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Date: Fri 2 November 2012

Scotland should ban companies involved in tax dodging from public contracts

UNISON Scotland today urged the Scottish Government to ban companies involved in tax dodging from being eligible for public contracts.

The public services union said that Ministers should use their forthcoming Procurement Reform Bill to take innovative action against companies using tax havens and other forms of tax dodging.

Scottish Organiser Dave Watson said: “It is entirely wrong that companies seeking to avoid paying their fair share of tax should be awarded public contracts.

“Public bodies in Scotland spend nearly £11 billion annually through procurement. This Bill offers ways to use that spending to deliver local social, economic and environmental benefits.

“We think this is an important opportunity to do what some European cities such as Helsinki and Paris are already doing, in acting against companies using tax havens.

“Our message to the Scottish Government is that they should adopt a tax justice approach, finding ways, with appropriate legal advice, to bar companies involved in tax dodging from being eligible to bid.”

Recently public outrage has focused on big-name companies like Google, Amazon and Starbucks paying miniscule amounts of tax. Many companies investing in PPP/PFI projects are registered in tax havens.

UNISON believes that community benefit clauses could be used to argue that the community will benefit from companies paying proper levels of taxes.

Dave added: “This Bill also offers opportunities to strengthen labour rights and workforce protections, to extend the Living Wage to private sector employees on public contracts and to exclude companies involved in blacklisting trade unionists from bidding for public contracts.

“And, of course, public procurement policies must contribute properly to Scotland’s climate change targets and must support a ‘Just Transition’ to a low carbon economy.”


For further comment please contact:
Dave Watson, Head of Bargaining and Campaigns, UNISON Scotland, on 07958 122 409
Fiona Montgomery, Communications Officer, UNISON Scotland, 0141 342 2877 or 07508 877000
Malcolm Burns, Communications Officer, UNISON Scotland, 0141 342 2877 or 078765 66978

Notes for Editors:

1. UNISON’s Procurement Reform Bill Consultation response is online at www.unison-scotland.org.uk/response/

2. A number of European cities/regions are already acting against companies that use tax havens.

3. Richard Murphy, of Tax Research UK, and adviser to the Tax Justice Network, says that legislation in England, the Public Services (Social Value) Act 2012, provides councils there with ways to argue for this that would not breach EU procurement rules. This would include councils being able to demonstrate that a large company paying tax would benefit the community through funding for better education, roads etc. This would allow them to choose a tender on the basis of which company pays tax or not.


UNISON believes the Procurement Reform Bill could use a similar approach.

4.There has been considerable success in winning the Living Wage for public service workers in Scotland – directly employed Scottish Government and NDPB staff, the NHS, a growing number of councils - but UNISON wants to see it extended to staff employed by contractors and this Bill offers the chance to do this. We also support John Park MSP’s Living Wage (Scotland) Bill. www.scottish.parliament.uk/S4_MembersBills/

5. Living Wage week takes place next week, from 4-10 November. The Scottish Living Wage Campaign website is at http://slw.povertyalliance.org/index.php