Former HMRC boss ‘has no shame’ over Deloitte job

Dave Hartnett, the former second permanent secretary of HM Revenue and Customs (HMRC), has been accused by Margaret Hodge MP of having “no shame” after taking a job as an adviser to accountancy giants Deloitte.

By Winnie.Agbonlahor

28 May 2013

Hartnett, who retired from HMRC ten months ago, has just started working one day a week at Deloitte as an adviser to foreign governments.

But Hodge, the chair of the Public Accounts Committee (PAC), told CSW: “Clearly this man has no shame.

"He better than anyone knows how these companies and big accountancy firms operate, how the likes of Deloitte advise their clients on how to manipulate the rules and exploit loopholes to get out of paying their fair share in tax.

"My committee has already expressed concerns about what appears to have been a far too cosy relationship between these companies and HMRC under Dave Hartnett.

"People will look at this appointment and think that quite frankly it stinks."

Hartnett was previously heavily criticised by the PAC for agreeing a number of "sweetheart deals" with major corporations including Goldman Sachs in the UK. A judge earlier this month found that a deal brokered by Hartnett with Goldman Sachs that let the US bank avoid paying interest penalties was lawful but “not a glorious episode in the history of the Revenue”.

The former HMRC official’s appointment was approved by David Cameron and the Advisory Committee on Business Appointments (ACOBA), with six caveats including a pledge by him to “not draw on any privileged information available to him whilst in Crown service” or engage in any discussions “with other fiscal authorities of UK’s confidential tax policy where he has been involved in that area of work in HMRC”.

Despite the restrictions, his appointment has been widely condemned. Labour MP John Mann, who sits on the Treasury select committee and questioned Hartnett on several occasions, told the Guardian: “It shouldn't be allowed. It is all-too-cosy relationships that is the problem at the heart of HMRC.

“It would be a strange government that would employ him considering the problems we've had trying to get our tax system in order, especially when he personally negotiated the deal with Vodafone.

“It gives the wrong message to a group of staff [at HMRC] who are already some of the most demoralised workers in the country.”

Deloitte defended his appointment, saying: “Hartnett will work as a consultant to Deloitte advising foreign governments and tax administrations, primarily in the developing world.

“He has significant experience in advising such countries on the development of effective tax regimes necessary to ensure their continued economic growth. He will not work with UK companies or with HMRC.”

The Cabinet Office issued a statement saying Hartnett “complied with the rules”.

ACOBA noted that the appointment “will not involve any consideration of UK tax liabilities or affairs (or any involvement with HMRC)”.

The new job comes four months after Hartnett was appointed as an adviser to banking group HSBC on financial risks and crime.

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