How Embarrassing

The latest figures released by the Electoral Commissions shows that Labour's biggest private donor in the last three months of 2014 was the tax dodging specialist accountancy company PwC (PricewaterhouseCoopers).

Another embarrassing revelation after Labour's complaints about other people's tax affairs which has apparently supported the party with donations of £1.04 million in sponsorship and staff costs to support the work of the shadow chancellor Ed Balls, for example.

Regular readers will also note that UK trade unions also handed substantial sums of their members' money to Labour as the general election approaches: £1,384,289 from Unison; £1,336,570 from Unite, £1, 088,810 from GMB and £416,872 from USDAW.    

So even though ordinary union members don't share the the political leanings of their union bosses, especially in Scotland where Labour is down to around 24% of the popular vote, the union hierarchy continues to have eyes only for Ed Miliband and the Labour Party.

Labour’s biggest private donor? ‘Tax dodge specialists’ accountancy firm PwC


Shadow chancellor Ed Balls and shadow work and pensions secretary Rachel Reeves both have PwC employees on their staff Chris Harris/The Times

By Sam Coates - The Times

Labour’s biggest private donor is the accountancy firm PricewaterhouseCoopers the Electoral Commission revealed yesterday despite accusations from a senior Labour MP that the firm has been “selling tax avoidance on an industrial scale”.

A PwC “forensic accountant” for the firm worked in the office of Ed Balls, according to Parliamentary records, while a manager of PwC’s capital markets division worked with Chuka Umunna in the Labour business team.

Rachel Reeves, the shadow work and pensions secretary, and Chris Leslie, shadow chief secretary, also recorded the use of PwC staff in their register of members’ interests.

The Electoral Commission revealed Labour received the £386,605 donation in kind from PWC in November. The sum represents the cost of staff seconded to the party to help work on policy and made the firm the party’s biggest private donor in the last three months of 2014.

In total, Labour has received £1.04 million from the firm, largely representing sponsorship and staff costs.

Although it has become standard practice for the opposition to accept free help from accountancy firms in the run-up to an election, it is embarrassing for Labour in the light of their recent campaign on tax avoidance and accusations against the firm by a senior MP, Margaret Hodge.

Mrs Hodge said the secondment of PwC staff to work in the offices of opposition frontbenchers was “inappropriate” earlier this month.

“The Conservatives took money from PricewaterhouseCoopers when they were in opposition, the Labour Party does and probably the Liberal Democrats too. I think that’s inappropriate, I wouldn’t do it,” she told BBC Radio 4’s The World at One.

The revelation will embarrass Labour leader Ed Miliband, who made Tory failings in tackling tax avoidance a key theme last week following revelations about the activities of HSBC in Switzerland.

Mrs Hodge, who chairs the Public Accounts Committee, has led the charge specifically against PwC for its role promoting tax avoidance schemes, as well as suggesting it attempted to mislead her committee.

Accompanying a PAC report published two weeks ago, she said: “Contrary to its denials, the tax arrangements PwC promotes, based on artificially diverting profits to Luxembourg through intra-company loans, bear all the characteristics of a mass-marketed tax avoidance scheme.”

According to the Register of Staff interests in the Commons, Tessa Jowell, Tristram Hunt and Mr Balls have given passes to PwC staff. Mr Balls, the shadow chancellor, employs a “forensic accountants” from the firm in his office called Nick O’Donovan.

According to his Linkedin profile, Mr Donovan was an analyst in the office of the shadow chancellor between March and December, but has now returned to the firm to be “Manager in Global Tax, Public Policy and Governance”. The most recent Parliamentary records from January suggest he still has a pass.

Mr Hunt has given a pass to Thomas Graham. His profile says he is a “Manager at PwC working as a consultant in the firm’s economics and policy team in the strategy practice” with a strong focus on education but makes no mention of working for Mr Hunt.

Mr Umunna’s team included Thomas Gough, a manager of the capital markets division at PWC. The latest Parliamentary register from mid January says he is “on secondment to Parliament to work with the shadow secretary of state for business and his team.” His LinkedIn profile suggests he left PwC to go to Sage, the software company, in January.

The Conservatives received £8.3 million in the three months to January, according to the Electoral Commission, narrowly ahead of Labour which received £7.2 million and the Lib Dems which took £3 million and Ukip on £1.5 million.

However once public funds are included, Labour received more than £2 million more in the three months to January.

The three biggest donations were all from trade unions to Labour, with Unison handing over £1,384,289 to Mr Miliband’s party, Unite donating £1,336,570 and GMB £1,088,810.

The Union of Shop, Distributive and Allied Workers also gave £416,872 to Labour.

The Tories’ largest donation was £500,000 from Michael D Gooley, while Lord Michael Glendonbrook gave £334,000 and David J Rowland donated £322,700.

The Lib Dems received £400,000 from Max Batley while Ukip received £394,254 from Rock Services Limited, the company of Arron Banks.

Analysis of the Electoral Commission data by Labour showed that donors associated with hedge funds gave the Tories almost £2 million in the period.