External Affairs

Panama Papers Fallout Weakens Cameron, Gives Labour a Boost

The British prime minister is one of the hundreds of political figures and high profile individuals under scrutiny following the leak of the Panama Papers. Exactly what are the accusations against Cameron and what impact have they had? 

Avoiding the question of future benefits

David Cameron has been left “dangerously exposed” by the fallout from the Panama Papers, according to the Guardian. A fact not helped by his inability to provide straightforward answers to questions surrounding his links – past, present and future – to his father’s offshore investment fund.

Accused of being “tight-lipped”, Cameron had initially very little to say on the revelations that his father’s Bahamas-based company, Blairmore Holdings Inc., had avoided paying UK tax dues for 30 years. Addressing the question of his own ties to the fund for the first time yesterday, Cameron stated:

In terms of my own financial affairs, I own no shares. I have a salary as prime minister and I have some savings, which I get some interest from and I have a house, which we used to live in, which we now let out while we are living in Downing Street and that’s all I have. I have no shares, no offshore trusts, no offshore funds, nothing like that. And, so that, I think, is a very clear description.

However the answer did not satisfy the British media as David Cameron failed to explain if any of his family members have benefitted from the fund in the past or stand to do so in the future. As a result, the top headlines in the British press yesterday included, “Cameron ducks question about benefiting from offshore trust,” and, “David Cameron is forced to deny he gets any income from his late father’s tax haven.”

On Wednesday, Downing Street issued a statement to further clarify that Cameron’s wife and children “won’t gain from offshore funds in future,” finally addressing the question over what the Camerons stand to gain from their links to the Bahamas investment fund in the long-term.

Scrutiny has also fallen on UK Chancellor George Osborne, who faced questions this morning from Sky News seeking to establish if he benefitted from any offshore investment funds. Boris Johnson, another high profile member of the Conservative Party, has so far avoided accusations and has defended his long-term friend, the prime minister, calling the allegations “absolute tripe”. 

Accusations of hypocrisy

Cameron has also faced criticisms of being a hypocrite for the way he has handled the allegation surrounding his father’s offshore funds. His official spokeswoman originally declined to comment on the subject, saying they were “a private matter”. This comes in spite of the fact that Cameron has publicly condemned individuals in the past who have participated in tax evasion, an activity he called “morally wrong”. Edward Snowden, the National Security Agency whistleblower, ridiculed Cameron for his double standards tweeting, “Oh, now he’s interested in privacy.”

On the issue of privacy, opposition leader Jeremy Corbyn was quick to tell the press: “Well, it’s a private matter in so far as it’s a privately held interest. But it’s not a private matter if tax is not being paid. So an investigation must take place, an independent investigation, unprejudiced, to decide whether or not tax has been paid.”

The evasive attitude of the prime minister towards the topic of his personal interests also contradicts his claim that his government has done more to crack down on tax avoidance than any other and his intention to host an anti-corruption summit in London in 2016.

Opportunity for the opposition

For Labour, the allegations against Cameron have presented an opportunity to attack the Tories. An article in the Independent has described Corbyn capitalising on the situation, calling for ministers to publish their tax returns and for the government to force the UK’s overseas territories and crown dependencies to comply with British tax law.

The most recent press release from Downing Street stating that the PM’s family do not have any offshore accounts and do not stand to gain from Blairmore, does not satisfy members of the opposition. Writing for the Guardian, John Mcdonnell, the shadow chancellor, has said that the Prime Minister’s needs to be more specific about the origins of his savings. Mcdonnell writes:

David Cameron, for example, says he has “some savings” from which he “derives some interest”, but does this mean any of his “savings” come or have come from Blairmore or any offshore tax arrangements at any time? He should just put the record straight rather than try to wriggle around, fooling no one.”

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