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Juncker must show he’s serious about tackling tax avoidance

notaxhavensMuch of the daily drip of revelations about European Commission President Jean-Claude Juncker’s ‘intensely relaxed’ approach to corporate tax dodging is hardly surprising. The question is whether we can use it to force Mr Juncker – whose intimate relationship with Luxembourg’s lax tax regime was why Labour opposed him taking up his present post in the first place – into taking action that will tackle these and other abuses.

MEPs and tax justice campaigners must not, however, fall into the trap of giving the Commission an easy way out of taking real action – we need action that is strong and decisive. We must resist anything that could allow those opposed to action to kick proposals into the long grass.

The latest ‘Lux Leaks’ revelations claim Mr Juncker, while prime minister and finance minister – he held both posts concurrently – acted as a business partner who ‘helped solve problems’ for multinationals. At the time, he reportedly said he “should neither feel ashamed nor need to justify” himself for rolling out the red carpet and enabling these companies to dodge billions in tax.

At a time of crippling austerity across Europe, such behaviour is even more unacceptable, as billions in tax revenue goes uncollected as a result of these lax Lux policies, money uninvested in public services for the benefit of the many, with the privileged few literally getting off scot free. No more. No longer can this situation be tolerated.

We need urgent action to tackle tax dodging, yet some of the measures proposed, such as the pointless gimmick of a motion of censure brought forward by UKIP – a party whose leader Nigel Farage has repeatedly come under fire for his tax arrangements, including the setting up of offshore accounts – will do nothing.

The option of a European Parliament committee of inquiry – which has the support of many people and organisations for whom I have great respect – sounds like a strong response, but we are still to be convinced it is the best response.

A committee of inquiry cannot look into issues of national law or taxation law and can only investigate breaches or poor application of EU law; cannot compel countries to provide them with any information; and can only look backwards at activity that has taken place already. It will not be able to look at the broader issue of tax havens or recommend immediate legislation to tackle this problem.

Labour MEPs have a long history of fighting against tax evasion and aggressive tax avoidance. It was our MEPs who led for the centre-left Socialists and Democrats Group in drafting last year’s European Parliament report that called for all multinational companies to be compelled to report what they earn, where they earn it and how much tax they pay; a common approach to tackling the use of tax havens; and a blacklist of companies engaging in tax evasion.

Today the Commission will unveil its work programme for 2015. This is a chance for Jean-Claude Juncker to show he is a reformed character and promise legislation to stop tax avoidance. This week also represents an opportunity for David Cameron to demonstrate his commitment to tax justice and ensure the issue of tax havens is on the agenda of the European Council summit.

Labour MEPs have long said we would not and indeed did not support Mr Juncker for President of the European Commission, precisely because of his involvement in creating Luxembourg’s lax tax regime.

Today is a big test of whether the Commission will act. The clock is ticking.

Labour MEP welcomes compulsory palm oil labelling

A change in European law made by an East Midlands MEP will mean all products containing palm oil must be clearly labelled. The new requirements will come into force on 13 December and follow concerns from many consumers about unsustainable palm oil.

Glenis Willmott, Labour MEP for the East Midlands, said:

“It is great news that the palm oil labelling I negotiated in the European Parliament is coming into force this month. Many people are gravely concerned about the destruction of the world’s rainforests, at a rate of 300 football fields an hour, partly to make way for unsustainable palm oil plantations. Fertile rainforests are the natural habitat of many endangered animals such as the orangutan.

“Currently companies can simply label palm oil as ‘vegetable oil’, meaning that consumers cannot make informed choices about what products to buy.”

Figures suggest that many manufacturers are already choosing to use other oils, or switch to certified sustainable palm oil.

Glenis Willmott MEP added:

“Labelling products with palm oil can have the double benefit of empowering consumers to make ethical choices and encouraging food producers to use sustainable ingredients. I hope that these new rules will be another step towards protecting the world’s rainforests and informing consumers.”

Osborne fails to overturn bankers’ bonus cap

First published by the Lincolnshire Echo, December 2014:

cameron-osborneIn recent weeks, George Osborne admitted defeat in his mission to keep limitless bonuses for top bankers in the City of London. Five years on from the financial crash, the average wage in the East Midlands is under £20,000; just two days’ work for some Barclays bankers. After Osborne spent over a year and £46,000 of taxpayers’ money on a legal battle, the European Court of Justice rightly ruled in favour of the EU’s cap on bonuses. This means that bonuses will be limited to 100% of bankers’ salaries, or up to 200% if shareholders agree to go higher.

In April 2013, Labour MEPs led work in the European Parliament, passing a package of reforms for the banking sector aimed at preventing the casino capitalism that caused the financial crash nearly six years ago. Alongside curbing excessive bonuses, these reforms made it easier for banks to lend to small businesses, which can unlock the potential for much-needed economic growth. Unfortunately levels of lending are still far too low and it appears that many British banks have failed to clean up their act or change their culture.

Many banks have already found creative ways to avoid the cap: some dole out unlimited ‘allowances’ to top-up executives’ pay, whilst others have opted for huge salary increases to enable even bigger bonuses to be paid out. For example, last year it was reported that one bank boss gets £1.7 million worth of shares each year on top of his seven figure salary and annual bonus. In 2011, five top Barclays managers shared a pay out of over £110 million.

Many of us have been appalled that Osborne has prioritised defending unlimited bonuses for bankers. People are equally angry that bankers pay has soared since the financial crash: up 11% in 2011 and 35% in 2012 alone. Meanwhile, many
people in the East Midlands have not had an above inflation pay rise for over five years. Insecure and zero-hour contracts are at the highest level ever; even getting a week’s work is uncertain for many. All of this indicates that this is a recovery enjoyed by the few, not the many.

Following the financial crash, it is clear that the way banks operate must change. The public are simply not convinced by the piecemeal promises that have been given so far, and with top executives’ pay continuing to rise rapidly, it isn’t hard to see why. Despite talk of breaking up big banks and introducing a better banking culture, Osborne and the coalition government have failed to pass any meaningful reforms. Instead it fell to the European Parliament to tackle obscene bonuses and encourage banks to lend in order to kick-start growth. Along with my Labour colleagues in Brussels, I will continue to work towards a more responsible, ethical banking sector.

Labour MEP Jumps for Dystonia!

Glenis and Vytenis Andriukaitis 2An East Midlands MEP has taken up the challenge to jump for dystonia and organised a photo shoot in the European Parliament to raise awareness of this little known brain disease. More than half a million people across Europe, including 70,000 in the UK, are affected by dystonia in some form, and many do not even know they have the disease. It causes pain and involuntary muscle contractions; there is currently no known cure for the condition.

Glenis Willmott, Labour MEP for the East Midlands, said:

“I am delighted to be joined by the Heath Commissioner, Vytenis Andriukaitis, and many high profile MEPs to raise awareness of this relatively unknown brain disease. If more people know about it then hopefully we can tackle the stigma felt by people with dystonia and of course get earlier diagnosis and treatment for people affected by it.”

Dystonia affects men, women and children of all ages and causes varying degrees of disability and pain, from mild to severe. It can affect one part of the body or all muscles in general. Although there is currently no cure, multiple treatments exist and scientists around the world are actively working on new therapies.

Glenis Willmott MEP added:

“Dystonia is a long-lasting disease but often it does not affect other brain functions. I am glad to be a part of this journey towards improved awareness, better treatments, increased research and one day, hopefully a cure. Together we can make a real difference for people affected by this devastating disease.”

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