UK Prime Minister Rishi Sunak has ordered an investigation into Conservative Party Chairman Nadhim Zahawi, who’s facing growing calls for him to quit after paying a penalty to resolve a multimillion-pound tax dispute.
Zahawi, who attends Sunak’s Cabinet, has been under pressure since UK media alleged that he had avoided tax by using Balshore Investments, an offshore company registered in Gibraltar, to hold shares in the polling company he co-founded, YouGov.
The former chancellor admitted on Jan. 21 that he had paid a penalty to HM Revenue and Customs to settle the dispute but insisted that his tax error was “careless and not deliberate.”
Sunak said on Jan. 23 that he has asked new ethics adviser Sir Laurie Magnus to assess whether Zahawi had breached the ministerial code.
But the prime minister said Zahawi, whose position the Labour Party says is “untenable,” will stay in post during the inquiry.
‘Integrity and Accountability’
On a visit to a hospital in Northamptonshire, Sunak told reporters: “Integrity and accountability [are] really important to me and clearly in this case there are questions that need answering.“That’s why I’ve asked our independent adviser to get to the bottom of everything, to investigate the matter fully and establish all the facts and provide advice to me on Nadhim Zahawi’s compliance with the ministerial code.
“I’m pleased that Nadhim Zahawi has agreed with that approach and has agreed to fully cooperate with that investigation.”
Sunak distanced himself from the allegations surrounding Zahawi, who he appointed chairman in October 2022.
“The questions that are being asked relate to a time before I was prime minister. When I was prime minister, the advice that I received was that there was no reason why Nadhim Zahawi could not be appointed to government,” he said.
Asked whether Zahawi shouldn’t stand down during the investigation, Sunak said, “As is longstanding practice, he will continue to play the role he does.”
Sunak has previously defended Zahawi against the tax allegations, telling Prime Minister’s Questions on Jan. 18 that Zahawi “has already addressed this matter in full, and there’s nothing more that I can add.”
But Downing Street suggested on Jan. 23 that Sunak wasn’t aware last week that Zahawi had paid a penalty.
The prime minister’s official spokesman said Sunak retains confidence in Zahawi as Tory party chair and hopes the investigation into him is completed “as quickly as possible.”
The spokesman couldn’t give a timeline for the investigation to be finished and acknowledged that it would be up to Sunak if he wanted to disagree with its conclusions.
‘Strong Failure of Leadership’
In a statement, Zahawi said: “I welcome the prime minister’s referral of this matter to the independent adviser on ministerial standards. I look forward to explaining the facts of this issue to Sir Laurie Magnus and his team.“I am confident I acted properly throughout and look forward to answering any and all specific questions in a formal setting to Sir Laurie.
“In order to ensure the independence of this process, you will understand that it would be inappropriate to discuss this issue any further, as I continue my duties as chairman of the Conservative and Unionist Party.”
But the main opposition Labour Party repeated its call for Zahawi to be sacked.
Labour leader Sir Keir Starmer told reporters: “I think it’s obvious that Zahawi can’t stay as Tory Party chair. The very idea that he can be discussing and negotiating his own tax affairs with the body that he’s supposed to be running, everybody knows it’s wrong.
“He clearly isn’t going to resign, and so the prime minister needs to show some leadership. This is a test of the prime minister. He promised us—his first words—integrity and accountability.
“Well, if those words mean anything, the prime minister should sack him, and sack him today and show some leadership. Because if he doesn’t, it’s just going to be further evidence, I think, for the British public, as to just how weak this prime minister really is.”
Failing to sack Zahawi would be a “strong failure of leadership,” according to Starmer.
“If this was somebody in my team, I would sack them,” he said.
Former Downing Street communications chief Sir Craig Oliver said Zahawi is “hanging on by a thread.”
“I think he’s in serious trouble, you cannot be Conservative Party chairman and not go out and face the media,” he told BBC Radio 4’s “Today” programme.
“The problem for Nadhim Zahawi at the moment is it doesn’t all add up. Why did you take the job as chancellor when you were clearly in dispute with the HMRC, and he is yet to come out with an answer that is satisfying or feels comfortable on that point.”
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