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Mark Field MP: Conservatives should protect the interests of the consumer by standing up against monopoly power

FIELD MARK Mark Field is MP for Cities of London and Westminster.

Observers of global economic trends will have noticed the paradox that whilst size of national markets is perceived to bring with it unmitigated potential benefits, there is increasing public hostility to large global institutions and corporations.

Hot on the heels of the BRIC group of nations has emerged the CIVETS amalgam of developing countries (Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa). It is these nations enjoying critical population mass, and a demographic skewed strongly towards those under the age of 25, which are near universally regarded as locations of likely optimal economic growth in the decades ahead.

Yet there is a contrarian trend in respect of global banks (which “need to be broken down lest they are too big to fail”) and international corporations (witness the recent travails of BP and General Motors to name but two). I suspect that internet transparency will result in greater public hostility towards large, multinational corporations, which have been able to exploit their complex network of international subsidiaries in order to minimise tax and regulatory obligations. Accordingly small remains beautiful in the eyes of countless consumers in the commercial sphere.

The political challenge that awaits government is to distil these two apparently conflicting trends into an effective and populist strategy for competition. Conservatives should be at the forefront in standing up against the power of monopoly, not by pandering to anti-business rhetoric but in an authentic spirit of consumer and individual protection. Promoting the interests of the ‘little man’ has perhaps too frequently been regarded as a ‘left wing’ preoccupation. However, we should not forget the honourable tradition of right-of-centre politicians grasping this nettle.

Arguably the most notorious “trust-buster” was US President Theodore Roosevelt who at the outset of the twentieth century led his own crusade against the overwhelming power of Big Business. In the era of Rockefeller, J P Morgan and US Steel, Roosevelt at the White House stood up against the making of monopolistic profits in virtually unlimited quantities. Closer to home and far more recently, the government of Margaret Thatcher liberalised middle-class monopolies (‘Big Bang’ in the City in 1986 alongside widescale reform of the legal and accountancy professions in the same decade).

Today’s Conservatives also recognise the necessity of open competition as the ultimate safeguard to consumer interests. Reform to the structure of the banking industry, for instance, will amount to little unless the financial sector provides considerably more choice to its retail consumers. Similarly a robust economic crime policy needs to place the promotion of commercial competition at the heart of its enforcement in order to deter fraudulent and anti-competitive activity.

I have written before about the role in this regard of the Serious Fraud Office, an organisation whose investigative function is set to merge with a new National Crime Agency. The Government’s current proposal asserts that such an Agency should rest within the Home Office’s control. Yet a beefed-up National Crime Agency umbrella will do little to ensure that competition policy is properly business oriented. The truth is that the Home Office understandably tends to look at its constituent agencies through the lens of organised crime alone. In a National Crime Agency dealing with child protection and serious organised crime, it is also not hard to imagine fraud slipping down the ladder of priorities.

Nevertheless, pursuing companies who seek to undermine the notion of a level playing field will be crucial to restoring the reputation of and confidence in our seemingly discredited free market system. The bringing of the SFO’s functions under the auspices of the Department of Business, Innovation and Skills instead, working alongside a more robust Office of Fair Trading and Competition Commission, could, I believe, prove fundamental to the success of this task.

The continued public debate over the banking and finance industry, whilst understandable, has been a great distraction in constructing a robust, populist competition policy. It is a great shame for it has always been competition, rather than rules and regulation, that has best served as a restraint on unbridled capitalism.

As the banking crisis unfolded in the autumn of 2008, it was always my fear that the unravelling of the financial system would all too easily be presented as a crisis of capitalism. Bank bailouts would then be perceived as the ultimate reward for failure in a dysfunctional marketplace that had ceased to benefit the consumer. Since that time, we have seen a plethora of quick-fire solutions and superficially attractive regulations. Yet the sense persists that our problems are only parked, not solved; the anger towards banks and big business lingers rather than dissipating.

This is not because the fundamental principles of capitalism are bust. Rather we have so far failed to restore a moral dimension to the market and resurrect the link between work, talent and reward that had become so warped at the height of the boom. Popular capitalism, by which I mean a capitalism that places the interests of the consumer at its heart, can be retrieved. But only by weaving competition into the very roots of our economic policy.


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