
Nadhim Zahawi’s tax affairs: What did the Conservative Party chairman do?
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2 years agoon
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adminThe chairman of the Conservative Party, Nadhim Zahawi, is currently under investigation over his multimillion-pound tax dispute.
On Monday, Prime Minister Rishi Sunak asked new ethics adviser Sir Laurie Magnus to assess whether the cabinet minister breached the ministerial code with the HMRC settlement he made while he was chancellor.
“Clearly in this case there are questions that need answering,” he told reporters.
Mr Zahawi has said he is “clearly being smeared” over questions about his tax affairs – and that he did not “benefit” from an “offshore trust”.
Mr Sunak is under increasing pressure to remove Mr Zahawi from his senior cabinet post.
But what do we know about the matter so far?
Who is Nadhim Zahawi?
Mr Zahawi, the chairman of the Conservative Party, was previously an aide to Conservative peer Lord Archer and – with another aide Stephan Shakespeare – founded polling company YouGov at the turn of the millennium.
In 2010, setting his sights firmly back on politics, he became MP for Stratford-upon-Avon.
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He secured his first junior minister post – education minister – in 2018, but became a household name after COVID broke out in the UK and he was appointed by former PM Boris Johnson as vaccine minister.
‘Game over’ for Zahawi – politics latest
The performance propelled him to cabinet and in September 2021, he took his first secretary of state post, back in the Department for Education.
He was propelled further to chancellor in the dying days of Mr Johnson’s premiership after the resignation of Rishi Sunak.
Mr Zahawi made an unsuccessful bid to become PM following Mr Johnson’s removal – losing out to Liz Truss – but was appointed Chancellor of the Duchy of Lancaster.
He became chairman of the Tory Party just weeks later when Ms Truss’s premiership came crashing down and Mr Sunak gained the keys to Number 10.
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2:13
What is going on with Zahawi’s taxes?
What is the controversy about?
In January 2023, The Sun On Sunday published a report claiming Mr Zahawi had paid a seven-figure sum to settle a dispute with HMRC over the sales of his YouGov shares.
The shares, worth an estimated £27m, were held by Balshore Investments, a company registered offshore in Gibraltar linked to Mr Zahawi’s family.
Sky News understands that, as part of a settlement with HMRC, Mr Zahawi paid a penalty to the tax collector.
The exact size of the settlement has not been disclosed, but it is reported to be an estimated £4.8m, including a 30% penalty.
By Monday, Mr Sunak had ordered a potentially far-reaching investigation into Mr Zahawi to be conducted by the PM’s new ethics adviser Sir Laurie Magnus.
Sir Laurie is expected to focus on whether the cabinet minister breached the ministerial code with the estimated £4.8m HMRC settlement he made while he was chancellor, but it could extend to his prior tax arrangement and whether he lied to the media.
It is unclear what the prime minister knew about Mr Zahawi’s dealings with the tax office when he appointed him to his cabinet in October.
Sources close to Mr Zahawi have said he is “absolutely not standing down”.
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0:14
Nadhim Zahawi asked if he will resign
What has Zahawi said?
Last July, it was reported that HMRC was investigating Mr Zahawi’s tax affairs – but a spokesperson for him at the time said he was “not aware of any formal investigation by HMRC” and insisted “his taxes are fully paid and up to date”.
The next day, allegations arose that concerns had been raised by officials over Mr Zahawi’s tax affairs before his appointment as a minister in Mr Johnson’s cabinet.
When the issue of his tax affairs came up in an interview with Sky News as Mr Zahawi prepared to launch his leadership bid, Mr Zahawi said: “I was clearly being smeared.
“I was being told that the Serious Fraud Office, that the National Crime Agency, that HMRC are looking into me. I’m not aware of this.”
It is unclear when Mr Zahawi first knew about the probe by HMRC, but his allies have said he told the Cabinet Office’s propriety and ethics team about the matter before his appointment.
Over the weekend, Mr Zahawi said HMRC concluded there had been a “careless and not deliberate” error in the way the founders’ shares, which he had allocated to his father, had been treated.
In a statement on Monday, following the PM’s announcement of an investigation into the matter, he added: “I am confident I acted properly throughout and look forward to answering any and all specific questions in a formal setting to Sir Laurie.”
Mr Zahawi has not confirmed how much his penalty amounted to or the value of the overall settlement with HMRC.
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1:01
‘Questions need answering’ in Zahawi case, says PM
What has the prime minister said?
The prime minister has ordered his ethics adviser to investigate whether Mr Zahawi broke ministerial rules over the estimated £4.8m bill.
A week ago, Mr Sunak told MPs that Mr Zahawi had “already addressed the matter in full” – but Downing Street subsequently revealed the PM had not been aware that the Conservative Party chairman had paid a penalty to HMRC as part of the settlement.
Mr Sunak admitted there are “questions that need answering” as the inquiry was launched, and it is unclear what he knew when appointing Mr Zahawi to the cabinet-attending role.
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What do we know about Conservative Party chairman Nadhim Zahawi’s tax affairs?
Investigation into appointment of BBC chairman after Boris Johnson loan claim
Downing Street subsequently suggested Mr Sunak did not know last week that Mr Zahawi had paid a reported 30% penalty to HMRC.
Probed on the matter by Labour leader Sir Keir Starmer at PMQs on Wednesday, the PM said: “The issues in question occurred before I was prime minister.
“With regard to the appointment of the minister without portfolio, the usual appointments process was followed, no issues were raised with me when he was appointed to his current role, and since I commented on this matter last week, more information has come forward.
“That is why I have asked the independent adviser to look into the matter.
“I obviously can’t prejudge the outcome of that but it is right that we fully investigate this matter and establish all the facts.”
Mr Sunak has so far resisted growing calls to remove Mr Zahawi from his current post.
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7:18
‘Zahawi should stand aside’, says Tory peer Lord Hayward
Who has called for him to go?
Former minister Caroline Nokes said there were “too many unanswered questions” over the tax row as she called for Mr Zahawi to “stand aside and let the investigation run its course”.
Speaking to Sky News on Tuesday, Lord Hayward agreed that the Tory Party chairman should think about “standing aside” while parliament’s ethics watchdog investigates his tax affairs.
“We don’t know what the timescales are for the inquiry, and I think that’s key,” he said.
“I think he should be considering whether he stands aside for the period of the inquiry.”
But Home Office minister Chris Philp said on Monday that Mr Zahawi should be treated as “innocent until proven guilty” and it is “reasonable” for him to continue as party chairman.
“The investigation has been launched by the prime minister; that is the right thing to do. It will get to the bottom of this and then the prime minister will make his decision,” he said.
“But I don’t think it is fair to jump to any conclusions before the investigation has concluded.”
Labour said Mr Zahawi’s admitted carelessness should see him removed from government.
Shadow foreign secretary David Lammy told Sky News: “When you’ve been chancellor of the exchequer and you said you’ve been careless despite the fact that offshore trusts have been set up in Gibraltar, I’m sorry, you really ought to resign or be sacked.”
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0:20
‘I regret not wearing a seatbelt’
What does this mean for the PM?
The Zahawi tax affairs saga formed one of two controversies Mr Sunak has been forced to confront this week, with questions also being raised over the decision to appoint Richard Sharp as BBC chairman while he reportedly helped former Number 10 incumbent Mr Johnson secure a loan of up to £800,000.
The PM has also distanced himself from this allegation, saying the chairman’s appointment was made by “one of my predecessors”.
But these two incidents add to what has been a turbulent first few months in Number 10 for Mr Sunak.
On his first day as PM in October, Mr Sunak vowed to restore “integrity and accountability” to government – a promise which has now been called into question by a series of events.
A few days after entering Number 10, the PM was forced to defend re-appointing Suella Braverman as home secretary days after she quit over data breaches.
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Labour leader Sir Keir Starmer accused the new PM of doing a “grubby deal” with Ms Braverman to secure her support in the Tory leadership contest.
An independent probe was also launched into the conduct of another cabinet member – Deputy Prime Minister Dominic Raab – after he was subject to multiple complaints of bullying.
Mr Sunak initially stood by the justice secretary – who he reappointed to the role in the autumn – but eventually bowed to pressure to allow the formal probe.
On top of this, the prime minister received a second police fine last week, this time for failing to wear a seatbelt.
The first was received last year after he broke coronavirus rules during the partygate scandal.
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Iran’s foreign ministry has told Sky News there is still a chance for peace talks with the United States.
In an interview in Iran’s foreign ministry in Tehran, a senior Iranian official said despite the attacks on his country by America and Israel, back-channel efforts are under way to restart the search for a diplomatic solution.
The comments will be seen as an olive branch for the Trump administration to seize as it explores a diplomatic way forward.
Sky News is one of only a handful of foreign news organisations allowed access to Iran following its short and devastating war with Israel.
We also filmed the impact of Israel’s attacks on ordinary Iranians in Tehran.
In the wake of a ceasefire declared by Donald Trump, Esmaeil Baqaei, the Iranian foreign ministry spokesman, said the US must show it is genuine in its desire for peace.
“Diplomacy must not be abused or used as a tool for deception or for simply a sort of psychological warfare against their adversaries.”
Iran felt diplomacy had been betrayed, he said. US-Iranian talks were on the verge of reconvening when Israel attacked his country.
And America had breached international law in its support of what he called “Zionist aggression”.
But Mr Baqaei said “diplomacy never ends, there are contacts, indirectly. My minister is talking to Oman, Qatar and others”.
President Trump says he is ready to talk with Iran, but major stumbling blocks need to be overcome.
The US wants Iran to give up nuclear enrichment completely. Iran has long insisted it has the right to carry on.
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A residential building hit by Israel in Tehran

A residential building hit by Israel in Tehran
Across town, we witnessed the impact of Israel’s attacks in Gisha, an upmarket neighbourhood of Tehran.
Israel claims its attacks on Iranian figures were precision-targeted. In reality they appear to have been far from surgical.
The airstrike came at 10.30 Friday morning two weeks ago. It ripped a hole through four floors of reinforced concrete in the residential apartment block.
The target may have been a nuclear scientist living there, but everyone in the building is now without a home. Engineers say it will almost certainly need to be torn down.
The mood in the Iranian capital seems subdued and tense.
Iranians fear Israelis will renew their air campaign despite the ceasefire, but the foreign ministry spokesperson said they “will respond” to any Israeli attack.

Listen to The World with Richard Engel and Yalda Hakim every Wednesday
There is widespread resentment of the leadership after nationwide social unrest and massive economic problems.
But the Israeli attacks have rallied many Iranians around their government all the same.
They had hoped diplomacy with America could deliver a new deal and an end to sanctions, then Israel began its 12-day aerial onslaught and the US joined in.
Iranians hope somehow talks can be restarted, but they also know the chances of progress are, for now at least, not great.
World
Rise in Gaza deaths linked to aid distributions by controversial group
Published
20 hours agoon
July 3, 2025By
admin
Sky News analysis shows that aid distributions by the Gaza Humanitarian Foundation (GHF) are associated with a significant increase in deaths.
Warning: This article contains descriptions of people being killed and images of blood on a hospital floor.
The US and Israeli-backed group has been primarily responsible for aid distribution since Israel lifted its 11-week blockade of the Gaza Strip last month.
The GHF distributes aid from four militarised Secure Distribution Sites (SDSs) – three of which are in the far south of the Gaza Strip. Under the previous system, the UN had distributed aid through hundreds of sites across the territory.
According to Gaza’s health ministry, 600 Palestinians have been killed while seeking aid from GHF sites, which charities and the UN have branded “death traps”.
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The UN put the figure at 410, but has not updated this number since 24 June. Both the UN and health ministry source their figures from hospitals near the aid sites.
Speaking to Sky News, GHF chief Johnnie Moore disputed that these deaths were connected with his organisation’s operations.
“Almost anything that happens in the Gaza Strip is going to take place in proximity to something,” he said.
“Our effort is actually working despite a disinformation campaign, that is very deliberate and meant to shut down our efforts.
“We just want to feed Gazans. That’s the only thing that we want to do.”
However, new analysis by Sky’s Data & Forensics Unit shows that deaths in Gaza have spiked during days with more GHF distributions.
On days when GHF conducts just two distributions or fewer, health officials report an average of 48 deaths and 189 injuries across the Gaza Strip.
On days with five or six GHF distributions, authorities have reported almost three times as many casualties.
Out of 77 distributions at GHF sites between 5 June and 1 July, Sky News found that 23 ended in reports of bloodshed (30%).
At one site, SDS4 in the central Gaza Strip, as many as half of all distributions were followed by reports of fatal shootings.
Sky News spoke to one woman who had been attending SDS4 for 10 days straight.
“I witnessed death first-hand – bodies lay bleeding on the ground all around me,” says Huda.
“This is not right. Food should be delivered to UN warehouses, and this entire operation must be shut down.”

Huda told Sky News that she has been trying to obtain aid from SDS4, in the central Gaza Strip, for the past 10 days
Huda says that the crowds are forced to dodge bombs and bullets “just to get a bag of rice or pasta”.
“You may come back, you may not,” she says. “I was injured by shrapnel in my leg. Despite that, I go back, because we really have nothing in our tent.”
One of the deadliest incidents at SDS4 took place in the early hours of 24 June.
According to eyewitnesses, Israeli forces opened fire as people advanced towards aid trucks carrying food to the site, which was due to open.
“It was a massacre,” said Ahmed Halawa. He said that tanks and drones fired at people “even as we were fleeing”. At least 31 people were killed, according to medics at two nearby hospitals.
Footage from that morning shows the floor of one of the hospitals, al Awda, covered in blood.
The IDF says it is reviewing the incident.
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15:58
Doctor’s final moments revealed
Issues of crowd control
Unnamed soldiers who served near the aid sites told Israeli newspaper Haaretz that they were instructed to use gunfire as a method of crowd control.
An IDF spokesperson told Sky News that it “strongly rejected” the accusations that its forces were instructed to deliberately shoot at civilians.
“To be clear, IDF directives prohibit deliberate attacks on civilians,” the spokesperson said, adding that the incidents are “being examined by the relevant IDF authorities”.
Eyewitness testimony and footage posted to social media suggest that crowd control is a frequent problem at the sites.
The video below, uploaded on 12 June, shows a crowd rushing into SDS1, in Gaza’s far southwest. What sounds like explosions are audible in the background.
Footage from the same site, uploaded on 15 June, shows Palestinians searching for food among hundreds of aid parcels scattered across the ground.
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Sam Rose, the director of UNRWA operations in Gaza, describes the distribution process as a “free-for-all”.
“What they’re doing is they’re loading up the boxes on the ground and then people just rush in,” he says.
Sky News has found that the sites typically run out of food within just nine minutes. In a quarter of cases (23%), the food is finished by the time the site was due to officially open.
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27:55
Doctors on the frontline
Confusing communications
Sky News analysis suggests that the issue may be being compounded by poor communications from GHF.
Between 19 June and 1 July, 86% of distributions were announced with less than 30 minutes’ notice. One in five distributions was not announced at all prior to the site opening.
The GHF instructs Palestinians to take particular routes to the aid centres, and to wait at specified locations until the official opening times.
The map for SDS1 instructs Palestinians to take a narrow agricultural lane that no longer exists, while the maps for SDS2 and SDS3 give waiting points that are deep inside IDF-designated combat zones.
The maps do not make the boundaries of combat zones clear or specify when it is safe for Palestinians to enter them.
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The same is true for SDS4, the only distribution site outside Gaza’s far south. Its waiting point is located 1.2 miles (2km) inside an IDF combat zone.
The official map also provides no access route from the northern half of Gaza, including Gaza City, across the heavily militarised Netzarim corridor.
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“They don’t know what they’re doing,” says UNRWA’s Sam Rose.
“They don’t have anyone working on these operations who has any experience of operating, of administering food distributions because anyone who did have that experience wouldn’t want to be part of it because this isn’t how you treat people.”
Once the sites are officially open, Palestinians are allowed to travel the rest of the way.
The distance from waiting point to aid site is typically over a kilometre, making it difficult for Palestinians to reach the aid site before the food runs out.
The shortest distance is at SDS4 – 689m. At a pace of 4km per hour, this would take around 10 minutes to cover.
But of the 18 distributions at this site which were announced in advance, just two lasted longer than 10 minutes before the food ran out.
“We don’t have time to pick anything up,” says Huda, who has been visiting SDS4 for the past 10 days.
In all that time, she says, all she had managed to take was a small bag of rice.
“I got it from the floor,” she says. “We didn’t get anything else.”
More than 200 charities and non-governmental organisations have called for the closure of GHF and the reinstatement of previous, UN-led mechanisms of aid distribution.
In a joint statement issued on 1 July, some of the world’s largest humanitarian groups accused the GHF of violating international humanitarian principles. They said the scheme was forcing two million people into overcrowded, militarised zones where they face daily gunfire.
Additional reporting by OSINT producers Sam Doak and Lina-Serene.
The Data and Forensics team is a multi-skilled unit dedicated to providing transparent journalism from Sky News. We gather, analyse and visualise data to tell data-driven stories. We combine traditional reporting skills with advanced analysis of satellite images, social media and other open source information. Through multimedia storytelling we aim to better explain the world while also showing how our journalism is done.
World
Teens unable to walk, mothers with rash-covered babies: Kush is ruining lives – and made with ingredients shipped from the UK
Published
22 hours agoon
July 3, 2025By
admin
A red shipping container sits on the tarmac of Sierra Leone’s Queen Elizabeth II Quay, under swinging cranes and towering stacks of similar steel boxes.
This one will likely be parked at the port permanently. The contents are suspected to be the ingredients of kush, the deadly synthetic drug ravaging Sierra Leone.
Sky News was given access to the container two weeks after it was seized.
“Preliminary testing has shown that these items are kush ingredients,” says the secretary of the Ports Authority, Martin George, as he points to the marked contraband in massive multicoloured Amazon UK bags and a large blue vat of strongly smelling acetone.
He adds: “Shipped from the United Kingdom.”

The container was selected for screening based on its origin. The UK is with the EU and South America on the list of places considered high risk for the import of illicit substances fuelling the drug trade in Sierra Leone and the region.
Kush has shaken this part of West Africa to its core – not just Sierra Leone but Liberia, Guinea, Guinea-Bissau and the Gambia. It is highly addictive, ever-evolving and affordable.
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The sprayed grey-green marshmallow leaves are rolled in a joint like marijuana and are extremely dangerous. Samples of the drug tested by researchers contained nitazens, one of the deadliest synthetic drugs in the world.

“It was a shock to find them in around half of the kush samples we tested, as at that point there was no public evidence they had reached Africa,” says Lucia Bird Ruiz-Benitez de Lugo from Global Initiative Against Transnational Organised Crime (GI-TOC) who independently tested kush from Sierra Leone.
“Nitazenes are among the deadliest drugs available on retail drug markets across the world – with one nitazene in kush in Freetown being 25 times stronger than fentanyl,” she added.
The shocking effects of its potency can be seen on the bodies of young men and women around Freetown. Teenagers with sores eating away at their legs, unable to walk. Mothers who smoked during pregnancy carrying sickly rash-covered infants. Young men drooling from the intense high and slumped over while still standing.

They are not the fringes of Sierra Leonean society but a growing demographic of kush users searching for an escape. People riddled by poverty and unemployment, living in the dark corners of a capital city which has endured a brutal civil war and Ebola epidemic in the last three decades alone.
An entire community of men and women of all ages is held together by kush addiction under a main road that cuts through the heart of Freetown.
They call themselves the “Under de Bridge family” and live in the shadows of the overpass, surrounded by the sewage and rubbish discarded by their neighbours.

One of them tells us the harsh conditions drive him to keep smoking kush even after losing more than 10 friends to the drug – killed by large infected sores and malnutrition.
Nearby, 17-year-old Ibrahim is pained by growing sores and says the drug is destroying his life.
“This drug is evil. This drug is bad. I don’t know why they gave me this drug in this country. Our brothers are suffering. Some are dying, some have sores on their feet. This drug brings destruction,” he says.
“Look at me – just because of this drug. I have sores on my feet.”
Read more from Sky News:
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Across a stream of sewage, a young mother expecting her second child cries from fear and anguish when I ask her about the risk of smoking while pregnant.
“Yes, I know the risk,” Elizabeth says, nodding.
“I’ll keep smoking while I live here but I have nowhere else to go. It helps me forget my worries and challenges.”
Life under the bridge is disrupted from its sleepiness by a yell. A plain-clothed police officer is chasing a child accused of selling kush.
The lucrative industry is absorbing all age groups and spreading rapidly to nearby countries – even passing through three different borders to reach the smallest nation in mainland Africa, The Gambia.
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2:53
Police hunt for kush dealers in West Africa
Gambian law enforcement has cracked down on spreading kush use with regular zero tolerance drug raids. The small population is extremely vulnerable and the country is yet to open its first rehabilitation centre. Rising xenophobia seems to be mostly directed at Sierra Leonean immigrants who they blame for smuggling kush into the country.
We spoke to one man from Sierra Leone who was arrested for dealing kush in The Gambia and spent a year in prison. He says that though he feels saddened other Sierra Leoneans are being alienated as a result of the trade he was involved in, he has no remorse for “following orders”.
“Do I feel guilty for selling it? No, I don’t feel guilty. I’m not using my money to buy the kush, people always give me money to get kush for them,” he tells Sky News anonymously.
“I needed a job. I needed to take care of my son.”
Gambia’s hardline approach has been credited with driving its local kush industry underground rather than eradicating it but is still hailed as the most impactful strategy in the region. Sierra Leone’s government told Sky News it needs help from surrounding countries and the UK to tackle the sprawling crisis.

Transnational crime experts like Lucia Bird Ruiz-Benitez de Lugo see the rise of kush as part of a global synthetic drugs network that requires a multi-national response.
“Coordinated action is urgently needed across the supply chain, particularly focused on nitazenes – the deadliest kush component,” says Ms Bird.
“Our research indicated that kush components are being imported to West Africa from countries in Asia and Europe, likely including the UK. All countries in the supply chain bear responsibility to act to mitigate the devastating and expanding impacts of kush across West Africa, a region with scarce resources to respond.”
Sky News’ Africa correspondent wins award
Yousra Elbagir has been named a winner of the International Women’s Media Foundation 2025 Courage in Journalism Awards.
She has chronicled the current war in Sudan, which has displaced more than 13 million people, including her own family.
Recently, Elbagir led the only television news crew to document the fall of Goma – the regional capital of eastern Democratic Republic of the Congo – to M23 rebels backed by Rwanda.
In the past year, her reports from the frontlines of Sudan’s war have broadcast massive scenes of devastation inside a global humanitarian crisis.
She said: “Our job as journalists is to reveal the truth and inform the public. Sometimes, it’s about exposing the misdeeds of the powerful. Other times, it’s about capturing the scale and depth of human suffering. Our job is also getting more difficult: Information wars and contempt for legacy media is growing by the day, which makes our job even more important.”
Elbagir added: “It is an honour to receive the IWMF Courage Award and join the ranks of such incredible women journalists. The courage to share the truth in our polarised world is at the heart of public service journalism and to be recognised for it is truly affirming – it gives me faith that people are listening.”
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