Category Archives: Britain

Britain, Business, Economic, Government

Leading firms must say how chief executive salaries compare with staff

CORPORATE GOVERNANCE

LEADING companies will be forced to disclose how much their chief executive is paid compared to their average worker . . . and justify the sum.

Business Secretary Greg Clark is due to announce this week that nearly 1,000 listed firms will have to publish the ratio in a crackdown on excessive boardroom salaries.

It is also believed that a new public register will name and shame those whose investors revolt over the pay of bosses.

The plans will be announced as ministers seek to rebut criticism that they have watered down the tough approach promised by Theresa May.

Last year the Prime Minister unveiled radical proposals, such as workers being granted representation on boards, but she has since backed away from these ideas. The plans follow criticism over the high pay of executives following scandals such as the collapse of BHS.

Mr Clark will announce that the Investment Association, the fund managers’ trade body, will oversee the creation of the new register to include any company which faces opposition from at least 20 per cent of shareholders.

Ministers say the publication of ratios between bosses and UK-based workers will shine a spotlight on boardroom pay. It is unclear if the figure for chief executives would be their total package, which averaged £4.5million last year in the FTSE-100, or only their much lower base salary.

Mr Clark is also expected to say that the Government will guarantee workers at listed companies a louder voice in the boardroom by amending the Corporate Governance Code. This will be achieved, according to sources, by designating a non-executive director to represent workers, nominating a director from the workforce or a new advisory council which would have access to board members.

That would meet a commitment made in the 2017 Conservative manifesto although the Government is abandoning a general election pledge to ‘legislate to make executive pay packages subject to strict annual votes by shareholders’.

Companies will also have to produce an annual statement explaining how they acknowledge the interests of workers and wider stakeholders. In addition to the rules to be imposed on big public companies, privately owned businesses, including Sir Philip Green’s Arcadia Group, will become subject to a new voluntary code of corporate governance principles supervised by the Financial Reporting Council.

The proposals will be hailed by ministers as a robust package of reforms designed to make big firms more accountable. They come after corporate governance failings at Sports Direct International and a bitter revolt over a £14million deal for BP chief executive Bob Dudley. This has spurred the Government to pledge a crackdown on boardroom excesses.

The collapse of high street chain BHS after being sold for £1 by Sir Philip was also a factor in hardening public and political opinion against the bosses of big businesses.

This year, there were fewer major protests over the pay of executives at FTSE-100 companies but there was a significantly higher number of revolts over bosses in the FTSE-250 index.

Under Sir Vince Cable, the former Business Secretary and now Liberal Democrat leader, shareholders in public companies were handed a binding say every three years on remuneration policy.

But the annual vote on what directors receive is on a non-binding basis and looks likely to continue that way.

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Britain, European Court, European Parliament, European Union, Government, Politics, Society

EU law may have precedence over UK courts for years after Brexit

BREXIT

The position paper was released by David Davis’s Department for Exiting the EU.

The UK Government has denied watering down its Brexit plans as officials have admitted EU judges could have jurisdiction over Britain for years after it leaves the bloc.

The Prime Minister, Theresa May, insisted the UK would ‘take back control’ of its laws, saying: ‘When we leave the EU we will be leaving the jurisdiction of the European Court of Justice.’

But a position paper published by the Government suggested the ECJ could continue to have control over Scots and English law for up to three years after Britain leaves at the end of March 2019.

That could mean EU judges will continue to pass down rulings on key issues until an independent new body is established to adjudicate on post-Brexit rows over trade or immigration.

Jacob Rees-Mogg, the Tory MP for North East Somerset, said: ‘If the ECJ has jurisdiction, you are part of a European superstate. Once you leave, it cannot have jurisdiction – that is the simple test.’

Officials have not been able to rule out the possibility that European judges could still have some influence even after the end of the three-year transition period. They highlighted the fact that trade deals that the EU has reached with other countries including Moldova force them to take account of European law.

Justice minister Dominic Raab admitted the Government would continue to keep ‘half an eye’ on EU laws after Brexit.

The prime minister said that after leaving the EU, ‘Parliament will make our laws – it is British judges who will interpret those laws and it will be the British Supreme Court that will be the arbiter of those laws’.

Mr Rees-Mogg welcomed the fact that the position paper made it clear the UK will eventually leave the influence of the ECJ.

But he added: ‘I would oppose the continuation of ECJ jurisdiction from the moment we leave the EU. If it continues beyond that, it is a problem. Once the European Communities Act is repealed, there will be no legal basis for ECJ jurisdiction.’

The position paper released by David Davis’s Department for Exiting the EU ruled out any ‘direct’ ECJ jurisdiction over Scots and English law after Brexit. It said legal disputes involving individuals and businesses should in future be decided in the UK judicial system, with the Supreme Court as the final arbiter.

It added a new dispute resolution mechanism – which could involve a joint committee or arbitration panel – will have to be created to deal with disagreements over the interpretation and application of the Brexit deal.

But it did not rule out the ECJ maintaining its authority during the transitional period, expected to last a number of years after the March 2019 deadline for Brexit, saying only that Britain will ‘work with the EU’ on the design of interim judicial arrangements.

It set out a range of existing arrangements involving the ECJ that could act as possible models for the new mechanism. These include the EU’s agreement with European Free Trade Association states such as Norway and Iceland and a treaty with Moldova.

Norway has its own EFTA Court to rule on disputes with the EU but it has to ‘pay due account’ to all relevant ECJ decisions.

The EU-Moldova agreement requires that, where a trade dispute concerns an interpretation of EU law, an arbitration panel must refer the question to the ECJ and be ‘bound by its interpretation’.

The Government document makes it clear that Britain is not committed to following any of the existing models, but it does not explicitly rule out any scenario other than direct ECJ jurisdiction.

The main job of a resolution body would be to adjudicate on disputes between the EU and the UK on how a trade deal will operate. It could also have to pass judgment on immigration matters.

Remain-backing groups accused the Government of a climbdown for saying there would be no ‘direct’ jurisdiction of the ECJ compared with its previous position of no jurisdiction whatsoever.

UK officials said that Britain would seek ‘legal autonomy’ but that the remaining power of the ECJ to rule on UK matters depended on the ‘scope’ of the transition period, which could last until 2022.

. More on Brexit UK Government threatens to get tough if Brussels bars trade deal

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Afghanistan, Britain, NATO, United States

Return to Afghanistan? Britain may help Trump beat Taliban

AFGHANISTAN

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President Donald Trump has declared that thousands of US soldiers will be deployed again to Afghanistan in reducing the threat of terrorism to the West. He has called on his NATO allies to provide resources and funding.

BRITISH warplanes and drones could be sent back to Afghanistan after Donald Trump announced a major policy U-turn and declared he is expanding the US military there.

A new strategy to defeat the Taliban and Islamic State could also see British personnel being sent back to Kandahar in southern Afghanistan – in a significant expansion of the UK’s current training operation.

US Secretary of Defence, General Jim Mattis, called his UK counterpart, Sir Michael Fallon, to discuss the plans prior to the speech given by the President earlier this week vowing to ‘kill terrorists’.

Mr Trump said that he would beef up the US military presence and others must do the same, adding that a withdrawal would create a vacuum for jihadis. The most senior American commander for the Middle East said the first deployment of new US forces would arrive in Afghanistan ‘pretty quickly’.

Mr Trump said: ‘The men and women who serve our nation in combat deserve the tools they need, and the trust they have earned, to fight and to win.’

It marks an abrupt turnaround from his election campaign, in which he regularly demanded an end to the 16-year conflict.

But since then, Taliban insurgents have recaptured swathes of the country, IS militants have waged terror, and US generals have publicly admitted the war is failing. The Taliban in Afghanistan responded by saying Mr Trump’s plans would make the country a ‘graveyard for the American empire’.

It is understood that during Sir Michael’s discussion with defence secretary General Mattis, the prospect of the UK sending ‘specific capabilities’ such as fighter jets and drones was raised. One option could be re-deploying air assets from Iraq where IS is on the back foot after being pounded by RAF warplanes.

Defence chiefs may also send RAF troops back to southern Afghanistan if they are asked to do so. They would be stationed in Kandahar, previously NATO’s regional HQ, and would form part of a plan to build an Afghan air force training academy.

A senior RAF officer said: ‘Kandahar will be one of the training locations. We are doing an awful lot of work in Kandahar right now to make sure the facilities are right … If the demand signal is to send people to Kandahar we will.’

A further 85 UK troops will be sent to the country in the coming weeks after requests by NATO. The Ministry of Defence commented by saying it is ruling out further increases.

The Defence Secretary welcomed President Trump’s pledge. Sir Michael said he had agreed with General Mattis that ‘we have to stay the course in Afghanistan to help build its fragile democracy and reduce the terrorist threat to the West. It’s in all our interests that Afghanistan becomes more prosperous and safer.’

Mr Trump made repeated calls ahead of his election for US troops to be withdrawn from Afghanistan, where they have been involved in military operations since 2001. But in an address at Fort Myer near Washington DC, he said he had decided to go against his ‘original instinct’.

US policy would now focus not on nation-building but on ‘killing terrorists’, he said, adding: ‘From now on, victory will have a clear definition – attacking our enemies, obliterating ISIS, crushing Al-Qaeda, preventing the Taliban from taking over Afghanistan and stopping mass terror attacks against America before they emerge. We will ask our NATO allies and global partners to support our new strategy with additional troop and funding increases in line with our own – we are confident they will.’

General Joseph Votel, top US commander for the Middle East, estimated the first new deployments would arrive in a few weeks or even days.

COMMENT

AFTER the horror of 9/11, there were clear and persuasive arguments for sending British forces to Afghanistan to join our American allies in attacking Al-Qaeda terrorist training camps.

But more than 15 years on – and three years after we withdrew our combat troops, leaving only some 500 behind to train the local military – shouldn’t we be thinking very carefully before answering Donald Trump’s call to rejoin the war?

During his election campaign, the President pledged to withdraw the 8,400 American soldiers who have remained in Afghanistan since combat operations officially ended in 2014.

But now, under pressure from his generals, he has changed his mind. And though he won’t specify numbers, he is widely expected to send some 4,000 extra troops – and says he expects his NATO allies to beef up their commitment too.

The President declared: ‘From now on, victory will have a clear definition – attacking our enemies, obliterating ISIS, crushing Al-Qaeda, preventing the Taliban from taking over Afghanistan and stopping mass terror attacks against America before they emerge.’

These are laudable objectives. But at the height of its deployment in 2010-11, the US had 100,000 personnel in Afghanistan (with similar aims). If they failed to beat the terrorists and the Taliban, why should Mr Trump believe the smaller force he envisages will enjoy more success?

In the course of a conflict that has already lasted more than twice as long as the Second World War, 456 British personnel have been killed, with thousands more wounded – many on battlefields now back under Taliban control.

Indeed, though it will grieve many to say so, it is very far from clear how much their heroic sacrifice achieved. Is there any reason to believe putting more troops in danger will accomplish anything beyond making more families torn by the futility of returning to fight in Afghanistan?

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