The UK’s new prime minister, Andy Burnham, moved swiftly to name key foreign policy appointments upon taking power on 20 July. Within 24 hours, Burnham announced former Labour leader Ed Miliband as foreign secretary and confirmed that Steven Doughty would remain in position as minister of state for the overseas territories.
Miliband’s appointment was a surprise, with most pundits expecting him to be appointed chancellor of the Exchequer.
Noting that the change of prime minister was the result of an “internal civil war” in the Labour Party, rather than the type of wholesale change delivered by general elections, veteran political correspondent Robert Nisbet told Compass TV’s Signal business show that the broad shape of UK foreign policy will remain unchanged.
“Andy Burnham does not want to call another general election and that means that he is beholden to the manifesto that Keir Starmer won in 2024. So, from that point of view, there is no change in the general direction of the government,” said Nisbet.
The continuation of Doughty as the minister responsible for Cayman also points to stability. But Doughty “has a new boss”, said Nisbet, and Miliband’s history suggests he may take a direct interest in Cayman’s financial services sector.
Nisbet noted that financial transparency was one of the central tenets of Miliband’s failed 2015 election campaign when he was Labour leader. “In one particularly fiery exchange, Miliband said his government would refer any overseas territory that failed to produce publicly accessible central registers to the OECD – so, in effect, he was saying that he would blacklist overseas territories that didn’t open up their beneficial ownership registries to everyone,” recalled Nisbet.
If Miliband still holds that stance it would put him on a collision course with Cayman, which has opened its register of beneficial ownership to legitimate interests, but has so far resisted UK pressure to extend that access to any member of the public.
Will the UK act?
Describing Miliband as a “bit of a maverick” from the left wing of the Labour Party, Nisbet said the foreign secretary’s actions will be guided by domestic politics.
“This is an issue that may well be popular with the British public for the simple reason that Britain is in the grip of a cost-of-living crisis,” said Nisbet. “Burnham wants to tackle [the crisis] as one of his chief priorities, so he may give Ed Miliband more latitude, more rope to crack down on areas that are seen as not being properly governed.”
If Miliband did decide to enforce the UK position on beneficial ownership on Cayman by way of Order in Council, it would open the door to a legal challenge to the UK government in the Cayman Islands courts, said Cayman-based financial lawyer Anthony Travers.
Travers noted that the 2022 European Court of Justice decision that struck down public access on the basis of proportionality and right-to-privacy provisions should act as a warning to the UK government.
“If the UK government seeks to extend public access by Order in Council, Foreign Secretary Miliband has no basis to expect any different outcome in the Cayman Court. Following the Chagos Islands cases, it is doubtful that the Foreign Secretary in the United Kingdom, through an Order in Council, can override the constitutional provisions of the Cayman Bill of Rights,” he said.
The prospect of a messy legal dispute and potential defeat probably doesn’t appeal to a government that needs “some clear wins”, added Travers, who also noted that UK law enforcement already has “24-hour access” to the information in Cayman’s beneficial ownership registry.
Nisbet agreed that Miliband may quickly find he has other more pressing issues to address.
“We also have to remember the global reality,” said Nisbet. “There are a lot of fires burning in the UK. The cost of living being one, war with Iran, issues with Gaza, a difficult relationship with Trump, poor economic growth and energy prices out of control. So, the relationship with overseas territories is unlikely to be a priority.”
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