UK workers pay price for foreign rule
TATA, it's time to go. As the Indian trading giant negotiates plant closures and pay cuts for the British staff of its Corus steel subsidiary and implicitly holds an axe over jobs at Jaguar Land Rover, it may soon become painfully clear why selling so many of our national assets to foreigners was not the bright idea it once seemed.
Sure steel jobs elsewhere will be shed and Detroit car workers will soon feel the pain.
Arguably fewer motor industry jobs will be lost here because, by and large, the working practices imposed on UK plants by firms such as Toyota have been beneficial.
But in this recession it will be easier for parent companies to make any necessary job culls thousands of miles from their own backyards.
In recent years this country has happily allowed foreign marauders to pick off the crown jewels of industry, finance and infrastructure.
Just think of Pilkington, P&O Ports, BAA, British Plaster Board and now airline group bmi. Those who have demurred have been labelled 'little Englanders'.
The influx of foreign capital to the City has helped London to become the leading global financial centre.
But overseas control means that the head office, investment budget and research spending will shift.
And now, with the loss of hundreds of jobs announced every day, it will become clear that foreign ownership matters in a very different way. Even in better days, shipping giant Maersk cut its UK pensioners adrift.
And in too many British outposts of overseas corporations, it will be our workforce asked to make the jobs sacrifice first.
Glory or bust? That appears to be the choice now facing British Airways boss Willie Walsh. His high road leads to global domination - mergers with Iberia of Spain, Qantas of Australia and a tie-up with American Airlines on the all-important North Atlantic routes.
Failure could leave him alone and feeling the hot breath of larger competitors on his neck at BA's home base of Heathrow, vulnerable to takeover himself. As Walsh's ambition vaults ever higher, the ground is moving under his feet. It has emerged that Virgin is in talks with Lufthansa, the German carrier that will soon acquire all of bmi (British Midland as was), proud possessor of a slew of Heathrow take-off slots.
Meanwhile regional carrier Flybe is also hoping to nibble away at BA's territory at Gatwick. All the while, BA's pension deficit - which at one stage looked to have been contained - is ballooning to threatening proportions. Walsh appears to have reestablished his authority and investor support after the disastrous opening of Heathrow's Terminal 5. That will evaporate overnight, however, if he fails to walk down the aisle with at least one of those he is romancing.
Entrepreneurs are vital to our economy, and in The Carphone Warehouse David Ross and Charles Dunstone have created a remarkable company. This, however, does not excuse Ross from not observing the rules as a quoted company director - and it ill behoves apologists such as Luke Johnson and Hugh Osmond to pretend it does.
Ross mortgaged his shareholding in Carphone - along with stakes in other companies where he is on the board, such as Big Yellow and National Express - against property loans with JPMorgan. Directors are entitled to do this, but they must inform the company chairman, who may then decide to tell the wider market.
When Ross first did this several years ago he followed the proper process so is clearly aware of it. There is pressure for entrepreneurs to hold shares, as investors feel reassured if the founders stay on board, and of course for business creatives with itchy feet, dying for the next deal, this may be an unbearable constraint.
In these circumstances, raising a loan against shares is one way out - if done according to the book. But clearly transparency is needed. It is not fair on other Carphone shareholders to discover that a huge tranche of shares might have to be sold overnight to repay a loan. And it is quite fatuous to claim that entrepreneurs are a rule unto themselves.
Though, didn't Channel 4 chairman Johnson fall foul of the Takeover Panel during the 2003 sale of PizzaExpress and pen an article that appeared to be dismissive of the evils of insider dealing?
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