Socialist Worker

Banks plot offshore scam to scupper Labour’s nationalisation plans

by Charlie Kimber
Issue No. 2594

Jeremy Corbyn tried to reassure bosses at last years CBI conference

Jeremy Corbyn tried to reassure bosses at last year's CBI conference (Pic: Jeremy Corbyn/Twitter)


“Corbyn’s coming, get your money out now”—that’s the message from analysts at Australian investment bank Macquarie.

It advises British water and energy company bosses and investors to shift businesses offshore to make it harder for a future Labour government to renationalise them.

The analysts said that shareholders and managers already have powerful legal protection under British law. But they can load up even more defences by using treaties negotiated with other countries by the European Union, as well as Britain itself.

The Financial Times newspaper revealed extracts from the research, which has a carefully-controlled circulation.

It says, “Macquarie’s analysts point to the provision stating that any compensation should ‘amount to the genuine value of the investment expropriated immediately before the expropriation or before the impending expropriation became public knowledge’.

“They claim that this would protect investors from the risk of politicians talking down the value of a company with a view to minimising compensation.”

The research note is titled “Four legs good, two legs better”—a reference to George Orwell’s novel Animal Farm which was a metaphor for Stalinism.

Labour’s shadow business secretary Rebecca Long-Bailey was right to say, “Transferring asset holdings overseas in pursuit of higher compensation shows total contempt for the British public.

“It is shocking but not surprising that investors are attempting to profit from nationalisation, just as they have from privatisation.

“It is precisely this kind of behaviour that makes democratic ownership and management of our utilities so necessary and popular.”

Expert 

Tax expert Richard Murphy responded, “I have always argued that offshore is a mechanism created by capital to launch an assault on democracy.

“That is exactly what is written all over this suggestion.

“Macquarie are making it clear that people’s choice to elect a government that might seek to take into public ownership the utilities that serve them should not matter.”

It’s no surprise that Macquarie should be dispensing such advice. Its ruthless search for profit and lavish pay for its executives and shareholders saw the Australian media label it “The Millionaire Factory”.

At one point it controlled the London bus operations of Stagecoach.

This research is further evidence of how bosses are preparing seriously to sabotage and obstruct any attempt at serious reforms.

Last autumn the bosses’ CBI organisation warned that renationalisation would “send investors running for the hills”.

Such enemies will not be placated by warm words or arguments that they can also gain from a government that seeks social justice and an end to austerity.

Instead they must be confronted. That requires removing their power through nationalisation and democratic control.

This will need above all a movement built in the streets and workplaces that can act outside the highly limited sphere of parliament.


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