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Rishi Sunak Talks Tough On Ethics But Questions Remain Over What He Knew About Nadhim Zahawi Tax Affairs

Rishi Sunak Talks Tough On Ethics But Questions Remain Over What He Knew About Nadhim Zahawi Tax Affairs

Prime Minister Rishi Sunak (Alamy)

3 min read

The Prime Minister’s decision to unceremoniously sack Nadhim Zahawi early on Sunday morning is the clearest example yet of his attempt to overturn a growing narrative that while he might be a capable manager, he is unable to take tough political choices.

Questions remain over what Rishi Sunak knew, or more importantly failed to ask, of the former Conservative party chairman’s tax affairs when he appointed him last autumn, while it seems unlikely he will get the credit he wants for moving decisively after a week when the calls for him to act came from across politics and beyond, including senior members of his own party.

Many Conservative MPs did not expect Zahawi to stay in post beyond Monday after Sunak ordered an investigation by his ethics advisor Sir Laurie Magnus into whether he had acted properly as the HMRC probe into his family’s offshore trust took place.

Nor did many think he would still be around by the time Prime Minister’s Questions took place on Wednesday lunchtime, when Sunak was forced to explain why at the previous week’s session he suggested the matter was closed.

But the PM stood firm on his commitment to wait for the outcome of Magnus’s inquiry before passing judgment on Zahawi’s ability to continue to hold high office.

Perhaps he was hoping the former Chancellor would fall on his sword in the way Gavin Williamson did once the pressure built up against him late last year, but it was clear from his defiance in the face of the allegations – including sending threatening legal letters to reporters attempting to get to the bottom of them – that Zahawi was unwilling to go quietly.

Once Magnus delivered his four-page report to Sunak he didn’t stand on ceremony: indeed he didn’t even wait for Zahawi’s own letter responding to his sacking before announcing his decision, as is the usual procedure in such a scenario, suggesting his keenness to show he was acting swiftly.

Nadhim Zahawi

Spare a thought for Michael Gove, who was sent out on the morning media round to offer a sincere mea culpa from the government over the Grenfell tragedy and skirt around the Zahawi story, only for it to explode while the Levelling Up Secretary was live on the airwaves.

Sunak starts his letter sacking Zahawi by repeating the words he said as he entered Downing Street, that he pledged the government he led “would have integrity, professionalism and accountability at every level”, thereby clearly sending a message that this decision was part of his commitment to upholding a higher level of standards than his predecessors.

The decision to simulatenously release the full report from Magnus, which does not pull its punches and lays out a damning timeline of the ways Zahawi is said to have breached the ministerial code, backs that idea up.

But by letting the situation drag on for a fortnight since Ashley Armstrong’s bombshell story in The Sun on Sunday confirming Zahawi’s multi-million pound settlement with HMRC, and more than a week on since Anna Isaac revealed in The Guardian that it included a penalty for failing to pay the right amount of tax originally, it lacks the impact it might have done as it was clear to everyone Zahawi could not survive. 

Sunak has failed to put distance between his administration and the story, which has reminded people of the PM’s own family’s complicated tax affairs, and added to the overall feeling that there is still wrongdoing at the heart of government - most notably with the investigation into deputy prime minister Dominic Raab still outstanding.

While Magnus places the blame for failing to report his tax investigation to officials who perform the vetting for ministers on Zahawi’s shoulders, the fact he was under scrutiny was public knowledge well before Sunak appointed him means questions over the Prime Minister's own knowledge will continue.

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