Tag Archives: observer

Another Tory ‘bait-and-switch’ scam – shares-for-rights scheme is employers’ tax dodge

shares-rights-tax

“This government is taking action domestically on [tax] avoidance and evasion,” wrote George Osborne in an article for The Observer, back in February. How right he was.

The Tory-led Coalition has done everything in its power to facilitate tax avoidance and ignore evasion, it seems, including the latest wheeze, which is to link it with a feeble attempt to get working people to throw away their rights in exchange for a few shares.

The BBC has reported that the new status of “employee shareholder” has come into force, allowing working people to claim shares in the company that employs them, if they give up the rights to claim unfair dismissal and statutory redundancy pay, the right to request flexible working (except in the case of two weeks’ parental leave), and some rights to request time off for training.

Nobody in their right mind would do this and expert opinion is that take-up will be small. So why do it?

Well, it’s not about the workers at all. It’s about helping company bosses avoid paying their taxes. Even the right-wing-leaning BBC was unable to cover up the facts (although it left them until the end of the article):

“Companies can also claim some corporation tax deductions on the issuance of shares to employees.”

Yes – it’s a tax dodge!

Here’s how it works, according to the Mirror: “New analysis show[s] it could also allow executives to avoid paying revenue on company shares. Tax experts commissioned by the TUC believe ruthless bosses could classify themselves as ’employee owners’ to escape Capital Gains Tax. And the Office for Budget Responsibility estimates the scheme could cost up to £1 billion, mainly due to tax avoidance.”

This will, of course, involve a drop in tax income to the Treasury, meaning increases in the national debt and deficit, which the Tories will no doubt use to justify further cuts to public service budgets as part of their ‘Starve The Beast’ agenda. Remember, this country has a chancellor who, for ideological purposes, actually wants to harm the British economy.

Meanwhile, as our friend at Another Angry Voice has put it: “If you’re thick enough to cash in your labour rights for a few grand worth of shares in the company you work for, then in a couple of years time when people are calling you ‘feckless’ for being unemployed, you’ll be one of the minority that actually deserve it (and your shares might well be worth only pennies in the pound compared to the value they had when you scrapped your labour rights to get them).”

Gauke’s attack should be a rallying cry for Labour

Another fool who doesn't think before speaking: David Gauke, pictured here with jaws clamped shut in a desperate attempt to prevent his foot from leaping into his mouth. It would serve him right if his ill-judged attack on a Labour MP brings the entire party and all its supporters together for a concerted attack on the Conservative-led coalition's silly and baseless policies.

Another fool who doesn’t think before speaking: David Gauke, pictured here with jaws clamped shut in a desperate attempt to prevent his foot from leaping into his mouth. It would serve him right if his ill-judged attack on a Labour MP brings the entire party and all its supporters together for a concerted attack on the Conservative-led coalition’s silly and baseless policies.

Tory Treasury tax-avoidance fan and whistleblower-basher David Gauke’s attack on the Labour Party is yet another shot in the foot for the Government That Can Do Nothing Right.

His ill-judged, ill-timed remark that Labour MPs were “turning on each other” is more likely to galvanise Her Majesty’s Opposition into more co-ordinated and powerful attacks on Coalition ideology and incompetence – especially after we learned the Tory claim that they inherited an economic mess from the last Labour government was nothing more than a blatant lie.

“They don’t really have anything to say and they’re now turning on each other and I think their own backbenchers are beginning to realise that the Labour leadership haven’t really got a voice,” Gauke told the BBC in response to a piece by Labour’s Swansea West MP, Geraint Davies, in The Independent.

In doing so, it seems Gauke was trying to distract attention from what Mr Davies was actually saying – which is worth repeating here, because it is likely he speaks for a huge majority of Labour members who are becoming increasingly frustrated by the contradictory and self-defeating behaviour of their leaders.

So what does Mr Davies say?

First: “The electorate doesn’t yet see a clear choice between the parties on cuts vs growth.” This is because Labour has promised not to reverse Conservative-led ideological cuts and to keep spending at Tory-set levels for 2015-16, if returned to office at the general election – even though the Conservatives have decisively lost the argument on austerity. It simply isn’t necessary.

Second: “The Tories have been relentless in asserting that Labour messed up the economy. Not rebutting this charge makes us look like a shamefaced schoolboy admitting responsibility by omission.” Mr Davies makes a second good point here – more so because, as William Keegan reported in Sunday’s Observer, the spring issue of the Oxford Review of Economic Policy exonerates the last Labour government of any economic wrong-doing. Gordon Brown and Alistair Darling did the right thing – and it is worth reminding everybody that the Conservatives, at the time, supported their actions. That was when the Tories were led by – who’d have thought it? – David Cameron and George Osborne, just as they are now!

The Observer article went on to note that US Treasury Secretary Jack Lew has also endorsed the Labour government’s actions in his recognition that demand in our economies must be stimulated. Conservative-led Coalition policy has drained demand away. This is why the smart commentators are pointing out that the unforeseen upturn in the UK economy in recent months has nothing to do with government policy; it’s just that things had to get better, sooner or later.

Third: He puts up his opinion – that a Labour government should boost the UK’s productive capacity “by linking industry, universities and councils. We need a sharper focus on the growing export opportunities to China, India, Brazil and Russia. We must invest in homes and transport, use public procurement as an engine to grow small and medium-sized firms…. We need to continue a journey towards jobs and growth, not to be diverted into a cul-de-sac of more cuts.”

The last comment dovetails perfectly with the attack launched by Labour this week on the Coalition’s record – which claims the average worker will have lost £6,600 in real terms between the 2010 election and that due to take place in 2015.

Paraphrasing former Tory PM Harold Macmillan, Labour said many workers had “never had it so bad”, pointing out that David Cameron has presided over a more sustained period of falling real wages since 2010 than any other prime minister in the past 50 years.

The Tories’ only response has been to repeat the lie that the Coalition was clearing up a “mess” that we all now know for certain Labour neither created nor left.

Conservative business minister Matthew Hancock was the one voicing it this time, so voters in his West Suffolk constituency please note: This man is a liar. You must not trust him.

And of course David Gauke weighed in as well. He’s the minister in charge of tax – who was revealed to have worked for a firm specialising in tax avoidance. Do you trust him? He’s also the minister who reportedly green-lit a plan to discredit Osita Mba, a solicitor with HM Revenue and Customs, after he blew the whistle on the notorious Goldman Sachs “sweetheart” deal that wrote off millions of pounds in interest charges on tax owed to the UK Treasury by the multinational corporation. A trustworthy man?

David Gauke is the MP for South West Hertfordshire. Voters there may wish to reconsider their opinion of him.

What these chuckleheads are missing is the fact that Mr Davies is not a lone voice in the wilderness; his article expressed the opinions of a wide majority of Labour members and voters.

And it cannot be coincidence that only a day after his Observer article appeared, veteran Labour MP Michael Meacher weighed in on his blog with a few opinions of his own about what Labour’s leaders should be saying.

“Will the Labour party declare it is opposed to zero hours contracts and will end them?” he wrote (perhaps after reading the Vox Political article on that subject).

“Will it show it is opposed to blacklisting by making it an imprisonable offence, prosecuting the 44 companies who indulged in it if convicted, and making it sure that all the 3,213 building workers secretly subject to blacklisting are informed of the cause of their up to 20 years’ joblessness and fully compensated? Will it say loud and clear that a decade of pay cuts for those on the lowest incomes is flagrantly unjust when the 0.01 per cent richest have not only not paid any price, but have seen their wealth continue to grow untouched?”

This is the sort of fire Labour members and voters want to see from the leaders. There is nothing to fear from tissue paper-thin Tory arguments and outright lies. It is time to stand up for Labour principles, damn the Tories for their evil, damn the Liberal Democrats as fools and dupes, and set out a plan to get the ship of state off the rocks and into calmer waters.

If Ed Miliband, Ed Balls, and the rest of the Labour front bench have any sense, they’ll realise that continuing with the course they have set will put them in a tiny minority that cannot possibly hope to win the next election. Alignment with Geraint Davies, Michael Meacher and the millions like them should ensure an overwhelming victory.

It isn’t even a choice, is it?

Iain Duncan Smith’s shirkers and scroungers: Soldiers, teachers and nurses

 

David Cameron, pictured in the Telegraph article: "I want to go on," he says, neglecting to add, "harming the honest, the hard-working, the strivers and the tryers of the UK. I want to go on rewarding the tax-dodgers, the bankers, the exploiters and Parliamentary scroungers. I want to go on deceiving the easily-led into believing that my way is the only way, and duping my Coalition partners into supporting my extreme right-wing policies until I can sling them into the gutter in 2015". Does that seem about right to you?

David Cameron, pictured in the Telegraph article: “I want to go on,” he says, neglecting to add, “harming the honest, the hard-working, the strivers and the tryers of the UK. I want to go on rewarding the tax-dodgers, the bankers, the exploiters and Parliamentary scroungers. I want to go on deceiving the easily-led into believing that my way is the only way, and duping my Coalition partners into supporting my extreme right-wing policies until I can sling them into the gutter in 2015”. Does that seem about right to you?

Apparently ‘Compassionate Conservatism’ doesn’t extend to people in certain professions.

According to a new analysis by The Children’s Society published in The Observer, almost half a million soldiers, teachers and nurses will lose hundreds of pounds every year when the Coalition’s latest benefit cut comes into force.

The cap of one per cent on benefit and tax credits upratings over the next three years means up to 40,000 soldiers will be worse-off: A second lieutenant in the army with three children, earning £470 a week and whose wife does not work will lose £552 per year.

Around 150,000 primary and nursery school teachers will lose out: A couple with two children where the sole earner is a primary school teacher earning £600 per week will lose £424.

But the majority of losers in the professions will be nurses – 300,000 of them. A lone-parent nurse with two children, earning the profession’s average of £530 per week, will lose £424 per year.

For a government that likes to state “We love the NHS”, the Coalition seems to really enjoy attacking nurses and trying to cover it up. By December 13 last year, 7,134 nursing posts had been lost since the Coalition came into power, 943 in the previous month alone. But when the issue was raised in Parliamentary debate, Health Secretary and gynaecological slang-term Jeremy Hunt did his level best to avoid giving a straight response. “The nurse to bed ratio has gone up. The average bed is getting an extra two hours of nursing care, per week, than under Labour.” That didn’t tell us how many nurses had lost their jobs. So we got: “The number of clinical staff in the NHS has gone up and not down. I don’t want to micro-manage every hospital in the country and tell them how many doctors and how many nurses.”

Perhaps there’s some deep-seated childhood trauma affected all the members of the Coalition government, that makes them want to persecute nurses and then try to cover it up? Whatever the case, I’m sure the facts would form the skeleton of a terrific little crime thriller.

Don’t be fooled by the fact that the government will be debating an increase of one per cent in benefits this year. With inflation at 2.7 or 3.2 per cent, depending on which system you use, that’s a real-terms cut of two per cent every year for the next three years.

I’d like to draw your attention to the fact that these figures were compiled by The Children’s Society, meaning they relate only to working parents. The one per cent cap on benefit rises will hit single working people as well – we just don’t have the figures for them yet.

The figures make a nonsense of Iain Duncan Smith’s increasingly desperate claims that his policy of cuts and persecution to achieve lower take-up of welfare benefits is fair.

The Tories have now alienated working people and those on benefits. Who’s next, do you think? I reckon pensioners had better prepare for the worst!

Remember last week, when he trotted out a roll of fabricated figures to make it seem that the tax credit system had run out of control under Labour (tax credits are among the benefits to be capped at one per cent)? It turns out that all his figures were wrong, with his claims about fraud – which stands at less than one per cent of total claims – spectacularly inaccurate.

How about the very next day, when he was dribbling about the relative percentage rises in Jobseekers’ Allowance and private sector salaries, claiming that the unemployed were getting a far better deal than workers – only to be rebuffed when we all checked how much this was in real money, found out that workers were still making far more (although not enough – remember many employers pay so little that people working full-time still have to claim state benefits, so that’s a subsidy for private companies, being paid out of our taxes). The amount paid in benefits as a proportion of average wages has stayed the same, as it should. The Work and Pensions Secretary is hell-bent on breaking that link in order to inflict real harm on Britain’s poorest.

Does anybody remember the Tory slogan “Broken Britain”? What they didn’t tell us was that they were the ones who wanted to break us!

And now David Cameron has told the Telegraph he wants to be Prime Minister for another full term, from 2015 to 2020. If he manages that feat, he will no doubt face pressure from some of his own cabinet members to inflict further harm on those receiving benefits.

For example, a group of 70 Tory MPs including Michael Gove and David Willetts have published an agenda of policies that one minister has already – according to the Torygraph – described as a “blueprint” for the party’s next general election manifesto.

It includes plans to lengthen the school day “to help working parents” – how do you like that, all you teachers who are losing benefits this year? You can rest assured that your pay won’t increase to cover the extra hours!

And it calls for benefits to be cut for people who live in the North, and other parts of the country where the cost of living is lower. They love regional pay, don’t they? And they WILL drive it through, no matter how much of the population oppose it!

For a representative selection of citizens’ opinions about this, I suggest you visit the MSN news site’s version of this story where (when I looked last night) the Comment column was unanimously opposed to Cameron continuing. That’s something like 20-odd pages of people demanding that he be ousted at the first opportunity.

It did my heart good to see that.

The sad truth is that none of the above will change the result of the debate and vote on benefits uprating, due to take place in the House of Commons on Tuesday.

As long as the Tories have the support of Nick Clegg’s Liberal Democrats, they have a majority and can vote through any ludicrous and harmful policies they please.

The only thing I can suggest is that you all email your MPs in advance of the debate and put pressure on them to do the right thing – or account for their decision if they vote with the government – especially if you live in the North, or in rural areas!

As ever, you can find your MP’s contact details here: http://www.parliament.uk/get-involved/contact-your-mp/

Follow me on Twitter: @MidWalesMike

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