Negotiators could agree regulation tomorrow (12 December)
The UK Treasury and the finance sector have colluded in lobbying against European legislation which would prevent financial speculation driving up food prices, says the World Development Movement unveiling new research today.
The World Development Movement says it has has uncovered details of a series of meetings held by the then Financial Secretary to the Treasury, Mark Hoban, from 2010 onwards, urging finance companies to lobby against proposed regulation which includes provisions aimed at stopping speculation by banks and hedge funds pushing food beyond the reach of millions of people. The anti-poverty group has accused the government of whipping up opposition to the legislation, against the public interest.
Mark Hoban and other Treasury ministers encouraged the City to coordinate lobbying efforts with the Treasury, and travelled to European capitals to persuade other governments to oppose tighter regulation of the commodity and other financial markets following the financial crisis. Foreign and Commonwealth Office (FCO) Minister David Lidington also offered the FCO's services to support the industry in opposing strong regulation.
European negotiators will meet in Brussels tomorrow to attempt to finalise regulation governing food speculation, which is part of the wider Markets in Financial Instruments Directive (MiFID). Campaigners fear that pressure from the UK could leave the final regulation too weak to be effective.
World Development Movement campaigner Christine Haigh said today: "Speculation has played a significant role in the sharp price spikes of the past few years. High food prices harm people on low incomes in the UK who are struggling to make ends meet, and they are disastrous for the millions of people who are hungry worldwide. In colluding with the financial sector to block controls on food speculation, the UK government has shown it puts the profits of hedge funds and investment banks above the fundamental human right to food."