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Cadbury

I do intend to address the issue of long-term investment, if I am allowed to proceed. I recognise that there is a valid concern about the nature of ownership. The Government consider that the best way to run a company is through enlightened shareholder value and for directors to take a long-term view. That was at the heart of the company law review that led to the Companies Act 2006. The best companies apply that principle, and we want to make sure that all do. It is up to shareholders to take a decision on the plans in front of them, but they need to look beyond short-term profit. We believe that there is real value in having a discussion about how we build a stronger culture of long-term commitment to sustainable company growth in this country. That should be based on co-operation between ultimate owners, fund managers and the corporate sector. Recent reviews by Sir David Walker and Sir Christopher Hogg have raised important issues, particularly to do with the effectiveness of institutional investor engagement in the long-term interests of UK companies. One part of the solution will be the new investor stewardship code on the responsibilities of institutional investors. The Financial Reporting Council will consult on that shortly. It is important that we take into account the position of all individuals who have funds from which they earn money—pension funds and other investments—and encourage them to take an active role in determining how their sums are invested in future. The Secretary of State for Business, Innovation and Skills recently had a very productive round-table discussion with investors, fund managers and representatives of companies to consider those important issues and to look at how to improve engagement for the long term. The debate engendered by the proposal and the takeover has created an atmosphere in which many new ideas on long-term investment are being put forward. The Government will consider those ideas as they come forward. They have already initiated debate and reports from Sir David Walker and Sir Christopher Hogg; some of that work predated the proposal. In our discussions with the investor community, we repeatedly stress the importance of long-term investment for the future of British industry, and we stress that long-term investors should have the interests of the United Kingdom at the forefront of their minds. Cadbury is an iconic brand. It has had, and continues to have, a huge impact, not just on the lives of its work force, but on the community around it and on the country. We understand the concerns that Cadbury employees have at this uncertain time about their jobs and the survival of this valuable British asset. We are determined to maintain levels of investment in Cadbury in the United Kingdom, and to ensure that jobs are secured. What Kraft has been saying until now is encouraging. We will continue to talk to it about the future, and to discuss its proposals for development of the business in the UK. Ultimately, those are matters not for the Government but for shareholders of the company. The last thing that we wish to do is threaten investment in UK companies, but I believe that there is genuine cause for concern—concern that has been eloquently expressed in this debate. I am sure that the Government will reflect on that. The concern is not about who owns a company, but about the nature of that ownership. We are working to encourage and strengthen among investors a culture of long-term commitment and engagement to businesses based in the United Kingdom. Question put and agreed to.