Tonight’s Panorama will surely enrage the notoriously touchy Barclay boys. Sirs David and Frederick Barclay are media tycoons who like to stay out of the media spotlight.
Often described as reclusive, the proprietors of the Telegraph Media Group dislike the term. They prefer to regard themselves as people who merely wish to be private.
Semantics aside, the point is that they have a history of complaining whenever they are treated to the sort of publicity to which other entrepreneurs are routinely subjected.
And they have also taken to the courts. In the 1996, they sued John Sweeney, the journalist who is presenting tonight’s programme and the BBC for invading their privacy. In 2005, they went to court in France to sue The Times over a series of articles about their business deals (eventually dropping the action). In 2010, they sued Private Eye for running a spoof Daily Telegraph front page.
So the boyos have form. And I’d guess that they will be watching BBC1 at 8.30pm to see what Sweeney has to say in a Panorama entitled “The tax haven twins.” Then again, maybe they cannot receive the programme live in their castle on Brecqhou in the Channel Islands or in their other home in the tax haven of Monaco.
But they have plenty of British-based aides, and lawyers, who will surely be monitoring the broadcast, which the BBC’s publicity department says will allege that one of their London hotels, The Ritz, hasn’t paid any corporation tax in 17 years.
Panorama has investigated the accounts of the hotel, which was acquired by the Barclays in 1995. It’s a profitable business, but the hotel has taken advantage of a series of perfectly legal tax reliefs to ensure its corporation tax bill was zero.
The programme will also raise questions about another of their businesses, the catalogue company Littlewoods, which they bought in 2002. It secured a VAT rebate, plus interest, from the revenue commissioners worth £472m over payments dating back to 1973. But the company has gone to court to demand a further £1bn from the government in compound interest.
It’s an important test case for taxpayers because, should Littlewoods win, it could open the door to claims worth billions of pounds from other companies.
The twins say they have had nothing to do with the running of the UK companies since they retired to Monaco more than 20 years ago.
“We have not attended office, management or board meetings in the UK since leaving the country,” Sir David Barclay said in a statement. “My brother and I have no editorial, political or economic power in the UK.”
Littlewoods, the Ritz and the Telegraph are each controlled by offshore trusts. However, the trusts were set up by the twins and one of the brothers attends trust meetings.
The UK businesses are managed by Sir David’s son, Aidan Barclay. On the Littlewoods claim, he said:
“This represents tax taken incorrectly by HMRC and held incorrectly for many years, facts which HMRC publicly recognise and accept.
Directors of companies have legal responsibilities and duties to recover and secure their companies’ assets from the perspective of each company itself and its various stakeholders. It would be a dereliction of their duties not to pursue repayments which are properly due from HMRC.”
Aidan Barclay told Panorama that Littlewoods lodged its VAT claim before the family took over the company, which is true. But the £1bn test case for compound interest was launched after the Barclays’ takeover.
He also explained that the Ritz had reinvested profits made by the hotel, adding: “The Barclay family members and their companies abide by the law and pay the taxes required by UK law and the laws of other relevant countries.”
Sir David Barclay said: “We have always acted in a responsible way with regard to taxation and have never been involved in any tax avoidance scheme. We are not responsible for corporate taxes in the UK and are unaware what tax is paid on the Ritz.”
Panorama will also touch on the controversy surrounding the Barclays’ activities in Sark. the island adjacent to Brecqhou.
As David Leigh has reported, the Sark segment has already attracted complaints from the Barclays’ estate manager on the island, Kevin Delaney.
His Sark Newsletter carried a lengthy article on 10 October criticising Sweeney for his (allegedly) “unbecoming drunken antics” during his visits earlier this year to film on the island. He wrote:
“Empowered by the might of the BBC, Mr Sweeney filmed people without their consent.
He aggressively invaded my offices and harassed and intimidated my staff in his concerted efforts at staging a hostile confrontation with me on camera – despite being made aware, in writing, that I did not want to be interviewed by him.”
Delaney returned to the attack on the BBC in a bulletin dated yesterday (16 December) in which he alleged that the editor of Panorama, Tom Giles, had repeatedly threatened him with libel proceedings.
Sweeney says he’ll let the programme speak for itself.
Source: BBC Full disclosure: I was interviewed for the programme