05072-19 Smith v Daily Mail

Decision of the Complaints Committee 05072-19 Smith v Daily Mail

Summary of Complaint

1. Heather Smith complained to the Independent Press Standards Organisation that the Daily Mail breached Clause 1 (Accuracy) of the Editors’ Code of Practice in an article headlined “Labour tax raid on family homes” published 1 July 2019.

2. The article, which featured on the front page and continued on to page two, reported that the Shadow Chancellor had "signalled major reforms  to inheritance tax" under Labour and that he was interested in “replacing the current levy with  a ’lifetime gifts tax’ on cash or homes given to children". The article reported that under these proposals, far more homes would be subject to inheritance tax and that "he claimed the plan, which the Tories say would affect 10 million households, could ensure ‘wealth is more fairly distributed’". It went on to report that "at present, the inheritance tax threshold is £475,000, or £950,000 for couples". The article reported on the front page that “only 640,000 households end up paying the tax each year”.

3. The article appeared in substantially the same format online under the headline: “Labour's tax raid on family homes will slash legacies for millions of children, say Tories: Shadow Chancellor McDonnell signals plan to tax parent's gifts to kids to redistribute wealth 'more fairly'” published 30 June 2019.

4. The complainant said that it was inaccurate to report that 640,000 households "ended up paying" inheritance tax each year. She said the correct number of estates that paid inheritance tax in the latest year for which figures were available (2015-2016) was 24,500 and that the reported figure was, therefore, inaccurate by a multiple of 26. The complainant said that the inaccuracy was significant as it had been published in a prominent position, on the front page of the newspaper, within an article which reported on a contentious political issue. The complainant also said that it was inaccurate to report that “households” paid the tax, as it is paid by estates. During IPSO’s investigation, the figures for 2016-2017 were released, which recorded that the number of estates which had paid inheritance in that year stood at 28,100.

5. The publication accepted that it had inaccurately reported the number of households that paid inheritance tax each year. It said that the figure of 640,000 was derived from an estimate provided by the Conservative Party press office of the number of homes in the UK which are worth £1,000,000 or more, being the number of households potentially liable to pay inheritance tax under the current arrangements. It said that the intention had been to present the 640,000 figure by way of contrast with the Conservative Party's estimate that 10 million homes would be affected by the new proposals; it said that "each year" had been mistakenly added during the subediting process. Whilst the publication accepted that it was inaccurate to report that 640,000 households paid inheritance tax annually, it did not accept that this inaccuracy undermined or rendered the overall thrust of the article inaccurate, namely that under the proposed reforms significantly more properties would be subject to tax than under the current inheritance tax scheme. The publication noted that neither the Labour Party nor the Conservative Party had complained that the article was inaccurate.

6. In its first response to the complainant, the publication offered to publish a correction in its corrections and clarifications column, which ordinarily appears on page two. The publication also offered to publish the correction as a footnote to the online version of the article. The publication revised its offer following comments from the complainant and proposed the following wording:

Our front-page article on July 1 about Labour’s proposed inheritance tax reforms said that under current rules, 640,000 households pay inheritance tax ‘each year.’ In fact, this figure represents an estimate by Tories of the total number of houses worth over £1m – whose owners would potentially be affected – and only approximately 24,500 estates pay the tax each year. We apologise for the error.

7. The publication said that its corrections and clarifications column was familiar to its readers as the position in the newspaper where corrections are published and that a correction published in the column was, therefore, suitably prominent. It noted the requirement of the Code for due prominence, rather than equal prominence, and argued that where an inaccuracy appears in an article is not the only factor to be taken into account; it said that the inaccuracy was relatively insignificant and, therefore, that a front page correction was not warranted.

8. The complainant said that the newspaper had failed to distinguish between comment, conjecture and fact, as it had reported a Conservative Party press office quote as fact. She also said the publication's offer was inadequate, as any correction would need to be published on the front page, where the original inaccuracy had appeared, given that this page was the most read page of a newspaper. The complainant said that many people who had not bought a copy of the newspaper that day would nevertheless have seen the front page on web and mobile applications and in shops, as a result, the published correction should be afforded equal exposure. Further, the complainant also said that any correction could state the number of households which paid inheritance tax in the latest year for which figures were available, making clear that the figure represented just 4.6% of the number of deaths. The complainant also said that the number of individuals who would pay inheritance tax under the current arrangements was likely to decrease and proposed that this also be included in the wording.

Relevant Code Provisions

9. Clause 1 (Accuracy)

i) The Press must take care not to publish inaccurate, misleading or distorted information or images, including headlines not supported by the text.

ii) A significant inaccuracy, misleading statement or distortion must be corrected, promptly and with due prominence, and — where appropriate — an apology published. In cases involving IPSO, due prominence should be as required by the regulator.

iii) A fair opportunity to reply to significant inaccuracies should be given, when reasonably called for.

iv) The Press, while free to editorialise and campaign, must distinguish clearly between comment, conjecture and fact.

v) A publication must report fairly and accurately the outcome of an action for defamation to which it has been a party, unless an agreed settlement states otherwise, or an agreed statement is published.

Findings of the Committee

10. It was not in dispute that it was inaccurate to report that 640,000 households paid inheritance tax each year; the number of estates which paid the tax in the latest year for which figures were available at the date of publication was approximately 24,500. The publication accepted that the mistake had been made in the subediting process so that the Conservative party estimate of the number of homes that were worth over £1 million had been misinterpreted. The Committee found that there was a failure by the newspaper to take care not to publish inaccurate information in breach of Clause 1(i).

11. The inaccuracy was significant, as readers would understand that the number of households which paid inheritance tax each year was substantially higher than the true figure. A correction was therefore required under Clause 1(ii) of the Code.

12. The publication had amended the online article as soon as it was made aware of the inaccuracy by the complainant. The publication then offered to publish a correction in its first response to the complainant during the referral period and had made several offers to accommodate the complainant's suggestions in an attempt to resolve the matter; the Committee considered that the final wording, offered before IPSO begun its investigation, was sufficiently prompt. The correction made clear that the reported figure of 640,00 referred to the number of houses estimated by the Conservative party as worth over £1m and potentially affected and confirmed that approximately 24,500 estates pay inheritance tax each year. The Committee considered that this correction addressed the published inaccuracies and referencing the percentage of deaths which are affected by inheritance tax was not necessary.

13. The Committee acknowledged that established corrections and clarifications columns demonstrate a commitment to correct inaccurate or misleading material while also providing a consistent position in which to correct inaccuracies for readers. The Committee considered whether the correction should also be published or referenced on the front page. The Committee did not consider that that this was necessary bearing in mind the significance of the inaccuracy in light of the report as a whole. The Committee considered that, in the circumstances, page 2 was a suitably prominent position to correct the inaccuracy and that the terms of the offered correction was sufficient to avoid a breach of Clause 1(ii).

14. The Committee acknowledged that inheritance tax is paid by estates, but the reference in the article to “households” paying the tax was not significantly inaccurate or misleading in circumstances where the article was focussing on the number of properties which might be affected by the proposals based on their value. There was no breach of Clause 1 on this point, but the Committee nevertheless welcomed that the publication had clarified that inheritance tax is paid by estates in the correction which it had offered to publish.

Conclusion

15. The complaint was upheld under Clause 1(i).

Remedial Action Required

16. Having upheld the complaint, the Committee considered what remedial action should be required.

17. The publication had offered to publish a correction in a prominent position and sufficiently promptly as to meet the requirements of Clause 1(ii). This should now be published to avoid a breach of Clause 1(ii).

Date complaint received: 01/07/2019

Date decision issued: 06/12/2019

Independent Complaints Reviewer

The complainant complained to the Independent Complaints Reviewer about the process followed by IPSO in handling this complaint. The Independent Complaints Reviewer decided that the process was not flawed and did not uphold the request for review.