George Osborne keeps clear of HSBC tax blame-game in the Commons

House Of Commons

George Osborne had made himself unavailable.

He was late with his tax return and had cut his finger or something, so it was left to the financial secretary, David Gauke, to accept the hospital pass of fielding an urgent question to the Treasury over allegations that the government and HMRC had known since 2010 that HSBC had been operating a tax avoidance scheme but had chosen not to do much about it.

“I welcome the opportunity,” said the minister without charisma through clenched teeth, before cataloguing how much the government had done to crack down on tax avoidance. While it was true that there had only been one prosecution as a result of the information, Gauke admitted, “the government had decided that civil penalties were the best way forward”.

Very civil penalties. “Dear tax exile, it has come to our attention that you may have been avoiding a few billion pounds in tax and making liberal use of Swiss cash machines. Obviously we don’t mind that much, but if you could send us a couple of hundred quid we would be most terribly grateful. And if you would like to make a donation to the political party of your choice, we enclose the relevant forms. Much love, George.”

Gauke was proving to be a great deal stronger on answer avoidance than tax avoidance, so Labour’s Shabana Mahmood tried to probe a little deeper. What had the government known about HSBC and when did it find out? Had the former chairman, Stephen Green, who had been handed a peerage and made trade minister by the prime minister months after the HSBC files had been handed to the government, ever had a chat with David Cameron at any time about what had gone at the bank while he was in charge?

“Stephen Green was an extremely successful trade minister,” Gauke harrumphed with forced indignation. The words sounded as if they might have been chosen with more precision than he meant to let on; with Green in charge, overseas businesses might accidentally have got the impression they were in for a tax-free bonanza. “He couldn’t have been expected to know what was going on in the bank on his watch. That would be like … ,” Gauke spluttered in search of the right simile. He settled for “ridiculous”, before going on to blame Labour for not having been aware of what Green’s company had been up to on its watch. Gauke is an irony-free zone.

As for Green’s pre-appointment procedures, the minister was sure they had been rigorous and far-reaching. Certainly as rigorous and far-reaching as those that Andy Coulson had been through. If Cameron had failed to get round to discussing HSBC’s tax avoidance schemes – Press 1 for Switzerland, 2 for the Cayman Islands – with Green, it was only because they had had so much else to talk about first. “The accusation that the government overlooked wrongdoing is false,” he said, baffled that almost everyone else in the country had come to the opposite conclusion.

The minister wasn’t without support. There were a handful of loyal Tories who had been bussed in to the Commons to back him up, though they weren’t exactly the government’s crack troops. “Would the minister agree that because the actual offences took place while Labour was in government,” they parroted in turn, “that they actually were to blame for everything and it would have been wrong for the Conservatives to have acted on the information once it was disclosed?” Gauke did agree, though he looked no happier at the end of the session than he had at the start. Osborne would do well to give him a wide berth for a few days.

Powered by article was written by John Crace, for on Monday 9th February 2015 18.32 Europe/ © Guardian News and Media Limited 2010