Morning Call: pick of the papers

The ten must-read pieces from this morning's papers.

1. Margaret Thatcher's biggest debt was to Argentina's navy (Guardian)

If not for Alfredo Astiz, 30 years ago Britain would have lost the Falkland Islands and Thatcher her political career, says Simon Jenkins.

2. Those hard Tory heads and hearts are back (Times) (£)

Not only is the 50p tax cut indefensible, but the Chancellor's cuts are grossly unfair in their effect on the poor, argues Philip Collins.

3. France is a deeply racist country, and Toulouse will only make that worse (Independent)

The French have transferred their resentments from Jews to Arabs, says Adrian Hamilton.

4. Chancellors cross the elderly at their peril (Daily Mail)

Osborne is blithely ignorant of the pain the elderly have suffered in the past few years, says a Daily Mail editorial.

5. Osborne gets bolder with each Budget - but it's still not enough (Daily Telegraph)

The Chancellor's slow-motion cuts are dragging out the austerity process, says Fraser Nelson.

6. A budget for Tory blowhards and Redwood dreamers (Guardian)

Forget mugging grannies, George Osborne's 50p rate gamble reveals a naked yearning for the glory days of Thatcher, writes Polly Toynbee.

7. Osborne's 'granny tax' does not go far enough (Financial Times)

Pensioners have had an easy recession so far, writes Tim Leunig.

8. Hague could learn from Operation Babylon (Daily Telegraph)

Israel's 1981 bombing raid on Iraq's nuclear reactor has echoes for the Middle East today, says Azriel Bermant.

9. Obama gets the conservative vote (Financial Times)

The Republicans are trailing in places where they have traditionally had a strong edge - both home and abroad, writes Philip Stephens

10. The British high street is dead - let's celebrate (Guardian)

Most town centres are boring clones, and the closure of large retailers will open up creative space for quirky start-ups, writes Wayne Hemingway.

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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.