The murk behind Brent Council’s Bridge Park deal

The murk behind Brent Council’s Bridge Park deal that was opposed by the community last week

Bridge Park Complex with Unisys on the horizon

 

The Kilburn Times LINK today reports on a heated consultation meeting regarding the redevelopment of Bridge Park, Stonebridge, and the surrounding area including the Unisys landmark building. There were demands for the land sale to be halted.

The newspaper quotes Jay Martin of the Bridge Park Community Council as saying:
This is not a consultation, it’s a fait accompli. It looks like this deal has already been done and decided. There are moral questions and legal questions to answer. There’s the possibility that this whole thing might end up in a judicial hearing.

The moral and questions that Martin refers to are presumably directed at Brent Council’s off-shore partners in this development.

The late and sorely missed Cllr Dan Filson who, while a Labour councillor, had a strong streak of independence, responded to Cllr Pavey’s suggestion that tax havens had to be tackled at national level rather than local government, with this comment on Wembly Matters LINK:
I must say I was surprised that whilst mentioning the two companies involved were neither incorporated nor registered in the UK, the Cabinet paper did not mention that they were registered in tax havens namely Luxembourg and the BVI, nor that the leading shareholder in the holding company was a convicted fraudster. A quick Google search revealed this.

Possibly the council officers preparing the report felt these issues did not matter given the safeguarding phrase that the decision of Cabinet would be subject to meeting financial scrutiny (quite how these financial checks would succeed given that they had not succeeded in the months leading up to Cabinet was not made clear!).

The wider issue of the ethics of dealing with tax haven companies wasn’t touched upon at all nor the fraudster angle. I understand Councillor Pavey’s position that it needs government action to deal with tax haven companies (to say nothing of persons being company directors of overseas companies who, by my book, should be disqualified from holding any positions of trust in any company trading or owning land in this country).

However Brent can have its own policies; but what should they be here? The land south of the North Circular Road at Stonebridge Park has been a derelict eyesore for a couple of decades. Brent can engineer development here by intervention using such land as it has as a bargaining tool. If we take the ethical route and don’t treat with tax haven companies will we get better or worse terms from other companies? Conceivably could Councillors be surcharged for not getting “best value” in a deal? Will any action happen on this site at all for another decade?

I don’t know how I would respond on these issues. My disappointment was that no attempt has been made to address them before this particular decision came to Cabinet despite the identity of these 2 companies being known for some time, years even. So the Cabinet was obliged to agree to a deal involving these two companies without a financial appraisal in front if it and without a stated policy on dealing with tax haven companies. It leaves an unpleasant taste.
Ex Inspector of Taxes, Philip Grant, LINK revealed a link with Quintain:
When offshore companies are involved, that will always raise suspicions about who is really behind them, and whether tax avoidance may be involved, although in this case you can read a little about GMH on Wikipedia:-

‘The General Mediterranean Holding (GMH) is a financial holding company established in 1979 in Luxembourg City, in southern Luxembourg, founded by Anglo-Iraqi businessman Nadhmi Auchi.

GMH is a diverse business group with activities in Banking & Finance, Real Estate & Construction, Hotel & Leisure, Industrial, Trading & Pharmaceuticals, Communications & IT and Aviation.’

The (publicly available) details do not say in which overseas territory Harborough Invest Inc. is incorporated, or resident for tax purposes.

By chance, I have come across GMH’s “agent”, Nick Shattock, before, when I was an Inspector of Taxes, and he was a director of Quintain Estates and Developments Plc (having previously been a partner in a firm of City solicitors). That information is on public record, and (of course) I cannot disclose anything which happened when I was responsible for dealing with the Quintain group’s company tax affairs, because of Civil Service confidentiality.

As a (past) director of Quintain (the developer behind Wembley Park), it is likely that Mr Shattock has already had dealings with Brent’s Strategic Director of Regeneration and Growth, Andy Donald. The report to Cabinet proposes that negotiations over the “deal” between Brent and GMH should be left in the hands of Mr Donald (as the “deal” with Galliford Try over the Willesden Green Library Centre redevelopment was).

Persuaded? Definitely not!
In January of this year Cabinet approved the land deal for Bridge Park nd Labour defeated Cllr John Warren’s move at Full Council to have it debated. The is an extract from my report of the meeting:
In the course of the resultant discussion Cllr Warren, speaking to Muhammed Butt, Leader of the Council, referred to ‘Your friend Mr Auchi’. Sir Nadhmi Shakir Auchi is Chairman of the off-shore British Virgin Islands company General Mediterranean Holdings (GMH) which is Brent Council’s partner in the redevelopment of Bridge Park. Muhammed Butt is the lead member for the conditional land sale of the Bridge Park site to GMH.

At the Brent Cabinet on January 16th Cllr Margaret McLennan, Deputy Leader of the Council, said that she was ‘thrilled’ by the Bridge Park deal. LINK

Auchi is controversial because of a 2003 allegation of fraud LINK and of course the whole issue of tax havens and tax avoidance is a current political issue with Jeremy Corbyn promising action by a future Labour Government.

Cllr Thomas intervened to call for Cllr Warren to withdraw his statement about ‘Your friend Mr Auchi’ directed at his leader, as the Council Meeting was being streamed and he wouldn’t want a ‘wrong impression’ to be given. Warren, saying he couldn’t remember exactly what he’d said,went on to say, ‘Mr Auchi has connections with the Labour Party. Let me say that. That is what I was referring to.’
The alleged link goes back to 2001 when the Guardian published an article entitled ‘A Tycoon, a Minister and Interpol’ LINK and involved Keith Vaz MP