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Nadhim Zahawi’s failure to disclose that he was in discussions with HMRC over his taxes was a “serious failure to meet” ministerial standards, a damning report into the affair has found.

Sir Laurie Magnus, who carried out the investigation as the prime minister’s new ethics adviser, said the former chancellor “should have understood” from the outset that he was under investigation by HMRC and that it was a “serious matter”.

He also criticised the MP for Stratford-on-Avon for failing to correct the record for more than six months, after he dismissed reports that HMRC was “looking into” his tax affairs as “smears” during a July 2022 interview with Sky News’s Kay Burley.

Mr Zahawi was sacked as Tory party chairman on Sunday by Prime Minister Rishi Sunak following the publication of Sir Laurie’s report, which looked into whether the former minister had fallen foul of the ministerial code.

Here Sky News looks at the key points in Sir Laurie’s report:

‘Mr Zahawi should have understood this was a serious matter’

“Mr Zahawi has told me that he had formed the impression that he and his advisers were merely being asked certain queries by HMRC concerning his tax affairs, and that this impression persisted until he received a letter from HMRC on 15 July 2022.

Sir Laurie Magnus
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Sir Laurie Magnus

“On the basis of the confidential information to which I have had access, including correspondence between HMRC and Mr Zahawi personally, I consider that an individual subject to the HMRC process faced by Mr Zahawi should have understood at the outset that they were under investigation by HMRC and that this was a serious matter.”

‘Investigation was a relevant matter for a minister to declare’

“I consider that an HMRC investigation of the nature faced by Mr Zahawi would be a relevant matter for a Minister to discuss and declare as part of their declaration of interests.

“I would expect a Minister to inform their Permanent Secretary and to seek their advice on any implications for the management of their responsibilities.

Politics news – latest: Zahawi attacks media after sacking

“I would likewise expect a Minister proactively to update their declaration of interests form to include details of such an HMRC process.”

‘Mr Zahawi’s failure to declare investigation did not meet ministerial standards’

“After his appointment as Chancellor on 5 July 2022, Mr Zahawi completed a declaration of interests form which contained no reference to the HMRC investigation.

“A later form acknowledged (by way of an attachment) that Mr Zahawi was in discussion with HMRC to clarify a number of queries.

“Only following receipt of HMRC’s letter received on 15 July 2022, did Mr Zahawi update his declaration of interests form to acknowledge that his tax affairs were under investigation, but he provided no further details other than the statement made previously that he was clarifying queries.

File pic: Rishi Sunak and Nadhim Zahawi

“Given the nature of the investigation by HMRC, which started prior to his appointment as Secretary of State for Education on 15 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.”

‘Mr Zahawi failed to declare HMRC investigation ended in penalty’

“The subsequent fact that the investigation concluded with a penalty in relation to the tax affairs of a Minister also requires declaration and discussion.

“It is a relevant interest which could give rise to a conflict, and particularly so in the case of HM Treasury Ministers and the Chancellor of the Exchequer, who has responsibility for the UK tax system.

Read more:
Nadhim Zahawi sacked as Tory chairman over tax affairs row
In full: Prime Minister Rishi Sunak’s letter sacking Nadhim Zahawi

“As a result of my inquiries, I conclude that Mr Zahawi failed to update his declaration of interest form appropriately after this settlement was agreed in principle in August 2022.

“It was not until mid-January 2023 that details of the earlier HMRC investigation and its outcome were declared.”

‘Omissions constitute a serious failure to meet ministerial standards’

“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.”

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Zahawi in July 2022: ‘I’ve always declared my taxes’

Nadhim Zahawi’s interview with Sky News in July 2022

What Mr Zahawi said:

“There have been news stories over the last few days which are inaccurate, unfair and are clearly smears. It’s very sad that such smears should be circulated and sadder still that they have been published.

“These smears have falsely claimed that the Serious Fraud Office, the National Crime Agency, and HMRC are looking into me. Let me be absolutely clear. I am not aware of this. I have not been told that this is the case.

“I’ve always declared my financial interests and paid my taxes in the UK. If there are questions, of course, I will answer any questions HMRC has of me.”

What Sir Laurie said about the statement:

“Mr Zahawi has told me that at the time of this statement, he was under the impression that he was answering HMRC’s queries, but that he was not under investigation.

“I consider that an individual subject to the HMRC process faced by Mr Zahawi should have understood that they were under investigation by HMRC and that this was a serious matter.

“Under the Ministerial Code, Ministers have a duty to ‘be as open as possible with Parliament and the public’.

“Whilst this duty clearly does not extend to disclosing personal tax information, it does include a general duty to be accurate in statements to ensure a false impression is not given or maintained.

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PM took ‘decisive action’ on Zahawi, says Gove

“Mr Zahawi did not correct the record until 21 January 2023, when Mr Zahawi’s public statement indicated that he had reached a settlement with HMRC following an investigation.

“I consider that this delay in correcting an untrue public statement is inconsistent with the requirement for openness.”

‘Insufficient regard for 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.

“I want to commend Mr Zahawi for his willingness to assist with my inquiry. I also fully appreciate the pressures faced by Ministers as they address the complex issues of government and the difficulties they encounter in balancing the demands of their personal lives and their ministerial responsibilities.

“These factors, however, cannot mitigate my overall judgement that Mr Zahawi’s conduct as a Minister has fallen below the high standards that, as Prime Minister, you rightly expect from those who serve in your government.”

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‘People were crying, they were trapped’: Spain reels from deadly flash floods

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'People were crying, they were trapped': Spain reels from deadly flash floods

Emergency responders are searching for bodies inside stranded cars and buildings following deadly flash floods in Spain that have killed at least 158 people.

Scenes of destruction have been left in the wake of the powerful floodwaters which hit the east of the country late on Tuesday and early Wednesday, marking Spain‘s worst natural disaster this century.

Cars have been piled high on top of each other, homes and businesses have been swept away, trees have been uprooted, and roads and bridges have been left unrecognisable.

Spain flooding latest: Looting breaks out as flood deaths rise

Damaged cars are seen along a road affected by torrential rains that caused flooding, on the outskirts of Valencia, Spain.
Pic: Reuters
Image:
Damaged cars along a road on the outskirts of Valencia. Pic: Reuters

People work to clear a mud-covered street with piled up cars in the aftermath of torrential rains that caused flooding, in Paiporta, Spain, October 31, 2024. REUTERS/Eva Manez
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People work to clear a mud-covered street in Paiporta. Pic: Reuters

At least 92 people have died in the worst-hit region of Valencia, while deaths were also reported in Castilla La Mancha and southern Andalusia.

An unknown number of people remain missing.

“Unfortunately, there are dead people inside some vehicles,” Spain’s transport minister Oscar Puente said.

In the Valencian district of La Torre, nine dead bodies were discovered inside a garage – with a local police officer among the victims.

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Man pulled from deadly floods

Luis Sanchez, a welder, said he saved several people from floodwaters rushing through the V-31 motorway south of Valencia city.

“I saw bodies floating past. I called out but nothing,” Mr Sanchez said.

“The firefighters took the elderly first, when they could get in. I am from nearby so I tried to help and rescue people. People were crying all over, they were trapped.”

Read more on this story:
Lives have been ripped apart in Spain
Floods hit ‘like a tsunami’ – eyewitness

Satellite images from NASA show how severe flooding has impacted Valencia and its surrounding towns.

The images, captured on 30 October, show large areas to the south of the city covered in floodwater.

The Turia river, which runs through the city, can be seen at a much higher level.

The Pobles del Sud, a large lake nearby, overflowed. Much of the area surrounding the lake was covered in floodwater.

The worst of the destruction was concentrated in Paiporta, a municipality next to Valencia city, where 62 people have been reported dead.

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Spanish town ‘worst-hit’ by floods

Mayor Maribel Albalat told national broadcaster RTVE: “We found a lot of elderly people in the town centre. There were also a lot of people who came to get their cars out of their garages… it was a real trap.”

What has caused the devastation?

The flooding events in Spain have been hard to witness. But the rainfall there could never have been anything but devastating.

Chiva, located just to the west of Valencia, received 491mm of rain in an eight-hour window.

Some 100-200mm fell in surrounding areas with the accumulation of running water producing apocalyptic scenes.

In addition there have been over 20,000 lightning strikes.

Whilst the rainfall totals are astounding in themselves, this part of the world is simply not accustomed to huge quantities of water falling from the sky.

In an average year, Spain would expect somewhere between 50 and 100 mm of rain throughout the entire month of October but Valencia and Andalusia would expect far less – just 60–70mm. 

So how did this happen? It’s attributable to a DANA, a “depresion aislada en niveles altos” or a “cut-off low”. 

This is a low pressure system which becomes slow moving or stationary, blocked by high pressure elsewhere, which can only keep shedding its rain over the same area for long periods of time.

These systems are not that unusual. They occur when cool air from the north is drawn across the Mediterranean in late summer and autumn when the waters are war. The temperature differential enhances storms and rainfall totals.

But whilst not uncommon, this one was certainly extreme. 

And it hasn’t gone yet. This same system has continued to bring further heavy rain and thunderstorms today, but it has now moved a little further north and east, heading toward the French border and currently remaining to the west of Barcelona. 

The rain and thunderstorms are likely to continue for a few days yet with the Tarragona and Castellon regions still under an amber warning while a yellow warning remains in force for both eastern and western Spain.

Spanish Prime Minister Pedro Sanchez said on Thursday morning that Valencia had been declared a disaster zone and that the priority was to find victims and missing people.

He also urged those affected to stay at home as more torrential rain was forecast.

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“The most important thing is that I know Spanish people are aware that this phenomenon has not finished,” he said.

Sky News’ Europe correspondent Adam Parsons, reporting from Valencia, said the devastation suffered in the region is “enormous”.

“What we’re witnessing now are the locals here who are waking up and seeing what’s happened to their town and what has happened is something almost apocalyptic,” he said.

A nearby shop was left “absolutely wrecked” and looked like a “bomb has gone off in there”, he added.

Three days of mourning has been declared in Spain, beginning on Thursday.

Spain’s Mediterranean coast is used to autumn storms that can cause flooding, but this was the most powerful flash flood event in recent memory, and scientists have linked its strength to climate change.

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‘No one came to rescue us’: In this destroyed Spanish town, people are angry

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'No one came to rescue us': In this destroyed Spanish town, people are angry

In the Spanish town of Algemesi, people are angry.

The suburb of Raval was one of the worst hit by flash flooding but residents feel abandoned.

At least 158 people have been killed in the disaster in eastern Spain – with the worst of the flooding concentrated around the Valencia region.

Spain floods latest: Looting breaks out as flood deaths surpass 150

“When the alert came the water was already two metres high,” Carolina shouts from her balcony. “There were no police, firefighters or the mayor. No one came to rescue us.”

The distress is echoed street after street.

Carmen puts her head in her hands and weeps.

“They have lost everything,” she says, pointing at her neighbours’ houses.

Read more:
‘People were crying, they were trapped’
Utterly random damage in town where 40 died

Every home is in ruins and their owners are heartbroken.

Dolores shows us inside her house. She says the flood was up to the ceiling but because no help came, they have had to hammer holes in the walls to clear the water.

“I feel awful. I’m terrified and very afraid. My husband is sick – we need more help,” she says.

Carmen says her neighbours have lost everything
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Dolores says her family had to hammer holes into the walls of their home

The level of destruction is immense.

On the street, we meet Noel with his children. The youngest toddler barefoot in the mud.

Yesterday, Noel and his wife had nothing to eat. He feels helpless.

Noel says he doesn't have access to water, light or food
Image:
Noel says he doesn’t have access to water, light or food

“Right now, there are people who are trapped. The mud is up to their waists, so they can’t open their doors,” he says.

“I live on a high floor so I didn’t have problems with the flooding in my home, but I don’t have water, light, or food.”

There’s a growing feeling of desperation in this suburb.

At one point, someone shouts “food!” and people rush to grab what they can from a nearby shop.

It’s not clear if they have been let in by the owner or are looting.

The devastation is so great and at a time when people are at their most in need, they feel frustrated and alone.

In a nearby shelter we meet people from Algemesi who have been made homeless by the flood.

Carol says she has never felt so hopeless.

Carol says there is 'nothing left'
Image:
Carol says there is ‘nothing left’

“There was a tree trunk that came into the front of my house. There are no walls, no ceiling. I don’t have anything. There’s nothing left,” she explains, beginning to cry.

For many, the initial trauma of this natural disaster has been compounded in the aftermath by a feeling of loss and loneliness.

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Ukraine war: Thousands of North Korean troops near Ukraine border will enter battle ‘within days’, says Blinken

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Ukraine war: Thousands of North Korean troops near Ukraine border will enter battle 'within days', says Blinken

Thousands of North Korean soldiers are now positioned near Ukraine’s border and likely to enter combat in the coming days, the US says.

Russian troops have been training them in artillery, drones and “basic infantry operations, including trench clearing”, said US secretary of state Antony Blinken.

He said it strongly indicated they would be used on the front line and would therefore become legitimate targets for Ukraine.

Some 10,000 North Korean troops are in Russia, including up to 8,000 in the Kursk border region, Mr Blinken said.

The troops are wearing Russian uniforms and carrying Russian gear, according to US defence secretary Lloyd Austin.

Read more: Where have North Korea troops been seen in Russia?

“We’ve not yet seen these troops deploy into combat against Ukrainian forces, but we would expect that to happen in the
coming days,” Mr Blinken said on Thursday.

More on Antony Blinken

America’s top diplomat said the recruitment of troops from North Korea to Russia’s “meat grinder” was a “clear sign of weakness”.

South Korea and the US discussed the issue in Washington on Thursday. Pic: Reuters
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A South Korean and US delegation met in Washington DC. Pic: Reuters

Mr Blinken made the assessment after he and Mr Austin met their South Korean counterparts in Washington DC.

Foreign minister Cho Tae-yul called for the immediate withdrawal of North Korean soldiers from Russia and condemned it “in the strongest possible terms”.

They also all agreed China should do more to rein in North Korea, Mr Blinken said, adding that he’d had a “robust conversation” with Beijing this week.

Image:
The Kursk region borders eastern Ukraine

Mr Austin also announced that – with the US election just days away – America would soon be announcing new security assistance for Ukraine.

The deployment of troops to Russia is down to the close relationship between President Putin and North Korea’s Kim Jong Un.

The leaders last met in June when Mr Putin travelled to North Korea for the first time in 24 years.

Russia's President Vladimir Putin and North Korea's leader Kim Jong Un together in Pyongyang in June. Pic: Reuters
Image:
President Putin and Kim Jong Un went for a drive together in Pyongyang in June. Pic: Reuters

A mutual defence pact was agreed during their summit, meaning the countries will help each other if they are attacked.

The US says North Korea has also given munitions to Russia as it continues its grinding effort to take more territory in Ukraine’s east.

The White House published images earlier this month which it said showed 1,000 containers of equipment being sent to Russia by rail.

There are concerns about what military aid Russia will now provide in exchange.

North Korea test-fired an an intercontinental ballistic missile for the first time in almost a year on Thursday and there is speculation Russia may have provided technological help.

South Korean TV showed pictures of Thursday's launch by the North. Pic: AP
Image:
South Korean TV showed pictures of Thursday’s launch by the North. Pic: AP

In a statement, the US, Japan and South Korea condemned the launch as a “flagrant violation” of UN resolutions.

“We strongly urge (North Korea) to immediately cease its series of provocative and destabilising actions that threaten peace and security on the Korean Peninsula and beyond,” they said.

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