Downloading PDF. Please wait... Issue 2787

Offshore wind farms go offshore to avoid tax

Troublemaker looks at the week’s news including tax avoiding companies, money laundering accountants and petrol profiteers
Issue 2787
North Sea windfarm

North Sea windfarm (Picture: SteKrueBe/Wikimedia)

Transmission cables from the 24 offshore wind farms around Britain—which have a combined value of nearly £7.7 billion—are all owned by companies with links to corporate tax havens.

An investigation by The Ferret investigation website has found that five companies which ­part-own the cables have links to either Luxembourg, Guernsey, Jersey or the Cayman Islands.

They are HICL Infrastructure, 3i Group, International Public Partnerships Limited, Equitix, and Dalmore Capital.

Tax experts said that the result could be the loss of “several hundred million pounds” as a result of the arrangements. The firms are part of umbrella groups which won auctions to operate the transmission lines transporting electricity from offshore wind farms to land.

These cables are valuable because their owners are paid even if the turbines they connect to are not ­producing energy.

The only firm to respond HICL Infrastructure, argued that tax haven links “do not impact the amount of corporation tax paid in the UK”.There is no suggestion that any of the companies are breaking the law.

Airlines flying empty flights

In a criminal boost to emissions, major airlines are running thousands of empty or near-empty flights this winter to avoid losing take-off and landing rights at major airports.

Lufthansa operated 18,000 flights this winter that would otherwise have been cancelled due to lack of passengers, including 3,000 flights under the Brussels Airlines banner.

Before the pandemic hit, the rule was that airlines must operate flights in at least 80 percent of their scheduled ­take-off and landing slots, or they risked losing them.

This was revised down to 50 percent after coronavirus broke out. But this still remains much higher than the actual number of flights needed to meet passenger demand.

Bookies win by a furlough

Bookmaker Ladbrokes claimed £102 million from the furlough scheme, despite rapid growth in online betting making up for all losses from the closure of stores.

Accounts published last week showed that Ladbrokes claimed £57.5 million in 2020, and the BBC understands it claimed a further £44 million this year. Since the pandemic began, parent company Entain has actually increased revenues, driven by strong online growth.

Last April’s Grand National broke the record for the biggest online sports betting event in Britain. This meant that despite lockdowns, Entain’s 2020 revenues were unchanged from the year before at £3.6 billion. It even managed to record a profit of £114 million. In the first nine months of 2021 revenues grew 8 percent.

Entain is also well placed to benefit from the explosive growth of online betting in the US through its BetMGM joint venture. Entain said the furlough money protected 14,000 jobs, and is “under review.”

Profiteering fuel rises

Giant petrol retailers stand accused of ripping off motorists by refusing to pass on wholesale price cuts. The RAC motoring organisation said unleaded petrol fell by 2p a litre, but should have come down by 12p.

It said drivers were overcharged by £5 million a day in December as retailers made an average of 16p a litre on petrol instead of the normal 6p. “December was a rotten month for drivers as they were taken advantage of by retailers,” said the RAC’s fuel spokesman, Simon Williams.

In the past, he said, retailers had reduced pump prices when wholesale prices dropped. “This time they’ve taken advantage of all the media talk about ‘higher energy prices’ and banked on the oil price rising again and catching up with their artificially inflated prices, which it has now done,” Williams said.

Mishcon de Reya, supposedly one of Britain’s most prestigious law firms, has been fined for committing “serious breaches” of money laundering rules.
The London-based firm has agreed to pay a fine of £232,500, plus a further £50,000 towards the costs of the investigation, which was carried out by the Solicitors Regulation Authority.

In its decision, published on Wednesday, the regulator said Mishcon de Reya’s conduct had “potential to cause significant harm by facilitating transactions that gave rise to a risk of facilitating money laundering”.

The richest 1 percent of British households have more wealth than the bottom 80 percent of the population. The wealthiest 10 percent have 43 percent of all wealth, the bottom 50 percent only 9 percent.

From the ONS report Household total wealth in Great Britain—April 2018 to March 2020 released last week

Tory peer trousers millions for PPE

Conservative peer Michelle Mone and her husband, Douglas Barrowman are accused of being secretly involved in a PPE business that was awarded more than
£200 million in government contracts after she referred it to the Cabinet Office.

Barrowman, an Isle of Man-based financier, may have played a central role in the business deal that enabled PPE Medpro to sell millions of masks and surgical gowns to the government at the start of the pandemic.

One person closely involved in PPE Medpro claimed Barrowman was “part of the financial consortium that backed” the company and was even involved in initial conversations with the Department of Health and Social Care (DHSC).

Documents suggest he and Lady Mone were kept informed of specific commercial arrangements about PPE Medpro’s supplies. And Mone appears to have sent messages to an individual in PPE Medpro’s supply chain about the contract to supply gowns. PPE Medpro was fast-tracked through the government’s “VIP lane” after Mone’s referral.

Councils let off law breaking landlords

Half of all councils in England and Wales have not prosecuted a single “rogue” landlord in the past three years, despite a rise in the number of complaints from tenants, the website openDemocracy has found.

Local authorities received more than 314,000 complaints about private landlords and letting agents between 2018 and 2021. One single mother in Nottingham was served an eviction notice after council officers decided to give her landlord “a chance” instead of taking legal action–even though they had failed to remedy dozens of safety hazards in her house.

Only 1,000 rogue landlords—those who fail to meet their legal obligations—have been prosecuted in the past three years. That’s despite government estimates in 2015 that there are at least 10,500.

It follows a report by the National Audit Office last month revealing that only ten landlords in the whole of England have been barred from renting property since new banning orders were introduced in 2016.

Things they say

‘Will the minister take steps to encourage public broadcasters to play the national anthem and ensure the BBC restores it at the end of the day’s programming before it switches to News 24?’
Andrew Rosindell, the Tory MP for Romford

‘The more we hear the national anthem sung, frankly, the better’
Chris Philp, culture minister

‘If the jury is a barrier to ensuring they are punished then that needs to be addressed’
Tom Hunt MP, vice-chair of the Common Sense Group of Conservative MPs, after the Colston Four verdict

‘The decision in the Colston statue case is causing confusion’
Suella Braverman MP, Attorney General for England and Wales

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