'Name and shame' tax havens under fire

The presence of seven British overseas territories on the OECD's 'name and shame' list of tax havens came under scrutiny during a Westminster Hall debate today.

During a debate on the foreign affairs committee's report on overseas territories, Andrew MacKinlay (Lab, Thurrock) accused the government of attempting to distance itself from its responsibilities.

"Ministers can't pretend it’s a remote problem they are trying to get their hands on, they are to blame," he said.

McKinley argued that in the case of the Cayman Islands, the government could not even pretend the problem was territory governments "dragging their feet".

"The Cayman Islands are wholly the responsibility on the UK government," he said.

"I find it amazing that ministers have the audacity to get up at the despatch box and refer to the OECD's list... when amongst them is at least one territory where the person in charge is someone appointed by Foreign Office."

"If there is a deficiency, the person to blame is the foreign secretary or the chancellor," he added.

The British territories of Anguilla, Bermuda, British Virgin Islands, Cayman Islands, Gibraltar, Montserrat and the Turk and Cacaos Islands were all named by the OECD as "unco-operative tax havens".

G20 nations pledged to crack down on tax havens following the London summit in April.

John Stanley (Con, Tonbridge and Malling), questioned why the chancellor had dodged the question when asked directly about the number by Liberal Democrat Treasury spokesman Vince Cable.

The Conservative member of the foreign affairs committee suggested that perhaps this was because the chancellor judged the answer might be an embarrassment to the Foreign Office.

"It is somewhere towards shocking that we have half the overseas territories on the name and shame list," he added.

Noting that the UK is directly responsible for financial regulation in many of the territories, Jo Swinson (Lib Dem, East Dunbartonshire) said there should be therefore "no barrier" to reform.

The Liberal Democrat foreign affairs spokesperson said help needed to be given to the territories to re-adjust their economies.

"We do need to recognise that the revenue they receive for financial services form a large part of their economy," she said.

"Support will need to be given to develop other economic avenues that are less shady or internationally embarrassing."

Foreign Office minister Gillian Merron said the prime minister had written to the overseas territories to encourage them to meet the OECD's standards.