Analysing the Ashcroft affair: What actually happened?

There is a lot of confusion over the Ashcroft affair. Labour have not made clear precisely how Ashcroft broke his promise, and the Tories aren't replying, save as to point out that Labour and the Lib Dems take donations from non-doms. This post looks at the promises Ashcroft made and considers whether he broke them.

On 23 March 2000, in response to being previously rejected for a peerage, Michael Ashcroft signed a document making a series of undertakings:

The controversy revolves around the words "I hereby give you my clear and unequivocal assurance that I have decided to take up permanent residence in the UK".

So, what does permanent residence mean? On the face of it, the meaning is ambiguous: there is no tax status of permanent residence. Indeed, Lord Ashcroft seems to think that it means long term resident. Unfortunately for Lord Ashcroft, the status of long-term resident did not exist until 2008, so it couldn't possibly be what he meant. In 2000 there were two and not three tax statuses: that of resident, and that of a non-domicile. Given that Ashcroft was already a non-dom, and that his memorandum implies positive action, it is difficult to see what he could have possibly meant other than changing his status to ordinarily resident.

Of course, there is another possible interpretation. One might argue that Ashcroft simply meant he was going to live in the U.K., and used the words permanent residence in a meaningless Freudian manner. Again, this is untenable. Ashcroft's memorandum states that "I have given my advisers instructions to make arrangements to give effect to this decision". It is difficult to see what arrangements Ashcroft's advisers would need to make except for changing his tax status.

HMRC provide a final nail in the coffin with their defintion of domicile: "under English law you are domiciled in the country in which you have made your permanent home".

In short, it seems clear that Ashcroft did not comply with promises he made to smooth his passage into the Lords. Conservative cries of "but Labour do it too!" may be factually correct, but they completely miss the point. It seems that both sides are simply talking past one another: Labour and Liberal politicians are failing to assert and explain the basis of the issues, instead plumping for lightweight rhetoric about how the Tories have not changed, and the Tories simply reply by making an entirely different point.

The debate about the proper role of non-doms is an important one, but it is a different one: the non-dom debate must not be clouded by a sterile debate about an issue of Lord Ashcroft failing to make good on his promise.