Cable survives – at a cost
By Peter Wozniak and Ian Dunt
Vince Cable will remain in the Cabinet despite previously undisclosed comments in which he said he had “declared war” on Rupert Murdoch, concerning the proposed takeover of BSkyB by Mr Murdoch’s NewsCorp.
A sting operation by a broadsheet newspaper had seen the business secretary confide that he is prepared to bring down the government over policy disputes with the Conservatives.
But the debate took on an altogether more serious tone as it emerged that Mr Cable openly declared his position on the commercially sensitive takeover – a stance that landed him in extremely hot water given his impartial role in the bid as business secretary.
He said, in comments that were not printed in the original Telegraph story, but in an audio file handed to the BBC: “I have declared war on Mr Murdoch and I think we are going to win.
“I have blocked it [the takeover] using the powers that I have got… I can’t politicise this, but from people who know what’s happening this is a big, big thing. His whole empire is under attack.”
Speculation about a possible resignation surged after the news emerged, but it has now been confirmed that Mr Cable will remain in the Cabinet as business secretary.
He will not take any part in the decision on the bid, however. Instead his department will have its purview drastically reduced, with all responsibility for media competition issues passing to Jeremy Hunt’s Department for Culture, Media and Sport.
A Downing Street statement read: “Following comments made by Vince Cable to the Daily Telegraph, the prime minister has decided that he will play no further part in the decision over News Corporation’s proposed takeover of BSkyB.
“In addition, all responsibility for competition and policy issues relating to media, broadcasting, digital and telecoms sectors will be transferred immediately to the secretary of state for culture, media and sport.
“This includes full responsibility for Ofcom’s activities in these areas.”
It continued: “The prime minister is clear that Mr Cable’s comments were totally unacceptable and inappropriate.”
Mr Cable responded by saying: “I fully accept the decision of the prime minister and deputy prime minister. I deeply regret the comments I made and apologise for the embarrassment that I have caused the government.”
The news is hugely damaging for the business secretary and for the government, which had to juggle the legal problems arising from the comments regarding Mr Cable’s quasi-judicial role in the bid – and the political ramifications of his potential removal from the job.
Although the controversial takeover of BSkyB has been approved at European level, it rested with Mr Cable to make a final decision on competition grounds after having referred the matter to the watchdog Ofcom – raising questions over the business secretary’s impartiality.
News Corp responded in a statement that the company was “shocked and dismayed [by Vince Cable’s comments]. They raise serious questions about fairness and due process.”
Meanwhile shadow business secretary John Denham commented: “Every company – big or small – that comes up in front of the competition authorities has a right to know that their case will be heard dispassionately and judged on its merits.
“Vince Cable, with these extraordinary remarks, has clearly shown he is unable to do that.”
The news broke shortly after a press conference featuring David Cameron and Nick Clegg – who were apparently unaware of the news, dismissing the previous Telegraph story after Mr Cable had been “extremely apologetic”.
Before the release of the new revelations, Mr Cable had been defended by George Osborne as “a powerful ally” in the government.
Two Telegraph journalists posing as concerned Liberal Democrat voters spoke with Vince Cable in his constituency.
The conversation reveals some of the realities behind the regular claims of unity between the coalition partners.
Mr Cable referred to government negotiation over policy as a “war” and suggested his resignation could act as a “nuclear option” if he was pushed too far.
“Can I be very frank with you?” he said.
“I have a nuclear option, it’s like fighting a war. They know I have nuclear weapons, but I don’t have any conventional weapons. If they push me too far then I can walk out of the government and bring the government down and they know that.”
Mr Cable also suggested there were plans to reduce the winter fuel allowance – a suggestion David Cameron denied in the press conference.
The prime minister went out of his way to guarantee that the payment would not be affected during the election debate.
But shadow work and pensions secretary Douglas Alexander said: “If Vince Cable doesn’t believe the promises given by David Cameron and George Osborne [on the winter fuel payments] why should anyone else?”
In a series of comments which allude to deep divisions in the coalition, Mr Cable also cast doubt on the quality of the policy making from Conservatives in the government.
“We are trying to do too many things, actually,” he said.
“Some of them are Lib Dem inspired, but a lot of it is Tory inspired. The problem is not that they are Tory inspired, but that they haven’t thought them through. We should be putting a brake on them.”
The business secretary cited the downgrading of the immigration cap as an example of a policy he managed to successfully see off.
“I’ve been involved in a big battle over immigration caps and I have won that argument,” he told the undercover reporters.
“That was mainly with the Conservative colleagues, but I had some allies like Oliver Letwin [Tory Cabinet Office minister].”
The immigration cap policy was said to have been downgraded from a pledge to an aim by Labour.
The interim cap was recently judged illegal due to lack of parliamentary scrutiny, but consultation has now closed on the permanent cap on tier one and two visas.
Bank bonuses – another issue on which the business secretary had been noticeably vocal in the past and which Nick Clegg championed last week – also came up in the discussion.
Mr Cable suggested that the Lib Dems wanted a “very tough approach” but that the Tories opposed it.
Bookies have had Mr Cable as favourite minister to leave the government for some time now. He has been forced to retract policy preferences on several occasions, including on a graduate tax.
It emerged that betting company William Hill had halved the odds on Mr Cable being the first minister to leave the Cabinet following today’s furore – from 4/1 to 2/1.
