Published in the Times on 26 February 2013. It was the lead letter for the day.
Dear Sir,
Jane O’Nions (letter, 25 February) gives but one example of executive pay being out of all proportion to any results achieved, a trend confirmed by a report in 2011 by the High Pay Commission.
One of the chief problems is that English corporate law was largely developed in the nineteenth and early twentieth century, when companies had far smaller numbers of shareholders. Accordingly, the latter were able to provide a check on executive performance. When the largest individual shareholder of a company holds less than 1% of the shares, as is common with large multinationals today, it will be all but impossible for the shareholders to act as a group.
Successive governments have always been reluctant to act by imposing higher taxes, partly because economists dispute whether they would lead to increased revenues, and partly because executives can either find loopholes or threaten to move business offshore. Moreover, many politicians will have one eye on directorships for themselves – a consideration which also puts paid to other forms of restraining pay besides tax. This effectively leaves it to executives themselves to set the level of their own pay [and it is not hard to guess the result of placing the design of the chicken coop in the hands of the foxes].
A second blight has been the attempts of local government and other public sector bosses trying to pay themselves in line with the private sector, leading to the absurd situation of many council chiefs earning considerably more than the Prime Minister. This is something the Government should deal with[, perhaps by starting with a sealed bid procedure for senior public sector roles].
Words in square brackets omitted.
Showing posts with label politics. Show all posts
Showing posts with label politics. Show all posts
Friday, 1 March 2013
Wednesday, 9 January 2013
Parliament and war - William Hague's proposals
Last week the Times reported that William Hague proposes to give MPs a veto over proposed military action (Times, p 6, 4 January). This proposal might be compared with the United States’ War Powers Resolution of 1973. Part of the fallout from the Vietnam War, the Resolution permits the executive to start military action, but requires Congressional approval after 60 days (with a further 30 day withdrawal period). This affords the executive the flexibility to respond to emergencies and to retain the element of surprise. It therefore answers two of the objections identified in your report about Mr Hague’s proposal.
The 1973 Resolution is not without its problems, however. For a major campaign it would be an operational nightmare for Congress suddenly to withdraw funding after two months, and political pressure not to compromise the action would be immense, so the provision may be more theoretical than real.
Secondly, during the Libyan campaign, the White House’s position was that the Resolution could not be invoked because the operation did not constitute a “war”. The reasoning given was that American forces were not engaged in sustained fighting or “active exchanges of fire with hostile forces”.
As I have argued in my book (Cases, Causes and Controversies: fifty tales from the law), that argument was entirely fallacious. The United States was (among other things) deploying armed drones to assist rebels attempting to topple the Libyan regime. Attempting to remove a sovereign government by force is a war in anyone’s language. Had a foreign-controlled drone fired on President Obama in the White House, for example, America would have considered it to have been the clearest declaration of war imaginable, and would have responded with the full weight of its armed forces without the slightest hesitation.
Thus one can expect that any mandatory veto granted to Parliament would have to allow not simply for emergency situations but also realpolitik, which seldom appears in a more cynical form than it does in the realm of armed conflict.
The 1973 Resolution is not without its problems, however. For a major campaign it would be an operational nightmare for Congress suddenly to withdraw funding after two months, and political pressure not to compromise the action would be immense, so the provision may be more theoretical than real.
Secondly, during the Libyan campaign, the White House’s position was that the Resolution could not be invoked because the operation did not constitute a “war”. The reasoning given was that American forces were not engaged in sustained fighting or “active exchanges of fire with hostile forces”.
As I have argued in my book (Cases, Causes and Controversies: fifty tales from the law), that argument was entirely fallacious. The United States was (among other things) deploying armed drones to assist rebels attempting to topple the Libyan regime. Attempting to remove a sovereign government by force is a war in anyone’s language. Had a foreign-controlled drone fired on President Obama in the White House, for example, America would have considered it to have been the clearest declaration of war imaginable, and would have responded with the full weight of its armed forces without the slightest hesitation.
Thus one can expect that any mandatory veto granted to Parliament would have to allow not simply for emergency situations but also realpolitik, which seldom appears in a more cynical form than it does in the realm of armed conflict.
Friday, 16 November 2012
J'Accuse - the Dreyfus affair then and now
I have been published in this week's New Law Journal, vol 162, 16 November 2012, p 1434 (£), on the Dreyfus affair.
Friday, 9 November 2012
The BNP and Strasbourg: Redfearn v United Kingdom
There was irony aplenty this week as a BNP member, whose party considers the Convention on Human Rights to be a means by which Britain may be exploited by "the world's scroungers" and promises its immediate abolition, won a case in Strasbourg. The case is Redfearn v United Kingdom (App. No. 47335/06).
A good summary and analysis appears on the UK Human Rights Blog by Martin Downs here.
Mr Redfearn was a bus driver. He was employed by a private company, Serco Ltd (Serco), which in turn supplied his services to a local authority. There were no complaints about the standard of his work for Serco Ltd and in fact his supervisor, who was of Asian origin, had nominated him for the award of "first class employee".
Redfearn's political affiliation became public when he was elected as a BNP councillor. A number of complaints were received from unions and employees, following which he was dismissed. The grounds given for dismissal were that he would present a risk to the health and safety of his co-workers and passengers and jeopardise the reputation of his employer. These were all based on his BNP membership.
Mr Redfearn challenged his dismissal without success in the domestic courts but, as mentioned, has just succeeded in Europe. It needs to be emphasised that he has only won a preliminary victory. He wished to argue that he had been unfairly dismissed on account of his political beliefis or affiliations. He was precluded from doing so by the requirement of domestic law that required a year's service before such complaints could be made. That one year qualifying period did not, however, apply to grounds of pregnancy, race, sex or religion. The majority of the Strasbourg court found that that exception needed to be reconsidered and expanded to include political opinion or affiliation, or a free standing cause of action to the same effect.
Here is a classic example of why exceptions from a general rule - in other words, breaches of the rule of law - are a minefield. The one year rule was thought by Parliament to be necessary to encourage employers to take on more staff. Then it was thought that some forms of ill treatment, such as discrimination, were so serious that an exception should be made to the general rule. Now, almost inevitably, more exceptions are found necessary, after expensive litigation, leaving the open question of whether still more might be found in the future or else deserving claimants will be left without a remedy. Employers will not be happy either and will be more cautious about hiring new staff as a result.
Another side issue concerns the application of the Convention to a private employment contract, and whether Serco was in fact equivalent to an arm of the state because it was supplying services for the local authority. I will however leave that aside to keep the post within manageable length.
Let us return therefore to the substantive dispute. Without belittling the skill and responsibility involved, if Mr Redfearn's job was simply to drive a bus it is hard to see how his political affiliations (or religious beliefs, or philosophical views) would have been relevant. They might have been if he had chosen to display them by symbols, or logos, or if he had been covered in aggressive or offensive tattoos; or if he had decided to treat his passengers differently according to their race or gender or appearance.
One of the key principles behind anti-discrimination laws - ironically the very type the BNP generally opposes - is that people should not be subject to different treatment in employment for irrelevant reasons. Race, gender, political opinions and membership of a lawful political organisation are generally irrelevant to most jobs and certainly, one would have thought, driving a bus.
If the driver's performance was satisfactory, then membership of a legal organisation would not be grounds for dismissal but instead an exercise of the basic human right of freedom of association, even if it involved associating with a group that would, if given the chance, remove a few basic human rights.
Then there is the question, already raised in Redfearn's case, whether he could have been moved to a non-customer facing role. If so, suppose Redfearn changed his mind and disowned the BNP: would he then be able to demand reinstatement to his previous role or at least reconsideration of his suitability elsewhere? Would there be a test of his sincerity? If so, would that be amenable to review by the employment tribunal?
The BNP is a party whose doubtful reputation on human rights and indeed human decency needs no elaboration. Moreover, most of its policies, even leaving aside their objectionable nature, are no more than slogans anyway, unworthy of serious study or attention. The party's performance at the ballot box has, thankfully, largely corresponded todate. But here we have the classic liberal dilemma of tolerating intolerance. The BNP has made clear it would like to expel anyone it doesn't like from the country, if it could get away with it. By contrast, a more tolerant society than the one the BNP would like to foist upon us has to tolerate dissent. It also has to tolerate even highly objectionable opinions, in the name of free speech, free association and freedom of religion.
One only has to look at what happens to political undesirables in other countries to realise that toleration of minorities, and even what most people find very objectionable minority views, is a fundamental requirement for democracy and freedom. Then there is the employment law perspective: people should only be promoted, demoted or fired for reasons connected with and relevant to their employment. In the case of a bus driver this does not include membership of a political party, unless as I have stressed the driver starts to treat his passengers differently or otherwise breaches his contract.
Homosexuals should not be discriminated against in the provision of services offered to the public, even if it offends the sincerely held religious beliefs of others. Nor should people be denied the ability to wear religious dress in public. Nor should people be sent to jail for writing offensive garbage on the internet. And people should not be dismissed from their job for holding political views (or indeed for any other reason) unless those views preclude them from doing their job properly, in which case it is their performance, not their views, which should be impugned.
A good summary and analysis appears on the UK Human Rights Blog by Martin Downs here.
Mr Redfearn was a bus driver. He was employed by a private company, Serco Ltd (Serco), which in turn supplied his services to a local authority. There were no complaints about the standard of his work for Serco Ltd and in fact his supervisor, who was of Asian origin, had nominated him for the award of "first class employee".
Redfearn's political affiliation became public when he was elected as a BNP councillor. A number of complaints were received from unions and employees, following which he was dismissed. The grounds given for dismissal were that he would present a risk to the health and safety of his co-workers and passengers and jeopardise the reputation of his employer. These were all based on his BNP membership.
Mr Redfearn challenged his dismissal without success in the domestic courts but, as mentioned, has just succeeded in Europe. It needs to be emphasised that he has only won a preliminary victory. He wished to argue that he had been unfairly dismissed on account of his political beliefis or affiliations. He was precluded from doing so by the requirement of domestic law that required a year's service before such complaints could be made. That one year qualifying period did not, however, apply to grounds of pregnancy, race, sex or religion. The majority of the Strasbourg court found that that exception needed to be reconsidered and expanded to include political opinion or affiliation, or a free standing cause of action to the same effect.
Here is a classic example of why exceptions from a general rule - in other words, breaches of the rule of law - are a minefield. The one year rule was thought by Parliament to be necessary to encourage employers to take on more staff. Then it was thought that some forms of ill treatment, such as discrimination, were so serious that an exception should be made to the general rule. Now, almost inevitably, more exceptions are found necessary, after expensive litigation, leaving the open question of whether still more might be found in the future or else deserving claimants will be left without a remedy. Employers will not be happy either and will be more cautious about hiring new staff as a result.
Another side issue concerns the application of the Convention to a private employment contract, and whether Serco was in fact equivalent to an arm of the state because it was supplying services for the local authority. I will however leave that aside to keep the post within manageable length.
Let us return therefore to the substantive dispute. Without belittling the skill and responsibility involved, if Mr Redfearn's job was simply to drive a bus it is hard to see how his political affiliations (or religious beliefs, or philosophical views) would have been relevant. They might have been if he had chosen to display them by symbols, or logos, or if he had been covered in aggressive or offensive tattoos; or if he had decided to treat his passengers differently according to their race or gender or appearance.
One of the key principles behind anti-discrimination laws - ironically the very type the BNP generally opposes - is that people should not be subject to different treatment in employment for irrelevant reasons. Race, gender, political opinions and membership of a lawful political organisation are generally irrelevant to most jobs and certainly, one would have thought, driving a bus.
If the driver's performance was satisfactory, then membership of a legal organisation would not be grounds for dismissal but instead an exercise of the basic human right of freedom of association, even if it involved associating with a group that would, if given the chance, remove a few basic human rights.
Then there is the question, already raised in Redfearn's case, whether he could have been moved to a non-customer facing role. If so, suppose Redfearn changed his mind and disowned the BNP: would he then be able to demand reinstatement to his previous role or at least reconsideration of his suitability elsewhere? Would there be a test of his sincerity? If so, would that be amenable to review by the employment tribunal?
The BNP is a party whose doubtful reputation on human rights and indeed human decency needs no elaboration. Moreover, most of its policies, even leaving aside their objectionable nature, are no more than slogans anyway, unworthy of serious study or attention. The party's performance at the ballot box has, thankfully, largely corresponded todate. But here we have the classic liberal dilemma of tolerating intolerance. The BNP has made clear it would like to expel anyone it doesn't like from the country, if it could get away with it. By contrast, a more tolerant society than the one the BNP would like to foist upon us has to tolerate dissent. It also has to tolerate even highly objectionable opinions, in the name of free speech, free association and freedom of religion.
One only has to look at what happens to political undesirables in other countries to realise that toleration of minorities, and even what most people find very objectionable minority views, is a fundamental requirement for democracy and freedom. Then there is the employment law perspective: people should only be promoted, demoted or fired for reasons connected with and relevant to their employment. In the case of a bus driver this does not include membership of a political party, unless as I have stressed the driver starts to treat his passengers differently or otherwise breaches his contract.
Homosexuals should not be discriminated against in the provision of services offered to the public, even if it offends the sincerely held religious beliefs of others. Nor should people be denied the ability to wear religious dress in public. Nor should people be sent to jail for writing offensive garbage on the internet. And people should not be dismissed from their job for holding political views (or indeed for any other reason) unless those views preclude them from doing their job properly, in which case it is their performance, not their views, which should be impugned.
Friday, 19 October 2012
MPs expenses
The issue of MPs’ expenses is back in the news. It seems that MPs have experienced much and learned little: the system is still being used as a cash cow, and they are still trying to keep the whole thing quiet.
According to the Telegraph:
The Independent Parliamentary Standards Authority (Ipsa) reversed its decision to publish information about MPs’ landlords today, after the Speaker of the House of Commons ordered the regulator to keep the information private for “security” reasons.
It is feared that several MPs may be exploiting a loophole in the rules that allows politicians to rent their homes to one another.
This means that MPs can still effectively build up property nest eggs at taxpayers’ expense, despite official attempts to stop the practice following the expenses scandal.
More details have followed since.
Both the amount of money MPs are paid and the method of payment – salary, bonus, expenses – are essentially political questions. They are however of legal interest in two respects. The first is the obvious question of whether expense claims are lawful; that is to say, whether they are within the rules. Various extremely high profile criminal prosecutions were made under the old regime, following determination of the prior question whether the courts or Parliament itself had jurisdiction over the matter. I wrote about this for Criminal Law & Justice Weekly (vol 175, 5 February 2011, p 73).
The second question is the rather more general point about the wrong approach to making law. In my forthcoming book (details on the sidebar in this blog) I have written about R v Chaytor and suggested something on the following lines:
The fundamental flaw is that any system which operates by people making claims and then hoping to get them approved, but with no restriction on the amount that might be claimed or penalty for having a number of claims refused, gives every encouragement to people to keep on shoving in claim after claim for anything and everything. Any rational, profit-maximising individual would do nothing else.
There are many alternatives. For example, MPs could simply have a fixed sum added to their salaries, to be spent on support staff, travelling expenses or whatever, but no more. Then – in sharp contrast with the present system – they would have every incentive to economise.
All the talk in the original controversy about needing second homes and travel expenses was predicated on the assumption that MPs actually needed to be in any particular physical place at any particular time. In the age of smartphones, videoconferencing and unlimited broadband access, however, that assumption is very hard to justify.
However, let us assume that it is indeed desirable for MPs to be physically present in the Houses of Parliament. Let us also assume that it would be unfair for MPs outside the M25 to be saddled with the extra costs of travelling to and staying in London. Then, one could build a hall of residence for those MPs (with a grander name if one prefers). It could be a modern, furnished and serviced apartment block next to the Palace of Westminster. It would cost a tiny fraction of the amount spent on second homes, the security costs would be far lower as there would only be one building to protect, and MPs would have no more and no less than they needed.
No doubt MPs would feel demeaned by this. But they might consider that a number of large city law firms have dormitories on their premises, together with a few ancillary services such as a canteen and laundry service. These are provided for partners working overtime on large deals. If the apartment block was within walking distance from the Houses of Parliament, (perhaps with an underground tunnel to reduce security costs and provide disabled access) it would slash travelling expenses as well.
This would go a long way towards restoring public confidence in MPs and Parliament generally. One fears though that a majority of MPs will still prefer to play the property market at the taxpayer’s expense and either withhold details from the public or take the loss of popularity on the chin.
Unless the above suggestion or a similarly radical reform is instigated, public confidence in Parliament will continue to be threatened. Needless to say, it is not only lawyers who should be concerned by that.
According to the Telegraph:
The Independent Parliamentary Standards Authority (Ipsa) reversed its decision to publish information about MPs’ landlords today, after the Speaker of the House of Commons ordered the regulator to keep the information private for “security” reasons.
It is feared that several MPs may be exploiting a loophole in the rules that allows politicians to rent their homes to one another.
This means that MPs can still effectively build up property nest eggs at taxpayers’ expense, despite official attempts to stop the practice following the expenses scandal.
More details have followed since.
Both the amount of money MPs are paid and the method of payment – salary, bonus, expenses – are essentially political questions. They are however of legal interest in two respects. The first is the obvious question of whether expense claims are lawful; that is to say, whether they are within the rules. Various extremely high profile criminal prosecutions were made under the old regime, following determination of the prior question whether the courts or Parliament itself had jurisdiction over the matter. I wrote about this for Criminal Law & Justice Weekly (vol 175, 5 February 2011, p 73).
The second question is the rather more general point about the wrong approach to making law. In my forthcoming book (details on the sidebar in this blog) I have written about R v Chaytor and suggested something on the following lines:
The fundamental flaw is that any system which operates by people making claims and then hoping to get them approved, but with no restriction on the amount that might be claimed or penalty for having a number of claims refused, gives every encouragement to people to keep on shoving in claim after claim for anything and everything. Any rational, profit-maximising individual would do nothing else.
There are many alternatives. For example, MPs could simply have a fixed sum added to their salaries, to be spent on support staff, travelling expenses or whatever, but no more. Then – in sharp contrast with the present system – they would have every incentive to economise.
All the talk in the original controversy about needing second homes and travel expenses was predicated on the assumption that MPs actually needed to be in any particular physical place at any particular time. In the age of smartphones, videoconferencing and unlimited broadband access, however, that assumption is very hard to justify.
However, let us assume that it is indeed desirable for MPs to be physically present in the Houses of Parliament. Let us also assume that it would be unfair for MPs outside the M25 to be saddled with the extra costs of travelling to and staying in London. Then, one could build a hall of residence for those MPs (with a grander name if one prefers). It could be a modern, furnished and serviced apartment block next to the Palace of Westminster. It would cost a tiny fraction of the amount spent on second homes, the security costs would be far lower as there would only be one building to protect, and MPs would have no more and no less than they needed.
No doubt MPs would feel demeaned by this. But they might consider that a number of large city law firms have dormitories on their premises, together with a few ancillary services such as a canteen and laundry service. These are provided for partners working overtime on large deals. If the apartment block was within walking distance from the Houses of Parliament, (perhaps with an underground tunnel to reduce security costs and provide disabled access) it would slash travelling expenses as well.
This would go a long way towards restoring public confidence in MPs and Parliament generally. One fears though that a majority of MPs will still prefer to play the property market at the taxpayer’s expense and either withhold details from the public or take the loss of popularity on the chin.
Unless the above suggestion or a similarly radical reform is instigated, public confidence in Parliament will continue to be threatened. Needless to say, it is not only lawyers who should be concerned by that.
Wednesday, 17 October 2012
Prince Charles and his letters
UPDATED
The role of "Prince of Wales" is not particularly easy to define. Aside from managing the Duchy of Cornwall, which is presumably almost completely delegated to professionals, the holder of the position seems to spend most of his time doing similar things to the monarch but (one suspects) with the same sort of feeling as the opening act for the Rolling Stones.
No Prince of Wales in history has had to wait as long to be King as Prince Charles. Perhaps with a resultant sense of frustration, Prince Charles has for some years now been writing letters on all manner of subjects to all manner of MPs and others in officialdom. In doing so he has been acting as a sort of unpaid lobbyist or semi-professional gadfly.
Immediately one sees a problem. When he becomes the monarch he will be required to be politically neutral, something his mother has almost always conscientiously observed. In turn that means Charles III will have to be seen to be politically neutral. But by writing so many letters on matters of political controversy, Prince Charles has been seen as anything but neutral or devoid of political opinions. One presumes those opinions will not disappear overnight when he becomes Charles III. Therefore, he will be somewhat compromised as monarch from the beginning.
With this in mind the Guardian newspaper made a freedom of information request to obtain a number of letters written by the Prince in 2004 and 2005. The request pertained to letters involving “advocacy” on the part of Prince Charles, defined as (i) identifying charitable need and setting up and driving forward charities to meet it, and/or (ii) the promotion of Prince Charles’ views on various issues.
In 2010 the Freedom of Information Act was amended to give the heir to the throne exemption from all future requests. This is somewhat remarkable on its face and deserves further comment at another time. Staying with the Guardian's request for now, however, the Upper Tribunal ruled in the Guardian's favour in September of this year (Evans v IC and Others (Seven Government Departments) [2012] UKUT 313 (AAC)). Now, however, the Attorney-General has reversed that decision, in a rather surprising ruling. The Telegraph reports:
[The Attorney General] said it was in the national interest to ban publication of the letters “because if he forfeits his position of political neutrality as heir to the throne, he cannot easily recover it when he is king”.
...
Mr Grieve overturned [the Upper Tribunal's] decision, saying there was an “exceptional case” for him to use his veto to prevent the Prince’s “most deeply held and personal beliefs” becoming public
In a 10-page summary of his reasons for overturning the judges’ decision, Mr Grieve said the Prince’s letters had been “urging a particular view on ministers” but this amounted to him “educating” himself about the work of government in preparation for becoming king, making the letters exempt from freedom of information requests.
The Attorney-General's ruling may be found here. I have to say I am not convinced by his reasoning, with the greatest of respect. It is a stretch to argue that lobbying for a change in the law is "educating" the lobbyist in how government works; and if that was the objective behind his letters there were rather better ways in which the Prince could have gone about it - seeking advice from constitutional lawyers and political scientists for example.
Secondly, if disclosure of the content of the letters would indeed forfeit the Prince's political neutrality, then they should not have been written in the first place. The answer is not for them to be written and then hushed up.
Thirdly, the Attorney General maintains that there is "nothing improper" in the letters, but that seems more like a reason for, not against, publication.
The Queen gives a weekly audience to the Prime Minister, and otherwise has ad hoc contact with politicians. No doubt at these meetings she gives her opinion on various matters and, of course, the content of all such occasions remains confidential. Here is the strongest ground in Prince Charles' favour: he may simply be informally copying what the Queen does already. It is unrealistic to think that the Queen has never offered her personal views to the Prime Minister during the weekly audience.
Nevertheless, I do not think the situations are identical. For a start, I am not aware that the Queen ever sent lobbying letters to anyone before she became Queen. Secondly, the Queen has never indicated that she wishes to influence contentious political matters in a concerted fashion, as opposed simply to offering the Prime Minister the benefit of her experience of more than six decades in public life. By contrast, Prince Charles has not made secret his strong views on the environment and various other issues and therefore presents himself as much more of a political animal. In other words, it comes back to being seen to be impartial, much as justice has to be seen to be done.
The present case is not the same situation as occurred with Prince Charles' private diaries, which were the subject of legal action a few years ago, and which I have written about for my forthcoming book (and previously for the New Law Journal). The diaries were never intended to be anything other than an entertaining read for the Prince's close friends: they were certainly not an attempt to influence senior politicians. Prince Charles was therefore entitled to an expectation of privacy with regard to their contents and even to the fact of their existence.
Nor is Prince Charles in the same position as, for example, a barrister hoping to become a judge one day. Although some barristers do become known for always acting for a particular type of litigant, and they may publish strong opinions on various areas of law, all are bound in their role as barristers by strict rules of conduct and the cab-rank principle. There is no equivalent for Prince Charles. Secondly, judges give virtually all their decisions in public, so one seen as favouring his former clients would be found out quickly. Again, that does not apply to the monarch, who does much in private including the aforementioned meetings with the Prime Minister.
The reality is that if the letters were published then pressure would mount for Prince Charles to step aside and allow William to become King when the Queen dies. It might be hard for Prince Charles to accept, but the truth is that the institution of the Monarchy would probably be more popular as a result, not least because it would not have to fend off inevitable rumours and accusations concerning the letters.
UPDATE: Jack Straw has written in defence of the letters here. It seems to me that the problem stems from the fact that Prince Charles has never made secret his wish to influence areas of very contentious politics - such as human rights - and areas of science, when he is qualified in neither and which one would not expect the monarch (or monarch to be) to attempt to influence. He might offer an opinion in private but seems to be going beyond this with sustained letter-writing campaigns. Were he to confine himself to helping with charities and building bridges between business and regulators - the sort of thing that no-one much disagrees with - there would be a lot less controversy and any correspondence would rightly be treated as confidential.
The role of "Prince of Wales" is not particularly easy to define. Aside from managing the Duchy of Cornwall, which is presumably almost completely delegated to professionals, the holder of the position seems to spend most of his time doing similar things to the monarch but (one suspects) with the same sort of feeling as the opening act for the Rolling Stones.
No Prince of Wales in history has had to wait as long to be King as Prince Charles. Perhaps with a resultant sense of frustration, Prince Charles has for some years now been writing letters on all manner of subjects to all manner of MPs and others in officialdom. In doing so he has been acting as a sort of unpaid lobbyist or semi-professional gadfly.
Immediately one sees a problem. When he becomes the monarch he will be required to be politically neutral, something his mother has almost always conscientiously observed. In turn that means Charles III will have to be seen to be politically neutral. But by writing so many letters on matters of political controversy, Prince Charles has been seen as anything but neutral or devoid of political opinions. One presumes those opinions will not disappear overnight when he becomes Charles III. Therefore, he will be somewhat compromised as monarch from the beginning.
With this in mind the Guardian newspaper made a freedom of information request to obtain a number of letters written by the Prince in 2004 and 2005. The request pertained to letters involving “advocacy” on the part of Prince Charles, defined as (i) identifying charitable need and setting up and driving forward charities to meet it, and/or (ii) the promotion of Prince Charles’ views on various issues.
In 2010 the Freedom of Information Act was amended to give the heir to the throne exemption from all future requests. This is somewhat remarkable on its face and deserves further comment at another time. Staying with the Guardian's request for now, however, the Upper Tribunal ruled in the Guardian's favour in September of this year (Evans v IC and Others (Seven Government Departments) [2012] UKUT 313 (AAC)). Now, however, the Attorney-General has reversed that decision, in a rather surprising ruling. The Telegraph reports:
[The Attorney General] said it was in the national interest to ban publication of the letters “because if he forfeits his position of political neutrality as heir to the throne, he cannot easily recover it when he is king”.
...
Mr Grieve overturned [the Upper Tribunal's] decision, saying there was an “exceptional case” for him to use his veto to prevent the Prince’s “most deeply held and personal beliefs” becoming public
In a 10-page summary of his reasons for overturning the judges’ decision, Mr Grieve said the Prince’s letters had been “urging a particular view on ministers” but this amounted to him “educating” himself about the work of government in preparation for becoming king, making the letters exempt from freedom of information requests.
The Attorney-General's ruling may be found here. I have to say I am not convinced by his reasoning, with the greatest of respect. It is a stretch to argue that lobbying for a change in the law is "educating" the lobbyist in how government works; and if that was the objective behind his letters there were rather better ways in which the Prince could have gone about it - seeking advice from constitutional lawyers and political scientists for example.
Secondly, if disclosure of the content of the letters would indeed forfeit the Prince's political neutrality, then they should not have been written in the first place. The answer is not for them to be written and then hushed up.
Thirdly, the Attorney General maintains that there is "nothing improper" in the letters, but that seems more like a reason for, not against, publication.
The Queen gives a weekly audience to the Prime Minister, and otherwise has ad hoc contact with politicians. No doubt at these meetings she gives her opinion on various matters and, of course, the content of all such occasions remains confidential. Here is the strongest ground in Prince Charles' favour: he may simply be informally copying what the Queen does already. It is unrealistic to think that the Queen has never offered her personal views to the Prime Minister during the weekly audience.
Nevertheless, I do not think the situations are identical. For a start, I am not aware that the Queen ever sent lobbying letters to anyone before she became Queen. Secondly, the Queen has never indicated that she wishes to influence contentious political matters in a concerted fashion, as opposed simply to offering the Prime Minister the benefit of her experience of more than six decades in public life. By contrast, Prince Charles has not made secret his strong views on the environment and various other issues and therefore presents himself as much more of a political animal. In other words, it comes back to being seen to be impartial, much as justice has to be seen to be done.
The present case is not the same situation as occurred with Prince Charles' private diaries, which were the subject of legal action a few years ago, and which I have written about for my forthcoming book (and previously for the New Law Journal). The diaries were never intended to be anything other than an entertaining read for the Prince's close friends: they were certainly not an attempt to influence senior politicians. Prince Charles was therefore entitled to an expectation of privacy with regard to their contents and even to the fact of their existence.
Nor is Prince Charles in the same position as, for example, a barrister hoping to become a judge one day. Although some barristers do become known for always acting for a particular type of litigant, and they may publish strong opinions on various areas of law, all are bound in their role as barristers by strict rules of conduct and the cab-rank principle. There is no equivalent for Prince Charles. Secondly, judges give virtually all their decisions in public, so one seen as favouring his former clients would be found out quickly. Again, that does not apply to the monarch, who does much in private including the aforementioned meetings with the Prime Minister.
The reality is that if the letters were published then pressure would mount for Prince Charles to step aside and allow William to become King when the Queen dies. It might be hard for Prince Charles to accept, but the truth is that the institution of the Monarchy would probably be more popular as a result, not least because it would not have to fend off inevitable rumours and accusations concerning the letters.
UPDATE: Jack Straw has written in defence of the letters here. It seems to me that the problem stems from the fact that Prince Charles has never made secret his wish to influence areas of very contentious politics - such as human rights - and areas of science, when he is qualified in neither and which one would not expect the monarch (or monarch to be) to attempt to influence. He might offer an opinion in private but seems to be going beyond this with sustained letter-writing campaigns. Were he to confine himself to helping with charities and building bridges between business and regulators - the sort of thing that no-one much disagrees with - there would be a lot less controversy and any correspondence would rightly be treated as confidential.
Tuesday, 26 June 2012
Jimmy Carr and tax avoidance
Published on Halsbury's Law Exchange here.
Jimmy Carr and his K2 tax-minimising cohorts have attracted their share of detractors for using a tax-avoidance scheme which reduced the amount payable on their income to about 2%. It is a familiar debate: where is the line drawn between tax avoidance (legal) and tax evasion (illegal)? Is tax even moral to begin with? (Those of a libertarian disposition think that it is far too high at present, morally entitling or even obliging people to avoid as much as possible, whilst those of the old left think it too low.)
Recently, Mr Carr has had a slightly unlikely apologist in the form of the Rev Dr Peter Mullen, a priest of the Church of England and former Rector of St Michael, Cornhill and St Sepulchre-without-Newgate in the City of London.
Dr Mullen, writing in the Telegraph, argues that
“… reasonably and legitimately, within the confines of the law, to avoid paying more tax than one needs to pay is no more dishonest than, say, the effort of a working man to sell his labour to the highest bidder.”
Of course the simple answer is for tax loopholes to be closed. And of course that is very much easier said than done. Thus we are left with the endless game whereby HMRC closes one loophole and another is discovered. With a tax system as complex as Britain’s, it seems that the battle will never be over. Nor is it anything new: Alan Coren’s feuilleton Tax Brittanica was probably not far off the mark, with his fictional Roman accountant, Dubious Abacus, running rings around the hapless tax inspector Miscellaneous Onus in 408 AD.
However, Dr Mullen goes on to a rather wider issue. He writes:
“There is a very deep issue here. For if something that is allowed as quite legal and above board is at the same time, as some in these same high places have declared, unacceptable and immoral, then that sets up a fatal disjunction between law and morality.
Is it seriously being maintained that the law – the way according to which we all agree to rule our lives – is immoral? Argue that, and you are doing much worse than shooting yourself in the foot. You are undermining the principles of any rational social ethic. And consequently rubbishing reason itself.”
Here Dr Mullen is entering some murky waters. One would hope that each of our laws has a moral justification, allowing for the fact that even within an ethical framework such as the modern conception of Judeo-Christianity that forms the basis of English law there will always be room for disagreement on particular issues. But it is a philosophical truism that not everything legal is moral, still less than that everything immoral should be illegal. That is one reason why the prosecuting authorities, under the aegis of the Attorney-General, have the discretion not to prosecute any individual act of criminality.
Suppose, for example, I break a bylaw by driving my car in a municipal park, in order to rescue someone who has had a heart attack. Technically I have broken the law, but no-one would suggest I have acted immorally, and (I would hope) the prosecuting authorities would take note.
Alternatively, suppose by some bureaucratic foul-up the government has built a new road but the road technically has not had a speed limit applied to it. It might be legal for me to drive at excessive speeds on the road, but it would certainly not be moral.
Back to Jimmy Carr and his fellow tax-minimisers. Assuming tax to be moral to begin with, is it immoral for the very wealthy, who can afford the advice, to use whatever loopholes available to avoid paying the rate that they would normally incur? The majority of wage earners do not have that option, because they are taxed at source and could not afford the advice anyway. The intention of the law is that those earning over a certain amount pay at a certain rate. If that law is morally just, then arguably it is not moral for Mr Carr and co to exploit the fact that the law is badly drafted.
On the other hand, it is not as if there is a moral imperative to pay more tax than is due, and on countless occasions individuals and corporations make decisions on company structures, trusts and individual transactions based on what would minimise tax. So far as they do not break the law, they are not being immoral so much as sensible. This argument is encapsulated in the famous quote from Tomlin LJ in Inland Revenue Commissioners v Duke of Westminster [1935] All ER Rep 259:
“Every man is entitled, if he can, to order his affairs so that the tax attaching under the appropriate Acts is less than it otherwise would be. If he succeeds in ordering them so as to secure this result, then however unappreciative the Commissioners of Inland Revenue or his fellow taxpayers may be of his ingenuity, he cannot be compelled to pay an increased tax. This so-called doctrine of ‘the substance’ seems to me to be nothing more than an attempt to make a man pay notwithstanding that be has so ordered his affairs that the amount of tax sought from him is not legally claimable”.
The Chancellor of the Exchequer would have done well to have recalled that quotation earlier this year when speaking of “aggressive tax avoidance”, which is not a concept known to the law.
Certainly it would not be justifiable to impose some sort of windfall tax, even in the case of an abysmal loophole which cost the treasury billions: the rule of law requires the law to be fixed in advance, so far as possible, and does not permit retrospective penal or revenue laws.
Nevertheless, there are still some difficult questions of law and morality involved, not of the open-and-shut variety Dr Mullen seems to assume. In Mr Carr's case, it would pay to recall that the Revenue looks to the substance of any transaction, and there seems on the face of it no purpose to Mr Carr's scheme and its constituent transactions other than to get around income tax.
Mr Carr might not have acted illegally or immorally, depending on how all the questions above are answered. But, having lampooned tax avoiders in the past as part of his well-remunerated stand-up comedy routine, he is certainly guilty of one charge – hypocrisy – and for that reason he has brought the unsympathetic press on himself.
Jimmy Carr and his K2 tax-minimising cohorts have attracted their share of detractors for using a tax-avoidance scheme which reduced the amount payable on their income to about 2%. It is a familiar debate: where is the line drawn between tax avoidance (legal) and tax evasion (illegal)? Is tax even moral to begin with? (Those of a libertarian disposition think that it is far too high at present, morally entitling or even obliging people to avoid as much as possible, whilst those of the old left think it too low.)
Recently, Mr Carr has had a slightly unlikely apologist in the form of the Rev Dr Peter Mullen, a priest of the Church of England and former Rector of St Michael, Cornhill and St Sepulchre-without-Newgate in the City of London.
Dr Mullen, writing in the Telegraph, argues that
“… reasonably and legitimately, within the confines of the law, to avoid paying more tax than one needs to pay is no more dishonest than, say, the effort of a working man to sell his labour to the highest bidder.”
Of course the simple answer is for tax loopholes to be closed. And of course that is very much easier said than done. Thus we are left with the endless game whereby HMRC closes one loophole and another is discovered. With a tax system as complex as Britain’s, it seems that the battle will never be over. Nor is it anything new: Alan Coren’s feuilleton Tax Brittanica was probably not far off the mark, with his fictional Roman accountant, Dubious Abacus, running rings around the hapless tax inspector Miscellaneous Onus in 408 AD.
However, Dr Mullen goes on to a rather wider issue. He writes:
“There is a very deep issue here. For if something that is allowed as quite legal and above board is at the same time, as some in these same high places have declared, unacceptable and immoral, then that sets up a fatal disjunction between law and morality.
Is it seriously being maintained that the law – the way according to which we all agree to rule our lives – is immoral? Argue that, and you are doing much worse than shooting yourself in the foot. You are undermining the principles of any rational social ethic. And consequently rubbishing reason itself.”
Here Dr Mullen is entering some murky waters. One would hope that each of our laws has a moral justification, allowing for the fact that even within an ethical framework such as the modern conception of Judeo-Christianity that forms the basis of English law there will always be room for disagreement on particular issues. But it is a philosophical truism that not everything legal is moral, still less than that everything immoral should be illegal. That is one reason why the prosecuting authorities, under the aegis of the Attorney-General, have the discretion not to prosecute any individual act of criminality.
Suppose, for example, I break a bylaw by driving my car in a municipal park, in order to rescue someone who has had a heart attack. Technically I have broken the law, but no-one would suggest I have acted immorally, and (I would hope) the prosecuting authorities would take note.
Alternatively, suppose by some bureaucratic foul-up the government has built a new road but the road technically has not had a speed limit applied to it. It might be legal for me to drive at excessive speeds on the road, but it would certainly not be moral.
Back to Jimmy Carr and his fellow tax-minimisers. Assuming tax to be moral to begin with, is it immoral for the very wealthy, who can afford the advice, to use whatever loopholes available to avoid paying the rate that they would normally incur? The majority of wage earners do not have that option, because they are taxed at source and could not afford the advice anyway. The intention of the law is that those earning over a certain amount pay at a certain rate. If that law is morally just, then arguably it is not moral for Mr Carr and co to exploit the fact that the law is badly drafted.
On the other hand, it is not as if there is a moral imperative to pay more tax than is due, and on countless occasions individuals and corporations make decisions on company structures, trusts and individual transactions based on what would minimise tax. So far as they do not break the law, they are not being immoral so much as sensible. This argument is encapsulated in the famous quote from Tomlin LJ in Inland Revenue Commissioners v Duke of Westminster [1935] All ER Rep 259:
“Every man is entitled, if he can, to order his affairs so that the tax attaching under the appropriate Acts is less than it otherwise would be. If he succeeds in ordering them so as to secure this result, then however unappreciative the Commissioners of Inland Revenue or his fellow taxpayers may be of his ingenuity, he cannot be compelled to pay an increased tax. This so-called doctrine of ‘the substance’ seems to me to be nothing more than an attempt to make a man pay notwithstanding that be has so ordered his affairs that the amount of tax sought from him is not legally claimable”.
The Chancellor of the Exchequer would have done well to have recalled that quotation earlier this year when speaking of “aggressive tax avoidance”, which is not a concept known to the law.
Certainly it would not be justifiable to impose some sort of windfall tax, even in the case of an abysmal loophole which cost the treasury billions: the rule of law requires the law to be fixed in advance, so far as possible, and does not permit retrospective penal or revenue laws.
Nevertheless, there are still some difficult questions of law and morality involved, not of the open-and-shut variety Dr Mullen seems to assume. In Mr Carr's case, it would pay to recall that the Revenue looks to the substance of any transaction, and there seems on the face of it no purpose to Mr Carr's scheme and its constituent transactions other than to get around income tax.
Mr Carr might not have acted illegally or immorally, depending on how all the questions above are answered. But, having lampooned tax avoiders in the past as part of his well-remunerated stand-up comedy routine, he is certainly guilty of one charge – hypocrisy – and for that reason he has brought the unsympathetic press on himself.
Saturday, 13 March 2010
Kemi Adegoke
This young lass banged on my door today. She is the Conservative candidate for my electorate. She asked if I had any local concerns. I do, so I told her. She promised to email me about one; we will see. She then asked if I have any national concerns. I have many, and shared a few with her. She agreed enthusiastically but I suspect most will fall into the Yes Minister category of perennial insolubles as described below. Still, I will keep an eye on her website and may offer a few suggestions as the campaign proceeds.
The incumbent MP is Tessa Jowell (Lab). Not the most tricky act to follow, one would have thought, though I think Jowell has a large enough majority to scrape in again notwithstanding her well-publicised financial difficulties with the gentleman and scholar Silvio Berlusconi.
These Jowell blames in toto on her now estranged husband, David Mills, though it's hard to claim to be a worldly individual with a grasp of financial affairs, as one presumes any MP would be required to assert, and yet offer an Manuelesque denial of your own personal dealings, especially when your signature is on a mortgage. Jowell also has no chance of joining the chorus of Labour MPs who have comparatively recently trumpeted that they were totally against the Iraq War whilst remaining in the party all along; she was a member of the cabinet at the material time and voted for it.
There is also the mild irritation for me that Jowell is my local MP and lives in London, but does not live in her constituency. Before her apparent separation, and whilst the Italian allegations were front page news, her husband emerged from their North London abode to the expected crowd of hacks and press photographers. He stormed past in a rage, got into his BMW and tried to drive off in a fast and aggressive manner. In doing so he had a minor collision with one of the hacks' cars, and got out of the car after lurching to a halt.
"So who's going to pay for that, then?" he demanded.
"Berlusconi?" came the helpful suggestion from a watching hack.
The incumbent MP is Tessa Jowell (Lab). Not the most tricky act to follow, one would have thought, though I think Jowell has a large enough majority to scrape in again notwithstanding her well-publicised financial difficulties with the gentleman and scholar Silvio Berlusconi.
These Jowell blames in toto on her now estranged husband, David Mills, though it's hard to claim to be a worldly individual with a grasp of financial affairs, as one presumes any MP would be required to assert, and yet offer an Manuelesque denial of your own personal dealings, especially when your signature is on a mortgage. Jowell also has no chance of joining the chorus of Labour MPs who have comparatively recently trumpeted that they were totally against the Iraq War whilst remaining in the party all along; she was a member of the cabinet at the material time and voted for it.
There is also the mild irritation for me that Jowell is my local MP and lives in London, but does not live in her constituency. Before her apparent separation, and whilst the Italian allegations were front page news, her husband emerged from their North London abode to the expected crowd of hacks and press photographers. He stormed past in a rage, got into his BMW and tried to drive off in a fast and aggressive manner. In doing so he had a minor collision with one of the hacks' cars, and got out of the car after lurching to a halt.
"So who's going to pay for that, then?" he demanded.
"Berlusconi?" came the helpful suggestion from a watching hack.
Monday, 8 March 2010
Still Yes Minister
Surfing the net I discover a link to a classic Yes Minister scene. I have left the following comment:
One thing which causes no end of wonder to those who came to the programme decades after it was first run (myself, for example) is how it manages still to be so topical. In different episodes Hacker grapples with ID cards, Trident renewal, funding of the arts as against funding of sport, bribes to and from Arabian countries with whom Britain is trying to make a buck, bailing out of failed city institutions by the Bank of England, appointments to the EU, honours doled out in return for favours, wastage in the NHS, banning of smoking, and on it goes.
The answer given by the authors, Antony Jay and Jonathan Lynn, is that when writing the scripts the first thing they did was go back to the newspapers of the 1950s and look for things that were still current for them (the 1980s). And it was the same old things that nearly 30 years on are still current today – all the things I mentioned in the previous paragraph and many more besides. I have the feeling that for as long as there is a Britain Yes Minister will be topical.
One thing which causes no end of wonder to those who came to the programme decades after it was first run (myself, for example) is how it manages still to be so topical. In different episodes Hacker grapples with ID cards, Trident renewal, funding of the arts as against funding of sport, bribes to and from Arabian countries with whom Britain is trying to make a buck, bailing out of failed city institutions by the Bank of England, appointments to the EU, honours doled out in return for favours, wastage in the NHS, banning of smoking, and on it goes.
The answer given by the authors, Antony Jay and Jonathan Lynn, is that when writing the scripts the first thing they did was go back to the newspapers of the 1950s and look for things that were still current for them (the 1980s). And it was the same old things that nearly 30 years on are still current today – all the things I mentioned in the previous paragraph and many more besides. I have the feeling that for as long as there is a Britain Yes Minister will be topical.
Thursday, 25 February 2010
Falklands again
In Monday's Times one Martin Cross argues that Britain now lacks the "financial capacity, manpower and equipment to defend the Falklands".
This is only so if Britain is again naive enough not to anticipate an Argentine invasion. Otherwise the British hunter-killer nuclear submarine fleet would be eminently able to exclude completely any seaborne invasion attempt, and it is more than doubtful whether the Argentine air force has the capacity to mount and sustain an air invasion.
Even if it does, since the cause of the strain on Britain's forces has been the very serious commitment to US-led invasions of Iraq and Afghanistan, on the basis of the much-discussed "special relationship", I wondered if there would be a chance of the US lending us the assistance of one of its eleven carrier battle groups.
On 25 February the US gave the answer: No.
The "special relationship" remains as special as ever.
This is only so if Britain is again naive enough not to anticipate an Argentine invasion. Otherwise the British hunter-killer nuclear submarine fleet would be eminently able to exclude completely any seaborne invasion attempt, and it is more than doubtful whether the Argentine air force has the capacity to mount and sustain an air invasion.
Even if it does, since the cause of the strain on Britain's forces has been the very serious commitment to US-led invasions of Iraq and Afghanistan, on the basis of the much-discussed "special relationship", I wondered if there would be a chance of the US lending us the assistance of one of its eleven carrier battle groups.
On 25 February the US gave the answer: No.
The "special relationship" remains as special as ever.
Monday, 22 February 2010
Cricketing honours
Letter 12:
From: http://www.timesonline.co.uk/tol/comment/letters/article6978152.ece
January 07, 2010
From: http://www.timesonline.co.uk/tol/comment/letters/article6978152.ece
January 07, 2010
Sir, The criticisms of the New Year Honours system (letters, Jan 5) are all valid, but nothing new. The system has long been no more than a mixture of tokenism, a substitute for paying civil servants a competitive wage and a means for the incumbent government to signify it is in touch with popular sentiment.
The decision to award all of the men’s cricket team MBEs in 2005 is a good example of the last, rather than simply bias against women. Geraint Jones received an MBE for his services as wicketkeeper in the 2005 Ashes. By contrast, both Alan Knott and Bob Taylor, whom one might respectfully suggest had rather more distinguished careers as English wicketkeepers, never received an honour between them. Paul Collingwood’s award was on the basis of a single appearance in the fifth Test, in which he contributed an important 10 in the second innings; Graham Thorpe did not receive an MBE until he had played 100 tests and Mark Butcher, who played 71 tests, has never received a thing.
Perhaps it is better to recognise that the system, like that of MPs’ expenses, is fundamentally flawed rather than simply flawed in execution, and do away with it accordingly.
Cricket and terrorism
Letter 03:
From http://www.timesonline.co.uk/tol/comment/letters/article544416.ece
July 16, 2005
The joys of cricket
From Mr James Wilson
Sir, William Rees-Mogg asks of his enjoyment of a county cricket match two days after the London bombs: “What right did we have to be so happy, so exceptionally happy, at such a time?” The answer is: every right. Not to continue with our way of life is to hand victory to the terrorists.
From http://www.timesonline.co.uk/tol/comment/letters/article544416.ece
July 16, 2005
The joys of cricket
From Mr James Wilson
Sir, William Rees-Mogg asks of his enjoyment of a county cricket match two days after the London bombs: “What right did we have to be so happy, so exceptionally happy, at such a time?” The answer is: every right. Not to continue with our way of life is to hand victory to the terrorists.
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