Last year, Mr Hancock lambasted a leading scientist for meeting a mistress and breaking Covid-19 regulations. EPA
Last year, Mr Hancock lambasted a leading scientist for meeting a mistress and breaking Covid-19 regulations. EPA
Last year, Mr Hancock lambasted a leading scientist for meeting a mistress and breaking Covid-19 regulations. EPA
Last year, Mr Hancock lambasted a leading scientist for meeting a mistress and breaking Covid-19 regulations. EPA

The Hancock Affair could alter the course of Covid-19 in the UK


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"It's a matter for the police." These were the words of a "speechless" Matt Hancock, the UK's health minister, when being interviewed on British television about the discovery that a leading epidemiologist, Neil Ferguson, was having an extra-marital affair, breaking Covid-19 regulations that the scientist in question had helped draw up. The health secretary's comments mirrored the justifiable anger many felt at Mr Ferguson's actions, during a time when those sticking to coronavirus measures were unable to say goodbye to dying relatives, or attend the births of their children.
Mr Ferguson's affair, which came to light in May last year, has now been overshadowed by news that the minister himself has been doing the same with a colleague, Gina Coladangelo. Mr Hancock's actions broke Covid-19 regulations that were in place at the time and, in the minds of many, the high ethical standards to which ministers should be held.

The health secretary is alleged to have broken a number of ministerial codes. AFP
The health secretary is alleged to have broken a number of ministerial codes. AFP
Recent polls suggest the public is losing patience with Mr Hancock

News of the health secretary's actions will be devastating to his, and Ms Coladangelo's family, respectively – both are married with children. But the most serious repercussions could be to public health, as fatigued Britons start to see little reason to stick to regulations that are routinely ignored by those who created them. By doing what he did, Mr Hancock was either placing himself above the law, or making the assessment that his measures were ineffective and not worth obeying. Neither will go down well with the millions of people separated from loved ones for months.
Beyond health, the case has other details that could end Mr Hancock's political career. There are accusations that he broke the ministerial code on relationships, which requires a minister's professional dealings with colleagues to be "proper and appropriate", as well as the code on conflicts of interest. Mr Hancock, who has known Ms Coladangelo since university, is also accused of rewarding contracts and even jobs to personal acquaintances.
In normal times, a senior public official would justifiably be held to account for such actions. The breach seems even more egregious today, after months of Mr Hancock being one of the most recognisable faces of a government that is meting out the most severe changes to life in the UK since the Second World War.

Most politicians deserve credit for being a crucial part of response to the pandemic. Crises place huge stress on those responsible for public safety, and the burden of governing during one will always reveal a person's contradictions. Most in the UK seem to be tolerant of the difficult job facing the government. Despite a number of setbacks and poor decisions, Prime Minister Boris Johnson's government remains popular, and has even climbed in opinion polls over the past few weeks. But the most recent polls could point to the public losing patience, particularly with Mr Hancock. A survey from pollster YouGov found that almost 50 per cent of participants thought he should resign. Only 25 per cent though he should remain in his role, with the remainder being unsure.
There has been much commentary in the UK about the extent to which the moral standards British voters demand of their politicians have changed in recent times. Thirty years ago, extra-marital affairs commonly led to immediate resignations. This rarely happens nowadays. But Mr Hancock's current situation shows something that remains as true as ever. Voters despise hypocrisy.

Timeline

2012-2015

The company offers payments/bribes to win key contracts in the Middle East

May 2017

The UK SFO officially opens investigation into Petrofac’s use of agents, corruption, and potential bribery to secure contracts

September 2021

Petrofac pleads guilty to seven counts of failing to prevent bribery under the UK Bribery Act

October 2021

Court fines Petrofac £77 million for bribery. Former executive receives a two-year suspended sentence 

December 2024

Petrofac enters into comprehensive restructuring to strengthen the financial position of the group

May 2025

The High Court of England and Wales approves the company’s restructuring plan

July 2025

The Court of Appeal issues a judgment challenging parts of the restructuring plan

August 2025

Petrofac issues a business update to execute the restructuring and confirms it will appeal the Court of Appeal decision

October 2025

Petrofac loses a major TenneT offshore wind contract worth €13 billion. Holding company files for administration in the UK. Petrofac delisted from the London Stock Exchange

November 2025

180 Petrofac employees laid off in the UAE

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

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