Sunday, September 30, 2012

Nick Clegg gives comfort to Channel Island tax havens

The slogan for last week's Liberal Democrat Conference was “Fair taxes in tough times", but you wouldn't have thought that if you heard Nick Clegg's interview with BBC Guernsey:
"There are lots of regulatory debates about exactly how the financial sector operates in the Channel Islands, but it's a great plus for us in the UK."
His remarks were seized upon by the cliques that rule Jersey and Guernsey, and the tone of the commentary on the accompanying video goes some way to justifying the arguments of those who see BBC Jersey and Guernsey as a sort of Pravda of the English Channel.

And if you read a a 2008 article from the Daily Telegraph by Gordon Rayner you will see that these islands serve as a good model of the sort of society we Liberal Democrats want to avoid on the mainland:
Just why, on a such a small and supposedly idyllic island, did so many hundreds of children end up in care homes? 
The answer lies in another little-publicised fact about Jersey - its unexpectedly high level of poverty, which brings with it the sort of social problems that lead to children being taken into care. 
Although Jersey, with its £250?billion financial industry, has the second-highest gross domestic product per capita in Europe, the island's wealth is largely held by the privileged few. Some 13,000 people - more than one in seven - live in social rental properties, Jersey's equivalent of council houses, and half of all households suffer from one or more of the internationally recognised measures for relative poverty. 
The crumbling 1960s council estates of St Helier are testament to the years of neglect. Rusting cars rot on rubbish-strewn drives, windows have bedsheets for curtains and the paint is peeling off walls and doorframes. "This place is run by the finance industry for the finance industry," says one resident. "Anyone else just doesn't count."
There are those in the Liberal Democrats who have a cooler view of the tax evasion industry. Listen to Vince Cable on the same video or read Danny Alexander:
“Fair taxes in tough times means everyone playing by the same rule book, and everyone paying their fair share,” he is expected to say. 
“We have this message to the small minority of wealthy people who don’t play by the rules: we are coming to get you and you will pay your fair share.”
Nick ingenuousness is endearing, and as deputy prime minister you have to be polite about all sorts of people whom you don't much like, but I do hope he does not make a habit of championing these grubby little tax havens.

And I also hope the fact that the Liberal Democrats' largest donor is based in Jersey will have no influence on our view of the question.

1 comment:

Richard T said...

Strange isn't it? We seem incapable of finding the time and effort to reform all the tax havens directly and indirectly controlled by the UK. It is the same lack of spirit that leaves plutocratic and aristocratic landowners untaxed on their land holdings and worse, given enormous amounts in subsidy to keep them happy. To me the one argument against wind turbines is that they are another form of pouring money into the pockets of landowners.

It of course cannot be that the old corruption at the heart of the British polity is holdig back change?