Sunday, 14 February 2016

REVEALED: IKEA''s tax avoidance - more complicated than its flat-pack instructions?


A new report commissioned by the Greens in the European Parliament has revealed that furniture multinational IKEA has dodged €1 billion in taxes over the last 6 years using onshore European tax havens.

IKEA is using a series of tax loopholes in different European countries, namely the Netherlands, Belgium and Luxembourg, to avoid paying taxes. Molly Scott Cato MEP, a member of the European Parliament’s special committee on tax, said:


Just like its flat-pack furniture, assembling a tax dodge is simple if you know the right tricks. And it’s easy to tuck away out of site where tax administrations will barely notice it. This report deconstructs the massive scale of IKEA’s tax avoidance practices. 

Ikea Bremt Park
This is a company which is held in some affection by British people, so what is revealed will come as a shock to many and risks damaging IKEA’s reputation with UK customers. It is time that corporations such as IKEA realised that being an ethical company goes beyond checking the credentials of suppliers and treating your staff well. Complex tax avoidance schemes are unethical and British people expect companies to pay a fair share of tax to fund the services they rely on.

Scott Cato  has joined other Green MEPs in signing a letter to the EU competition commissioner, Margrethe Vestager, and tax commissioner, Pierre Moscovici, presenting the report as evidence and urging the Commission to carry out a further investigation to verify possible infringement of EU law. Molly said:
This cynical ‘tax hopping’ is reprehensible and we want the European Commission to fully investigate if and how it infringes on EU law, and take action to address this. EU finance ministers, for their part, should work immediately on trying to recoup the tax revenues, which have been denied to them.
Greens also say that a Corporate Tax Package published by the European Commission at the end of January will not go far enough in preventing IKEA using its different tax loopholes. Molly concluded:
There is an urgent need to change the regulatory framework which facilitates corporate tax avoidance in Europe. We badly need public country-by-country reporting rules for all sectors to provide transparency and ensure the tax strategies of corporations can be properly scrutinised. 

We also need a minimum corporate tax rate to end the race to the bottom of tax dumping in Europe. Such measures require the active cooperation of EU governments and most have so far shown no enthusiasm for truly tackling corporate tax avoidance.

Details of new uplifted Brent councillor allowances for 2016-17

Perhaps it is not a great  public relations strategy to be discussing a 1% increase in councillor allowances at the same Full Council Meeting which will be agreeing a budget that cuts services, but that is what will happen on February 22nd LINK

Apart from the uplift there are other changes due to the proposed revised Scrutiny arrangements (see below). It is also proposed that councillors will be able to claim travelling and subsistence allowances for conferences they attend outside of the borough. This will be set at the same level as council officers.

In a move that might not sweeten relationships between the two Conservative Groups on the Council it is proposed to remove the  deputy leader allowance for the Conservative Group (led by Cllr John Warren) from Cllr Carol Shaw. Instead £9,000 will go to the leader of the Brent Conservative Group, Cllr Suresh Kansagra.

The report reminds councillors of the principle behind the allowance scheme:
 Members are reminded that the 2014 Report advocates the setting of allowances at a level that enables people to undertake the role of councillor while not acting as an incentive to do so. It is equally important, as acknowledged, that there should not be a financial disincentive. It is also worth mentioning that in 2014 Members allowances were set at a reduced, or much reduced, level than the amount recommended by the independent panel. The difficulty in increasing allowances for Members given the current financial austerity, was recognised by the independent panel
These are the proposed new allowances for 2016-17:

BASIC, SPECIAL RESPONSIBILITY AND CO-OPTED MEMBER ALLOWANCES WITH EFFECT FROM 1 APRIL 2016

Basic Allowance

Payable to all councillors = £10,100


Special Responsibility Allowances
(No more than one allowance per member)  This is in addition to the Basic Allowance.
1. Leader of the Council = £39,354

2. Deputy Leader of the Council = £28,681

3. Other Cabinet Members (x6) = £18,898

4. Chair of the Scrutiny Committee = £14,140 (under current scrutiny arrangements until 18 May 2016)

5. Vice-Chair of the Scrutiny Committee = £5,050 (under current scrutiny arrangements until 18 May 2016)

6. Chair of the Community and Well-being Scrutiny Committee (under new scrutiny arrangements from 19 May 2016) = £14,140

7. Chair of the Resources and Public Realm Scrutiny Committee (under new scrutiny arrangements from 19 May 2016) = £14,140
8. Vice-Chair of the Community and Well-being Scrutiny Committee (under new scrutiny arrangements from 19 May 2016) = £5,050

9. Vice-Chair of the Resources and Public Realm Community and Well- being Scrutiny Committee (under new scrutiny arrangements from 19 May 2016) = £5,050

10. Members of the Scrutiny Committee (x6) (under current scrutiny arrangements until 18 May 2016) = £3,202

11. Members of the Scrutiny Committees (x12) (under new scrutiny arrangements from 19 May 2016) = £3,202

12. Chair of the Planning Committee = £14,140
13. Members of the Planning Committee (x6) = £3,234

14. Chair of the Standards Committee = £2,155

15. Co-Chair of the Youth Parliament = £2,155

16. Chair of the Pension Fund Sub-Committee = £2,155

17. Chairs of the Service User Consultative Forums (x5) = £2,155

18. Chairs of the Brent Connects Area Consultative Forums (x5) = £4,873

19. Members of the Alcohol and Entertainment Licensing Committee (x15) = £2,155
20. Member of the Adoption and Permanency Panel = £3,234

21. Member of the Fostering Panel = £3,234

22. Leader of the Principal Opposition Group* = £12,913
23. Other Group Leader(s) = £9,000

24. Group Whip for the majority group with over 50% of councillors = £5,583

25. Deputy Whips for the majority group (x2) = £2,155

26. Mayor = £9,090

27. Deputy Mayor = £7,070 

*For the purposes of this Scheme this is the second largest group of the Council. If there are two or more opposition groups of the same size, it is such group as the Council shall decide.

Co-opted Member Allowances

1. Chair of the Audit Committee (non-voting) = £423

2. Independent member(s) of the Standards Committee (non-voting) = £423

3. Education voting co-opted members of the Scrutiny Committee (x4) (under current scrutiny arrangements until 18 May 2016) = £224

4. Education voting co-opted members of the Community and Well-being Scrutiny Committee (x4) (under new scrutiny arrangements from 19 May 2016) = £224

The introduction of two Scrutiny Committees is the main source of the increase in spending on allowances.  The overall budget cannot be predicted because it is not possible to forecast claims under the new conference expenses system and because only one special allowance can be paid even if a councillor takes on several roles.  The allocation of these roles will not be known until after the AGM.

The allocation of roles has been controversial in the past with accusations of unfairness to councillors with an independent mindset and favouritism towards the compliant. The increase in the number of potential roles may satisfy more of the 56 strong Labour Group.

With the leadership of the Labour Group (and therefore the Council)  to be decided at the AGM in May things could become quite interesting.


Brent admits single Scrutiny Committee failures and proposes a change to two committee system

Less than two years after the adoption of the controversial decision to have just one Scrutiny Committee in Brent proposals are to go before the Cabinet to have two Scrutiny Committees. If adopted this would go to the May Council AGM.

The proposal outlines the issues that have arisen from the single committee structure, some of which were forecats by a guest blog on Wembley Matters in May 2014 LINK:

.        The purpose of moving to a single Scrutiny Committee meeting on a frequent basis was to enable a more consistent, holistic and streamlined approach to all scrutiny activities commissioned by a single committee. The introduction of a single committee to replace the previous four themed scrutiny committees also made a considerable saving in terms of member allowances. Prior to May 2014 each scrutiny committee had a chair, vice-chair and six members with respective allowances. The annual potential cost of each committee was £38,020 in member allowances, making a total for the whole scrutiny function of potentially £152,080. The current cost of member allowances for a single scrutiny committee is potentially £36,190 making a potential saving of £115,890 on the previous model. These costings are maximum potential costs only as members already in receipt of a special responsibility allowance would not be entitled to a second special responsibility allowance for their scrutiny role. The costings nonetheless provide a useful illustration of the indicative costs implications.

.        It was considered that operating separate scrutiny committees produced a fragmented approach to scrutiny with each committee developing its own work programme which did not always reflect the cross-cutting aspects of complex policy issues. It was also felt that a single committee would be a more effective use of the finite officer resources available to support scrutiny given the pressure on resources.

.        However after nearly two years of operating the single Scrutiny Committee structure, the anticipated advantages have not outweighed the logistical issues of monthly meetings and has resulted in a concentration of scrutiny activities into a relatively small group of members and officers.

.        Having one committee responsible for all scrutiny activities has meant that the committee has not developed in depth specialism and understanding of services or key policy agendas. With a wide variety of issues being considered at each meeting the agendas can be incoherent and this makes it difficult to develop continuity on specific subjects or issues between committee meetings.

.         In particular the move away from themed committees has resulted in less active engagement of service areas in working constructively with scrutiny members as there is less perceived ownership of one corporate Scrutiny Committee. This has both distanced service departments from scrutiny and meant that less members overall are activity engaged in debate and discussion on the policy issues and performance of Council services. In practice the current model means that only eight members are actively engaged in scrutiny discussion on a regular basis (although other members who are not part of the formal scrutiny committee do contribute to task groups). Previously around 30 non–executive members regularly contributed to a scrutiny committee at least once a quarter.

.        The single Scrutiny Committee model has also impacted on the development of a productive scrutiny relationship with statutory partners, particularly in relation to the duties of the Council to scrutinise the provision of local health services and partnership work on community safety. It has proved difficult to accommodate a consistent work programme on health issues, children’s services and adult social care within the single work programme. This has limited the development of an in depth understanding of these complex and critical service areas, which was noted in the findings of the recent Ofsted inspection of Brent’s Safeguarding and Looked After Children’s services.

.        The disadvantage of a single Scrutiny Committee structure could not necessarily have been foreseen. Brent is still the only Council in London to operate a single scrutiny committee structure, although three others have a main committee with themed sub-committees. However as the Council enters the next phase of change with the development of the Brent 2020 Vision and the programme of outcome based reviews, it is vital that we reconsider the most appropriate scrutiny structure which will facilitate the effective engagement of members in shaping the future direction of the Council via the Scrutiny function. This is particularly important given the political composition of the Council and the challenging nature of the issues the borough faces.

The report goes on to propose a two committee structure to remedy the situation after setting out the role of Scrutiny:
 
.        There are a number of key objectives which any new scrutiny structure should be designed to achieve. These are:-
·      To enable non-executive members to develop a thorough understanding of key policy and service issues which supports effective and constructive scrutiny of performance and decision-making across Council services and meets the statutory requirements of scrutiny.
·      Maximises the number of Members engaged in regular scrutiny activities and enables non-executive members to contribute to the shaping of Council policy at the right point in the policy development process.
·      A structure that covers both the breadth of internal and external issues but also provides sufficient scope for the committee to develop specialisation and become experts in their subject areas.
·      The frequency of scrutiny meetings is aligned to the decision-making timetable and enables high quality reports to be produced with scrutiny input made at the right time in the development of options and proposals.
·      Can take a holistic view of partnership, performance and resourcing issues in relation to the individual service or issue under scrutiny.
·      Enables clear accountability of Lead members and senior officers for decisions and service performance.
·      The scrutiny function should be responsive to the views and concerns of service users and residents, actively seeking their opinions to shape their work programme.
·      Is properly resourced and supported by senior officers and services within the Council and the contribution of scrutiny members is a valued part in the process of defining the Council’s future policy direction.
.        3.15  In order to achieve these objectives it is therefore proposed that the future Scrutiny committee structure should, as set out below, be more closely aligned to the organisational structure of the Council as well as providing more opportunity for in-depth scrutiny.

 Proposed Scrutiny Structure

The proposal is to have two scrutiny committees combining the following remits:-

·      Community and Well being Scrutiny Committee 

This committee would cover Housing, Adult Social Care, Public Health and the statutory responsibilities with regard to scrutiny of local health services and major reconfigurations of provision. It would also scrutinise the children and young people’s service, partnership work undertaken by the Children’s Trust and scrutiny of Safeguarding arrangements. The committee would be composed of eight elected members (seven from the Labour Group and one opposition group member which is consistent with current political balance arrangements). The four voting education co-opted members and the two non voting education co-opted members would be part of this committee. 

·      Resources and Public Realm Scrutiny Committee 

This committee would cover corporate resources, (including Customer Services, Policy, Partnerships and Performance, Procurement and IT) as well as regeneration, environment and community safety. The committee would be composed of eight elected members (seven from the Labour Group and one opposition group member which is consistent with current political balance arrangements). 
The indicative cost implications in respect of special responsibility allowances are set out below. As previously stated, however, these costings are potential maximum costs only and actual costs are likely to be lower as some of the members will already be in receipt of a special responsibility allowance. In addition, in accordance with the provisions of the Members’ Allowance Scheme, a 1% uplift in allowances has been factored in. On this basis the total potential costs are £40,614 higher than the current scrutiny structure.

2 x Chairs allowance at £14,140
2 x Vice Chairs at £5,050
12 x SRA allowance for committee members at £3,202
Total
£28,280 £10,100 £38,424
£76,804
  
The full report can be found HERE

Saturday, 13 February 2016

Should Greens and Labour 'think the unthinkable' to topple the Tories?


Following on from the last article this is another Guest Blog, this time  from Davy Jones. It was first published by Labour Briefing LINK  I am no longer a member of the Brent Green Party Committee but need to make it clear that this is not to be seen as representing the views of Brent Green.  It is a contribution to a discussion which is also happening elsewhere (see Michael Calderbank's Facebook discussion of a Progress report by Danny Dorling.
 

JEREMY CORBYN’S AMAZING VICTORY in the Labour leadership election has rightly revived the question of how Greens and other progressives can work together with Labour. This was not easy during the recent General Election, when Labour nationally was supporting austerity and was well to the right of the SNP, Plaid and the Greens. Potentially, all that has now changed.


“There could be Labour Green candidates in many areas to avoid splitting the anti-Tory vote.”



As someone who stood for the Greens against a left Labour candidate in Brighton Kemptown, I am acutely aware of the need for us to avoid dividing ourselves against the most reactionary government in my lifetime. The Tories received the support of less than 25% of the electorate.

They are also trying to hold onto power permanently by redrawing the boundaries and hastening individual voter registration. We therefore have to “think the unthinkable” to topple the Tories.


The historic link of the Labour Party to the trade unions has entrenched the notion of it being the sole party on the left. Most other European countries can boast significant alternative left parties. Almost uniquely, the UK still retains the First Past the Post system for national elections, which is deeply undemocratic and reinforces the two-party domination of elections.


It is vital that Labour under Jeremy unequivocally comes out in support of proportional representation. This would at a stroke make it far more likely that joint work and electoral pacts might be considered across the left. But it would also signal that Labour understood that it risks never being elected and forming a government under the current electoral rules.


Above all, members of Labour, the Greens, the SNP, Plaid and other left currents need to come together in campaigning work – against austerity, tackling climate change, defending the NHS, bringing railways back into public ownership. This will help to overcome accumulated sectarianism, lack of goodwill and trust. Only then will electoral alliances or other bold steps feel realistic and essential.


Out of such collaboration, it would be logical to identify the key areas of policy agreement of Corbyn’s Labour, the Greens, SNP and Plaid – and to discuss in a constructive way where differences remain on other key issues.


From such discussions a Progressive Policy Platform could be developed across the parties of the left. There could be negotiations over whether an agreed single candidate could be found to stand on that platform to take on the Tories, with other parties considering whether they would stand down or run merely a token local campaign.


Possible Issues for Collaboration and a Progressive Policy Platform:

  • Tackling climate change – supporting renewable energy, opposing fracking and nuclear energy; removing subsidies from fossil fuels
  •  War & Peace – opposing military interventions in the Middle East; no to replacing Trident; ending the global arms trade
  • Europe – for a progressive democratic Europe of social justice and solidarity
  • Austerity and cuts to public services – supporting those fighting against the cuts, especially the attacks on local council services and democracy, and for increased investment in public services; closing tax havens and loopholes, forcing big companies to pay taxes and reforming the banking sector
  • Privatisation – opposing it in the NHS and elsewhere, and for bringing other key services, such as rail, energy, academies, back into public ownership
  • Housing – opposing Right to Buy, supporting private sector rent controls, and a massive capital programme of house- building including making existing homes energy efficient
  • Democratic rights – Opposing the Trade Union bill; support for proportional representation; opposing the Immigration Bill and supporting refugees; for a fully elected second chamber.


“An even more radical option, namely that the Green Party affiliates to the Labour Party in the same way as the Co-operative Party...” 


Others on the left have suggested an even more radical option, though many Green and Labour members will be aghast at the suggestion, namely that the Green Party affiliates to the Labour Party in the same way as the Co-operative Party is affiliated.  Labour claims to be the broad church of progressive politics, it is argued – so why not invite the Greens (and maybe also the SNP and Plaid) to a affiliate if they wish to do so?


The parties would remain independent, but through affiliation, members would stand for election as Labour or Labour Greens, just as people currently stand as Labour or Labour and Co-operative Party members. So there could be Labour Green candidates in many areas to avoid splitting the anti-Tory vote.


Clearly, this would be a non-starter unless and until Jeremy Corbyn is able to ensure the Labour Party nationally adopts consistently anti-austerity and pro-environmental sustainability policies, as well as a thorough democratisation of the Labour Party itself.


No doubt, opponents will come up with lots of reasons why serious collaboration between Labour and the Greens will not work. But one thing is clear: the current situation of division across the left is not an option – unless we are prepared to put up with the most reactionary Tory Government for 100 years continuing in power, with its neo-liberal policies of trashing the planet and the economy. “Just one more push” simply does not off­­er any solution.

Can Red and Green work as a team?


People on the left are sometimes perplexed when I say I am a socialist and ask why then I am not in the Labour Party. This was easier to answer under the pro-austerity pro-neoliberalism previous Labour leadership but Corbyn's victory does raise the possibility of joint work and campaigning.

However, as an ecosocialist and member of Green Left I will still have differences even with Corbyn Labour. Some of the issues are covered in this Guest Blog by Mike Shaughnessy which was first published on the Green Left blog LINK

 
This is a write up of a talk I gave earlier this week to my local Green Party meeting in Haringey, north London, on ecosocialism.

Ecosocialism is a green political philosophy - it is an ecocentric and democratic socialism.

It is not like twentieth century socialisms, is more like nineteenth century socialisms and owes a fair amount to anarchist theory. Twentieth century socialisms had, if anything, an even more dismal record than capitalism on ecology.

Ecosocialism is anti-capitalist, and sees the capitalist system as the effective cause of the ecological crisis.

Capitalism commodifies everything, puts a price on it, which is exchange value, and uses the earth as a resource for production and sink for the dumping of toxic waste from the production process, usually free of cost. Climate change is the most spectacular aspect of the ecological crisis, but not the only one. Capitalism releases toxic pollution, into the air, land and sea.

Capitalism is unable to solve the ecological crisis it has set going, because the logic of the system is to ‘grow or die’. Growth that is exponential and the planet is now close to its limit of being able to buffer the damage caused by this required infinite growth, on a finite planet.

I’m going to say something about the historical lineage of the philosophy, threads of which can be traced back for as long as human beings have formed communities, where some elements of ecosocialism can be found in the way people have lived in balance with nature. And today, many indigenous peoples around the world still practice some of these forms of social and economic management.

In South America ecosocialism has found its way into government. Venezuela, until the recent right wing election victory, had a department of ecosocialism. Bolivia still runs forms of ecosocialism in government and has fought off many capitalist corporations plunder of the country’s natural resources, in mining and gas extraction on common land.

There is an English line too. The first stories to be told about Robin Hood, were of a man fighting against crown enclosures of common land. He has become famous for ‘robbing from the rich to give to the poor’, but in fact what he was doing, was fighting to stop the rich robbing from the poor.

Then there were the Diggers during the English civil war, who set up communes on common land and called for a ‘common treasury of the land’.

And William Morris, the nineteenth century socialist and craft movement champion. If you read his novel News from Nowhere, it describes an ecosocialist utopia.

In the modern age, ecosocialism emerged in the mid 1980s, in the west, in the United States, although you can argue quite convincingly that in the US in goes back to Murray Bookchin’s social ecology movement in the mid 1960s. And in the east, in India, where to a lesser extent ecosocialism emerged but more so in the philosophy of ecofeminism, which is a similar philosophy to ecosocialism. For example, ecosocialists agree with ecofeminists that the oppression of women in our society is part and parcel of the system's domination of nature, reproduction in particular. This is done by the capitalist system co-opting the prevailing patriarchal practices, to extract extra surplus value from the workers, in terms of unpaid domestic labour, without which the system could not function. 

And all for free to the system.

Examples of modern day ecosocialism can found be found in the Kurdish area of northern Syria called Rojava and the Zapatistas in Chiapas the most southern state in Mexico.

So, what are the component parts of ecosocialism? There are many, but I’ve selected four of the main ones:

Metabolic Rift    

Nature contains billions of ecosystems, all connected in a finely balanced way, to form what we might call the ‘ecosphere’. Capitalism, disrupts and eventually completely ruptures this balance, setting off chain reactions which cannot be cured easily. Human beings are ecosystems too, and the way the system forces us to live, causes a rupture between us and nature and leads to illnesses like stress, depression and obesity.

And to those who say the ways of capitalism are ‘human nature’, then if this is true, why have we only been living this way for a couple of hundred years? The only thing natural about capitalism, is that it was invented by creatures of nature, us. And we can just as easily un-invent it – and we should.

Ecosocialist writer James Bellamy Foster has managed to link this to Karl Marx’s notion of an ‘irreparable rift’ between humans and nature, in volume three of Capital.

The Commons

Historically, in Britain and other western nations, people were forcibly removed from common land as it was enclosed, with violence employed, to drive the people off the land and into the capitalist factories in the towns and cities. And today the same thing is happening in developing countries. By taking away peoples alternative way of providing for themselves, they are left with no choice but to move into cities and work often 16 hours a day for meagre pay in factories, where health and safety is non-existent, and female workers are routinely harassed and molested.

When I visited Senegal in west Africa a few years ago, one day I spoke with some fishermen who complained about the factory ships from the European Union, Russia and Japan that were hoovering up all of the fish, so much so, that the local fisherman couldn’t catch enough fish anymore to earn a decent living. Here was a system of managed commons which had fed local people for thousands of years and provided a livelihood for the fishermen, destroyed by the capitalist factory boats. Robbing from the poor - to give to the rich.

You have probably heard of the ‘global commons’ on the internet, peer to peer sharing and free software, which ecosocialists welcome, with the possibilities it provides for living outside of the capitalist system, to some extent anyway.

Ecocentric Production

This is a quote from my favourite ecosocialist writer Jovel Kovel describing our vision of ecosocialism: ‘a society in which production is carried out by freely associated labour, and by consciously ecocentric means and ends’.

I think this sentence covers the production process under ecosocialism neatly. The ‘freely associated labour’ bit refers to the absence of surplus value, profit for capital.

Production would be for ‘use-value’, not ‘exchange value'. It will require useful work only, doctors, nurses, teachers etc. and there will be no need for work such as pushing numbers around on a computer in a bank in the City of London, which is useless to humanity - and indeed harmful.

What is produced will be of the highest quality, and beauty, and made to last and be repairable. My laptop packed up last week and I put it in for repair. But they couldn’t fix it because they couldn’t get the replacement part – this laptop is only a little over a year old, but it is obsolete. Throw it away, and get another was the advice.

In Green Party circles you hear a lot about sustainability, or sustainable production, but we ecosocialists prefer the word sufficiency, or sufficient production. Only as much as is needed will be produced, and no more. It should go without saying that the production process will be in balance with nature too.

Radical Democracy

Democracy in an ecosocialist society will devolve all decisions down to the lowest possible level. A series of assemblies, local, town, regional and at least at first, national. The assemblies will be freely elected and each assembly will be subject to recall from the level below, and assembly members should serve only one term. Eventually, the state will be dissolved.

All of this must seem like a million miles away – and it is. But now is not the same thing as the future. The ecological crisis will get worse, if we carry on like we are, and will present opportunities where radical solutions are sought. We must be ready to seize these opportunities.

And where does this all leave the Green Party? Well, interestingly The Guardian newspaper, during last year’s general election campaign, twice, once by one of its columnists and once in an editorial, described the Green Party as ecosocialist.

I think what was meant by this, was concern for the environment and advocating things like nationalising the railways and energy companies – all of which is to the good, but it is not really ecosocialism. 

The Green Party seems to have some hazy notions which are heading in the right direction, but for some reason, fails to follow through this thinking to its logical end – ecosocialism.

We in Green Left, try to push it along a bit, so that the Green Party fulfils its radical agenda, which logically means parting company with capitalism and championing ecosocialism.