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Jeremy Hunt's statement to MPs on junior doctors' dispute - Politics live Jeremy Hunt's statement to MPs on junior doctors' dispute - Politics live
(35 minutes later)
12.44pm GMT
12:44
Many MPs are bringing up the effects of impostion on morale and recruitment.
Hunt says he believes “the biggest threat to morale is when doctors are not able to deliver the care they came into the profession to deliver.”
That’s what we’re trying to put right. In the end, the government have to decide what is right for patients and services as well as right for doctors.
12.38pm GMT
12:38
Jack Dromey, Labour MP, asks if Hunt is proud that he has alienated junior doctors, and patronised them by saying they did not understand what was on offer.
Hunt says Dromey “can do a lot better than that” but insists the BMA would not meet the government without pre-conditions until December this year, when they had already balloted for industrial action.
12.35pm GMT
12:35
Here’s the full statement from Labour’s shadow health secretary Heidi Alexander to Jeremy Hunt a few minutes ago.
This whole dispute could have been handled so differently.
The Health Secretary’s failure to listen to junior doctors, his deeply dubious misrepresentation of research about care at weekends and his desire to make these contract negotiations into a symbolic fight for delivery of seven-day day services has led to a situation which has been unprecedented in my lifetime.
Everyone, including the BMA, agrees with the need to reform the current contract. But hardly anyone thinks the need to do that is so urgent that it justifies imposition, and all the chaos that will bring.
One of the hospital chief executives who the Secretary of State claims is supporting him has tweeted this morning: “I have supported the view that the offer made is reasonable… I have not supported contract imposition”.
Can the Health Secretary not see that imposing a new contract which doesn’t enjoy the confidence of junior doctors will destroy morale which is already at rock bottom?
Does he not realise that this decision could lead to a protracted period of industrial action which will be distressing for everyone – patients, doctors, everyone who works in or depends upon the NHS?
A poll earlier this week found that nearly 90 per cent of junior doctors are prepared to leave the NHS if a contract is imposed. The Health Secretary needs to stop behaving like a recruiting agent for Australian hospitals and start acting like the Secretary of State for our NHS.
The Health Secretary has been keen to present a new junior doctor contract as the key which unlocks the delivery of 7 day services. This is a massive oversimplification and he knows it. Whilst research shows a higher mortality rate amongst patients admitted to hospital at the weekend, there is absolutely no evidence which shows a lack of junior doctors specifically causes this.
What we heard from the Secretary of State today could amount to the biggest gamble with patient safety this House has ever seen. He has failed to win the trust of the very people who keep our hospitals running and he has failed to convince the public of his grounds for change.
Imposing a contract is a sign of failure. It’s about time the Secretary of State realised that.
Updated
at 12.36pm GMT
12.33pm GMT
12:33
MP Bernard Jenkin says he has such sadness that junior doctors were caught up in a dehabilitating and damaging dispute. He asks Hunt to speak directly with them and calls the BMA relationship “destructive.”
Hunt reiterates he believes there was no reason to have this dispute, and a seven-day NHS was something that was desired by every single doctors who “chose a career in medicine with the highest ethical motives.”
He says he will continue to engage with doctors directly.
Updated
at 12.34pm GMT
12.29pm GMT
12:29
Here’s some of the first reactions from junior doctors, students and others to Hunt’s confirmation that he will be imposing the contract.
Hunt announces Junior contract to be imposed. He has failed Patients, the NHS & this country. There'll be no certainly, only uncertainty now
We seem to be living in a dictatorship not a democracy #juniorcontract @Jeremy_Hunt
@Jeremy_Hunt you're a liar. A complete liar. Thank you for making me feel like the last 6 years of uni have been for nothing #Juniordoctors
I'm devastated for my F2 daughter who is going to Oz in August and my son who graduates as a Dr this year #notsafenotfair #juniordoctors
12.25pm GMT
12:25
Labour MP Barry Gardiner says it is logical to assume the problem he is trying to solve will get worse as fewer doctors join the NHS.
Hunt says there are 10,600 more than five years ago.
There have been a lot of smoke and mirrors about what the contract proposal is.
I hope all trainees and medical students look at the proposal that independent experts believe fair and reasonable and we will continue to recruit more doctors into the NHS.
Updated
at 12.25pm GMT
12.23pm GMT
12:23
Hunt is challenge on his statistics on weekend death rates by the SNP’s Philippa Whitford, who is a doctor, who points out studies show that nurses are more important to mortality.
Hunt calls her comments “immensely more constructive” than Labour’s, but says the contract will be looked back on as a major step forward for a seven-day NHS.
Conservative MP Dr Sarah Wollaston, a former GP, said the BMA should welcome the inquiry into morale announced today and asks that both sides move forward in a positive way and “take the temperature down”.
.@Jeremy_Hunt: "hope we can go forward in a positive spirit". That's just laughable as he's IMPOSING a #juniorcontract. #juniordoctorexodus
Updated
at 12.27pm GMT
12.13pm GMT
12:13
Here’s a list of the NHS chief executives backing the imposition of the contract.
A list of NHS chief execs backing the position set out in Sir David Dalton's letter to Jeremy Hunt #juniorcontract pic.twitter.com/y2RjJ9x1iN
But the consensus is already crumbling, as Heidi Alexander points out, one of the chief executives listed says he has not agree that the contract should be imposed, only that doctors should accept the deal
@cpeedell I have not supported contract imposition. I have supported the view that the offer made is reasonable.
Updated
at 12.15pm GMT
12.10pm GMT
12:10
Heidi Alexander, the shadow health secretary, says the imposition of the contract will “destroy morale” among junior doctors and says Hunt’s statistics on weekend death rates are “deeply dubious”.
She cites the number of doctors moving to Australia to work, saying the UK should not train doctors to export them to the Southern hemisphere.
This could be the biggest gamble with patient safety this house has ever seen. Imposing a contract is a sign of failure and it is about time the Secretary of State realised that.
12.05pm GMT12.05pm GMT
12:0512:05
Hunt announces review into 'morale' of junior doctors
Hunt said the process has “uncovered deep seated concerns about morale, well-being and quality of life” and he cites separation from spouse and families on placements and inadequate support from seniors.Hunt said the process has “uncovered deep seated concerns about morale, well-being and quality of life” and he cites separation from spouse and families on placements and inadequate support from seniors.
He has asked Dame Sue Bailey to lead a review into measures outside the contract that will improve morale. He has asked Dame Sue Bailey, president of the Academy of Medical Royal Colleges, to lead a review into measures outside the contract that will improve morale.
Updated
at 12.41pm GMT
12.04pm GMT12.04pm GMT
12:0412:04
Hunt says the government’s “door remained open” for three years and said the departments showed a willingness to negotiate time and again.Hunt says the government’s “door remained open” for three years and said the departments showed a willingness to negotiate time and again.
But he said it was imperative both sides demonstrated flexibility and compromise. “The BMA proved ultimately unwilling to do that.”But he said it was imperative both sides demonstrated flexibility and compromise. “The BMA proved ultimately unwilling to do that.”
He refers to eight studies on weekend death rates, and said that six pointed to inadequate staffing levels.He refers to eight studies on weekend death rates, and said that six pointed to inadequate staffing levels.
Hunt said he is confident that the new contract is “one that in time can commend the confidence of workforce and employers.”Hunt said he is confident that the new contract is “one that in time can commend the confidence of workforce and employers.”
11.59am GMT11.59am GMT
11:5911:59
Hunt says those working one in four or more Saturdays will receive a pay premium of 30%. It does represent a reduction in current rates, because hospitals must be able to afford additional weekend restoring.Hunt says those working one in four or more Saturdays will receive a pay premium of 30%. It does represent a reduction in current rates, because hospitals must be able to afford additional weekend restoring.
The government will also give doctors a basic pay rise of 13.5%.The government will also give doctors a basic pay rise of 13.5%.
11.57am GMT11.57am GMT
11:5711:57
Hunt will impose contract on junior doctorsHunt will impose contract on junior doctors
Hunt pays tribute to the chief negotiator, Sir David Dalton, who he said has reached agreement on 90% of issues.Hunt pays tribute to the chief negotiator, Sir David Dalton, who he said has reached agreement on 90% of issues.
But Sir David and NHS England’s chief executive, Simon Stevens had asked him to end the uncertainty, and Hunt said he has decided to do that today.But Sir David and NHS England’s chief executive, Simon Stevens had asked him to end the uncertainty, and Hunt said he has decided to do that today.
UpdatedUpdated
at 12.06pm GMTat 12.06pm GMT
11.55am GMT11.55am GMT
11:5511:55
Jeremy Hunt in the House of CommonsJeremy Hunt in the House of Commons
I’m switching now to cover Jeremy Hunt’s statement on the junior doctors’ contract in the House of Commons, he’s expected to impose the contract on the doctors this summer.I’m switching now to cover Jeremy Hunt’s statement on the junior doctors’ contract in the House of Commons, he’s expected to impose the contract on the doctors this summer.
11.54am GMT11.54am GMT
11:5411:54
Labour MP Caroline Flint asks why HMRC hasn’t applied any penalties to Google for non-payment of tax over the last five years.Labour MP Caroline Flint asks why HMRC hasn’t applied any penalties to Google for non-payment of tax over the last five years.
It is very difficult to argue they have taken insufficient care, even if they have come to the wrong conclusion in their accounting, Harra said.It is very difficult to argue they have taken insufficient care, even if they have come to the wrong conclusion in their accounting, Harra said.
Flint says that the lawyers and tax experts of Google have “out- manoeuvred” HMRC and says there is “considerable public anger”.Flint says that the lawyers and tax experts of Google have “out- manoeuvred” HMRC and says there is “considerable public anger”.
UpdatedUpdated
at 11.54am GMTat 11.54am GMT
11.51am GMT11.51am GMT
11:5111:51
Lin Homer is going back to the letter sent last night to the committee. The letter contained taxpayer-confidential information, she said, which they needed Google permission to make public. She insists the information was intended to be aired in the committee.Lin Homer is going back to the letter sent last night to the committee. The letter contained taxpayer-confidential information, she said, which they needed Google permission to make public. She insists the information was intended to be aired in the committee.
The SNP’s Deirdre Brock said the committee does not need the exact numbers. What they need to know is, is every business treated the same, even small shops in her constituencies?The SNP’s Deirdre Brock said the committee does not need the exact numbers. What they need to know is, is every business treated the same, even small shops in her constituencies?
It is exactly the same process, Brock said, though admits the average length of an investigation is 22 months so “this was a long one”.It is exactly the same process, Brock said, though admits the average length of an investigation is 22 months so “this was a long one”.
11.45am GMT11.45am GMT
11:4511:45
Jim Harra, HMRC’s Director General for Business Tax says he does not have a figure for how much the six-year investigation into Google has cost the taxpayer.Jim Harra, HMRC’s Director General for Business Tax says he does not have a figure for how much the six-year investigation into Google has cost the taxpayer.
Obviously, us conducting a six year audit is a very expensive and resource intensive process which, obviously, I wish we didn’t have to do.Obviously, us conducting a six year audit is a very expensive and resource intensive process which, obviously, I wish we didn’t have to do.
They do not usually take six years. It is a new area of the economy. [For companies like Google] their scale and business model and ways their customers behave change all the time. we can’t just look at one year and extrapolate that to other year.They do not usually take six years. It is a new area of the economy. [For companies like Google] their scale and business model and ways their customers behave change all the time. we can’t just look at one year and extrapolate that to other year.
It was long, resource-intensive and pain-staking.It was long, resource-intensive and pain-staking.
UpdatedUpdated
at 11.45am GMTat 11.45am GMT
11.42am GMT11.42am GMT
11:4211:42
Up next is HMRC’s turn to be probed over the tax arrangment with Google, and corporate tax deals more generally.Up next is HMRC’s turn to be probed over the tax arrangment with Google, and corporate tax deals more generally.
In front of the committee is Dame Lin Homer, chief executive and permanent secretary, Jim Harra, director general of business tax and Edward Troup, tax assurance commissioner.In front of the committee is Dame Lin Homer, chief executive and permanent secretary, Jim Harra, director general of business tax and Edward Troup, tax assurance commissioner.
Hillier reveals that the committee received a letter yesterday offering some confidential background information about the HMRC and Google deal.Hillier reveals that the committee received a letter yesterday offering some confidential background information about the HMRC and Google deal.
Homer admits that letter was co-ordinated with Google, offering to share more information about the deal with the PAC.Homer admits that letter was co-ordinated with Google, offering to share more information about the deal with the PAC.
Hillier said the approach was disappointing.Hillier said the approach was disappointing.
We want answers about this in public, so taxpayers hear the answers too. Last minute, confidential information does not help that. We want to talk openly and honestly.We want answers about this in public, so taxpayers hear the answers too. Last minute, confidential information does not help that. We want to talk openly and honestly.
I don’t need to remind you that you are public servants. I was disappointed with that approach.I don’t need to remind you that you are public servants. I was disappointed with that approach.
UpdatedUpdated
at 11.43am GMTat 11.43am GMT
11.36am GMT11.36am GMT
11:3611:36
Here’s some reaction from the Twitter-sphere about the Google executives in front of the PAC.Here’s some reaction from the Twitter-sphere about the Google executives in front of the PAC.
"If you are so keen on this tax reform, why don't you lead by example" #googletax"If you are so keen on this tax reform, why don't you lead by example" #googletax
Bonkers of Google to pretend that *its* tax complexity is a function of tax rules. It's a function of Google's choices.Bonkers of Google to pretend that *its* tax complexity is a function of tax rules. It's a function of Google's choices.
What we have discovered PAC/Google: 10 year deal - taxes £112m, interest £18m, Google says it's "fair", UK tax structure stays the sameWhat we have discovered PAC/Google: 10 year deal - taxes £112m, interest £18m, Google says it's "fair", UK tax structure stays the same
David Mowat on PAC asks Google if their employees are proud of them not paying more tax. Ridiculous idealistic nonsenseDavid Mowat on PAC asks Google if their employees are proud of them not paying more tax. Ridiculous idealistic nonsense
11.34am GMT11.34am GMT
11:3411:34
PAC concludes questioning GooglePAC concludes questioning Google
Hillier concludes by calling on the company to be more transparent.Hillier concludes by calling on the company to be more transparent.
Why don’t you lead by example to provide more information to the general public and to other countries?Why don’t you lead by example to provide more information to the general public and to other countries?
If you want your staff to be proud, if you want to do good in the world, then why can’t you tell the ordinary British taxpayer how your settlement was reached?If you want your staff to be proud, if you want to do good in the world, then why can’t you tell the ordinary British taxpayer how your settlement was reached?
Hutchinson said no company has ever provided as much detail on a tax settlement as Google, but he cannot say more because it is commercially sensitive.Hutchinson said no company has ever provided as much detail on a tax settlement as Google, but he cannot say more because it is commercially sensitive.
11.30am GMT11.30am GMT
11:3011:30
Back at the PAC, Richard Bacon MP is still pressing the Google executives on the exact pre-tax profit of Google of which 19% tax was paid.Back at the PAC, Richard Bacon MP is still pressing the Google executives on the exact pre-tax profit of Google of which 19% tax was paid.
I’m trying to express myself clearly. You paid tax at 19%, which must be 19% of something. You have said several times that you pay it at 19%.I’m trying to express myself clearly. You paid tax at 19%, which must be 19% of something. You have said several times that you pay it at 19%.
You answer that by saying that is spread over 5 years. I can’t understand why you don’t know that. I don’t understand why you don’t have that figures now. I’m very surprised you don’t know it.You answer that by saying that is spread over 5 years. I can’t understand why you don’t know that. I don’t understand why you don’t have that figures now. I’m very surprised you don’t know it.
11.26am GMT11.26am GMT
11:2611:26
While I’ve been focussed on the Google evidence at the select committee, Chris Bryant, the shadow leader of the house, has been asking an urgent question on short money in the House of Commons, relating to the funding of political parties.While I’ve been focussed on the Google evidence at the select committee, Chris Bryant, the shadow leader of the house, has been asking an urgent question on short money in the House of Commons, relating to the funding of political parties.
He called George’s Osborne’s plans to cut the funding of state grants to opposition political parties by 19% as “shabby”.He called George’s Osborne’s plans to cut the funding of state grants to opposition political parties by 19% as “shabby”.
Bryant said Commons Leader Chris Grayling had failed to turn up for three meetings yesterday on the issue.Bryant said Commons Leader Chris Grayling had failed to turn up for three meetings yesterday on the issue.
Why, frankly, isn’t the Leader of the House doing his proper job and standing at the despatch box today?Why, frankly, isn’t the Leader of the House doing his proper job and standing at the despatch box today?
What’s the word for this behaviour? Is it shabby, tawdry or just downright cynical?What’s the word for this behaviour? Is it shabby, tawdry or just downright cynical?
Here’s the report from the Press Association of the exchange between Bryant and Cabinet Office Minister John Penrose.Here’s the report from the Press Association of the exchange between Bryant and Cabinet Office Minister John Penrose.
Replying to an urgent question from Labour, Cabinet Office Minister John Penrose told MPs a consultation will start “shortly”.Replying to an urgent question from Labour, Cabinet Office Minister John Penrose told MPs a consultation will start “shortly”.
Opening his remarks, Mr Bryant quoted previous Conservative comments objecting to opposition parties being under-resourced at a time when spending has increased on taxpayer-funded special advisers.Opening his remarks, Mr Bryant quoted previous Conservative comments objecting to opposition parties being under-resourced at a time when spending has increased on taxpayer-funded special advisers.
He said: “In opposition the Prime Minister said he would cut the number and cost of special advisers, yet in Government he has appointed 27 more special advisers than ever before and the cost has gone up to the taxpayer by 2.5 million a year.He said: “In opposition the Prime Minister said he would cut the number and cost of special advisers, yet in Government he has appointed 27 more special advisers than ever before and the cost has gone up to the taxpayer by 2.5 million a year.
“There’s a word for that Mr Speaker but it’s not parliamentary.”“There’s a word for that Mr Speaker but it’s not parliamentary.”
“In opposition, the Conservatives banked 46 million a year in short money but in Government they want to cut short money by 20% for the Opposition.“In opposition, the Conservatives banked 46 million a year in short money but in Government they want to cut short money by 20% for the Opposition.
“There’s a word for that Mr Speaker but it’s not parliamentary.“There’s a word for that Mr Speaker but it’s not parliamentary.
“How can it be right for the Government to cut the policy development grant for political parties by 19% when it’s not cutting the amount of money spent on special advisers of its own?“How can it be right for the Government to cut the policy development grant for political parties by 19% when it’s not cutting the amount of money spent on special advisers of its own?
“Surely history has taught us that an overweening executive is always a mistake.“Surely history has taught us that an overweening executive is always a mistake.
“Surely if a party in Government needs financial support in addition to the civil service then it’s in the national interest that all the opposition parties should be properly resourced as well.”“Surely if a party in Government needs financial support in addition to the civil service then it’s in the national interest that all the opposition parties should be properly resourced as well.”
Mr Byrant said the Government has been briefing journalists that its proposals will be published on Friday - when Parliament is in recess.Mr Byrant said the Government has been briefing journalists that its proposals will be published on Friday - when Parliament is in recess.
UpdatedUpdated
at 11.27am GMTat 11.27am GMT
11.21am GMT11.21am GMT
11:2111:21
Hutchinson says Google is paying what they think is a “reasonable” amount of tax - 19%. Mowat said if that is the case, why do they book sales in Ireland, channel business through the Netherlands and Bermuda?Hutchinson says Google is paying what they think is a “reasonable” amount of tax - 19%. Mowat said if that is the case, why do they book sales in Ireland, channel business through the Netherlands and Bermuda?
If we did have our UK office selling directly to UK customers, that would be a change in our structure, but would not change that the tax rules require you pay tax in the UK relating to the value of the profits generated in the UK?If we did have our UK office selling directly to UK customers, that would be a change in our structure, but would not change that the tax rules require you pay tax in the UK relating to the value of the profits generated in the UK?
Is Tom Hutchinson from @Google honestly saying they'd pay the SAME tax in the UK if they had a permanent establishment here? Really?? #pacIs Tom Hutchinson from @Google honestly saying they'd pay the SAME tax in the UK if they had a permanent establishment here? Really?? #pac
11.17am GMT11.17am GMT
11:1711:17
Tory MP David Mowat concedes Google has paid “probably the right amount of tax” given its exceptionally complex tax structures.Tory MP David Mowat concedes Google has paid “probably the right amount of tax” given its exceptionally complex tax structures.
But he says it is not the correct moral course.But he says it is not the correct moral course.
You use Ireland, Holland, Bermuda. Doesn’t it bother you some of your employees might bail out over that?You use Ireland, Holland, Bermuda. Doesn’t it bother you some of your employees might bail out over that?
UpdatedUpdated
at 11.17am GMTat 11.17am GMT
11.15am GMT11.15am GMT
11:1511:15
Hutchinson said it was not a negotiated tax settlement.Hutchinson said it was not a negotiated tax settlement.
There was not a number that was thrown out by HMRC and we negotiated it down. That is not the way the process worked.There was not a number that was thrown out by HMRC and we negotiated it down. That is not the way the process worked.
Bacon said the row is ruining the reputation of the internet giant.Bacon said the row is ruining the reputation of the internet giant.
This is staining your reputations. You have chosen to take very complex routes. You can’t like the fact that lots of people hate you because of this. Why don’t you face up to that?This is staining your reputations. You have chosen to take very complex routes. You can’t like the fact that lots of people hate you because of this. Why don’t you face up to that?
Brittin said they cannot pay more than the government demands of them.Brittin said they cannot pay more than the government demands of them.
We have reached the end of a lengthy independent process. At the end of the process, the HMRC told us exactly the right amount to pay and we are paying it. We have just finished an intensive review with tax specialists where they decided this is the right amount to pay.We have reached the end of a lengthy independent process. At the end of the process, the HMRC told us exactly the right amount to pay and we are paying it. We have just finished an intensive review with tax specialists where they decided this is the right amount to pay.
We believe we are [paying the right amount] because this is what we are asked to pay.We believe we are [paying the right amount] because this is what we are asked to pay.
11.09am GMT11.09am GMT
11:0911:09
An extraordinary response to a question from Tory MP Richard Bacon.An extraordinary response to a question from Tory MP Richard Bacon.
Can you tell me the number on which you paid tax at 20%?Can you tell me the number on which you paid tax at 20%?
Brittin said he does not have the profit numbers in front of him. Hutchinson said he also does not have the exact numbers of how much tax was paid in the UK. Bacon himself uses a calculator to work out the profits on activities in the UK - around £230m.Brittin said he does not have the profit numbers in front of him. Hutchinson said he also does not have the exact numbers of how much tax was paid in the UK. Bacon himself uses a calculator to work out the profits on activities in the UK - around £230m.
Why did it take you take six years - as long as the second world war - to explain your activities adequately to HMRC? Are you saying it’s HMRC’s fault for being so slow. Either you’re bad at explaining or they are very thick at understanding.Why did it take you take six years - as long as the second world war - to explain your activities adequately to HMRC? Are you saying it’s HMRC’s fault for being so slow. Either you’re bad at explaining or they are very thick at understanding.
Brittin said HMRC interviewed people at Google “from top-to-bottom” to try to understand the way the business operates.Brittin said HMRC interviewed people at Google “from top-to-bottom” to try to understand the way the business operates.
It’s incredible that it takes six years to explain what the internet is, Bacon said.It’s incredible that it takes six years to explain what the internet is, Bacon said.
11.02am GMT
11:02
Tom Hutchinson has repeatedly insisted the company’s tax arrangements in Bermuda have no impact on the tax paid in the UK.
Jolyon Maugham QC, a barrister specialising in tax, says this cannot possibly be the case.
Bermuda *does* have an impact on tax paid in the UK. Without the Bermuda tax haven Google would have no incentive to avoid UK taxes.
11.00am GMT
11:00
There is robust laughter in the room as Brittin attempts to suggest that Ireland is a good base for Google because of the numbers of languages spoken by staff.
“Not for tax reasons?” Mowat says. Brittin admits favourable tax arrangements were one of the reasons, as well as lower property prices and good internet connections across the Atlantic.
Updated
at 11.00am GMT
10.58am GMT
10:58
Conservative MP David Mowat mockingly said it is “laudable” that Google says it wants a simpler tax system, but says the company cannot blame the UK for having a complex system because its company has a complex structure.
It wasn’t us who decided to say all our sales were booked in Dublin. It wasn’t us that decided that the ways you were going to choose to operate by using ‘the double Irish’.
You tell us you want a transparent system. Yet you use the double Irish, you use the Dutch Sandwich, you use Bermuda.
Your argument is everyone else does it so we do.
10.55am GMT
10:55
Tom Hutchinson, Google’s head of tax, is adamant that it is the tax system, not the company, which is to blame for the current row.
He’s clearly not exactly enjoying his time in front of the committee.
I would love to see the system be more simple so we won’t have to come to meetings like this and explain it, but we need the governments to work together and develop an overall worldwide system.
Updated
at 10.55am GMT
10.49am GMT
10:49
Tax came up from 'time-to-time' in meetings with ministers, Google admits
Flint draws attention to more than 20 meetings which Google had with ministers over the past five years and asks if the tax question “ever came up”.
Brittin says there has been no political involvement in the deal with HMRC. Flint and Hillier says that is not the question. Brittin says they have never sought a meeting with government over tax deals. Again, Flint said, that is not the question.
I’m sure, given the scrutiny, we’ve had that the tax issue will have come up from time to time. You’d be surprised if you didn’t given the scrutiny.
Google and government had informal chats about their tax arrangements. Wonder what was said?
Updated
at 10.51am GMT
10.43am GMT
10:43
Caroline Flint is speaking now. She asks about the remaining £112m paid in tax, because the other £18m was interest, and asks if any fines were paid. Hutchinson says not.
Flint asks if Google thinks it is a fair settlement. Hutchinson says he thinks it is, after an extensive audit. “It was higher than we paid on returns,” he said.
“So, why weren’t you paying it in the tax years during that six-year period?” Flint said.
It’s a good question, Hutchinson admitted, to some murmurings in the room.
Flint says the public will be incredulous.
The public tuning into this will be asking themselves, how can a massive company like Google, with all the expertise that it hires, how can HMRC not, in real time, tackle the problems of how you pay your tax?
Updated
at 10.44am GMT
10.37am GMT
10:37
'We have never paid a larger settlement than the one we just agreed to'
Brittin said the reports were just statements by politicians in those countries, “politicians who would like to see tax paid in proportion to sales”, rather than actual deals.
Hutchinson goes further, and says the British tax settlement is the highest ever paid.
Those are articles that are not based on facts. I can say, we have never paid, as part of an audit outside the US, we have never paid a larger settlement than the one we just agreed to.
Updated
at 10.37am GMT
10.31am GMT
10:31
Tom Hutchinson, Google’s head of tax, repeats Brittin’s point that profits Google makes from UK customers are related to the value created outside the UK, the technology of the Google search engine.
Look at the value of the substance of the values for services in the UK, what would you pay a third party? That’s what we did doing our tax returns, HMRC came back and argued that should be a higher amount, that’s what we ended up paying.
Jackson asks him whether it is true that Google have had “involved” discussions with Italy and France over their tax affairs, which Hutchinson refuses to comment on. It has been reported the web giant is set to pay the French government more than three times what it has paid HMRC.
Updated
at 10.36am GMT
10.25am GMT
10:25
Stewart Jackson, Conservative MP, called Google’s press release about how it had agreed to pay £130m in back taxes “a dead cat strategy”,
“You knew that would put pressure on the Treasure and HMRC,” he said.
Stewart Jackson accuses Google of using tax press release as a "dead cat". Dead cats have definitely jumped the shark.
He also calls the article Brittin wrote in the Telegraph, on reformation of international tax, as Google posing as “a disinterested observer”.
You have made a choice to avoid tax, and you have set up structures specifically to do so. I think there’s an element here of we are doing the UK taxpayer a favour by paying tax.
Quite frankly, if i hadn’t disclosed between 2005 to 2015 all the circumstances of my income I would be in trouble with HMRC. Why are you different?
Brittin said the audit was a way for HMRC was to understand “the nature of internet business”.
He says the heart of the matter for income tax is place where “value is created.”
Most of the value is created by the search, which is developed and built in the US, some is created by the marketing but most by the search. There are 20,000 engineers in the US, and 1,000 in the UK.
The rules require you to pay your tax based on the economic value creation.
Updated
at 10.26am GMT
10.13am GMT
10:13
Google’s Brittin says he wants to clarify the most recent tax bill that attracted the negative attention.
He says that of the £130 million it paid in back taxes, £18 million was interest and the rest is tax.
Brittin is asked the cost of Google’s new base in Kings Cross, which he says has cost around £1bn. He insists that despite the size and cost of the building, the global operation’s headquarters are still based in Ireland.
“Frankly you are taxing already my patience and the patience of the hard-working taxpayer out there,” Hillier says.
Updated
at 10.16am GMT