Boundary changes will hit Welsh Labour MPs hardest

There is a clear political dimension to the way that the coalition’s proposed boundary changes will

There is a clear political dimension to the way that the coalition’s proposed boundary changes will be implemented.

Today during Deputy Prime Minister's Questions, the shadow Treasury minister Chris Leslie raised the matter of House of Lords reform, asking Nick Clegg whether the proposed reduction in the number of MPs, accompanied by new coalition appointments to the Lords, was intended as a political move against Labour.

Clegg responded by confirming that the Labour-instituted method for appointing peers will remain in place until a full review of the second chamber has taken place, and also pointed out that a number of Labour peers have just joined the Lords, appointed as part of the Dissolution Honours list in May.

However, the Deputy Prime Minister did not really address the main point of Leslie's question: under the Parliamentary Voting System and Constituencies Bill 2010-2011, which is now making its way through the House, 50 MPs's seats will be scrapped, and it looks as if a significant proportion of them will be in Labour-supporting areas.

Yesterday, the House of Commons Welsh affairs committee published a report which concluded that not only does the coincidental clash of the referendum with the next Welsh Assembly election raise concerns, but that Wales would be affected disproportionately by the cut in the number of constituencies. The report reads:

The reduction in the number of Members of the House of Commons proposed by the bill would affect Wales more than any other part of the UK; the evidence we have received suggests that Wales would lose at least ten of its 40 MPs, a 25 per cent reduction (in comparison to a 17 per cent reduction for Northern Ireland, 16 per cent for Scotland and 5 per cent for England).

Of the 40 Welsh MPs, 26 are Labour, eight are Conservative, and the Lib Dems and Plaid Cymru have three each. Reducing this total by a quarter would inevitably impact more on Labour than any other party, purely as a result of it being the largest political grouping.

The new boundaries would be drawn in order to create constituencies of roughly equal size – each consisting of roughly 76,000 voters. The rights and wrongs of the changes themselves will no doubt still be debated at length before the final vote on the bill. But, without doubt, the boundary changes will have a heavier bearing on the opposition than the government, and clearly there is a strongly political dimension to the way the coalition has gone about delivering its "new politics".

Caroline Crampton is web editor of the New Statesman.

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BHS is Theresa May’s big chance to reform capitalism – she’d better take it

Almost everyone is disgusted by the tale of BHS. 

Back in 2013, Theresa May gave a speech that might yet prove significant. In it, she declared: “Believing in free markets doesn’t mean we believe that anything goes.”

Capitalism wasn’t perfect, she continued: 

“Where it’s manifestly failing, where it’s losing public support, where it’s not helping to provide opportunity for all, we have to reform it.”

Three years on and just days into her premiership, May has the chance to be a reformist, thanks to one hell of an example of failing capitalism – BHS. 

The report from the Work and Pensions select committee was damning. Philip Green, the business tycoon, bought BHS and took more out than he put in. In a difficult environment, and without new investment, it began to bleed money. Green’s prize became a liability, and by 2014 he was desperate to get rid of it. He found a willing buyer, Paul Sutton, but the buyer had previously been convicted of fraud. So he sold it to Sutton’s former driver instead, for a quid. Yes, you read that right. He sold it to a crook’s driver for a quid.

This might all sound like a ludicrous but entertaining deal, if it wasn’t for the thousands of hapless BHS workers involved. One year later, the business collapsed, along with their job prospects. Not only that, but Green’s lack of attention to the pension fund meant their dreams of a comfortable retirement were now in jeopardy. 

The report called BHS “the unacceptable face of capitalism”. It concluded: 

"The truth is that a large proportion of those who have got rich or richer off the back of BHS are to blame. Sir Philip Green, Dominic Chappell and their respective directors, advisers and hangers-on are all culpable. 

“The tragedy is that those who have lost out are the ordinary employees and pensioners.”

May appears to agree. Her spokeswoman told journalists the PM would “look carefully” at policies to tackle “corporate irresponsibility”. 

She should take the opportunity.

Attempts to reshape capitalism are almost always blunted in practice. Corporations can make threats of their own. Think of Google’s sweetheart tax deals, banks’ excessive pay. Each time politicians tried to clamp down, there were threats of moving overseas. If the economy weakens in response to Brexit, the power to call the shots should tip more towards these companies. 

But this time, there will be few defenders of the BHS approach.

Firstly, the report's revelations about corporate governance damage many well-known brands, which are tarnished by association. Financial services firms will be just as keen as the public to avoid another BHS. Simon Walker, director general of the Institute of Directors, said that the circumstances of the collapse of BHS were “a blight on the reputation of British business”.

Secondly, the pensions issue will not go away. Neglected by Green until it was too late, the £571m hole in the BHS pension finances is extreme. But Tom McPhail from pensions firm Hargreaves Lansdown has warned there are thousands of other defined benefit schemes struggling with deficits. In the light of BHS, May has an opportunity to take an otherwise dusty issue – protections for workplace pensions - and place it top of the agenda. 

Thirdly, the BHS scandal is wreathed in the kind of opaque company structures loathed by voters on the left and right alike. The report found the Green family used private, offshore companies to direct the flow of money away from BHS, which made it in turn hard to investigate. The report stated: “These arrangements were designed to reduce tax bills. They have also had the effect of reducing levels of corporate transparency.”

BHS may have failed as a company, but its demise has succeeded in uniting the left and right. Trade unionists want more protection for workers; City boys are worried about their reputation; patriots mourn the death of a proud British company. May has a mandate to clean up capitalism - she should seize it.