The Prime Minister Rishi Sunak has finally ordered a probe into his cabinet colleague and Conservative Party Chairman today after saying that Nadhim Zahawi had questions to answer over his tax affairs.
He asked his standards advisers to investigate the situation, a week after it emerged that Mr Zahawi had been in dispute with HMRC over a tax bill over his use of an offshore company to hold shares in the polling firm YouGov. It was further reported that the Conservative Party Chairman settled the dispute by paying nearly £5 million to the taxman, while he was Chancellor last summer.
The news of the investigation cam after a week of assurances from the Conservative Party that Mr Zahawi had paid all the taxes he owed. However, these failed to quell reports about his tax affairs or speculation about his future.
While allies of Mr Zahawi stressed the tax authorities accepted the error was ‘careless’ rather than deliberate, and he opted to pay the full amount demanded rather than negotiating, in a bid to wrestle back control of the news agenda, the PM was forced to launch a probe into his colleague.
Downing Street said Mr Sunak was responding to ‘additional facts’ that surfaced over the weekend, while insisting Mr Sunak retains confidence in the senior minister, who will continue his duties during the investigation.
The news of the investigation, caps off a terrible week for the Prime Minister, which has seen him accept a fixed penalty fine for not wearing a seat belt, allegations of “pork barrel” politics with the announcement of the second round of Levelling Up Grants and widespread discontent among his backbenchers on several major Government policies including plans to criminalise Conversion Therapy.
Mr Sunak announced the probe during a visit to a hospital in Northamptonshire. He told reporters that his standards adviser Sir Laurie Magnus would be looking into the case.
“Integrity and accountability is really important to me and clearly in this case there are questions that need answering,”he said.
“That’s why I’ve asked our independent adviser to get to the bottom of everything, to investigate the matter fully and establish all the facts and provide advice to me on Nadhim Zahawi’s compliance with the ministerial code.
“I’m pleased that Nadhim Zahawi has agreed with that approach and has agreed to fully co-operate with that investigation.”
Asked whether Mr Zahawi would stand down during the probe, Mr Sunak added: “As is longstanding practice, he will continue to play the role he does.”
In a statement, Mr Zahawi said: “I welcome the Prime Minister’s referral of this matter to the independent adviser on ministerial standards. I look forward to explaining the facts of this issue to Sir Laurie Magnus and his team.
“I am confident I acted properly throughout and look forward to answering any and all specific questions in a formal setting to Sir Laurie.”
However, the decision to launch the investigation was attacked by Labour who believe that Mr Zahawi’s position was untenable, his actions “unacceptable” and have called on him to be sacked.
Angela Rayner MP, Labour’s Deputy Leader and Shadow Chancellor of the Duchy of Lancaster, commented: “This pathetic attempt to pass the buck is simply not good enough. Nadhim Zahawi was Chancellor of the Exchequer while he hadn’t paid his tax and was negotiating a settlement with HMRC at the time. You don’t need an ethics adviser to tell you that’s unacceptable.
“The Prime Minister made the decision to appoint Nadhim Zahawi as a government minister and Conservative Party Chair. Rishi Sunak’s vote of confidence in Nadhim Zahawi is yet another example of his weak leadership and appalling judgement. He can no longer dodge questions about what he knew and when, or why warnings were ignored.
“It’s his responsibility as Prime Minister to ensure his Cabinet’s tax affairs are up-to-date and in order, but he’s too compromised to do his job and failing to deliver the integrity, professionalism and accountability he promised. Rishi Sunak must get a grip and dismiss Nadhim Zahawi from his Cabinet immediately.”
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