Woolwich terror attack: Cameron and Miliband respond

"The terrorists never win because they cannot defeat the values we hold dear," says Cameron after the beheading of a British soldier in Woolwich.

David Cameron and Ed Miliband have now both responded to the suspected terrorist attack in Woolwich, which saw a British soldier beheaded by two men at 2:20pm this afternoon. The two suspects, one of whom declared in a grim video, "The only reasons we have done this is because Muslims are dying every day", were shot by police and are receiving emergency treatment in hospital. The full statement from the suspect with the bloodied machete was:

We swear by Almighty Allah we will never stop fighting you. The only reasons we have done this is because Muslims are dying every day. This British soldier is an eye for an eye a tooth for tooth. We apologise that women had to see this today but in our lands our women have to see the same. You people will never be safe. Remove your government. They don't care about you.

Cameron, who is in Paris for meetings with François Hollande, said at a press conference at the Elysée Palace:

I've been briefed by the Home Secretary about this sickening attack in Woolwich in London. It is the most appalling crime. We obviously are urgently seeking, the police are urgently seeking, the full facts about this case but there are strong indications that it is a terrorist incident.

Two people at the scene of the murder were wounded by the police and they are being treated as suspects. The Home Secretary is chairing COBRA tonight to bring together the police, the security services, all of the agencies, so that we can gather every piece of information that we can. The police and the security services in the UK will get all of the support that they need to deal with this or indeed any other incident.

I'll be returning to London later tonight, so that I can chair a COBRA meeting again in the morning to make sure that we have all of the facts of this case. Tonight, our thoughts should be with the victim, with their family, with their friends. People across Britain, people in every community, I believe, will utterly condemn this attack. We've had these sorts of attacks before in our country and we never buckle in the face of them. We show indomitable British spirit. The terrorists never win because they cannot defeat the values we hold dear.

He will travel back to London tonight and attend a COBRA meeting tomorrow morning.

Miliband, who cut short a visit to Germany to return to the UK, said:

This is a truly appalling murder which will shock the entire country. All of my thoughts are with the family and friends of the victim. The British people will be horrified by what has happened in Woolwich. They will be united in believing that this terror on our streets cannot be allowed to stand. The Labour Party will offer the Government our complete support in establishing the facts of what happened and ensuring that those responsible face the full force of British justice.

Although some MPs have suggested that parliament, which went into recess yesterday, should be recalled, a spokesman for John Bercow said that there had been no request from Downing Street for him to do so.

One of the Woolwich murder suspects is shown holding a bloodied machete. Photograph: ITV News.

George Eaton is political 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.