The government is coming under increasing pressure to use the annual £5 million tax it takes from frozen Libyan assets in the UK to compensate victims of Gaddafi-IRA bomb attacks.
News of the tax, which emerged yesterday, angered victims of Semtex explosive Colonel Gaddafi supplied to the IRA.
For years their calls to tap the £12bn Libyan assets frozen in the UK have met with determined government opposition.
A lawyer acting for victims estimates the UK has received around £40 million in tax from the assets over the last eight years.
UUP peer Lord Empey, who has been pushing a bill through Westminster to allow the Libyan holdings to be tapped, yesterday supported a call by MPs for the tax to be used to create a victims’ reparation fund.
“The fact that the Treasury has been raking it in while victims have been sitting at a standstill will be found by quite a few people to be disgusting,” he said.
The fact that the Treasury has been raking it in while victims have been sitting at a standstill will be found by quite a few people to be disgustingLord Empey
“Ministers must have known about this for some considerable amount of time, while telling victims they could not do this or that.”
Lawyer Matt Jury is pressing Libya for $450m (£353m) compensation for 150 IRA victims. Mr Jury, who acted for Omagh Bomb victims in the landmark civil action against the RIRA, estimates the UK could have made £40m so far in tax, at a rate of £5m per year since the UK assets were frozen in 2011.
The government therefore has “a worrying conflict of interest” regarding calls to tap the assets, he said.
“The reason why the government has refused to countenance this may now be clear – the alternative is just too profitable.”
The level of tax the UK has taken from the £12bn Gaddafi-linked assets has been revealed by the NI Affairs Committee at Westminster, which has pressed government to come clean on the issue for months.
Libya has paid compensation to US, French and German victims of terror attacks it sponsored, but argues that it owes nothing to UK victims.
Libya paid some $3m (£2.4m) each to US victims of terror attacks it sponsored.
After persistent questioning over months, the government has now revealed to The NI Affairs Committee that since 2016-17 the Treasury has collected around £17m from Gaddafi-linked assets frozen in the UK. Approximately £5m is collected each year.
The Gaddafi regime supplied several shipments of Semtex explosive to the IRA in the mid-1980s, leading to a deadly campaign of bombings across the UK.
NI Affairs Committee chairman Simon Hoare MP said: “The government claims it has been taking a more ‘visibly proactive’ approach to securing compensation for victims, but it took my committee to point out that the profits the government has been accruing from frozen Libyan assets could be put to better use. “I am glad the figure has now been revealed to us, and there is now a clear moral imperative for this money to be used to help victims who have suffered for far too long.”
In 2015 the powerful committee of MPs called on the government to establish and finance a reparations fund for the victims ahead of the outcome of negotiations with Libya, which the government refused to do.
The Libyan tax information the government has now revealed makes it clear that money is readily available to create such a fund, he added.
UUP peer Lord Empey, who has been pushing a bill through Westminster to allow the assets to be tapped, agreed that the annual £5m tax should now be used to create the reparation fund. This would both meet the committee’s recommendations and safeguard confidence in the UK for investors, he added.
Committee member Ian Paisley MP said: “It is disgraceful that after years of the government denying that Libya assets could be touched we now learn that the Treasury has been skimming them for millions. This in my view confirms that the government could pay the UK victims and subsequently claim back the capital costs at a later stage.”
Stephen Gault was seriously injured in the 1987 Poppy Day bomb which killed 12 people, including his father Samuel.
He said the IRA used Libyan-supplied Semtex as a booster in the bomb.
“The British government has been benefiting from these assets while telling us it would be unacceptable for victims to benefit from them,” he said.
“Yet now it has emerged they siphoned off £17m. So it is total double standards for the government to say it can’t use another country’s funds to compensate victims.
“To my mind £17m is a lot of money and would go some way to start compensating victims of Libyan Semtex supplied to the IRA.
“I wake up every day in pain as a result of bomb,” he said. “I have to take painkillers and medication on a daily basis plus several injections every month just to help me get by with everyday life.
“Plus my father was also murdered. People say time is a great healer but when your loved one is brutally murdered like that and there is no justice it never leaves you.
“Plus the traumatic circumstances has a massive impact on your wider family.”