As the GMB reported yesterday:
Almost half of Southern Cross care homes are owned by companies based outside the UK, including hundreds registered in tax havens, according to a union dossier.
The GMB said 199 homes are registered in the Cayman islands, 43 in Guernsey, 41 in Gibraltar, 39 in Jersey, four in the British Virgin islands and one in the Isle of Man.
The union said it had established the names of 80 landlords who own 615 of the 750 homes but was still trying to find out details of the other owners.
National officer Justin Bowden said: "Southern Cross may be on its last legs but for Southern Cross's 31,000 residents and 43,000 staff, this looks like a case of 'out of the frying pan, into the fire'.
"These 80 landlords are a rag-bag bunch whose number includes overseas interests, tax dodgers and in some cases 'identity still unknown'. Many themselves are in financial difficulties.
"All this spells months more uncertainty and worry for residents and staff. Where is Government in this care scandal? The ears of the 31,000 elderly and vulnerable residents and 43,000 staff must be ringing from the deafening silence from Downing Street.
Cameron says he is in favour of transparency, accountability and obligation in public services. This, though, is the reality: we get offshore companies, completely opaque, accountable to no one, with no financial information available on public record, ending up as the landlords and operators of care homes for the elderly in this country.
It's sickening.
It's wrong.
It's as opaque as it is possible to be.
It lacks all forms of accountability.
There is no protection to those who need it within such a system.
Cameron wants to devolve responsibility from the state to the corporate entity. But as my research has shown, 20% of all companies in the United Kingdom disappear each year without question being asked. That is a complete failure of corporate responsibility.
In addition I've shown that the government does not ask almost one third of companies to submit tax returns each year. That's the behaviour of a cowardly state.
Of those 1.8 million companies that are asked to submit tax returns, 600,000 do not submit them and they are not pursued for any penalty for not doing so. That is the behaviour of companies who know they can ride roughshod over the government: a cowardly government; a government that is not willing to enforce regulation to ensure transparency, accountability and the obligation to pay tax.
And Cameron presides over a government that is responsible for more tax havens in this world than any other, and he's doing nothing about it.
To argue that the functions of state should be passed to corporations when regulation of corporations is so weak, and is known to be so weak, is the act of a man who is both a coward and a fool. Cameron knows that if he does what he proposes accountability, transparency and responsibility will all go by the wayside. But he says otherwise. That's grossly dishonest.
If there is to be any further devolvement of any responsibility of any sort from the state in this country to the private sector then the rules by which the private sector operates have to be enforced and enhanced.
Companies must be made to account.
Their directors must be held accountable if they do not.
Tax havens must be shattered open and the information within them brought into the public domain.
Full accounts of every corporate entity must be on public record.
Country by country reporting must be the norm.
Corporate social responsibility reporting should not be an optional extra: it should be a requirement of all companies of any size.
Tax avoidance, and the transfer of profits generated from state funded activity to tax havens outside the UK should be banned.
Personal liability for those persons who act in breach of trust, who have committed fraud, who have deliberately assisted their companies to evade tax, and who've misrepresented accounting information should be rigourously enforced.
Then, and only then can the public sector be satisfied that the private sector can undertake the tasks that they may wish to transfer to it.
Until then, any transfer of services to the private sector involves unknown and very obviously significant, and dangerous, risks for the users of the services in question and that is wholly unacceptable and an act of gross irresponsibility on the part of any politician.
Which is why Cameron's Big Society must be stopped, now.
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““These 80 landlords are a rag-bag bunch whose number includes overseas interests, tax dodgers and in some cases ‘identity still unknown’. ”
It is essential that the Land Registry is complete so we do know who owns Britain. I raised this issue at the Compass Conference under the plenary Q&A session re ‘democracy’. With this information and all land valued, the registered owners (wherever they are located) can receive the bill for the land rent which belongs to the community which creates it. If they don’t want to pay then they forfeit title. This essential step would destroy the Southern Cross business model of separating property owning/speculation and management, which is increasingly popular.
Dear Richard – this latest raft of excellent blog entries carry an echo of an earlier historical movement, but this time in a different key. For just as the Trade Unions -a valid and essential part of any civic society and order – overplayed their hand in the 1970’s, and ended up being the subject of quite intense legislative activity, designed to ensure they operated within well-regulated limits, so now you are rightly saying the same needs to be done with the functioning of corporations. I always entertained a fantasy of a one-clause amendment to one of Thatcher’s union laws – an interepretation clause, to read “For the purposes of the application of this law, all references to Unions shall be construed as including incorporated bodies and corporations” – thereby forcing regular elections, the need to get each shareholder to approve donations to political parties etc. However, what you have in mind is so much more thorough-going, and better construed. All power to you elbow, with your campaign for a “Courageous State” – not something Pip, Squeak and Wilfrid (Cameron and Co) and Rag, Tag and Bobtail (Clegg and Co) are likely to opt for.
Is there any reason why the government should not immediately introduce a 50% (or even 67%) withholding tax on rent paid to overseas landlords?
Of course, it would be very easy to avoid by transferring ownership to a UK company (with the payment of stamp duty naturally) but at least rental income would be available for taxing in the normal way and, as Carol Wilcox says, the Southern Cross business model would suddenly be a lot less appealing.
In principle this tax exists
In practice you fill in a form, send it to H M Revenue & Customs and promise to submit a tax rerturn and they let you off it
They then ever check if the tax is paid….
I feel a blog coming on
It would presumably need more people. And the rate of return on the incremental payroll? Off scale I would imagine.
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