Tories accuse PM of funding tax cuts for Mauritians

The High Court ruled against a last-minute legal challenge by some Chagossians to stop the deal

Sir Keir Starmer has defended the UK’s £3.4bn deal to hand over sovereignty of the Chagos Islands to Mauritius, while retaining control of a UK-US military base on Diego Garcia.

At prime minister’s questions, Conservative leader Kemi Badenoch called it a “terrible” deal and asked “why on earth” British taxpayers should be paying for tax cuts in Mauritius.

Last week, Mauritian prime minister Navin Ramgoolam said the money from the Chagos deal would be used for debt repayments, as part of a Budget package that will see 80% of workers exempted from income tax.

The prime minister said the UK risked jeopardising the “vital intelligence and strategic capability” on Diego Garcia without a deal.

“Legal uncertainty would compromise it in very short order,” he told MPs, adding “no responsible prime minister would let that happen”.

He said: “We have secured the base for the long term and that has been welcomed by our allies – by the US, by Nato, by Australia, New Zealand, India.

“It’s been opposed by our adversaries – Russia, China and Iran. And in the second column we add Reform, following Putin, and the Tories following Reform.”

But Badenoch insisted the deal had “nothing to do with national security”, adding that she had seen the security briefings when she was in government and it was “bad deal before and it’s still a bad deal”.

Negotiations to hand over sovereignty of the Chagos Islands to Mauritius began under the previous Conservative government.

Under the terms of the deal agreed by Labour, the UK will lease use of the Diago Garcia base for a period of 99 years.

The UK will pay £165m in each of the first three years. From years four to 13, it will pay £120m a year. After that, payments will be indexed to inflation.

Sir Keir says this will average out at a cost of £101m a year, although this figure is disputed by the Conservatives, who say it will be much higher.

In his Budget, Navin Ramgoolam announced plans to reduce Mauritius’s public sector debt to 60% of GDP in the long term.

“These projections are inclusive of the revenue from Chagos, which will be used for debt repayment for the first three years,” he said in a speech to the country’s Parliament.

He also announced that 80% of workers will not pay income tax but higher earners will pay more.

It comes as a panel of experts urged the UK to renegotiate the Chagos deal as it “fails to guarantee” the rights of the Chagossian people.

The panel, appointed by the UN Human Rights Council, said it was “gravely concerned about the lack of meaningful participation of Chagossians in the processes that have led to the agreement”.

Philippe Sands KC, who represented Mauritius in its long-running legal battle with the UK over the Chagos islands, insisted this was not the case.

“I want to really knock on the head this idea that all of the Chagossians were not involved in the various processes. That is simply not true,” he told a House of Lords committee.

“It is true, however, that the Chagossian community is divided and I respect that division.”

The “quid pro quo” for the military base remaining on Diego Garcia was that Chagossians would be allowed to settle on the outer islands of the archipelago, he told peers.

He said he understood the “bitterness and the hurt” of the Chagossian community in the UK, who were “forcibly deported from Diego Garcia and who wish to return and will not be able to return”.

But he said “most in Mauritius and Seychelles have made very clear…that they wish this deal to go ahead” – and they had been “deeply involved in consulting with successive prime ministers of Mauritius”.

He told peers the deal “will enhance Britain’s position in the world” as a country that respects “the rule of law”.

It follows a 2019 advisory opinion from the International Court of Justice saying the islands should be handed over to Mauritius.

Mr Sands, who revealed that he had become a Mauritian citizen in 2020, so he could take part in a hearing in person during the Covid pandemic, said he had not been working “pro bono” for the country’s government but could not say how much he had been paid.

He also paid tribute to Liz Truss, who he said had kicked off negotiations during her brief tenure in Number 10.

This is disputed by Truss, who has blamed Boris Johnson for starting the process when he was PM.