Tony Blair’s accounts ‘massively opaque’
Former Prime Minister Tony Blair channelled millions of pounds through a network of companies and paid just a fraction in tax, according to recently published official accounts.
The accounts provide the strongest evidence yet of the scale of Blair’s complicated finances through his various activities since leaving office in June 2007, which include his business consultancy firm Tony Blair Associates, speeches/lectures, and acting as an adviser to JP Morgan and Zurich, among other ventures.
Richard Murphy said in his blog that Blair adopted a “massively opaque structure” to ensure that much of his activity was hidden from view in an “arcane and rare” corporate structure called a 'limited partnership'.
The former Labour leader had set up a management services company, Windrush Venture, which was principally used to manage his business affairs.
The accounts reveal an income last year of more than £12m and ‘administrative expenses’ of £10.9m, leaving Windrush Ventures with a profit of more than £1m, on which Blair paid just £315,000 in corporate tax, at a rate of 28%.
Of the administrative expenses, £2.285m went on paying 26 employees an average salary of £88,000; £550,000 a year went on rent for Blair’s offices in Grosvenor Square and a further £300,000 was used for office equipment and furniture. However, this leaves nearly £8m of “administrative expenditure” unexplained in the accounts.
Murphy told The Telegraph: “It is in the limited partnership where things really happen. But that is the one Mr Blair keeps secret. We don’t know how much money is in the LP. It is completely hidden. The question is why is Tony Blair running such as a completely secretive organisation?”
“By exploiting legal but dubious legal loopholes he has ensured contrary to the spirit of the law that it does not need to file its accounts on public record even though all its members are limited liability entities,” Murphy added.
While the Windrush accounts are prepared in accordance with the relevant legal, accounting and regulatory guidance, and audited by KPMG, they come under public scrutiny at a time when both Labour and Conservative leaders appear to be cracking down high earning tax avoiders.
Just last week the Tories came out in support of a new anti-avoidance rule and further scrutiny on senior executive pay, while Labour leader Ed Milliband has been recently peddling the concept of "responsible capitalism".
Murphy concluded: “When the debate now is about good capitalism he [Blair] shows he is a long, long way from being anywhere near the demands for accountability that imposes. And that is why it’s fair to raise the issue.”