Ahead of tomorrow’s ‘mini-Budget’, ANDREW FISHER delves into the murky pool of business interests retained by the millionaire Chief Secretary to the Treasury, Croydon South MP Chris Philp
Removing the cap on rich bankers’ bonuses, cutting Stamp Duty, slashing Corporation Tax and cutting taxes on higher earners. Thatcherism is well and truly back in today’s Conservative Party.
Trickle-down economics is being repeated with a subtext of “Yes, we’re giving huge tax breaks to the rich, but it will benefit everyone … honest”.
Of course, trickle-down economics didn’t work the first time round in the 1980s – inequality doubled, growth slowed and poverty increased.
This first as tragedy, second time as farce economic strategy in the new government under Liz Truss is being overseen by her Chancellor of the Exchequer Kwasi Kwarteng and Chief Secretary to the Treasury, Croydon South MP Chris Philp.
Kwarteng has said his solution to the cost of living crisis is “cutting taxes, putting money back into people’s pockets and unshackling our businesses from burdensome taxes and unsuitable regulations”.
But all the tax cuts leaked so far ahead of tomorrow’s emergency Budget statement seem to put the most money into the pockets of those with plenty already. Even the reversal of the National Insurance increase will benefit the highest paid disproportionately, with the Institute of Fiscal Studies calculating that the lowest-paid workers stand to gain just 63p a month. The richest will get £150 a month.
Reducing Corporation Tax, slashing Stamp Duty and removing the cap on bankers’ bonuses will benefit only a wealthy elite of people, who just happen to be the sort of people who fund the Conservative Party.
Or those who become Conservative MPs.
Take, for example, Chris Philp.
The Chief Secretary to the Treasury was first elected to represent Croydon South in 2015. He had previously been a director of two businesses that turned out to be conspicuous failures: Blueheath Holdings and Clearstone. The latter company collapsed owing £500,000 in unpaid taxes.
Philp claims he had no involvement in Clearstone from November 2006, seven months before it went into administration owing half a million pounds to the public exchequer where he now works.
The past is the past. What matters more is the present.
And presently Philp is an “individual person with significant control” of at least five property, finance and investment vehicles – mostly Limited Liability Partnerships, or LLPs, called Pluto: Pluto Partners LLP, Pluto Silverstone Co Invest LLP, Pluto Monza Co Invest LLP, Pluto Development Partners LLP and Pluto Capital Management LLP.
Lord Prem Sikka, a professor of accountancy, told me, “LLPs provide liability shields to their controllers.
“They provide opacity and are light on disclosures, especially about executive pay and other returns extracted by their controllers.”
Chartered accountants Plummer Parsons say that LLPs, “can offer significant tax advantages… an increasing number of people are taking the view that the use of an LLP is by far the most commercially flexible and tax efficient structure available”.
The new Chief Secretary to the Treasury must be in agreement.
Philp claims “receipts I receive are subject to full UK income tax, capital gains tax, etc”.
But we only have his word for that, as Philp has refused to publish his tax returns.
When he was Shadow Chancellor, Labour’s John McDonnell published his tax return every year and challenged his opposite number to do the same. Labour’s Shadow Chief Secretary, Pat McFadden, might want to consider the same transparency challenge to Chris Philp…
Philp’s LLPs have played a significant role in funding some controversial housing developments, including for housing developer Pocket Living, a company accused of contributing to “rabbit-hutch Britain”.
Pocket Living is responsible for a recent development at Addiscombe Grove, which seems likely not to have met the Parker-Morris standards on minimum property sizes that were abolished by the Thatcher government.
Philp must have been at least aware of Pocket Living for several years.
In 2017, shortly after the Croydon South MP had been appointed as a Parliamentary Private Secretary to Treasury ministers, Philp spoke at a fringe event at Conservative Party Conference alongside Marc Vlessing, the CEO of Pocket Living. It is unclear what advice Philp took on conflicts arising from his business interests while attending such meetings in his role as part of the Treasury ministers’ team.
Vlessing, who was awarded the OBE in 2018 “in recognition of everything Pocket Living has achieved”, is available as a speaker on the subject of “How do you influence politicians to achieve lasting regulatory change to create new markets”.
Vlessing also recently spoke on a panel with Sir Eddie Lister, Boris Johnson’s former chief of staff who, until 2019, was also Chair of Homes England. Vlessing was there to complain about planning laws. “We are now operating in 16 local authorities and it does chew up an awful lot of time to get through all these different political and planning environments,” he told the “Movers and Shakers” event.
This might seem a conflict of interest for the Chief Secretary to the Treasury. Philp is quoted in this week’s issue of Private Eye as saying that he is “currently going through the regular Treasury process to declare and manage interests and ensure no conflict”.
Former ministers in such circumstances were advised to divest themselves of all such potential conflicts of interest. Time will tell what decisions Philp takes to avoid such concerns, and such concerns are significant.
When Philp was first elected to Parliament, his Prime Minister was David Cameron. It was Cameron who said, in relation to the MPs’ expenses scandal, “Sunlight is the best disinfectant.”
Perhaps Philp can take Cameron’s advice and open up his murky finances to some sunlight?
- From 2015 to 2019, Andrew Fisher, pictured right, worked as the Labour Party’s Director of Policy under Jeremy Corbyn. He is the chair of the Croydon Central Constituency Labour Party. Fisher is also the author of The Failed Experiment – and how to build an economy that works, and now writes regular columns for InsideCroydon in a personal capacity
Some of Andrew Fisher’s recent columns:
- New PM gives Philp opportunity to do right thing for Croydon
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- England’s Tories remain enthusiastic only about ground rent
- Tories’ sly stealth tax rises are ‘economically idiotic’ as inflation soars
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