Diary: Blame Thatcher for tax avoidance scandal

 

The startling revelation that some of the highest-paid civil servants have turned themselves into private limited companies to avoid income tax is the latest manifestation of something that began many years ago.

Margaret Thatcher, as we know, believed in inequality of income as a spur to ambition – but 1981, when the UK was in the grip of a recession worse than the current one, was no time to be upping the salaries of people who were already comparatively well paid.

Under pressure to raise MPs' pay, which was not keeping pace with inflation, the Thatcher government introduced the system by which their income was supplemented with generous expenses, thus laying the first seeds of the MPs' expenses scandal.

In yesterday's Yorkshire Post, Mrs Thatcher's former press secretary Bernard Ingham, who was a civil servant, not a political adviser, revealed that her government was also the first to introduce Whitehall mandarins to the bonus culture.

"During the Thatcher years, it was decided to motivate civil servants with filthy lucre," he wrote. "In No 10 they decided that I, as chief press secretary, ought to be incentivised. So I was given a bonus, subject to annual review. I have no recollection of how much it was – so it wasn't much of an incentive – or what it was paid for unless it was for not falling asleep on the job. They kept paying it until I retired."

From expenses that are salary top-ups in disguise and bonuses that do not have to be earned, it is but a short step to manipulating the system to avoid tax.

Jumping the gun on Scots independence

A classic typing error flashed up on screen yesterday as the BBC News channel gave live coverage to David Cameron's speech on Scottish independence. Summing up the Prime Minister's argument in a sentence, the caption read: "Scottish Independence: the United Kingdom is a previous thing." What a difference one letter can make.

Cornwall asserts its ancient rights

Legislation to cut the number of MPs from 650 to 600 at the next election has many opponents, but only one that argues its case by citing a law passed more than 1,000 years ago.

The legislation's rigid arithmetic makes it impossible for Cornwall to have an exact number of parliamentary constituencies, so it will have five and a half, the "half" being a new seat straddling the Cornwall-Devon border.

The Cornish Stannary Parliament, a pressure group claiming to be a revival of the body that administered Cornwall until 1753, has issued a statement warning that this is contrary to ancient law, giving the society no choice but to overrule Westminster. The statement claims: "The national border between Kernow (Cornwall) and Wessex was firmly established to be at the eastern bank of the River Tamar for all time by an agreement between Hywel (King of Kernow) and Athelstan (King of Wessex) in the year AD936."

Argue your way out of that one, Mr Cameron.

Time for PM to show who's boss

Brian Binley, a Tory member of the Commons Business Select Committee, is not pleased with Vince Cable's choice of Les Ebdon, a man he accuses of wanting "to sacrifice academic excellence for the sake of pointless targets and political correctness", as the man who will keep watch over how universities select their student intake.

But his anger, it appears, is aimed not so much at the newly appointed Director of Fair Access, or at the Business Secretary who appointed him, as at David Cameron, for letting them get away with it. "Every bone in David Cameron's body should be screaming out against this ridiculous and dangerous state of affairs," Mr Binley wrote on his blog yesterday.

Mr Binley also issued a press release which contained this ringing insult: "The Prime Minister needs to get a grip and cease leaving the impression that his agenda is determined by the imprint of the last Liberal Democrat who sat on him."

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