Last week, the Guardian newspaper published a letter from the World Development Movement’s director Deborah Doane which raised concerns about the suitability of Sharon Bowles MEP, candidate for the new governor of the Bank of England, because of what we see as her support for ‘light touch’ regulation of the financial sector.
Sharon Bowles replied via the Guardian noting that a member of her staff has met with a World Development Movement (WDM) staff member, and that she doesn’t have sufficient time in her diary to entertain all meetings that are requested of her.
While she is correct that a member of her staff has met with a WDM staff member in Brussels, we would like to stress why we felt this was inadequate. First, we are a movement-based democratic organisation, with 16,000 members and supporters, alongside a network of over 50 local groups. Members of 11 of our local groups* in the south east of England, where Ms Bowles has her constituency, have contacted her a number of times in the past year about food speculation. This is an issue on which Ms Bowles has significant influence as the chair and only UK Liberal Democrat member of the European parliament’s economic and monetary affairs (ECON) committee. Despite contact from each of the groups and offers from WDM to coordinate, they have been disappointed that requests to meet with her as their elected representative have been repeatedly declined.
At the same time, we are aware that Ms Bowles has had a significant number of direct meetings with the finance sector and financial lobbyists, and that her staff have had significantly more. WDM and our allies have previously exposed the undue access that the finance sector has to politicians and regulators alike and we remain concerned that voices which represent the public interest are marginalised.
WDM members and activists are concerned about the way in which speculation by banks and other financial institutions is distorting food and other commodity prices and contributing to price spikes. We are calling for caps, known as ‘position limits’, on the number of contracts speculators can hold.
By contrast, the UK government and financial sector lobbyists have been calling for a weaker form of self-regulation known as position management. Position management is used currently in the UK, and has failed to prevent even clear cases of food price distortion by speculators, such as when hedge fund Armajaro bought up the entire European cocoa supply. Armajaro pushed prices to a 33 year high and caused other traders to threaten to move to better regulated exchanges in the US.
In correspondence to WDM and our supporters as recently as August, Ms Bowles has repeatedly stated her support for the weaker position management. We are pleased to see that she and her colleagues in the Liberal Democrat (ALDE) group in the European Parliament have recently supported a compromise text which was agreed by the ECON committee last month, after having previously argued on numerous occasions against position limits being mandated. However, while the new text does require the limits on speculation that Ms Bowles says she now supports, the text is still far from adequate, leaving significant loopholes and exemptions.
There is a vote on the proposals for all MEPs next week in the European Parliament, and members of her constituency would still welcome a meeting to explain their views.
* Bexhill and Hastings, Brighton and Hove, the Chilterns, Lingfield and Dormansland, Horsham, Milton Keynes, North Kent, Oxford, Portsmouth, St Albans, Worthing.