Rishi Sunak’s government hit by Nadhim Zahawi scandal with more ministers facing questions

Rishi Sunak’s attempts to focus on his government’s priorities threatened to be further hit by more questions over the Nadhim Zahawi tax storm and the position of other Cabinet ministers.

Critics accused the Prime Minister of failing to act quickly enough in sacking Mr Zahawi as Tory party chairman and he is also facing growing pressure to deal swiftly with the string of bullying allegations against Deputy Prime Minister Dominic Raab.

Mr Zahawi was sacked as Conservative Party chairman on Sunday due to a row over his tax affairs and after an ethics inquiry found he was “in serious breach of the ministerial code”.

The PM used a meeting of the Cabinet at Chequers last week to push his top team to deliver on his five key pledges of halving inflation, cutting debt, growing the economy, reducing NHS waiting lists and addressing cross-channel migration.

But his attempts are being dogged by controversies with fresh questions being asked why Suella Braverman is Home Secretary given she also previously admitted breaking the ministerial code when she used a private email to send a document about immigration.

The Prime Minister asked Sir Laurie Magnus, his independent adviser on minister interests, to investigate whether Mr Zahawi had acted properly after it was revealed he paid a penalty as part of an estimated £4.8 million settlement dispute with HMRC.

In his report Sir Laurie said Mr Zahawi had shown “insufficient regard for the principles of the general principles of the ministerial code and the requirements in particular under the seven Principles of Public Life, to be honest, open and an exemplary leader through his own behaviour”.

In a letter to Mr Zahawi, Mr Sunak said following the investigation “it is clear that there has been a serious breach of the Ministerial Code”.

“As a result, I have informed you of my decision to remove you from your position in His Majesty’s Government.”

In the letter, Mr Sunak told the Tory MP: “When I became Prime Minister last year, I pledged that the Government I lead would have integrity, professionalism and accountability at every level.”

In his letter to the Prime Minister following his sacking, Mr Zahawi did not explicitly mention the findings of the inquiry.

But he told Mr Sunak he is concerned “about the conduct from some of the fourth estate in recent weeks”, in a reference to the media.

He said: “It has been, after being blessed with my loving family, the privilege of my life to serve in successive governments and make what I believe to have been a tangible difference to the country I love.”

In comments that appear to indicate that the former chancellor holds out little prospect of returning to office in the years to come, he said: “You can be assured of my support from the backbenches in the coming years. Your five priorities are the right priorities, and I will do whatever I can to help you deliver them.”

The row surrounding Mr Zahawi centred on a tax bill over the sale of shares in YouGov – the polling firm he founded – worth an estimated £27 million and which were held by Balshore Investments, a company registered offshore in Gibraltar and linked to Mr Zahawi’s family.

The former head of the civil service Lord Kerslake said the PM "should’ve acted sooner" but said he should be able to "rely on his ministers to be transparent and stick to the ministerial code".

Conservative MP Robin Walker, who chairs the education select committee, said it was "concerning" how long it took for the full details of Zahawi’s tax affairs to come to light - particularly "given some of the roles he’s held in that time", including chancellor of the exchequer.

Both Labour and the Liberal Democrats said the public should get answers about what and when Mr Sunak knew about the controversy.

Shadow education secretary Bridget Phillipson said the Prime Minister should have sacked Mr Zahawi a “long time ago”.

“It’s vital that we now get answers to what Rishi Sunak knew and when did he know it. We need to see all the papers, not just have the Prime Minister’s role in this brushed under the carpet.”

The Liberal Democrats also called on Mr Zahawi to go a step further and leave parliament.