Money: Rich irony as Paymaster General steps into minefield

Click to follow
The Independent Online
For journalists at the conference to launch the Government's new Individual Savings Account, the choice of ministers to present the proposals was the sweetest of ironies.

Geoffrey Robinson, the Paymaster General, who has a beneficial interest in an offshore trust worth more than pounds 12.5m in Guernsey, was the one sent in to sell the Treasury's new scheme.

The civil servant chairing the press conference rapidly became fretful. Barely had Mr Robinson sat down than the hostile questions started from the audience.

"What happens if you were saving in a PEP to help pay off your mortgage, Minister? Is the Government really going to renege on tax pledges given to investors by the last administration? How do you square your plans with New Labour's promise of no new taxes?"

In vain, Mr Robinson, the Treasury's very own offshore tax specialist, pleaded that mortgage holders would not be disadvantaged by his Government's proposals. His comment that he did "not wish to discuss this issue" any longer also cut no ice with questioners. "You might not want to, but we do," shouted one journalist.

Of course, the question all the assembled journalists really wanted to ask was: "With your experience of Guernsey-based trusts, would you want to save your money in an ISA? What other tax-saving opportunities could you advise us on?"

Sadly it was not to be. Ignoring a forest of raised hands, the official hastily declared the press conference over.

Michael Heseltine later stepped into the row over Mr Robinson's admission that he had money in an offshore trust. The former deputy prime minister said that when he was a minister he had rejected his accountants' advice to move his assets so he would not pay British taxes on them.

Mr Heseltine, who as owner of the Haymarket publishing group was one of the richest members of the last government, said he felt it would be hard to explain to voters why they were subject to taxes that ministers were avoiding. Speaking in a BBC interview, he said there was nothing inherently wrong with tax avoidance, which was simply minimising the amount paid. That was "perfectly honourable and legitimate", he said. "Tax avoidance, it is argued, is the duty of the citizen."

However, he said that although he had put his money into a trust when he became a minister in order to avoid conflicts of interest he had not accepted suggestions that it should be moved offshore. "I thought it was improper in a minister," he said.