Leading article: A shameful tax avoidance culture


Related Topics

It was bad enough when it was only Ed Lester, the head of the Student Loans Company, who was enjoying lower taxes thanks to his being paid as a private contractor rather than a government employee. The implications grew darker when the Department of Health was forced to admit that two dozen of its senior staff were also pulling the same stunt. Only now, after a much-needed Whitehall-wide review, is the full extent of the rot revealed – and it should make both the non-mandarins themselves, and those who waved through their advantageous arrangements, blush with shame.

That there are no fewer than 2,400 civil servants being paid "off payroll" – more than two-thirds of whom have been in their jobs for upwards of two years – is wrong in every conceivable way. First, there is the cost to the public purse. Although there is no reason to believe that these people are not paying all that is required from them as contractors, the exchequer may be losing as much as £30m each year thanks to their disingenuous status. Then there is the question of governance: it is hardly in the best interests of an organisation for executive staff to be freelance.

Most compelling of all, however, is the moral argument. At a time of unprecedented spending cuts, with welfare reforms biting chunks out of benefits payments and salaried government workers striking over pay and conditions, it is neither just nor politic for Whitehall to be turning a blind eye to the tax avoidance ploys of some of its most expensive staff.

Danny Alexander – the Treasury Chief Secretary who commissioned the review – is trying to regain the initiative for the Government, launching a consultation on new tax rules for "personal service companies" and pledging to tighten up off-payroll appointments before the end of the year. Not a moment too soon.

But the matter cannot end here. So far, there has been no probe into either the NHS or local government, where such arrangements may be rife. As the Chancellor has rightly noted, tax avoidance is "morally repugnant". It is up to his Government to ensure that the public sector is setting the example it should.

React Now

Latest stories from i100
iJobs Job Widget
iJobs General

Recruitment Genius: Senior Digital Marketing Consultant

£28000 - £45000 per annum: Recruitment Genius: A Senior Digital Marketing Cons...

Recruitment Genius: Assistant Stores Keeper

£16640 - £18500 per annum: Recruitment Genius: An Assistant Stores Keeper is r...

Recruitment Genius: Claims Administrator

£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

Recruitment Genius: Software Developer - C# / ASP.NET / SQL

£17000 - £30000 per annum: Recruitment Genius: Developer required to join a bu...

Day In a Page

Read Next
Mosul falls: Talk of Iraq retaking the town, held by IS since June, is unconvincing  

Isis on the run? The US portrayal is very far from the truth

Patrick Cockburn
John Rentoul met Ed Miliband aged 23, remarking he was “bright, and put up a good fight for the utilities tax, but I was unconvinced.”  

General Election 2015: Win or lose, Ed Miliband is not ready to govern

John Rentoul
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Russell Brand's interview with Ed Miliband has got everyone talking about The Trews

Everyone is talking about The Trews

Russell Brand's 'true news' videos attract millions of viewers. But today's 'Milibrand' interview introduced his resolutely amateurish style to a whole new crowd
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living
Increasing numbers of homeless people in America keep their mobile phones on the streets

Homeless people keep mobile phones

A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before
'Queer saint' Peter Watson left his mark on British culture by bankrolling artworld giants

'Queer saint' who bankrolled artworld giants

British culture owes a huge debt to Peter Watson, says Michael Prodger
Pushkin Prizes: Unusual exchange programme aims to bring countries together through culture

Pushkin Prizes brings countries together

Ten Scottish schoolchildren and their Russian peers attended a creative writing workshop in the Highlands this week
14 best kids' hoodies

14 best kids' hoodies

Don't get caught out by that wind on the beach. Zip them up in a lightweight top to see them through summer to autumn
Robert Fisk in Abu Dhabi: The acceptable face of the Emirates

The acceptable face of the Emirates

Has Abu Dhabi found a way to blend petrodollars with principles, asks Robert Fisk