Sarah Cardell says role of competition regulator remains the same but it must be wary of perceptions. Signs by the lifts in the Canary Wharf headquarters of the Competition and Markets Authority (CMA) remind staff not to talk about their work in public, given the billions of pounds resting on its decisions. But a very public debate is taking place about how the competition watchdog works and is run, with the Labour government determined to make an example of it.
![[John Collingridge]](https://i.guim.co.uk/img/uploads/2023/01/17/John_Collingridge.png?width=75&dpr=1&s=none&crop=none)
In October the prime minister rebuked regulators in front of global business leaders for “needlessly holding back the investment we need to take our country forward”. In January they were hauled into 10 to explain how they would support the government’s growth ambitions. Then days later, the government defenestrated the CMA’s chair, Marcus Bokkerink, replacing him with the former head of Amazon in the UK, Doug Gurr.
Two and a bit years since she became chief executive of the watchdog, Sarah Cardell and her organisation are under the spotlight like never before. Britain’s chief trustbuster is sitting in a meeting room at the CMA’s head office after a whirlwind morning of broadcast interviews about its latest intervention, this time in the market for baby milk formula. It demanded changes such as standardised packaging in hospitals and allowing shoppers to use loyalty cards to buy formula milk – changes that it said could help parents save £300 a year by switching to lower-priced brands.
It is an illustration of the breadth of responsibility the watchdog has: from trying to police the tech juggernauts of Silicon Valley, to fining cartels in the asbestos removal industry, to intervening in the price of baby milk. “This job is for me a particularly unique opportunity to really deliver a tangible impact for people. We can be talking about tech and then we can talk about baby formula,” says Cardell. “It’s a market that really, really matters for parents and where the set of proposals that we have put out can make a real difference.”.
But some say that its primary job of ensuring fair competition and keeping powerful vested interests in check, so that households and businesses are not unfairly squeezed by higher prices and reduced choice, has been made significantly harder in recent months. The government, desperate to prove its pro-growth credentials after a series of mis-steps culminating in a confidence-sapping budget, has demanded the CMA bend to its will. That culminated in the business secretary, Jonathan Reynolds, last week issuing new guidance for the CMA, demanding it focus more on economic growth and not overreach into global deals.
Critics warn that by politicising the competition watchdog the government risks eroding one of the most sacred pillars of the UK: strong, independent regulation. A former regulator said: “There’s going to be awful aggro from the business community if the CMA blocks deals now because they are going to think the government has given a signal to allow them. “It seems like the UK now welcomes monopolies provided they have an investment story. There’s something really topsy-turvy about this.”.
Cardell, an Oxbridge-educated former competition lawyer at Slaughter and May, insists there was “no conflict of views at all between myself and Marcus” and the reasons for his departure are between him and the government. Reports claim that several members of the CMA’s board offered to resign in protest at the government’s tactics. For all that, Cardell appears at peace with the bruising approach from Westminster and Gurr’s arrival.
“I am very comfortable with his appointment and genuinely very much benefiting from working with him,” she says. “Doug actually brings really quite a breadth of experience to the chair role.”. Nor does she feel the CMA’s new growth focus is at odds with its core pro-competition mandate. “I don’t see there being a fundamental tension between the two and we haven’t got a growth duty that’s coming in over and above. Our statutory functions are to promote competition and protect consumers. Those fundamentals haven’t changed.
“It’s about making sure that the way in which we discharge those statutory duties is done in a way that helps to contribute to driving growth, building that business investor confidence. “We are looking for more pace, for more predictability, proportionality, and making sure our processes work.”. She insists the CMA has not been a brake on economic growth, but admits “where we do need to go further is to make sure that perceptions of the regime haven’t created a chilling effect, haven’t had a detrimental impact on business and investor confidence.”.
