IEA withdraws rival Brexit plan after charity watchdog’s investigation
'Plan A+' report, launched by David Davis and Jacob Rees-Mogg in September, was billed as an alternative to Theresa May's Chequers deal
A high-profile report trumpeted by arch-Brexiteers including David Davis, Boris Johnson and Jacob Rees-Mogg as their alternative to Theresa May’s Chequers plan has been withdrawn, after a Charity Commission investigation.
The ‘Plan A+’ report was published by the Institute of Economic Affairs (IEA) in September. Johnson, the former foreign secretary, hailed it on Twitter as a “fine piece of work”, while Davis, Rees-Mogg and former Northern Ireland secretary Theresa Villiers appeared at the report’s launch.
‘Plan A+’’s lead writer was Shanker Singham, the IEA’s trade policy chief who has been described as the “Brexiteers’ brain”, and whose “unparalleled” contact with influential Brexit-backing politicians has attracted scrutiny.
The report called for the UK to drop EU-style regulation, including the bloc’s strict food production and environmental standards, in order to strike trade deals with other countries around the world.
The IEA is registered as an educational charity. It has been under investigation by the Charity Commission since July, when an undercover investigation by Unearthed, published in the Guardian, raised concerns that the IEA’s work on Brexit may have broken charity rules by campaigning for a specific policy outcome – hard Brexit and a US-UK free trade deal.
On Friday the IEA removed ‘Plan A+’ from its website and deleted its tweets promoting the report. The IEA’s chair of trustees announced in a statement that this followed an investigation by the Charity Commission, the sector’s regulator.
A Charity Commission spokesman confirmed that Friday’s announcement stemmed from a regulatory compliance case it opened after the publication of Unearthed’s investigation.
The Charity Commission’s deputy chief executive, David Holdsworth, said in a statement: “We made clear to the IEA that the report in question overstepped the line of what is permissible charitable activity and requested that it was removed. We are pleased that the IEA has responded by doing so.”
He added: “The report was not sufficiently balanced and neutral as required of an educational charity under charity law. We also found that the charity had been undertaking political activity not in line with the charity’s purposes.”
Labour’s shadow Cabinet minister Jon Trickett told Unearthed: “I welcome the fact that the Charity Commission has now confirmed what to many of us has been worryingly clear from the start: that the IEA was using the cover of charity law to pursue its extreme free market agenda. Yet we are still none the wiser as to who funds the IEA and many think tanks like it.”
As an educational charity, the IEA is able to accept tax-free donations but must abide by Charity Commission requirements to be politically impartial, balanced and neutral in how it presents information and stick to its charitable object of education.
The IEA’s director-general Mark Littlewood told an undercover reporter, posing as a representative of investors in hormone-reared beef: “Our principal campaign is on trade arrangements and free trade. We’ll either win or lose in 12 months,” he added.
In a separate meeting during the undercover investigation, Littlewood explained the think tank’s work on post-Brexit agriculture pursued a specific policy goal: “The key point underlying all of this is that we’ve got to get away from the precautionary principle”, he said, referring to the cautious approach to risk that underpins European environmental regulation.
The comments were made in meetings several months before the September publication of the ‘Plan A+’ report.
Holdsworth said: “Charitable think tanks are first and foremost charities and need to behave as such. The law is quite clear that charitable think tanks and education charities must retain balance and neutrality in any research work and publications… It is disappointing that the trustees of some charitable think tanks appear not to fully understand their duties.”
He added: “We will therefore be writing to all charitable think tanks next week with formal regulatory advice to remind them of their duties.”
The IEA now plans to set up a non-charitable arm to ensure it can continue to put forward “firm policy proposals”, the charity’s chair of trustees, Neil Record announced on Friday.
He added: “We believe it is increasingly unclear what charitable think tank activity is acceptable, and what is not. A worrying precedent is in the process of being set: research papers – and their launches – which put forward firm policy proposals may now fall outside the parameters of what the Charity Commission considers acceptable activity.”
Last year the commission ordered the IEA to withdraw a pre-election press release on Labour’s manifesto and a report it published jointly with the Taxpayers’ Alliance, ‘Policy Proposals for a Conservative Manifesto’, over concerns about partisan bias.
In June a report written by Singham in his previous role at the Legatum Institute, ‘Brexit Inflection Point: The Pathway to Prosperity’, was also withdrawn after a Charity Commission investigation. The watchdog found it “crossed a clear line” by promoting a particular policy outcome and was “not consistent” with the charity’s aims.
The Charity Commission’s investigation into the IEA is ongoing.