Channel Islands finances praised by Nick Clegg

The financial services industry in the Channel Islands has been described as "hugely important" by the UK's Deputy Prime Minister Nick Clegg.

He told the BBC the islands were "an important gateway for the wider financial sector and indeed the economy in the United Kingdom".

Meanwhile his fellow Liberal Democrat Vince Cable has called for a crack down on "tax havens".

Although it was not clear if Mr Cable was referring to the islands or not.

There is no generally agreed definition of "tax haven".

The business secretary called for "cracking down hard on not just criminal tax evasion but on abusive tax avoidance".

While Mr Clegg praised the islands as vibrant, innovative and well-known he alluded to concerns held by his party colleagues over how the islands operated separately from the UK.

He said: "There are lots of regulatory debates about exactly how the financial sector operates in the Channel Islands, but it's a great plus for us in the UK."

Senator Philip Bailhache, Jersey's Assistant Chief Minister, said: "I'm entirely relaxed about the comments made by Mr Cable, we are not interested in tax evasion in the Channel Islands nor are we interested in aggressive tax avoidance."

Work together

Deputy Jonathan Le Tocq, Guernsey's Deputy Chief Minister, said: "I think there has been misunderstanding, but I think it's heartening to hear the Deputy Prime Minster, Mr Clegg, speak of the benefits the Channel Islands bring to the City of London.

"I think that is a message we want to reiterate and underline, there's increasing understanding that it's not what people think."

He said it was important the islands worked together on their international reputation.

Deputy Le Tocq said: "There are differences between the islands, but in terms of how the outside world and obviously the UK view us we're seen as a unit.

"We have far more in common than we have that separating us so in the vast majority of cases it helps us to make our points known together."

Both Channel Islands politicians have attended this week's Liberal Democrats conference in Brighton.

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