Outlook: Merger reform

STEPHEN BYERS has decided to take the politics out of takeover decisions, except, er, in those cases where he choses to put them back in.

Yesterday's long-awaited consultative document on reform of mergers policy promises the competition authorities the same degree of independence that the Bank of England now enjoys in setting interest rates.

There is, however, a catch. In addition to defence and newspaper mergers, Mr Byers will also reserve the right to interfere where he deems there are "additional exceptional public interest criteria" which need to be taken into account.

The unions are already lobbying the Secretary of State for Trade and Industry to make full use of these powers even though the reforms are unlikely to become law until after the next election.

Mr Byers' defence is that the Chancellor has exactly the same reserve power, giving him the right to take charge of interest rates at times of economic crisis. The point, however of such powers, is that they are only of any purpose provided they are never used.