CORRECTION: This article and its headline were updated at 2.45pm on 30 January. The original article wrongly claimed that Virgin Care was registered in the British Virgin Islands; in fact, while the Virgin Group’s ultimate holding company is registered there, Virgin Care is UK-registered. We have also included comments from Virgin making clear that Virgin Care is loss-making, and further quotes stating that no dividends have ever been taken from Virgin Care, and that it has reinvested any money it has received.
Boris Johnson spent the general election promising us that the NHS wasn’t on the table in any post-Brexit trade deal with the US. But while there was evidence that this wasn’t true, he also doesn’t need a trade deal to screw over the NHS. Because government funds for the public service are already being channelled into the hands of private contractors in a big way.
The Mirror has reported that Richard Branson’s Virgin healthcare firm has swept up £2bn worth of contracts over 10 years but has paid nothing in corporation tax.
Dr John Lister, secretary and health policy academic at Keep Our NHS Public, described Virgin as “parasitic”:
Virgin continues to play a parasitic role in the NHS, fragmenting services and poaching NHS-trained staff and undermining nearby NHS trusts.
the company pays no corporation tax and therefore only takes resources from the public sector while contributing nothing of value.
Read on...Support us and go ad-free
Virgin Care didn’t pay any corporation tax because because it has never made a profit.
According to the Mirror:
The group’s biggest part subsidiary is Virgin Healthcare Services, which has a large number of contracts. Its turnover was £248.8million last year but it made a profit of £503,000.
However, a potential corporation tax bill of just under £96,000 was wiped out by losses made in other group companies.
Virgin refutes the accusation that Virgin Care is parasitic, telling The Canary:
Virgin Care is a responsible health provider. It has not made a profit to date and every penny it has received has been used to pay to deliver services…
Innovation, however, comes at a cost, which is why Virgin Group has invested more than £60m into Virgin Care and why the business is currently loss-making. No dividends have ever been taken from Virgin Care and Sir Richard Branson has publicly pledged to re-invest any profits over and above his investment back into helping NHS patients.
Virgin Care is registered in the UK, although its ultimate holding company is registered in the British Virgin Islands, a tax haven where Branson lives.
Virgin says it has:
always been completely transparent about the structure and financial position of the Virgin Care business which is UK-registered and reports to HMRC.
It also says the £2bn figure:
is based on a number of assumptions which may or may not prove correct: that every contract runs to its maximum length, including optional extensions; that the winning bid in financial terms matched the commissioners’ initial advertised total value; and that all performance-related payments (which can make up more than 20% of annual revenue) are made in full.
People have reacted angrily to the news. Former Green Party leader Natalie Bennett described Branson as the “UK’s largest and least deserving benefit recipient”:
Making Richard Branson the UK's largest and least deserving benefit recipient.
— Natalie Bennett (@natalieben) January 27, 2020
Meanwhile, Labour leadership contender Keir Starmer branded the news a “disgrace”:
This is a disgrace. Public services should be in public hands, not making profits for shareholders. https://t.co/YVvAhFImy8
— Keir Starmer (@Keir_Starmer) January 27, 2020
Other people also pointed out the corporate welfare bailout Branson’s part-owned FlyBe received:
Corporate Welfare: Flybe (30% owned by Richard Branson's Virgin Group) wants more UK govt money; can't offer collateral for security as billionaire investors already hold charges over many of its assets.
Wealthy elites continue to pick people's pockets.https://t.co/MuqJRIOZuk
— Prem Sikka (@premnsikka) January 27, 2020
Not just Branson
But it’s not just Branson. Our NHS is being sold off piece by piece. And if we don’t act now, what’s left of our NHS will be auctioned off to the highest bidder.
Featured image via Flickr – Chatham House
Do your bit for independent journalism
Did you know that less than 1.5% of our readers contribute financially to The Canary? Imagine what we could do if just a few more people joined our movement to achieve a shared vision of a free and fair society where we nurture people and planet.
We need you to help out, if you can.
When you give a monthly amount to fund our work, you are supporting truly independent journalism. We hold power to account and have weathered many attempts to shut us down and silence the counterpoint to the mainstream.
You can count on us for rigorous journalism and fearless opposition to an increasingly fascist government and right wing mainstream media.
In return you get:
- Advert free reading experience
- Behind the scenes monthly e-newsletter
- 20% discount from our shop