David Davis, the senior Conservative MP and former shadow home secretary, has launched a scathing attack on what he calls “crony capitalism” of the current government, accusing it of being “far too close” to big business and “shamelessly courting” Rupert Murdoch.
Davis, who narrowly lost the leadership to David Cameron in 2005, also criticises the government’s “terrible pickle” over the £1 million bonus given to RBS’s Stephen Hester, saying: “Apparently the government…feared Hester would quit if it vetoed the bonus. So what?”
In an exclusive article for Prospect’s March issue, Davis writes that “when it comes to crony capitalism, government is often not the solution, but part of the problem…If it is not addressed, Britain’s crony capitalism will inflict huge damage to our interests, economy, industry and society. The gap between achievement and reward will widen. Social mobility will continue to fall. It will also continue to stifle growing businesses, destabilise our banking sector, and poison our politics.”
As controversy continues to rage around Rupert Murdoch’s News International media empire, the senior Conservative criticises Cameron’s closeness to the mogul. “Crony capitalism has also characterised political leaders’ relationships with the press,” he writes. “Prior to the phone hacking scandal, the shameless courting of Rupert Murdoch and other media moguls by politicians was no less unedifying for being standard practice. That cosiness went far beyond exclusive interviews and off the record briefings.
“David Cameron has accepted in parliament that he got too close to newspaper proprietors after becoming leader. It is arguable that the Leveson inquiry should be looking as much at the behaviour of political leaders as at the behaviour of newspaper editors.”
Davis spreads the blame for what he calls “the network state” across government departments: “Wherever you look in Whitehall the government is too close to big business…In business, we need to drop the idea that biggest is best, and that Britain’s economic health is well served by focusing ministerial attention on a few dozen multinational corporations. The Ministry of Defence’s disastrous record in public procurement is partly a product of an overly cosy relationship with a few suppliers. The Department of Energy and Climate Change’s clumsy environmental policies stem from close contacts with half a dozen enormous companies.”