Year 2000 No. 34, February 24, 2000

Norwich Union and CGU Merger

Workers' Daily Internet Edition : Article Index : Discuss

Norwich Union and CGU Merger

US and British Warplanes Continue to Attack Iraq

Resigning UN Humanitarian Co-ordinator for Iraq Continues to Speak Out

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Norwich Union and CGU Merger

Another so-called mega-merger of the monopolies has occurred, in this case within the banking and financial services sector. The CGU (Commercial General Union) and Norwich Union Insurance firms have agreed a merger reportedly worth £19 billion – subject to Monopolies and Mergers Commission approval. Norwich Union is the country’s fourth largest general insurer, whilst CGU itself was born out of a previous merger between Commercial Union and General Accident in 1998. To be called CGNU, the new company – which will be the fifth largest in Europe – aims to compete with European counterparts AXA and Allianz, of France and Germany respectively.

CGNU expects up to 4,000 of its almost 35,000 British based workforce to lose their jobs, and a further 1,000 jobs will go worldwide. Reacting to the news Roger Lyons, General Secretary of the MSF union, said that "compulsion is completely unacceptable and will be resisted in every way possible".

Apparently the merged company CGNU will achieve £250 million savings within 18 months. CGU Chief Executive Bob Scott justified the merger on grounds of the "massive changes in financial services world-wide". He stressed, "The merger of CGU and Norwich Union will create the UK’s largest insurance group with strong positions in a number of European and international markets." This logic is also seen in recent mergers within this sector which created CGU, Royal Insurance and Sun Alliance, Lloyds TSB’s acquisition of insurance firm Scottish Widows and most recently the Royal Bank of Scotland securing control of NatWest.

The merger has the stated aim of competing in the globalised market. Such mergers and takeovers have been escalating as the competition becomes more intense and the anti-social offensive intensifies. The "economies of scale" such "mega-mergers" brings are driving the process of monopolisation, while in the insurance sector alone tens of thousands of workers have lost their jobs in the past five years in this scramble. The concentration, monopolisation and decrease in number of the banks and financial institutions has particularly been a phenomenon of the 20th century. With the present stage of capitalism, these institutions not only call the tune for the whole economy by their control of finance capital, but are the chief beneficiaries of the payment of interest on government debt. Furthermore, a large proportion of society is in hock to the insurance companies, and the rich find their hands on the wealth that the workers produce in this way also. Especially the further monopolisation of the banks, which analysts predict has not yet ended, represents the further placing every pore of society in a position where the rich can demand that it enriches them on a massive and continual basis.

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US and British Warplanes Continue to Attack Iraq

Three people were injured in air raids by US and British warplanes on northern Iraq on Saturday, the official Iraqi News Agency said.

"The American and British crows (planes) attacked our service and civilian installations, and the hostile bombing led the injury of three citizens," INA quoted a military spokesman as saying. He said the incident took place in Nineveh province (Mosul), 450 km (270 miles) north of Baghdad. He also said the warplanes carried out 16 sorties and flew over the provinces of Dohuk, Arbil and Nineveh. The spokesman said Iraqi ground defences challenged the planes and drove them off. He said other planes flew over southern provinces of Basra, Nasiriya and Kut but he did not report any casualties.

The US and British planes have been bombing targets in the two zones frequently since December 1998, as US imperialism and the British government are intent on punishing Iraq as a "rogue state" which will not do the bidding of the US and its allies.

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Resigning UN Humanitarian Co-ordinator for Iraq Continues to Speak Out

The resigning UN Humanitarian Co-ordinator for Iraq who tendered his resignation a little over a week ago, Hans von Sponeck, has said that he will present a farewell report on the devastation caused by US and British airstrikes on Iraqi territory.

A Washington Post report of February 17 said that this was "viewed by American officials as a parting act of defiance against the allied powers, which have pushed for his removal for months". The report continues that von Sponeck said that "he and Jutta Burghardt, a fellow German who is head of the World Food Programme in Iraq, resigned after concluding that a UN Security Council resolution in December provided false hope that the suffering of ordinary Iraqis would soon be eased". Hans von Sponeck is reported as saying, "I do not want to be associated with a Band-Aid that is inadequate to end the plight of the civilian population." He said that UN staff workers had witnessed 23 of the 99 airstrikes investigated by his office and that he personally had witnessed three attacks. His predecessor, Denis Halliday, had also resigned in order to speak out against the genocidal effects of the sanctions against Iraq, 16 months before.

Hans von Sponeck is due to speak in London on May 6 at a Dayschool on Iraq, organised by the Mariam Appeal and the Emergency Committee on Iraq. Further details can be obtained from the website: www.mariamappeal.co.uk

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