Nadhim Zahawi must resign now, insists Cabinet colleague

Zahawi - Leon Neal/Getty Images
Zahawi - Leon Neal/Getty Images

Nadhim Zahawi should resign over his handling of his tax affairs, one of his Cabinet colleagues has told The Telegraph.

In a sign that support for the beleaguered Conservative Party chairman is rapidly draining away, a Cabinet minister told The Telegraph on Saturday night: “I think he’s got to go.”

However, the minister said that Rishi Sunak was still right to refer Mr Zahawi to his independent ethics adviser, Sir Laurie Magnus, rather than summarily firing him.

“If he’d have sacked him you’d have had the constant refrain of ‘it wasn’t natural justice’,” they said.

“What is the point of having an ethics adviser if there’s perceived to be ambiguity that they can’t do the job?”

Mr Zahawi is under mounting pressure after it emerged he paid a penalty to HMRC over previously unpaid tax while he was chancellor, as part of a multi-million-pound dispute with the taxman.

There are fears among Tory MPs that the longer the controversy drags on the more damage it is doing to the party.

A former Cabinet minister told The Telegraph it was crucial Mr Zahawi “steps down as quickly as possible”. “Given that he’s not volunteering, then I think he ought to be told,” they added.

‘He’s not doing him any favours at all’

They said that the position of Britain’s top civil servant, Simon Case, was also untenable, amid claims he provided poor advice to the Prime Minister over Mr Zahawi’s appointment.

The Cabinet Secretary is also facing questions about his apparent role in facilitating and clearing a loan facility of up to £800,000 for Boris Johnson.

The MP said: “I would be surprised if he lasted much longer. To be honest, Rishi needs to look at Case as a matter of urgency, because he’s not doing him any favours at all.

“He needs to listen to the advice I’m sure he’s getting from senior colleagues now… to get rid of Case and get himself a better operator at the centre of government.”

An ally of the Prime Minister compared Mr Case to Gavin Williamson, the former education secretary who is often cited as a Machiavellian figure in Tory circles.

“Some of the commentaries around him being a master of the court rather than a government delivery person, are true,” the ally said.

“One suspects there’s similar DNA to Gavin Williamson.” They added that it might benefit Mr Sunak to “have a traditional mandarin taking over, and to clear out another big piece of debris from the Johnsonian era”.

Even figures in the Labour Party believe that Mr Case’s days are numbered.

A senior Labour MP described the Cabinet Secretary as a “wet blanket”. Asked whether the party would be able to deal with him if Labour win the next election, they said: “He won’t be there by then. He won’t be there by the autumn.”

Sir Alistair Graham, the former chairman of the committee on standards in public, told The Telegraph that Mr Case had questions to answer over the recent controversies.

“I’m surprised a Cabinet Secretary was involved in sorting out a prime minister’s finances - it’s scandalous I would have thought,” he said.

“If there is a full investigation, then Mr Case should be providing answers on why he was involved.”

However, on Saturday night, an ally of Mr Case insisted that he had not involved himself in Mr Johnson’s finances, saying he had only provided advice to the former prime minister.

The senior Whitehall source insisted that Mr Case’s relationship with Mr Sunak was strong and dismissed claims that he would soon leave his post as “rubbish”. They said that he worked most days with the Prime Minister and pointed out that he had been in attendance at last week's away day for the Cabinet at Chequers.

A Cabinet Office spokesman said: “The Cabinet Secretary is focused on ensuring that the Civil Service and the whole of Government is working together to deliver for the British people.”

The Sunday Times reported that Mr Case formally advised Mr Johnson to stop asking Richard Sharp - his pick for the job of BBC chairman - for “advice” relating to “personal financial matters” days before he was announced as chairman.

Mr Sharp is reported to have previously met with Mr Case in order to arrange a loan guarantee which was provided by Sam Blyth, a distant relation of Mr Johnson’s.