Nadhim Zahawi fired by Rishi Sunak for "serious breach" of Ministerial Code over HMRC tax investigation

Mr Zahawi has been the Conservative Party chairman and Minister without Portfolio after being appointed to the posts by Rishi Sunak in October 2022.

He had previously briefly served as Chancellor in the final weeks of Boris Johnson’s Government and as a Minister for Liz Truss.

An investigation into how he settled a multimillion-pound tax dispute while chancellor has now led to Mr Sunak concluding there was a “serious breach” of the Ministerial code.

Mr Zahawi had authorised HMRC to discuss his settlement – estimated to be worth £4.8 million and including a penalty – with the ethics investigation ordered by Mr Sunak.

That investigation, conducted by Sir Laurie Magnus, has now concluded Mr Zahawi failed to declare the ongoing HMRC investigation into his tax affairs after being appointed Chancellor in July 2022 as he should have done and also failed to declare the outcome of the investigation the following month. Sir Laurie said Mr Zahawi had also failed to disclose relevant information - in this case the nature of the investigation and its outcome in a penalty - at the time of his appointments to posts in the Truss and Sunak governments.

In a letter to Mr Zahawi, Mr Sunak said the findings of his independent adviser on ministers’ interests Sir Laurie Magnus made it “clear that there has been a serious breach of the ministerial code”.

The letter said: “When I became Prime Minister last year, I pledged that the Government I lead would have integrity, professionalism and accountability at every level.

“That is why, following new information which came to light in recent days regarding your personal financial arrangements and declarations, I asked Sir Laurie Magnus, the independent adviser on ministers’ interests, to fully investigate this matter. You agreed and undertook to co-operate fully with the inquiry.

“Following the completion of the independent adviser’s investigation – the findings of which he has shared with us both – it is clear that there has been a serious breach of the ministerial code. As a result, I have informed you of my decision to remove you from your position in His Majesty’s Government.

“As you leave, you should be extremely proud of your wide-ranging achievements in Government over the last five years.

“In particular, your successful oversight of the Covid-19 vaccine procurement and deployment programme which ensured the United Kingdom was at the forefront of the global response to the coronavirus pandemic.”

In his letter to the Prime Minister, the independent adviser on ministers’ interests Sir Laurie Magnus told Rishi Sunak that certain “omissions” by Nadhim Zahawi fell short of the standards set out in the ministerial code.

In his report, dated January 29, Sir Laurie wrote: “Given the nature of the investigation by HMRC, which started prior to his appointment as Secretary of State for Education on 15th September, 2021, I consider that by failing to declare HMRC’s ongoing investigation before July 2022 – despite the ministerial declaration of interests form including specific prompts on tax affairs and HMRC investigations and disputes – Mr Zahawi failed to meet the requirement to declare any interests which might be thought to give rise to a conflict.”

Sir Laurie also told the PM: “I also conclude that, in the appointments process for the governments formed in September 2022 and October 2022, Mr Zahawi failed to disclose relevant information – in this case the nature of the investigation and its outcome in a penalty – at the time of his appointment, including to Cabinet Office officials who support that process.

“Without knowledge of that information, the Cabinet Office was not in a position to inform the appointing Prime Minister.

“Taken together, I consider that these omissions constitute a serious failure to meet the standards set out in the ministerial code.”

“I consider that Mr Zahawi, in holding the high privilege of being a Minister of the Crown, has shown insufficient regard for the General Principles of the Ministerial Code and the requirements in particular, under the seven Principles of Public Life, to be honest, open and an exemplary leader through his own behaviour,” he concluded.