Dods Monitoring

Dods Monitoring

GMB: Political Work Monitoring

Organisation: BBC Radio 4 Today – July 3 2007

Date released: 03 July 2007

Private equity face more scrutiny

Private equity chiefs will face fresh scrutiny by the Treasury select today amid reports they are making large gains from firms which pay almost no corporation tax.

The BBC reported today that Saga and the AA - two private equity-owned firms set for a merger - had paid almost zero corporation tax since being taken over more than two years ago.

Meanwhile the owners, Charterhouse, Permira and CVC, made gains of

£2.5 billion, it said, around three and a half times the original investment.

Labour committee chairman John McFall said: “The question is: are the private equity companies using debt as equity? If they are then they are distorting the system. These are questions that are still to be answered.”

The committee will today question four more private equity bosses, McFall described the inquiry as a “very live issue”.

At a previous hearing, private equity leaders sought to dispel their reputation as corporate “asset strippers”, claiming that they were good for jobs and profits. Several MPs were incredulous when none could say how much their companies paid in capital gains tax.

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Date released: 02 July 2007

BBC 2 The Daily Politics - CBI president in call action on private
equity

July 2 2007

President of the CBI Martin Broughton has said the large bonuses and
favourable tax regime enjoyed by many private equity executives is a
cause for "real concern".

Questioned by the BBC's Andrew Neil, he was sceptical that social
mobility had declined as severely as recent studies have suggested and
insisted that equality of opportunity was now "much greater" than in
past decades.

But Broughton, who is also chairman of British Airways, admitted that it
was "fairly indisputable" that private equity executives enjoying
capital gains tax advantages should pay income tax at the same 40 per
cent as other higher earners.

Parliamentary material is reproduced with the permission of the
Controller of HMSO on behalf of Parliament. Crown copyright material is
reproduced with the permission of the Controller of HMSO and the Queen's
Printer for Scotland. All other material may be subject to copyright.
For more information on this material please contact Dods Monitoring on
020 7091 7580.
Dod's Parliamentary Communications Limited Registered in England under
Company number 01262354 Registered Office: 4 Grosvenor Place, London
SW1X 7DL.