Protesters outside the tory party conference last year
Remember being at school and spending ages working on something – a painting, maybe – only for some nasty kid to come along and ruin it just as you were adding the finishing touches? Last week the UK government was being that kid.
For the last two years, WDM has been campaigning hard to make sure new European rules on food speculation will be strong enough to prevent speculators flooding the markets for food contracts and causing massive spikes (or slumps) in food prices.
We’ve now reached the final stage of the negotiations (you can see how far we’ve come here).This is where the three EU institutions meet for regular negotiations to try and agree the final text of the legislation on food speculation alongside a whole packet of other financial reforms.
After years of intense lobbying by WDM local group members, staff and our allies across Europe, a couple of weeks ago the European Commission published a proposed compromise text. It looked good. It wasn’t perfect, but most of our biggest concerns about ways speculators might be able to evade the new rules had been addressed in some way.
Last week the negotiators met to discuss this proposed compromise. But no agreement could be reached because of differences between the different EU member state governments. Specifically, the UK, in contrast to most of the other big countries such as France, Germany and Italy, disagreed with proposals to remove major loopholes.
The UK government is effectively being a spoilt child that refuses to cooperate with its classmates to make school a nicer place. It claims that, since at the moment many commodities are traded in London, it wants its own rules rather than agreeing common EU limits to make sure traders can’t play off different countries against each other in a race to have the weakest controls on food speculation.
And it won’t support efforts to make sure all contracts are covered by the new rules, preferring to exempt its favourite toys – shady, bilaterally traded contracts of the type that helped contribute to the financial crisis – from limits on speculation.
Ultimately the UK is in a big sulk, because it doesn’t want its financial sector to have to play by rules at all. But everyone else does. Because they know the dangers of failing to do so. It’s time the UK grew up and took responsibility for its financial sector. Which is what we’re telling the new financial secretary to the treasury, Sajid Javid, in a letter this week.