Socialist Worker

The big business grip on Labour

Issue No. 1741

Blair's love affair with the rich

The big business grip on Labour

THE RECENT scandals involving Peter Mandelson, Keith Vaz, Geoffrey Robinson and the Hinduja brothers show the degree to which New Labour ministers are connected with the rich and powerful. More than this, every level of government under Labour is now dominated by big business.

Every aspect of government policy is connected to the needs of the corporations and always ensures the needs of the wealthy come first. Tony Blair claims to be green. But his "green speeches" have been on the platform of the Green Alliance, which no ordinary person can join, but that any corporation can if it pays �2,500. Firms which back the Green Alliance include Thames Water, the company fined the most for polluting, as well as Shell, BP-Amoco GlaxoSmithKline and electricity generator National Power.

Peter Hain MP, during his time at the Foreign Office, issued a pamphlet at the end of January called The End of Foreign Policy? It argues that foreign policy should be based on "global responsibility" and "ecological sustainability".

The pamphlet was issued through the Green Alliance, whose longest running backer is mining company Rio Tinto. The press release for Hain's pamphlet even said it was "supported by Rio Tinto". Trade minister Richard Caborn recently announced government backing for the "Worldaware Awards", which "recognise the contribution the private sector makes towards integrating developing countries into the global economy". The award for long term commitment to the developing world is sponsored by Rio Tinto.

The award for sustainable development is sponsored by Shell. International development minister Clare Short backs the idea that globalisation helps the poor. Her department's website says that it has hired the country's most expensive accountants, PriceWaterhouseCoopers (PWC), as consultants on some 44 different projects. Cost? Around �400 an hour.

The multinationals Gap and Nike have hired PWC to oversee their "ethical" audits which, they claim, show they are not responsible for hiring children to work in appalling conditions. Professor Dara O'Rourke of the Massachusetts Institute of Technology in the US went with PWC to inspect factories in China and Korea.

The professor reported at the end of last year that PWC had a pro-management bias, did not uncover the use of carcinogenic chemicals, and failed to recognise that some employees were forced to work over 80 hours a week. PWC overlooked the absence of safety guards on machines, and could not distinguish between a company-run union and an independent one.

PWC advises New Labour on its Private Finance Initiative (PFI) schemes and was recently appointed by the government to run a PFI training programme. The links between New Labour, lobby companies and big business are very important when it comes to New Labour's favourite policy-privatisation. Among the areas to get the New Labour sell-off treatment are the Criminal Records Bureau and its task of issuing new criminal record certificates for millions of job applicants.

Shortlisted to get the contract are Capita, PWC and Serco. Oil companies, financial consultants and building firms which have donated staff to the Treasury for free have then won lucrative government contracts, according to the Observer.

The companies involved in this scheme include PWC, Ernst and Young, BP-Amoco and Esso, and building contractor Tarmac. The gravy train works in the other direction as well. Former MEP Carole Tongue has got a job with lobby firm Citigate Westminster. Among the clients her new firm deals with is energy giant Enron.

Enron is a US firm which has donated to New Labour for the past three years. Its top man in Europe, Ralph Hodge, was given a CBE in the New Year's Honours list. Hodge said he would use "any channel" to overturn Labour's support for a moratorium on new gas-fired power stations. Enron was initially allowed exemptions, and now New Labour has junked the policy.


Bosses in key positions

FROM ITS first weeks in power Labour appointed fat cats to key positions:

  • LORD SIMON: As chairman of BP-Amoco he lobbied against oil taxation. Made minister for trade and competitiveness in Europe at the Department of Trade and Industry (DTI). Negotiated the removal of controls on the energy market.
  • CHRIS FAY: Chairman and chief executive of Shell UK, and president of the UK Offshore Oil Operators' Association, which has fiercely resisted environmental legislation. Made chairman of New Labour's advisory committee on business and the environment, and then became head of the G8's global taskforce on renewable energy.
  • JUDITH HANRATTY: Company secretary of BP-Amoco, appointed to the board of the government's Competition Commission, which regulates mergers.
  • EWEN CAMERON: President of the Country Landowners' Association, where he opposed the government's right to roam policy. He was then put in charge of the Countryside Agency, which is responsible for implementing the right to roam.
  • SIR PETER DAVIS: Chief executive of Reed International, where he sent 900 employees from work to welfare. Appointed chairman of the New Deal taskforce responsible for moving people from welfare to work.
  • JOHN BOWMAN: Director of Commercial Union, accused of mis-selling its pensions. He was appointed to the board of the Occupational Pensions Regulatory Authority.
  • DINAH NICHOLS: Non-executive director of Anglian Water, which was prosecuted six times for pollution. Appointed director general of environmental protection at the Department of the Environment.
  • IAN McCALLISTER: Chairman of Ford. Appointed vice-chairman of the government's Cleaner Vehicles Taskforce.
  • ROBERT OSBORNE: Head of special projects at construction firm Tarmac, a major builder of PFI hospitals. Appointed chief executive of the Department of Health's Private Finance Unit. Then went back to Tarmac to run its PFI division.
  • LORD SAINSBURY: Chairman of the giant supermarket chain. Made a minister in the DTI, which regulates competition policy. Also chairman of the Food Chain Group, which represents food retailers on the government's Foresight Programme. As science minister he led a delegation of biotech companies to the US.
  • LORD HOLLICK: Media baron, made adviser to DTI on competition policy.

Ministers' connections

WE KNOW about Blair, Mandelson and Keith Vaz's connections with the billionaire Hinduja brothers. But what about Patricia Hewitt? The Leicester West MP is also "e-commerce" minister. She "received hospitality" from the Hindujas in both London and Bombay, and saw one of the brothers at the DTI.

Hewitt used to be head of research at Andersen Consulting (now called Accenture), the firm the Hindujas have now hired to look at its "e-commerce" restructuring.


Fat cat favours

LOOK WHO featured in the New Year's Honours list:

  • JOHN JEREMY COCKBURN (OBE): Canadian operations director for engineering and arms manufacturer British Aerospace (BAE).
  • IAN ANSELL (MBE): BAE senior systems engineer.
  • FRANK MOYES (MBE): BAE Trident nuclear submarine navigation team leader.
  • JULIAN BLOGH (CBE): Chief executive of Ultra Electronics, which supplies BAE and others' warplanes.

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Article information

News
Sat 31 Mar 2001, 00:00 BST
Issue No. 1741
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