guardian.co.uk,
Rajeev Syal and Shiv Malik, Friday 9 December 2011
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| Revenue chief Dave Hartnett's role in the Goldman Sachs deal is currently being investigated by HMRC. Photograph: Sarah Lee for the Guardian |
The head of
Revenue & Customs is to retire in the wake of revelations about his
organisation's decisions to waive millions of pounds owed by corporations.
Dave
Hartnett, 60, will step down as the permanent secretary for tax next summer, a
spokesman said . He will leave with a pension pot worth £1.7m.
Hartnett
has admitted that his organisation made "a mistake" when he shook
hands on a deal to excuse the US bank Goldman Sachs from paying around £10m in
interest charges. His organisation has also been accused of allowing Vodafone
off interest charges of more than £1bn.
His
announcement came hours after the Guardian disclosed that Revenue & Customs
is investigating the whistleblower who uncovered the Goldman Sachs deal and
Hartnett's role in it.
Senior MPs are
angry that Osita Mba, a solicitor who used the Public Interest Disclosure Act
to tell the National Audit Office and two parliamentary committees about the
deal, could face the sack or criminal prosecution.
Hartnett's
decision to retire came in a press release announcing a new chief executive,
Lin Homer, for the Revenue. A spokesman for the Revenue said Hartnett had
decided to retire some weeks ago and that permanent secretaries can retire from
60.
An HMRC
spokesman said: "He's going to stay on until Lin [Homer] gets to grips
with the department, when he will be well over 61.
"It
was entirely his decision ... he's not been pushed or encouraged. His chair has
not been moved closer to the door."
However, on
7 November, Hartnett told a parliamentary committee examining the Goldman Sachs
and Vodafone deals that he had no plans to stand down.
Margaret
Hodge, chair of the public accounts committee, asked Hartnett if he had
considered his position. He replied: "I have work to do and I have no
plans to resign."
His
decision to retire will not change the Revenue's decision to pursue Mba,
possibly through the courts, the spokesman added.
Hartnett's
package will anger critics. At the most recent valuation, in March 2011, his
pension pot was worth £1.7m. He is expected to receive an annual payout of up
to £80,000 and a lump sum on retirement of one year's salary, which is recorded
as £160-165,000.
In
September 2010, Hartnett was criticised for refusing to apologise for the
scandal that saw millions of people asked for backdated tax after his
department failed to collect tax correctly. He told BBC Radio 4: "I'm not
sure a need to apologise ... We didn't get it wrong." He later issued an
unreserved apology.
His
department is expected to be severely criticised in a public accounts committee
report to be released before Christmas. The National Audit Office is trying to
appoint a judge to investigate at least four corporate tax deals signed off by
Hartnett, the Guardian understands.
Hodge, who
has been one of his fiercest critics, welcomed Hartnett's decision but said the
Revenue needed to move on by making root and branch changes.
She said:
"Dave Hartnett has given many years of public service and I wish him well,
but it is time for a change at the top of the HMRC. Our inquiry uncovered
systemic issues, which I hope the organisation will set about tackling
urgently."
She also
called for the inquiry into Mba to be dropped.
"I
hope the fact that we have published Mr Mba's name will now give him proper
protection through whistleblower legislation and that the new management will
drop any case against him," she said.
Richard
Bacon, the Conservative MP and public accounts committee member, described
Hartnett's resignation as a "very English solution".
Bacon added
that following the Guardian's report on Thursday, Hartnett may have thought
that "the game's not worth the candle" and decided to retire.
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