Exclusive: Ashcroft ‘not suitable for a peerage’
Updated on 02 March 2010
Channel 4 News can reveal that the chairman of the committee responsible for vetting honours given to political donors believed Lord Ashcroft was not a suitable man for a peerage.
Lord Ashcroft, a major Conservative party benefactor, yesterday admitted that he was a "non-dom", which means he has avoided paying British tax on international earnings.
Channel 4 News has learned that the chairman of the committee responsible for giving honours to political donors, Lord Thomson, who died in 2008, felt that Lord Ashcroft was not a suitable man to be a peer because he neither lived full-time in Britain nor paid UK taxes.
Lord Thomson’s wife told Channel 4 News that in the year 2000 Lord Thomson was contacted while in Nicosia by the British consul there.
Lady Thomson said: "A place was arranged - at a crossroads with a cafe. We made our way to the cafe. George and the consul had a private talk and looked at the documents and made their decision.
"I think they imposed restrictions. When they read the documents they were destroyed at once. They had been flushed down the convenience.”
"I know George was rather furious afterwards. He felt he had been promised a certain code of behaviour and that had not worked out. I would say that George felt this was not a suitable man to be a peer.”
Ahead of being made a lord in 2000, Ashcroft had promised then Conservative leader William Hague that he would "take up permanent residence in the UK again before the end of the calendar year".
The committee had already refused to give Lord Ashcroft a peerage once in 1999 on the grounds that he wasn’t living permanently in the UK or paying full UK tax.
Channel 4 News tried to contact Lord Ashcroft for a response, but we have not yet received a reply.
Liberal Democrat peer Lord Oakshott said today's development threw into great question Lord Ashcroft’s assurances yesterday.
"I know, because I knew Lord Thomson very well, that he was deeply unhappy about the way the whole thing was handled."
David Cameron today refused to say when he knew of Lord Ashcroft’s tax status. "The outcome is," he said, "that the two questions people have been asking – what is his tax status and what undertakings did he give before becoming a peer? – those questions have been answered."
"So I admire people who want to try and flog this dead horse – but the horse is dead and should no longer be flogged."
Meanwhile, Cathy Newman reported that it looks like some of the wealthiest peers are laughing all the way to the bank. One leading non-dom told Channel 4 News tonight: "Rich men don’t pay much tax in any event."
In other words, despite new legislation going through parliament, they will find a way of tying up their money to avoid being clobbered.
Liberal Democrat shadow home secretary Chris Huhne told Channel 4 News: "I suspect that the document shown to Lord Thomson at that fateful meeting in Cyprus was the document that was signed, the solemn and binding undertaking where he said very clearly that 'I will be permanently resident in the UK.'
"And it would have been on that basis that George Thomson – who was a very honest and upstanding and wise man – would have made his judgement that if he was going to be permanently resident in the UK and a full UK taxpayer, then it was not possible for the appointments committee to continue to block the peerage."
And Chris Huhne rejected David Cameron's assertion that Lord Ashcroft's critics were flogging a dead horse.
He told Jon Snow: "What Lord Ashcroft did when he made those irrevocable commitments back 10 years ago to get his peerage – and they were signed off with the flourish that these were solemn and binding undertakings – he committed himself to permanent residence in the United Kingdom.
"And that phrase is very significant in tax law because it means in my view, on the advice that I've had, that he cannot avail himself of non-dom status.
"And that's one of the reasons why, in the statement that we had yesterday from him, he went to such lengths to say they he’d been negotiating with officials to establish that permanent residence did not actually mean permanent residence – it merely meant long-term resident.
"Because as a non-dom, you have to say that 'I care about somewhere else more than I care about Britain, and I’m going to go and live and die somewhere else in the end.'"
