Leading article: Keep politics out of competition policies

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The Independent Culture
THERE IS a nasty smell hanging over Stephen Byers' decision to refer the take-over of Cable and Wireless Communications' cable TV business to the Competition Commission. The odour is one, at best, of dirty dealing. At worst it contains the hint of political corruption.

Consider the facts. Three months ago Mr Byers announced, to considerable self-congratulation, that he was taking decisions on merger referrals away from the politicians (eg himself) and putting them into the hands of an independent competition authority. We applauded that decision. So did business. Political pressure should play no part in regulating commercial competitiveness.

Yet here we are at the start of a new Parliament and, shamefully, no legislation has been introduced to enable this change of policy to take place, nor is it likely to be this side of the election. And far from stepping out of decisions in the meantime, Stephen Byers has proceeded to make a series of blatantly political interventions.

In the case of the proposed NTL take-over of Cable and Wireless's cable interests, he has acted against the advice of his Director General of Fair Trading, who judged not only that the take-over posed no monopoly problems, but that it would even increase competition with the other players in the pay-TV market, such as BSkyB. Which no doubt explains why BSkyB was the only company to lodge any objections to the department.

Why did the Trade Secretary listen so readily to this single objection? And what was his Industry Minister, Kim Howells, doing enjoying a cosy lunch last Tuesday with BSkyB's chief executive, Tony Ball, only four days after the referral? Inevitably suspicions are aroused, especially when relations between this Government and Mr Murdoch remain surprisingly close, as demonstrated only this week by the Prime Minister's cavorting with The Sun to mark that Europhobic organ's 30th birthday?

It could be all above board, of course. Maybe Mr Byers was prompted solely by his concerns about the future of pay-TV in overruling the Office of Fair Trading, and Mr Howells never mentioned any matters relating to pay-TV in his hour at the trough with Rupert Murdoch's minion.

It could be. But we don't and can't know for certain - because Mr Byers made the decision himself; because he is not required to give the precise reasons for his action; and because the Opposition, as fearful of Mr Murdoch as is the Government, has reacted only very slowly and late.

On taking office, the Government issued a business manifesto in which it promised to intervene less and make its decisions "transparent". That is precisely what Mr Byers has not done in this case. Until he does, the smell will linger.

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