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October 19, 2016updated 15 Jan 2021 11:51am

Corruption: parliamentary committee tells UK Government to put its house in order

The House of Commons International Development Committee welcomed the UK government’s efforts to position the country as a global leader on anti-corruption, but said there is much more it could do to get its own house in order.

The committee released its fourth report of session 2016-17 on its inquiry on tackling corruption overseas.

While it praised the government’s leadership on anti-corruption, particularly in the last six years, it argued that the recent revelations such as the Panama Papers had shown how far the UK still needs to go “to effectively tackle corruption both in the UK and overseas”.

“It is clear from the evidence we received that companies and individuals in the UK, Crown Dependencies and Overseas Territories play a major role in facilitating global corruption,” the report read. “Following the revelations in the Panama Papers, of the involvement of individuals and businesses based in the UK and in the UK’s overseas territories and crown dependencies in tax evasion and tax avoidance, [the Prime Minister] must also make further progress on putting the country’s own house in order.”

The government’s effort to position the UK as a global leader on anti-corruption culminated in the London anti-corruption summit in May 2016, the committee acknowledged. However it said it was disappointed that the government had missed an opportunity to build on the momentum of the summit to influence UK’s overseas territories and crown dependencies to increase transparency by creating public beneficial ownership registers.

“Lack of transparency in the overseas territories and crown dependencies will significantly hinder efforts to curb global corruption and continue to damage the UK’s reputation as a leader on anti-corruption,” the report read.

Equally the committee welcomed the amendment to the Financial Bill 2016 which will permit the treasury to make country-by-country reporting of multinationals’ profits and payments public, but it said the government could go further.

“The amendment to the Finance Act 2016 allows, but does not commit, the Government to publication of country by country reports produced by multinational enterprises. We urge the Government to publically commit to making country by country reporting by UK-based multinational enterprises public,” the report read.

In its report, the committee raised its concern that discussions and decisions on international cooperation in tax matters are happening primarily through the OECD.

“We remain concerned that the OECD—due to its composition—is not adequately reflecting the needs of the poorest countries in its policy outcomes,” it argued. “The Government should reconsider whether the OECD is the best forum for discussions and decisions on international tax matters. If the Government believes it is, then more must be done to ensure the voices of developing countries are heard within this forum and that policy outcomes are reflective of the needs of both developed and developing countries.”

The report is accessible on the UK Parliament Website

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