Cameron under fire for family's tax avoidance

Ian Cameron ran investment funds in Panama and Geneva aimed at avoiding UK tax.

The Guardian reports that David Cameron's father made his family fortune through a network of offshore funds in countries like Panama and Geneva, which "explicitly boasted of their ability to remain outside of UK tax jurisdiction".

Ed Howker and Shiv Malik write:

The structure employed by Cameron senior is now commonplace among modern hedge funds, which argue that offshore status can help attract international investors. UK residents would ordinarily have to pay tax on any profits they repatriated, and there is nothing to suggest the Camerons did not.

Nevertheless, the dramatic growth of such offshore financial activity has raised concerns that national tax authorities are struggling to pin down the world's super-rich.

The news has sparked mixed reaction. The tax campaigner Richard Murphy points out that it leaves the prime minister open to charges of hypocrisy. Despite inheriting £300,000 from his father after his death, Cameron is seemingly against the sorts of practices which were used to earn that money, saying about a general anti-avoidance rule that:

One of the things that we are going to be looking at this year is whether there should be a general anti-avoidance power that HMRC can use, particularly with very wealthy individuals and with the bigger companies, to make sure they pay their fair share.

On the other hand, many have agreed with the sentiment expressed by Sally Bercow, who wrote:

Not liking Guardian front page on Cameron family fortune. At all. Raking around his dead father's affairs - not on. And Dave is not his dad. Feel a bit sick having read it actually. Am clearly going soft. I say attack Dave, not his late father...

Downing Street is sticking to the latter line, telling the Guardian that it did not want to comment on what was a private matter for the Cameron family.

The problem the Camerons have is that, as the debate over whether or not George Osborne pays the 50p tax demonstrated, wealth is as much a political issue as income. And while the latter can be safely divided between personal income, knowledge of which may be in the public interest, and family income, which isn't, the former is harder to draw a line through.

Accusations that the prime minister is "out of touch" are fundamentally rooted in his family history and the privilege that it bequeaths him. If examining that history is out of bounds, then the debate is forced to focus more heavily on wealth than income – which can distort the debate.

David Cameron leaves Number 10. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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How Theresa May laid a trap for herself on the immigration target

When Home Secretary, she insisted on keeping foreign students in the figures – causing a headache for herself today.

When Home Secretary, Theresa May insisted that foreign students should continue to be counted in the overall immigration figures. Some cabinet colleagues, including then Business Secretary Vince Cable and Chancellor George Osborne wanted to reverse this. It was economically illiterate. Current ministers, like the Foreign Secretary Boris Johnson, Chancellor Philip Hammond and Home Secretary Amber Rudd, also want foreign students exempted from the total.

David Cameron’s government aimed to cut immigration figures – including overseas students in that aim meant trying to limit one of the UK’s crucial financial resources. They are worth £25bn to the UK economy, and their fees make up 14 per cent of total university income. And the impact is not just financial – welcoming foreign students is diplomatically and culturally key to Britain’s reputation and its relationship with the rest of the world too. Even more important now Brexit is on its way.

But they stayed in the figures – a situation that, along with counterproductive visa restrictions also introduced by May’s old department, put a lot of foreign students off studying here. For example, there has been a 44 per cent decrease in the number of Indian students coming to Britain to study in the last five years.

Now May’s stubbornness on the migration figures appears to have caught up with her. The Times has revealed that the Prime Minister is ready to “soften her longstanding opposition to taking foreign students out of immigration totals”. It reports that she will offer to change the way the numbers are calculated.

Why the u-turn? No 10 says the concession is to ensure the Higher and Research Bill, key university legislation, can pass due to a Lords amendment urging the government not to count students as “long-term migrants” for “public policy purposes”.

But it will also be a factor in May’s manifesto pledge (and continuation of Cameron’s promise) to cut immigration to the “tens of thousands”. Until today, ministers had been unclear about whether this would be in the manifesto.

Now her u-turn on student figures is being seized upon by opposition parties as “massaging” the migration figures to meet her target. An accusation for which May only has herself, and her steadfast politicising of immigration, to blame.

Anoosh Chakelian is senior writer at the New Statesman.

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