Margaret Hodge shrugs off “tax prat" line

Interview with the PAC chairman.

It’s been an interesting year for tax, and in particular the debate about where the line is drawn between legitimate tax planning and aggressive avoidance. The focus on whether everyone is contributing their fair share is a consequence of austerity and is being played out all around the world, where every pound, dollar and euro of income is more valuable than ever.

In the UK, the Public Accounts Committee (PAC), the body responsible for shining a light into the murkier corners of government finance and making sure taxpayers get value for money, has been at the heart of this debate. The current chairman of the committee is Lady Margaret Hodge. Lady Hodge (the title comes from her second husband) is proud of the PAC’s work on tax, a project it kicked off after a whistleblower reported a so-called sweetheart deal between Goldman Sachs and HMRC. In getting the committee to focus on the issue, Hodge has turned tax into something of a personal crusade.

In the process she rounded on tax advisors, including accountants and lawyers, who devise tax-minimising schemes. The PAC hauled the top tax partners at the Big Four in for a challenging session. In the process she has earned the ire of parts of the profession. Taxation dubbed her its “Tax Prat of the Year”, in a cover story that challenged almost every aspect of the PAC’s report.

Sitting in her Westminster office, Hodge shrugs off the “tax prat” line and claims she doesn’t have a view about the accountancy profession as a whole. “There are people who do a good, honest job. But there is a divide. There are others, in accountancy and the legal profession, who take a different view to mine about the role of tax in society.”

Anyone who has followed the work of the PAC, or indeed who has followed Hodge’s career, won’t be surprised to hear her mount a passionate defence of the positive redistributive role of tax.

“There is a civic duty on all of us to contribute according to our means to the common good,” she says. “In very practical ways all your readers want a public transport system that works and want the realm defended and so on. Even if you can manage on your own and don’t need the support of the state, there are all sorts of things you want from the state and there is a moral imperative to pay a fair contribution to society.

"I know there are people who don’t think that way, I just disagree with them.”

Hodge admits the PAC stumbled onto tax avoidance as an area for investigation, but she is clear why it has become such a defining issue.

“The reason it’s become a big issue is because we’re living in hard times and everyone is feeling the pinch. People want to know everyone is paying a fair share. And it is about fairness. There are those who see tax as just a legal obligation, but I don’t agree. There are legal obligations, but they arise out of a civic duty.”

The rest of this interview can be read on economia.

Margaret Hodge MP. Photograph: Getty Images

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A swimming pool and a bleeding toe put my medical competency in doubt

Doctors are used to contending with Google. Sometimes the search engine wins. 

The brutal heatwave affecting southern Europe this summer has become known among locals as “Lucifer”. Having just returned from Italy, I fully understand the nickname. An early excursion caused the beginnings of sunstroke, so we abandoned plans to explore the cultural heritage of the Amalfi region and strayed no further than five metres from the hotel pool for the rest of the week.

The children were delighted, particularly my 12-year-old stepdaughter, Gracie, who proceeded to spend hours at a time playing in the water. Towelling herself after one long session, she noticed something odd.

“What’s happened there?” she asked, holding her foot aloft in front of my face.

I inspected the proffered appendage: on the underside of her big toe was an oblong area of glistening red flesh that looked like a chunk of raw steak.

“Did you injure it?”

She shook her head. “It doesn’t hurt at all.”

I shrugged and said she must have grazed it. She wasn’t convinced, pointing out that she would remember if she had done that. She has great faith in plasters, though, and once it was dressed she forgot all about it. I dismissed it, too, assuming it was one of those things.

By the end of the next day, the pulp on the underside of all of her toes looked the same. As the doctor in the family, I felt under some pressure to come up with an explanation. I made up something about burns from the hot paving slabs around the pool. Gracie didn’t say as much, but her look suggested a dawning scepticism over my claims to hold a medical degree.

The next day, Gracie and her new-found holiday playmate, Eve, abruptly terminated a marathon piggy-in-the-middle session in the pool with Eve’s dad. “Our feet are bleeding,” they announced, somewhat incredulously. Sure enough, bright-red blood was flowing, apparently painlessly, from the bottoms of their big toes.

Doctors are used to contending with Google. Often, what patients discover on the internet causes them undue alarm, and our role is to provide context and reassurance. But not infrequently, people come across information that outstrips our knowledge. On my return from our room with fresh supplies of plasters, my wife looked up from her sun lounger with an air of quiet amusement.

“It’s called ‘pool toe’,” she said, handing me her iPhone. The page she had tracked down described the girls’ situation exactly: friction burns, most commonly seen in children, caused by repetitive hopping about on the abrasive floors of swimming pools. Doctors practising in hot countries must see it all the time. I doubt it presents often to British GPs.

I remained puzzled about the lack of pain. The injuries looked bad, but neither Gracie nor Eve was particularly bothered. Here the internet drew a blank, but I suspect it has to do with the “pruning” of our skin that we’re all familiar with after a soak in the bath. This only occurs over the pulps of our fingers and toes. It was once thought to be caused by water diffusing into skin cells, making them swell, but the truth is far more fascinating.

The wrinkling is an active process, triggered by immersion, in which the blood supply to the pulp regions is switched off, causing the skin there to shrink and pucker. This creates the biological equivalent of tyre treads on our fingers and toes and markedly improves our grip – of great evolutionary advantage when grasping slippery fish in a river, or if trying to maintain balance on slick wet rocks.

The flip side of this is much greater friction, leading to abrasion of the skin through repeated micro-trauma. And the lack of blood flow causes nerves to shut down, depriving us of the pain that would otherwise alert us to the ongoing tissue damage. An adaptation that helped our ancestors hunt in rivers proves considerably less use on a modern summer holiday.

I may not have seen much of the local heritage, but the trip to Italy taught me something new all the same. 

This article first appeared in the 17 August 2017 issue of the New Statesman, Trump goes nuclear