For every £1 that goes in £10 leaves

An interesting statistic indeed but what does it mean?

On Monday 18th Oct 2010 Channel 4’s Dispatches programme loked at how the Rich in the UK beat the Tax system. There were two surprises for me as I watched this programme

1. Andrew Mitchell Secretary for state International Development whose budget has been ring fenced was one of the super rich implicated by the programme

   

2. The tax evasion has implications for overseas development.I have previously written about Vulture funds that see companies buying up third world debt and us the tax payers picking the tab so this was fascinating stuff indeed

Point number 2 was especially interesting the expert interviewed was John Christensen of the Tax Justice Network and this is what he had to say

for every £1 that goes  out of the rich countries into the developing world as Aid at least £10 of capital flows out of those countries illicitly into tax heavens through offshore structures and this explains in part why developing countries have not been able to finance their own development and remain reliant on aid and external borrowing

WOW! that statement left me lost for words and that is very unusual I must say.

But surely the secretary of state knows this?  Well I hope so anyway! It  was interesting note that he ended his speech at  the London School of Economics with that all so familiar ConDem slogan

WE ARE ALL IN THIS  TOGETHER

Well are we?  Based on the information provided in this programme it doesn’t sound like it. One would also be forgiven for reaching the conclusion that only the rich truly benefit from Aid.

The question where do we go from here? If those that should know better are themselves seemingly avoiding the taxman what about the poor?

Further reading on the issue of ring fencing the Aid budget is at http://www.birdsontheblog.co.uk/has-britain-exported-its-welfare-benefits-system-to-africa/

Have you got a view? Did you perhaps watch the programme? What did you make of it