THE SPECTATOR
UNFAIR SHARES
But the pure in spirit on the Left are quite wrong in accusing Labour's trade and industry spokesman of reactionary re- visionism. The policy Mr Gould is propos- ing is nothing like the wider share own- ership propagated by Mrs Thatcher and her acolytes. What Mr Gould means is that workers should be given a share of the equity in their own companies. Now there are already ways that this can be encour- aged, for example through employee Building Society savings accounts which can be converted into shares in the em- ployee's company on certain trigger dates. But Mr Gould is arguing that everyone should, as of right, have shares in the company they work for, presumably so that they can influence the policies and business decisions of their company.
Yet there is nothing to stop employees who work for quoted companies — the vast majority, by size, of British business from buying shares in their companies on the Stock Exchange. If Mr Gould means as he must — that employees should be given a greater share in their companies than they could ever achieve through normal market operations, then what he is advocating is a form of expropriation, in which the control of shareholders who have paid the market rate for their shares is forcibly diluted by transferring part of that value to a new group of investors.
This concept of workers' control of industry through combinations is certainly far closer to traditional socialist ideals than the peculiar device of social ownership mooted by Labour at the last election, in which shareholders in companies such as British Telecom and British Gas were to have responsibility without power, in the form of disenfranchised equity. Yet this latest version of social ownership is still not the real McCoy. One imagines that Mr Gould is not in favour of making these new shares tradeable, so this class of equity would have no value except as an obstruc- tion, and its owners would not be able to vote with their feet, by selling. Any obscur- ity on these counts is presumably entirely intended by Mr Gould, since it is much more difficult to pin down and attack a policy which has not been properly thought out.
Mr Gould has yet another bright idea where the first one came from. This is that people who contribute to pension funds should have a say in how their money is invested. Shades of Mr Arthur Scargill, who fought strenuously to make the British Coal pension fund sell its holdings in companies which provided alternatives to coal-based energy. More recently the em- ployees of a number of left-wing councils have seen their future pensions eroded by the decision of their councils to disregard stockbrokers' advice and become founder shareholders in the News on Sunday.- The vast majority of pension fund contri- butors want nothing more or less than the shrewdest possible management of their funds, so that their pensions turn out to be as big as possible. The idea that such an objective could be attained by investment managers who were forced to buy or sell on the strength of an endless series of mass votes of the workforce is laughable.
But for all the vacuity of his ideas, Mr Gould has got the politician's feel for the opponent's weak spot. There is no doubt that despite the apparent success of the Government's drive for wider share own- ership, its privatisation campaign has a number of highly unsatisfactory features. The Government has consistently sold assets at prices which do not take full advantage of the institutional thirst for new equity, and it has packaged the assets in `Hello, mariner!' ways which favour the short-term sharehol- der at the expense of the long-term con- sumer. If the Government was truly com- mitted to the transfer of assets to the general public — and not merely reducing the PSBR — it should hand them over directly, without going through the expen- sive middle men in the City of London and in the financial districts of New York and Tokyo. The people of this country could then choose between keeping their shares and receiving a dividend stream in lieu of tax cuts, or selling them on to institutions. Such a policy could also have the effect of arresting the decline in the proportion of British industry owned by small sharehol- ders. How about that, Mr Gould?
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