Wednesday briefing: Pandora Papers revelations continue

Hallo, Warren Murray aiming to put you a step ahead.

Ben Elliot, the Conservative party’s embattled co-chair, jointly owned a secret offshore film financing company that indirectly benefited from more than £120,000 of UK tax credits. The revelation Elliot has a British Virgin Islands-based company – which he owns with Ben Goldsmith, the brother of the Tory peer and minister Zac – will raise fresh questions for the businessman, wie se courting of ultra-wealthy but controversial political donors has already provoked widespread criticism.

Maandag, die Pandora papiere – the largest leak of offshore data in history, which has been shared with the Guardian and other media by the International Consortium of Investigative Journalists – helped expose how a series of substantial Conservative party funders are facing a range of allegations about their links to offshore finance. Vandag, the same leak shines a light on a British Virgin Islands (BVI) company Elliot and Goldsmith created to fund the making of Fire in Babylon, the pair’s 2010 documentary film about the great West Indies cricket team of the 1970s and 80s. Analysis of financial disclosures suggests the duo’s BVI company held a controlling stake in a British subsidiary that made the film. The UK company received a £600,000 loan from its BVI parent in 2008, plus £121,000 from a government scheme designed to incentivise film production in the UK between 2009 en 2011. The film made a small loss, and without the tax credits the subsidiary would not have been able to fully repay its offshore creditors, the largest of which was Elliot’s and Goldsmith’s BVI company, which had loaned the UK business most of its funds.

While the arrangement does not appear to have breached any tax regulations or laws, it does raise questions about whether government film schemes should be helping to fund projects that are controlled in a tax haven. If Fire in Babylon had become profitable, then the structure might also have provided some tax advantages. Neither Elliot nor Goldsmith answered the Guardian’s questions about whether any loan interest was paid by the UK production company to their offshore company, nor why the pair’s names were initially kept off publicly available Companies House filings, which would have shown how they had a controlling stake in the UK production company via their BVI company. The connection only formally emerged in 2016, when Elliot and Goldsmith were registered as “persons of significant control” of the UK firm, WIB Productions Ltd, which made the film. They said the idea they “might have attempted to conceal our involvement in the making or financing of Fire in Babylon is patently absurd, given our names were all over it from the start, in the credits, on the invitations, in newspaper and radio interviews and so on”. Goldsmith added: “It is a love letter to one of the great sporting stories of all time.”

Here are responses, some of them edited, received from three offshore services providers – Alcogal, Asiaciti Trust and Fidelity – whose information appears in the Pandora Papers, and who were invited by the Guardian to comment on their activities and those of their clients.

Level up north – Michael Gove, the new levelling up secretary, will instruct his department to boost homebuilding in the north of England, na concerns among Tories that existing proposals targeted the south. It is understood Gove will drop the “zonal” approach – which left local people unable to reject housing in areas designated for development – and overhaul the mandatory housebuilding targets that alarmed southern Tories. Afsonderlik, Dr Patrick Roach, the UK’s most senior black union leader, has said the levelling-up agenda must not be “colour-blind” or it will leave black workers behind. He called on the government to make employers much more transparent and accountable for things like addressing racism at work and ethnicity pay gaps. Boris Johnson will brush off petrol queues en empty shelves as evidence of a “change of direction” towards a high-wage economy, as he closes a Conservative conference at which supply shortages have barely been acknowledged.

Brexit fishing power play – The EU could cut Jersey and Britain’s electricity supply over the UK’s failure to provide sufficient fishing licences to the French, says France’s EU affairs minister, Clément Beaune. “Enough already, we have an agreement negotiated by France, by Michel Barnier, and it should be applied 100%. It isn’t being. In the next few days … we will take measures at the European level or nationally to apply pressure on the United Kingdom.” The UK partly relies on electricity from France. Under the post-Brexit agreement struck on Christmas Eve, the EU can take measures “proportionate to the alleged failure by the respondent party”. That could be extended to the energy supply to the rest of the UK, but would need to be proportional and agreed to by other member states.

Book thrown – Facebook puts “astronomical profits before people”, harms children and is destabilising democracies, the whistleblower Frances Haugen has told the US Congress. The former employee said Facebook knew it steered young users towards damaging content and its Instagram app was “like cigarettes” for under-18s.

Haugen is a former Facebook employee with 15 years in the industry as an expert in algorithms and design. She offered suggestions including changing newsfeeds to be chronological rather than algorithmic, appointing a government body for tech oversight, and requiring more transparency on internal research. Her testimony puts pressure on US lawmakers to take action after years of hearings and circular discussions about big tech’s growing power.

‘Stop diabetes in its tracks’ – So many Britons are obese that almost one in 10 in the UK will have diabetes by 2030 amid alarming levels of obesity, putting millions at risk of “devastating complications” including heart attacks, kidney failure, stroke, amputation and blindness, says Diabetes UK. The charity is calling for urgent action “to stop it in its tracks” including enrolling more people in the NHS diabetes prevention programme, greater access to weight loss programmes, and assurances that people with diabetes will get regular NHS checks to cut the risk of complications. Diabetes UK is launching a new TV campaign, This is Diabetes, featuring families across the UK living with the condition.

We all need a few more zeroes … Tina Turner has sold the rights to her music catalogue spanning six decades, including hits such as What’s Love Got to Do With It, and Private Dancer, to the music publishing company BMG.

The “queen of rock’n’roll” sold her artist’s and writer’s shares of her recordings, as well as the management of her name, image and likeness, in the largest deal struck with a single artist in BMG’s history. The sums involved were not disclosed. Turner, 81, will continue to be a recording artist on Warner Music’s books.

With queues outside petrol stations and claims selfish punters are using jerry cans to stockpile fuel, one word has become synonymous with the supply chain crisis that has hit the UK in recent weeks: panic. But the social psychologist Clifford Stott says something different is going on.

The case of Meng Wanzhou poisoned Beijing’s relations with Washington and Ottawa. Now the Chinese telecommunications company Huawei hopes the obvious bargain to release her in return for two Canadians may start a mending of the ways. Huawei is one of more than 300 Chinese companies kept on a banned entity list in the US, which claims the firm is capable or has used its equipment to spy on behalf of the Chinese state. Patrick Wintour writes that it seems unlikely that the aggressive atmosphere in Washington towards Huawei will ease.

England’s Ashes tour of Australia took a significant step towards being confirmed later this week following positive talks between players’ representatives, the ECB, Cricket Australia and the Australian government. Barcelona ripped Arsenal apart in style to kickstart their Women’s Champions League defence with a 4-1 win at the Johan Cruyff Stadium. Emma Raducanu says she will endeavour to continue working in exactly the same manner as before her shock US Open victory last month as she adjusts to the increased attention and her transformed status.

A fifth of UK adults have increased their following of women’s sport during the pandemic, research has found, with many citing the rise in coverage as a reason for their greater interest. News of a welcome and substantial boost in prize money for the first women’s major of the golfing year has arrived with the not inconsequential footnote of no host venue being in place after 2022. Twenty-five men who claim they are victims of historical sexual abuse at Kelties Boys Club have launched group proceedings against Celtic Football Club. And a youth football coach has called for “common sense” after he was fined and suspended for leading his team off the pitch when they were exposed to homophobic abuse.

Asian shares have slipped, defying a Wall Street rally where technology companies and banks erased most of the losses from the previous day’s sell-off. Trading was closed in Shanghai for the Chinese national holidays. Futures trading puts the FTSE 40-50 points down ahead of its open. The pound is worth $1.360 and €1.174 at time of writing.

Die Guardian’s lead today is “Pandora papiere: Tory co-chairs firm indirectly benefited from £121k tax credits”. Die Daily Mail has “French threat to sink Xmas” saying there is the threat of a “Calais blockade” in response to the fishing row. Die i’s lead is “Covid vaccine mandatory for frontline NHS workers in Javid plan”.

Now for pretty much all the others … “PM: I’ve got the guts to make us a high-wage country” says the Telegraph and the Express naturally laps that line up too: “Boris: we’ve got the guts to fix Britain”. Die Metro, wel, sees it as an abrogation – “Can he fix it? No he can’t” with the PM shown clambering out of a little earthmoving machine. Die Mirror is more scathing: “No alternative … no heart” as Johnson “repeats idol Thatcher’s lies to say he must snatch back £20 a week from hard-up families today”.

Die Financial Times says “Johnson steps up battle with business over immigration” and the Times looks ahead in time: “PM to reveal minimum wage rise in a few weeks”.

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