Friday, March 19, 2010

Lord Ashcroft affair: Pressure builds on Hague over secret non-dom deal.

William Hague is coming under fresh pressure over the Ashcroft affair as newly released papers suggest that he was well aware of the deal which granted Ashcroft non-dom status, despite Hague's persistent claim that this was something he only became very recently aware of.

Hague, the former leader of the Conservative party who had been lobbying for the billionaire to secure a seat in the House of Lords, has repeatedly insisted that he was only told earlier this year that Ashcroft was a non-dom, and therefore not paying full UK tax on all his earnings.

But previously confidential parliamentary correspondence published today showed that Hague's chief whip, James Arbuthnot, was instrumental in lobbying for Ashcroft not to have to give up tax privileges on his massive overseas earnings – despite assurances given by Hague that he would pay "tens of millions" to the Treasury.

The papers also include a letter from Arbuthnot which suggests that Hague was fully aware of the deal between the Cabinet Office and Ashcroft.

If this is true, and I have no way of knowing at this point whether or not it is, then Hague would have been lying publicly about this for the best part of a decade.

The correspondence released today by the public administration committee revealed for the first time that Arbuthnot was deeply involved in the negotiations that led to the downgrading of Ashcroft's undertaking.

Arbuthnot, who was said to be acting as an intermediary for Ashcroft, insisted that the billionaire – under the terms of the assurances he had given – could take up his seat in the Lords despite not being domiciled in the UK for tax purposes.

Sir Hayden Phillips, a senior civil servant, eventually agreed with Arbuthnot in July 2000 that Ashcroft needed only to become a long-term resident in order to comply with the undertakings he had given. In turn, Arbuthnot replied within hours, saying: "I confirm that I agree with your understanding of the position." He added: "The leader of the opposition is satisfied that the action adequately meets the terms of Michael Ashcroft's undertaking to take up permanent residence in the UK."

It is that last sentence which raises questions for William Hague to answer. He was the leader of the opposition in July 2000. And Arbuthnot is implying that he was fully informed of the deal being made between himself and Sir Hayden Phillips.

Hague has denied that he was aware of the deal which was struck and is insisting that he delegated the entire matter to his chief whip.

It does, however, become increasingly hard to believe that in the decade which followed - despite repeatedly being asked in public about this - that Hague never once had the intellectual curiosity to ask whether or not Ashcroft had actually complied with the promises he had made on his behalf.

Indeed, it would have made his life much easier to ask Ashcroft, if only so that he could have batted away the kind of questions which Paxman grilled him on in this clip.

Hague is continuing to insist that he didn't ask Ashcroft the burning question, despite the publication of Arbuthnot's letter which appears to imply the opposite.

The foreign secretary David Miliband said that the letters proved that Hague was "intimately" involved in the process. He said: "It is now clear there has been a decade of deception at the top of the Conservative party and I repeat my call … that David Cameron sacks Lord Ashcroft."

Hague's version of events is hanging on a very wobbly hook. And one has to be willing to give him an awful lot of the benefit of the doubt to conclude that his version of events is even remotely credible.

Click here for full article.

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