Ed Miliband speaks to supporters at Redbridge on May 1, 2014. Photograph: Getty Images.
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Miliband challenges Cameron's hands-off approach on foreign takeovers

Labour leader denounces PM for acting as a "cheerleader" for the Pfizer-AstraZeneca deal and calls for a new public interest test.

In no major western country is it easier for a foreign firm to take over a domestic company than in the UK. If Britain is to move towards the "responsible capitalism" championed by Ed Miliband, this will need to change.

Aware of this, Miliband used his appearance on The Andrew Marr Show to challenge David Cameron's response to Pfizer's bid for AstraZeneca (the largest proposed foreign takeover in British history). He denounced Cameron for acting as a "cheerleader" for the deal and announced that Labour would bring in a new "public interest test" for such takeovers. Revealing that he had written to the PM on the subject today, he said: "No other country in the world would be waving this bid through, nodding it through on the basis of pretty weak assurance from Pfizer, who have a pretty dubious record when it comes to their record in this country and other takeovers.

"I'm writing to the Prime Minister today setting out how we adapt the public interest test in the future and how he, rather than being that cheerleader for this takeover with paper-thin assurances, should be actually championing British jobs and a British success story that is AstraZeneca."

In his letter to Cameron, Miliband rightly notes Pfizer's worrying track record, including its 2012 decision to close down its R&D facility in Sandwich (leading to the loss of 1,500 jobs) and its weak commitment to investment.

The Tories will probably seek to dismiss Miliband's proposals as crude state interventionism but it is harder for them to do so when figures such as Michael Heseltine, an economic adviser to the government (I recently interviewed him in his Treasury office) and Lord Sainsbury are also questioning whether the deal is in the national interest. Heseltine called earlier this week for the introduction of "reserve powers" to protect British companies when assets such as the country's science base are at risk. He said: "Foreign takeovers can often be hugely helpful and I have no doctrinal preoccupations - I've done enough takeovers of small businesses myself to know how valuable they can be. But the important point is that every other advanced economy has mechanisms of some sort on a failsafe basis to scrutinise foreign takeovers and we're the only country that doesn't."

With Pfizer responsbile for 6,700 high-quality jobs across eight sites in the UK, the stakes are high. By challenging Cameron to abandon his laissez-faire approach, Miliband has smartly intervened in a way that chimes with the public's increasing hostility to no-holds barred capitalism.

Here's the full text of Miliband's letter to Cameron.

Dear Prime Minister

I’m writing regarding the ongoing bid for AstraZeneca by Pfizer. This bid raises serious questions about a key sector of our economy. I know we share a commitment to the UK’s retaining it’s leading global role in pharmaceuticals and wanted to put in writing my concerns with this bid. I also wanted to propose areas on which we could work together to strengthen the oversight of takeovers involving UK firms and to suggest a stronger role by the UK government in this particular bid.

We all recognise that takeovers are an essential part of a functioning economy and can lead to greater efficiencies and better services for consumers. However we also all recognise that too often in recent years major takeovers have failed to deliver the promised benefits.

In this particular bid the stakes could not be much higher. Pfizer’s bid for AstraZeneca affects one of the UK’s most significant investors in R&D, a major contributor to our science base, and 6,700 high quality jobs in the UK. Despite those high stakes, the impression created in recent days has been of a Government cheerleading for this deal on the basis of a short letter with inadequate assurances.

I am strongly of the view that, when it comes to such a strategically important part of UK PLC, we need a more substantive assessment of whether this takeover is in the national economic interest before the UK government allows itself to be seen to be supporting it.

There are reasons to think that such an assessment would be of value. Firstly the company’s track record in the UK raises concerns, including their decision in 2012 to close down the world-renowned R&D facility in Sandwich, leading to the loss of 1,500 jobs. Secondly AstraZeneca currently spends a significantly higher proportion of its turnover on R&D than Pfizer – a crucial concern given the importance of pharmaceutical investment in R&D to the UK science base. Lastly there are concerns about Pfizer’s wider track record regarding the impact on research of previous takeovers.

For the future this case strengthens the view I have expressed in the past that we need to look again at the UK’s takeover regime. In particular there should be a stronger public interest test which encompasses cases such as these where strategic elements of our science base, with impacts well beyond the firm concerned, are involved. Should you wish to make changes to that effect the Labour Party will support you to make them happen.

However, more immediately we need to act swiftly in the case of this specific bid. I have seen the assurances you have received from Pfizer, but this merger would have an impact for decades to come, so it is not enough to have a few specific promises that only last for the next few years.

I note that you have opened up dialogue with the company about this bid and, while noting that this is a decision for the shareholders concerned, responded positively to the outcome of those discussions. I would hope that such a position, allowing the UK Government to be seen as cheerleading for the bid, would only have been taken on the basis of a thorough assessment of whether this bid is in Britain’s national economic interest. If you already have such an assessment I would be grateful for it to be made public to inform those taking this decision. If you do not have detailed advice of that sort I would call on you to put in place an immediate independent assessment to ensure that the implications for our national economic interest are fully discussed. Such an assessment would provide elements of the transparency and information that a wider public interest test would involve. ‎It would also be in Pfizer’s interest if their commitment to the UK’s science base is as strong as they insist. And it is only after such an assessment has been made that a British Prime Minister should decide whether to support such a bid – not by staging quick backroom conversations with one party to a deal.

Ed Miliband

George Eaton is political editor of the New Statesman.

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Sadiq Khan likely to be most popular Labour leader, YouGov finds

The Mayor of London was unusual in being both well-known, and not hated. 

Sadiq Khan is the Labour politician most likely to be popular as a party leader, a YouGov survey has suggested.

The pollsters looked at prominent Labour politicians and asked the public about two factors - their awareness of the individual, and how much they liked them. 

For most Labour politicians, being well-known also correlated with being disliked. A full 94 per cent of respondents had heard of Jeremy Corbyn, the current Labour leader. But when those who liked him were balanced out against those who did, his net likeability rating was -40, the lowest of any of the Labour cohort. 

By contast, the Labour backbencher and former army man Dan Jarvis was the most popular, with a net likeability rating of -1. But he also was one of the least well-known.

Just four politicians managed to straddle the sweet spot of being less disliked and more well-known. These included former Labour leadership contestants Yvette Cooper, Andy Burnham, and Hilary Benn. 

But the man who beat them all was Sadiq Khan, the Mayor of Lodon. 

YouGov's Chris Curtis said that in terms of likeability Khan "outstrips almost everyone else". But since Khan only took up his post last year, he is unlikely to be able to run in an imminent Labour contest.

For this reason, Curtis suggested that party members unhappy with the status quo would be better rallying around one of the lesser known MPs, such as Lisa Nandy, Jarvis or the shadow Brexit minister Keir Starmer. 

He said: "Being largely unknown may also give them the opportunity to shape their own image and give them more space to rejuvenate the Labour brand."

Another lesser-known MP hovering just behind this cohort in the likeability scores is Clive Lewis, a former journalist and army reservist, who served in Afghanistan. 

Lewis, along with Nandy, has supported the idea of a progressive alliance between Labour and other opposition parties, but alienated Labour's more Eurosceptic wing when he quit the frontbench over the Article 50 vote.

There is nevertheless space for a wildcard. The YouGov rating system rewards those who manage to achieve the greatest support and least antagonism, rather than divisive politicians who might nevertheless command deep support.

Chuku Umunna, for example, is liked by a larger share of respondents than Jarvis, but is also disliked by a significant group of respondents. 

However, any aspiring Labour leader should heed this warning - after Corbyn, the most unpopular Labour politician was the former leader, Ed Miliband. 

Who are YouGov's future Labour leaders?

Dan Jarvis

Jarvis, a former paratrooper who lost his wife to cancer, is a Westminster favourite but less known to the wider world. As MP for Barnsley Central he has been warning about the threat of Ukip for some time, and called Labour's ambiguous immigration policy "toxic". 

Lisa Nandy

Nandy, the MP for Wigan, has been whispered as a possible successor, but did not stand in the 2015 Labour leadership election. (She did joke to the New Statesman "see if I pull out a secret plan in a few years' time"). Like Lewis, Nandy has written in favour of a progressive alliance. On immigration, she has stressed the solidarity between different groups on low wages, a position that might placate the pro-immigration membership. 

Keir Starmer

As shadow Brexit minister and a former director of public prosecutions, Starmer is a widely-respected policy heavyweight. He joined the mass resignation after Brexit, but rejoined the shadow cabinet and has been praised for his clarity of thought. As the MP for Holborn and St Pancras, though, he must fight charges of being a "metropolitan elite". 

 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.