 100 years, slower even than the bounce back from the Great Depression of the 1930s. Real wages have at last started to rise as a result of falling inflation, but incomes per head are on average the same now as they were in 2006, before the financial crisis. Business investment has fallen for the past two quarters, and the current account deficit is higher than ever, at 6% of GDP.

We are helping hard- working people by raising tax allowances – Raising the personal allowance is not a well-targeted way of helping the low paid because it helps earners further up the income scale as well. Britain’s low-pay culture means millions of workers don’t earn anything like £10,600 a year. As a result, Osborne is thought to be toying with the idea of raising the threshold for employee national insurance contributions, which is effectively another form of income tax but kicks in at a lower level.

We will ease back on austerity while sticking to our deficit-cutting target – Even after a trim, Osborne’s cuts programme will still look drastic. Labour will argue that he is taking too much of a risk with economic growth and jeopardising essential public services.

We will launch a new crackdown on tax evasion – This is too little, too late, and many of the perks that help the super-rich avoid tax – including non-domiciled tax status – remain in place. Meanwhile, the Conservatives are under fire for appointing former HSBC chairman Stephen Green as a trade minister, apparently without checking his possible involvement.

Feel free to copy out the above and check it against Osborne’s speech on Wednesday.

One thing is certain – it will contain nothing that should persuade you to vote Conservative in May.

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Will the submarine chancellor surface to talk about tax dodging?

Another Tory crook?

Another Tory crook?

It seems the Tories have nowhere to hide today – now Labour is piling on the pressure over tax dodging and the HSBC scandal.

Ed Miliband suggested the government had “gone into hiding” over the issue at his question and answer session in the West Midlands earlier today, and now Chris Leslie, Labour’s shadow chief secretary to the Treasury, has stepped into the fray.

“We’ve now had a week of silence from George Osborne – the submarine chancellor still hasn’t surfaced,” he said.

“It is time he and David Cameron finally started answering questions about HSBC and Lord Green… In this row over tax evasion David Cameron and George Osborne are now guilty of political evasion.”

Earlier, Mr Leslie had said: “We need a full and frank statement from Lord Green explaining what he knew about what was happening while he was in charge of HSBC.

“There are also mounting questions for ministers, which continue to go unanswered. Did David Cameron and George Osborne discuss tax evasion at HSBC with Lord Green? The Prime Minister failed to answer this four times in the House of Commons.

“Why did they appoint Lord Green as a Tory minister months after the government received these files? Why have we only had one prosecution out of 1,100 names? And why did George Osborne and the Treasury sign a deal with the Swiss in 2012 which prevents the UK from actively obtaining similar information in the future?

“It is time we finally had answers from David Cameron and George Osborne.”

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