The coalition agreement stated that the government would “make every effort to tackle tax avoidance, including detailed development of Liberal Democrat proposals”. On Newsnight last night it was revealed that the Lib Dem proposals included tax avoidance by senior public sector employees.
Ed Lester, chief executive of the Student Loans Company, who was appointed in May 2010, has for the past 18 months been paid through Penna Consulting, which charged the Student Loans Company for his services. This means that income tax and national insurance contributions are not deducted at source, unlike student loan repayments.
Paperwork obtained by Newsnight shows that this was signed off at ministerial level, despite officials warning about the loss of revenue. Danny Alexander, George Osborne’s right hand man at the Treasury, confirmed this in the House of Commons last week when he said: “As chief secretary, I now personally sign off any new pay above £142,000.”
Alexander boasted that in 45 of 83 cases that had passed his desk he had managed to lower the pay level. In at least
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