Colonialism isn't the best answer to tax dodging

Party like it's 1799.

An interesting point from Ed Conway's write-up of the G8's tax debates. It seems Germany and co aren't particularly happy with British Overseas Territories:

Moreover, it transpires that neither Germany or Russia wanted to sign up to some of the G8 pledges on tax evasion. Other countries remain less enthusiastic about the avoidance/evasion clampdown. Others remain sceptical about the UK’s motives – earlier this year Austria’s finance minister Maria Fekter said she laughed when she first heard George Osborne was focusing on tax.

“Great Britain has many money laundering centres and tax havens in its immediate legal remit – the Channel Islands, Gibraltar, the Cayman Islands, Virgin Islands.

“These are all hot spots for tax evasion and money laundering.”

It's similar to a line pushed domestically: the British overseas territories are British, so we should do something about them. It sounds less appealing when you phrase it as what it actually is: colonialism for the left.

The various islands left in the British Empire are, largely, independent. Britain takes responsibility for defence and foreign affairs, and the Home Office recommends the Queen on who to appoint as governor, but beyond that, they are self-determining. They have elected legislatures and heads of government, as well as their own courts systems (although appeals go to the Privy Council) Most of them would probably be fully independent by now – once decolonialisation began, it went along at a fair clip – except they're too small to realistically survive on their own.

You can be fairly sure, however, that if they did survive, and were made fully independent, their first act would probably not be to shrink their financial sectors. That's one of the few areas in which a small economy actually has a competitive advantage over bigger ones.

So what Austria wants is for the Britain to over-rule independent, elected governments and force them to follow policies which aren't in their best interest. I know the sun never set on the British Empire, but that's ridiculous.

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 tribunal fees silenced low-paid workers: “it was more than I earned in a month”

The government was forced to scrap them after losing a Supreme Court case.

How much of a barrier were employment tribunal fees to low-paid workers? Ask Elaine Janes. “Bringing up six children, I didn’t have £20 spare. Every penny was spent on my children – £250 to me would have been a lot of money. My priorities would have been keeping a roof over my head.”

That fee – £250 – is what the government has been charging a woman who wants to challenge their employer, as Janes did, to pay them the same as men of a similar skills category. As for the £950 to pay for the actual hearing? “That’s probably more than I earned a month.”

Janes did go to a tribunal, but only because she was supported by Unison, her trade union. She has won her claim, although the final compensation is still being worked out. But it’s not just about the money. “It’s about justice, really,” she says. “I think everybody should be paid equally. I don’t see why a man who is doing the equivalent job to what I was doing should earn two to three times more than I was.” She believes that by setting a fee of £950, the government “wouldn’t have even begun to understand” how much it disempowered low-paid workers.

She has a point. The Taylor Review on working practices noted the sharp decline in tribunal cases after fees were introduced in 2013, and that the claimant could pay £1,200 upfront in fees, only to have their case dismissed on a technical point of their employment status. “We believe that this is unfair,” the report said. It added: "There can be no doubt that the introduction of fees has resulted in a significant reduction in the number of cases brought."

Now, the government has been forced to concede. On Wednesday, the Supreme Court ruled in favour of Unison’s argument that the government acted unlawfully in introducing the fees. The judges said fees were set so high, they had “a deterrent effect upon discrimination claims” and put off more genuine cases than the flimsy claims the government was trying to deter.

Shortly after the judgement, the Ministry of Justice said it would stop charging employment tribunal fees immediately and refund those who had paid. This bill could amount to £27m, according to Unison estimates. 

As for Janes, she hopes low-paid workers will feel more confident to challenge unfair work practices. “For people in the future it is good news,” she says. “It gives everybody the chance to make that claim.” 

Julia Rampen is the digital news editor of the New Statesman (previously editor of The Staggers, The New Statesman's online rolling politics blog). She has also been deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.