INLAND REVENUE OFFICIAL (DISMISSAL) (Hansard, 13 April 1956)

§ Mr. Anthony Fell (Yarmouth)
The Coldham story is not a pleasant one, and certainly not pleasant for the Treasury to listen to or for the Board of Inland Revenue to read about or to think of. I think it can be said with little fear of contradiction that, though they may present to the public a front which is definite and unworried about the consequences of their action or inaction on this case, I am certain that their consciences and their minds, if they search them, cannot rest easy upon the case of Mr. Coldham as he has so far been treated.
In the short time at my disposal I will tell the story of this small one. Coldham was an ordinary man. He had not been particularly well educated. What there was of his education was cut short because, at the age of 15, he volunteered for the R.F.C. in the First World War. After the war I suppose he got what education he could and he became a valuation officer, working for local authorities well and honestly for 25 years, with one period of intermission. That was when he volunteered, much beyond the age when he need have done, in the Second World War to serve in the Army, which he did.
That is a brief review of his career. I have mentioned his war service because it shows that although Coldham may have been a small man, he is a man not without some courage, as will be seen as this rather hurried story unfolds.
This little man ran into difficulty. Up to 1950 he had worked as a valuation officer for the local authorities for 25 years. In 1950, he was approached by the Board of Inland Revenue and asked, 643 because of the tremendous work it had to do on revaluation, whether he would transfer to the Board of Inland Revenue, and Coldham agreed so to do. Then, not because Coldham had applied for the job of looking after an office or had suggested to anybody that he would like it, Coldham was put in charge of the Yarmouth valuation office by the Board of Inland Revenue. He was there until 1954 before anything very serious happened.
The only interesting thing during that period was that he was working like a nigger. That is agreed on all sides. It has certainly never been disputed by anybody with whom I have come in contact. He was working 60 to 70 hours a week. During that period he was visited by Sir Eric Bamford, the then chairman of the Board, who impressed upon him the urgent need to get on with the job, not worrying too much about filling in forms but rather doing the job that was needed.
On the occasion when Coldham asked for assistance from the Board of Inland Revenue to help him with the work, no assistance was forthcoming. He asked for legal assistance from the Board and no legal assistance was forthcoming, but, ironically enough, it did not take the Board very long to find legal assistance to prosecute Coldham when it came to a case a little later on.
What was the substance of the case, and what happened in 1954? The first thing that happened was that Coldham's right-hand man—that is an ironical term—apparently got some suspicion that Coldham was not being truthful about his return of expenses. I am not saying anything against this right-hand man and I shall not mention his name, but it should be remembered that he had been in the Civil Service much longer than Coldham, that he himself wrote out all the claims forms and that he was the man who first approached the Board of Inland Revenue, saying that he thought his chief was not being truthful about his expenses.

§ Mr. Douglas Houghton (Sowerby)
Might I say straight away that it was not that officer who approached the Board of Inland Revenue? I did it myself.

§ Mr. Fell
I am most interested to hear this. It is a revelation which I have been seeking for a very long time. It is a little strange that when the hon. Member for Sowerby (Mr. Houghton) previously spoke to me he was not sufficiently forthcoming to tell me that and, indeed, tried to suggest that the case was not worth taking up. At no time did the hon. Member suggest to me that the first person to go to the Board of Inland Revenue was not the man to whom I have referred.

§ Mr. Houghton
I deny that straight away. Will the hon. Gentleman give way?

§ Mr. Fell
I cannot give way. I must carry on with my speech.

§ Mr. James Callaghan (Cardiff, South-East)
Why should my hon. Friend have told the hon. Member for Yarmouth (Mr. Fell) that it was he who approached the Board of Inland Revenue?

§ Mr. Fell
The hon. Member for Cardiff, South-East (Mr. Callaghan) will realise why as the case unfolds. We now have to modify the story slightly.
The general secretary of a union to whom the man had gone for advice apparently got in touch with the Board of Inland Revenue or the Treasury, I know not which. The man himself wrote a letter. This was done either on the advice of the general secretary of the union or on the man's own initiative. If I am to believe what the general secretary of the union told me, it was on the advice of the general secretary. I should never have mentioned this had the hon. Member for Sowerby not interrupted me just now.
On the advice of the general secretary, the man went back and set up his own little Gestapo system using not only himself but anyone else, including a very junior, female temporary civil servant, to spy on Coldham without his knowledge. The position, unfortunately, is very much worse than that. Not long after this little private Gestapo system had been set up, apparently with the connivance of a trade union—that to me is an astonishing revelation—a further Gestapo system was set up in the valuation office at Yarmouth, but this time apparently on the direct instructions of the Board of Inland Revenue.
645 An investigator was sent down in early 1955—one cannot get the exact date, and I cannot get the letter this man was supposed to have written to the Board of Inland Revenue. I was told by the Board of Inland Revenue that it had a letter from this man. I suppose that the hon. Member for Sowerby does not deny that the man wrote to the Board of Inland Revenue. Apparently he does not.

§ Mr. Houghton
I have no knowledge of any letter written by this man to the Board of Inland Revenue. My knowledge is concerned only with a man who dealt with it.

§ Mr. Fell
That is very interesting. When I asked the Chairman of the Board of Inland Revenue whether he would show me the letter, he refused to do so. Surely that shows that there was some such letter. It is interesting that the Chairman of the Board refused to show it to me, if there was nothing in that letter of which he was not a little ashamed.
The Gestapo organisation was set up in Coldham's office. It apparently included his chief assistant, the two assistant valuation officers who were next under his chief assistant, the telephone operator who tapped his telephone calls, and, as far as one can see, it included anybody else in the office who could be persuaded to spy on his chief without his chief's knowledge.
That is a part of the story of Coldham which has not been denied by the Board of Inland Revenue, or by the Treasury. Let us see what happened. Finally, on 22nd March, an investigator invaded Mr. Coldham's office, I believe without any prior notice whatsoever, with a companion. He shot a number of questions at Coldham which, in fact, covered four foolscap pages or more. I am not sure that it was not eight pages.

§ Mr. Paul Williams (Sunderland, South)
For the sake of the record. March of which year?

§ Mr. Fell
March, 1955.
If Coldham had had any sense at that inquisition, of course, he would have said, "No, I shall not answer any questions" or at least he would have said that he wanted someone with him while answering the questions. However, he sat there and tried to answer questions relating to 646 four years previously, at least two or three years previously. He got into the most shocking muddle, and, because he got into the most shocking muddle, one day later he was suspended. Worse than that: three weeks later, without any one going to Coldham other than the official investigator—a kind of "get your man" attitude—on 14th April he was dismissed with retrospective effect to 24th March, the day of his suspension.
He was dismissed, because he had broken certain rules. I do not deny that there were some rules in the rule book which Coldham had broken. It is also true that the Treasury could have dismissed Coldham for breaking the rules and could have left it there and nobody would ever have said anything, because the Treasury is in a special position with regard to the law and cannot be sued for wrongful dismissal, or anything of that nature.
However, the Treasury did not leave it there. It instituted criminal proceedings against Coldham on the very grounds for which he was dismissed. The criminal proceedings were heard at Yarmouth and on 6th July last year at Yarmouth Quarter Sessions, after retiring for less than quarter of an hour, the jury found him not guilty on every single charge mentioned.
In answer to my various questions the Treasury says, "We have to be careful with Government finance." Of course it has, but has it ever stopped to say, "We also have special responsibilities towards our employees because we are specially protected against the law."? Has the Treasury ever said, "Here was a man who could not in any circumstance sue us for anything at all, because we, the Treasury, are specially protected by the law."? Did the Treasury ever say, or did the Board of Inland Revenue, "What about this man? What about his history? What about the fact that we took him on at our wish and not at his? What about the fact that he has only been with us for a few years, and that he has a perfectly good record in local government service for 25 years?"
Never did the Treasury, apparently, say any of these things to itself, yet my right hon. Friend the Financial Secretary to the Treasury will dispute my next statement. Let me dispute it with him 647 before he disputes it with me, for I had an interview with the Chairman of the Board of Inland Revenue, who said to me in no uncertain terms, "I want you, Mr. Fell, to understand that all throughout we have given every possible consideration and made every possible allowance from the human angle where Coldham is concerned." I did not say at the time, "Then why was it that Coldham was not paid the salary owing to him from the beginning of March, 1955, until 24th March, 1955, until I had forced you into the position of paying it on 4th October of last year?" If the Treasury has given consideration to the humanities of this matter, why was it that I received a letter from the Board which said: … to questions about whether the Board knew what they had done to Mr. Coldham, I replied … This is written by an official at the Board— to the effect that the Board realised that the consequences could hardly be more serious (entailing among other things the loss of position and prospective pension) but they did not know what Mr. Coldham had done following his dismissal, nor had they had either reason or right to inquire.

§ Mr. Callaghan
I know very little about the facts, like most hon. Members, except for what has been revealed in the Questions which the hon. Member has asked from time to time. Why was this man dismissed? What was he alleged to have done?

§ Mr. Fell
It is extremely difficult to put the whole of the case. Shall I put it in really colloquial English which, at any rate, the hon. Gentleman and I will understand perfectly? He was alleged to have "fiddled" his expenses.

§ Mr. Callaghan
Is not that a good reason for dismissal?

§ Mr. Fell
If the hon. Gentleman will bear with me, I will try to tell the rest of the story. I have not much time. Nobody has argued about the question of dismissal.

§ Mr. P. Williams
On the question of the "fiddling" of expenses, is not it a fact—I think that my hon. Friend has said this already—that the expenses claims were prepared by Coldham's right hand man, because he himself simply had 648 not the time, as he was working about 20 hours a week overtime?

§ Mr. Houghton
That is not true.

§ Mr. Fell
That may or may not have been so. The fact is that his right hand man wrote them out for him—he made out the expenses. One imagines that they sat down together and said, "How do we do this?", and he wrote them down. I am not alleging anything against him.
What I am arguing about—and I have been doing it for the last nine or ten months—is this. Here was a man with almost 30 years in local government service and Government service. He had a spotless record and worked tremendously hard. He was then investigated by this Gestapo set-up, was dismissed peremptorily with, as far as one can judge, very little consideration being given to his past, or to the man himself; certainly not being interviewed by a chief or a superior of any sort whatever.
Then he was taken to court for the very offences for which he was dismissed and the point is that he was acquitted on all charges. Because he had been dismissed rather than suspended before the bringing of criminal proceedings, he lost all his pension rights, his job and his good name. But because he was a man of courage and "guts" he went to work on the night-shift at a factory in Yarmouth for a number of months. Now this man, whom the Treasury say is unfit for employment, is now a temporary rating officer to the Berkshire County Council. Where do we go from there?
I have a lot more to say, but I have only time to put straight questions to my right hon. Friend. First, I wish to ask about the dismissal before criminal proceedings. Could my right hon. Friend tell me the nature of the 14 cases quoted as precedents? Can he tell me why, in quoting one of these cases as a precedent, he said, on 29th March: When we have a case, such as in another of the fourteen cases to which I referred, where an officer admits that he has helped a member of the public to prepare a false Income Tax return, one cannot suspend a man like that pending proceedings."—[OFFICIAL REPORT, 29th March. 1956; Vol. 550, c. 2331.] I do not understand what all that is about. Can the right hon. Gentleman please tell me how many of these men 649 whom he cited in the 14 cases of precedents had jobs to go to; how many of the cases were acquitted at the trial and if any of them were acquitted were they paid anything in restitution for loss of pension rights?
On the question of the Gestapo investigation, may I ask what were the exceptional circumstances to which the Chancellor referred on 29th November, 1955, because I cannot find them? What consideration was ever given to the story of Coldham himself? May I see a copy of the Poulter letter? Will Coldham be paid what salary is due to him? Where a board has special protection from the law, what is the duty of the board? What is the attitude of my right hon. Friend to the fact that both the Chairman of the Board of Inland Revenue and the last Chancellor of the Exchequer said that they considered that this man had been penalised much more than the case deserved? A learned counsel, who looked at this case especially for me, has referred to this remarkably harsh decision. I appeal to my right hon. Friend to reconsider this matter and do something in the interests of justice for this man.

§ The Financial Secretary to the Treasury (Mr. Henry Brooke)
My hon. Friend the Member for Yarmouth (Mr. Fell) has taken 22 minutes out of an available 30 minutes to set forth his case, and has left me with eight minutes in which to reply. He said that this was not a pleasant case for the Treasury or for the Inland Revenue to listen to. It is not a pleasant case for anybody to listen to, because it concerns a man's mistakes. I use a neutral word. But I want to tell my hon. Friend—I know that he accepts me as a man of honour—that my conscience is clear about this.
I have investigated this matter personally with the utmost care, and I am convinced that the decisions taken by the Board of Inland Revenue have been correct. My hon. Friend has had the opportunity of personal talks with the Chairman of the Board of Inland Revenue and with the former Chancellor of Exchequer my right hon. Friend the Lord Privy Seal. I have spoken to both of them since my hon. Friend's remarks in the House just before Easter as to their attitude at those interviews. Neither of them has been willing to accept the 650 interpretation that my hon. Friend put on their attitude on that day and again today by suggesting that they thought that Mr. Coldham had been harshly treated.
The fact is that Mr. Coldham, who was referred to as a small man by my hon. Friend, was, in fact, not a junior clerk, but an official in a highly responsible position. He was in charge of the valuation office, and he was drawing a salary of about £1,200 a year. It is exceedingly important in the public interest that men of that position in the Civil Service should be entirely free from any suspicion of "fiddling" any figures at all. In fact, he has admitted that he did "fiddle" these figures, and that is really a central fact of the case.
My hon. Friend suggested that it was impossible for Mr. Coldham to remember clearly what had happened three or four years before. In fact, he was interviewed in March, 1955, regarding journeys in the summer of 1954 and in the winter of 1954–55. The evidence showed that many of the claims made were clearly inaccurate, and that he must have known that they were inaccurate. Mr. Coldham did not deny this evidence at the time nor subsequently at the trial at which he was acquitted of a criminal offence.
I think that my hon. Friend's difficulty is that he cannot quite grasp that this case has come up under two separate and distinct codes. The first is the Departmental disciplinary code and the second the criminal code, by which Mr. Coldham was publicly acquitted of any offence. But I want to make one reference to what happened on that occasion because my hon. Friend has made great play with the "Gestapo methods" that he has alleged. In fact, all that was done there was done under the direction of the investigating officers of the Board of Inland Revenue when the matter came to their attention.
I think it is important for me to get on the record here what the Recorder at the trial was reported in the Eastern Daily Press of 7th July, 1955, as saying on the matter. The Recorder is reported as saying: We may not like the idea of a subordinate interfering with our affairs, but the results were right, because in the end here is Mr. Coldham coming into the witness box and saying that all the evidence given by typists and other people we have heard is quite right and that the journeys were bogus entries: 651 'Which I put in because out of office hours over weekends in the Spring and Summer of last year I did in fact do work for which I travelled and never claimed'. The position here was that this senior officer in charge of the office had admitted that he had done what he ought not to have done.
In a case like that, I must put it to the House that it is not right for the Inland Revenue to suspend a man when the actions complained of have been admitted. Mr. Coldham admitted his faults, and he was dismissed. It is not the case that action of that kind by the Board of Inland Revenue prejudices subsequent proceedings. In fact, it may well influence subsequent proceedings in the man's favour because people may think that he has had his punishment already. He had made these statements, on his honour, in his travelling claim which were not true. My hon. Friend suggested that these figures had been put in by somebody else, but here is a man in charge of the office signing—

§ Mr. Fell
It was admitted in court that they were written in the hand of the other man.

§ Mr. Brooke
I think that my hon. Friend's case was that Mr. Coldham was signing figures which had been put on to the form by somebody else. That may be so, but he was signing them, on his honour, as correct. One is entitled to ask 652 that people in responsible positions, when they do that sort of thing, shall take responsibility for their action.
Mr. Coldham has suffered very severely: I know that. It is a fact of life—it may be a tragic fact of life—that the higher one gets in a position of responsibility, the more is at risk if one makes a mistake. Mr. Coldham has sacrificed his pension rights. He has lost heavily in the financial sense. I speak of nothing else, but that is the risk which we all carry when we assume, willingly or otherwise, positions of high responsibility.
My hon. Friend made great play with the way in which this claim came to light. The fact is that Coldham's actions were scandalising the office and that members of his staff took action. If there is to be any complaint about what happened, Mr. Coldham could have avoided it by not committing the acts he did. My hon. Friend suggests no solution. If a senior person watches over his junior, that, apparently, is all right, but my hon. Friend objects when a junior watches over a senior.