Labour has a historic opportunity to replace the Tories as the party backed by business

by Jonathan Todd

This piece is part of a new book “Labour’s Reset: The Path Back to Power”. Click here to download it. The book looks at the barriers for voters in picking Labour, what the party can do in opposition to tackle these issues and the type of policy platform that would attract switchers to Labour at the election

Backing business should be a sine qua non of politics. Yet we now have a ‘fuck business’ prime minister,[1] who won an 80-seat majority against a Labour Party that the CBI characterised as, ‘proposing the biggest programme of renationalisation this country has ever seen at great cost with uncertain returns to the taxpayer’. As a result, Labour was then seen as being ‘at least as damaging’ as No Deal Brexit.[2]

Two political consequences follow:

  1. Such a prime minister offers Labour a chance to develop closer relations with business than the Conservatives.
  2. Labour’s 2019 manifesto is not the package with which to seize this opportunity.

‘I’m acutely aware that among my first tasks is rebuilding the relationship between the Labour party and business,’ Keir Starmer recently said, much to his credit.[3]

Around the same time as Starmer was saying this, the chief executive of the North East England Chamber of Commerce was writing to the prime minister asking him to give his ‘most urgent and personal attention’ to the ‘damage being done to our economy’ by the prime minister’s Brexit. Two weeks after receiving this letter, the prime minister had still not replied.[4]

Doing counterintuitive things often helps parties in opposition. A pro-business Labour confounds entrenched views of the party and confirms that we are under new management.

What Boris Johnson is getting wrong enlarges this opportunity for Labour. Equally, he is getting something right: optimism.

‘Remember that Barack Obama’s breakthrough owed a lot to the slogan, “yes we can.” The left needs to show that it can somehow improve things,’ writes Chris Dillow. ‘This requires not just policies, but the self-confidence to sell them. Johnson shows that politicians can succeed by not being scared of their own shadow. The left should learn from this.’[5]

Labour needs to articulate an optimism about the UK and a sense of purpose about what we can become.

Much of what the UK might achieve is bound up with business: how the extraordinary achievement of the Oxford AstraZeneca vaccine might be built upon; how the City of London might power a green industrial revolution; how our farm and food standards might save our countryside and reduce our waistlines; how investment in gigafactories might again make us the best place in the world to make cars; how we might put solar panels on every new home and in outer space[6] to create abundant energy and pump-prime British industry; and how we might create careers of meaning, dignity and decent pay for everyone.

There is so much that the UK might achieve, but none of it is possible without business to develop new products and services; create jobs and pay wages; and pay taxes that finance public services.

We should see business as partners on the journey that Labour seeks for Britain, and all successful partnerships are conversations.

In contrast, it has not only been on Brexit that business concerns have found deaf ears in government. In March 2021, for example, it was confirmed that the Industrial Strategy was being discontinued as a policy by the UK government, along with the council of business leaders that had overseen it. As part of the Budget, a document entitled Build Back Better was published by HM Treasury outlining the government’s investment plans for economic growth, but this is not a strategy in the same way and provides little detail on innovation challenges or prioritising high-growth sectors.

To scrap the Industrial Strategy is to move the goalposts for business; to replace the Industrial Strategy with such a half-baked publication is to use jumpers for goalposts, neither of which provides much encouragement for business to shoot for goal.

The uncertainty that hangs over the future of Local Enterprise Partnerships (LEPs) is another insult to the time and expertise that businesspeople have voluntarily invested in these structures.

Even though the UK currently suffers from a debilitating shortage of 100,000 HGV drivers, industry has also received a deaf ear from government on this pressing problem. ‘Our members tell us the only thing that is going to solve this in the short term is flexibility on the immigration system,’ recently said James Firth, head of road freight regulatory policy at Logistics UK, which represents freight owners including supermarkets.[7] But, despite business facing massive complications, the government prefers Brexit dogma to taking this step.

This refusal to support business contrasts with the productive interactions enjoyed by business with the last Labour government. From the Prawn Cocktail Offensive, which sought to rebuild business trust in Labour over lunches with Shadow Chancellor John Smith, to the council of senior business figures that Gordon Brown formed to advise him as prime minister, this period in government was marked by respectful relations with business.

Since then, Labour has changed, as has business. Over the decade between Gordon Brown’s council of business leaders following him out of Downing Street and Jeremy Corbyn’s highhanded approach to business leading to the nadir of the CBI’s damning verdict on the 2019 manifesto, business has sought to rebuild its reputation after the financial crisis of 2007/8.

The most prominent campaigns on the CBI website, for example, do not push for taxes to be cut or regulations to be junked. These campaigns transmit much more civic purpose than that:[8] Transform the journey – better commutes for all; Race to zero – driving the UK’s sustainable future; Connect business and education to help every student succeed.

There is much to chew on here at a contemporary Prawn Cocktail Offensive. Call it a Canape Offensive. Ensure the slow food philosophy informs the canapes to emphasise Labour’s renewed focus on farming and food standards. Let the food do some of the talking.

But most of the talking should come from businesspeople and be heard by receptive Labour listeners. Formalising this process would communicate the seriousness with which Labour takes it and help the engagement be more substantive and meaningful.

Of course, Labour already has structures for dialogue with business such as the affiliate society Labour Business. The Business Forum on the Monday of conference is Labour’s flagship business event of the year and aims to understand the views of businesses from across the country. It consists of speeches, roundtables, panel discussions and Q&As with Keir Starmer, Rachel Reeves and other members of the Shadow Cabinet.

These initiatives should be made more:

  • Prominent: Not enough people know the Business Forum exists.
  • Ongoing: Instead of being just a moment in time, there should be a continuous conversation to provide Labour with live business intelligence that can be used to attack the government and refine our policy propositions.
  • Structured: There should be a business forum, chaired and appointed by the shadow chancellor, for dialogue, engagement and policy development. The business representation on this forum should be representative of different business sectors, parts of the country and sizes of business.
  • Fun: With some imagination, something more enjoyable than speeches and roundtables might be found.

This requires:

  • Planning: A programme of activities should be made for the forum over 2022 with the aim of significantly improving Labour’s relations with business in advance of a potential general election in the spring of 2023.
  • Coordination: This should be within existing networks and between the policies and campaigning of the party and the input of this new forum.
  • Political leadership and focus: There should be a willingness to commit to the programme of activities and to having the party’s thinking shaped by this new forum.
  • Business commitment: To a charter of social responsibility, including paying the living wage, as a condition of membership of this forum.

At the heart of a new approach from Labour to engaging business should be a new commitment to formalise the relationship with business by expanding the membership and remit of Labour Business from just another affiliate to one which has

  • Representation on the National Executive Committee
  • A formal role in Labour’s policy making process as a consultee

Labour is at its best when rooted in the experiences of the British people. We have a union link that provides some of that connection but just 13% of private sector employees are members of a union. Labour has an opportunity to fill this gap by taking direct action to engage British business and extend its role within Labour via a new business link.

Yonder polled voters for Uncut on their views if Labour were to make such a change and the results were striking: 74% of non-Labour voters considering backing Labour at the next election said it would make them more likely to vote Labour. Just 9% disagreed, a net majority of +65%. Out of this group, 15% said it would make the ‘much more likely’ to vote Labour.

We need to run the party as we intend to run the country: with business at its heart. We need pride in the strengths of our country and optimism about what these strengths can achieve in partnership with a thriving private sector. We need to form that partnership now and have it drive our approach to winning and retaining power.

Where we are in power, such as in London and Manchester, we need to demonstrate the tangible difference that improved relations with business can make to the quality of Labour administration.

It takes a dream to build a successful business. Not of wealth beyond avarice but of making a difference. Labour, too, are dreamers – of a better tomorrow. Together, a hopeful Labour and a flourishing private sector can transform our country.

This requires much more than the threat to business that Labour had come to be by 2019. It demands more than lip service to the importance of the private sector or the cold shoulder that the government have given business for too long.

It needs a fundamental reboot in Labour’s relations with business.

There is time – just – for this to be delivered before the next general election. Labour should pursue this end with the singlemindedness, confidence, and focus of start-up entering a new market.

Jonathan Todd is Deputy Editor of Labour Uncut. He writes in a personal capacity and as Chief Economist of BOP Consulting, a strategy and research consultancy, and co-founder of 1000 trades, the best place to drink in the UK according to the Observer Food Monthly Awards 2019.

[1] This is something the prime minister was reported as saying about business concerns around Brexit when he was foreign secretary in June 2018.

[2] Carolyn Fairbairn speech at CBI Annual Conference, 18 November 2019.

[3] Financial Times, 5 August 2021.

[4] The Guardian, 9 August 2021.

[5] Stumbling and Mumbling blog, 14 June 2021.

[6] See Will Hutton, ‘Fifty years after Apollo, space is about to transform our life on Earth beyond recognition’, The Observer, 2 May 2021.

[7] The Guardian, 20 July 2021.

[8] When the website was accessed on 10 July 2021.

Tags: , , , , , , ,

13 Responses to “Labour has a historic opportunity to replace the Tories as the party backed by business”

  1. Alf says:

    Starmer is a Tory.

  2. Tafia says:

    Business favours whoever promises them lower business rates and taxes, less regulation, less interference, more grants, lower costs, lower workers rights.

    Simple as that. New Labour won in 1997 promising ‘light touch’ remember.

  3. Ann Onnimus says:

    Do you want the Labour Party to be the party of labour or the party of business? It’s one or the other. The idea that we can be both is a delusion – their interests are fundamentally and inevitably opposed.

  4. A.J. says:

    Mr. Todd is that wonderful creature, the eternal optimist. Certainly there has been the infrequent kiss and cuddle between a Labour leadership grouping and business over the years – and this idiot of a PM was scarcely helpful with his ‘F*** Business comment (he did actually say that, didn’t he?). But even a canny leader like Wilson fumbled the ball – and how many impoverished would-be Labour voters want to hear about the Party not much caring about some becoming ‘filthy rich’ (or whatever expression Mandelson used)? The Labour Party is supposed to be about redistribution of wealth, is it not? Greater equality? Improved opportunities?
    Besides, what, now, is ‘business’? Mostly corporate capitalism?
    Certainly the Party should keep its wits about it… keep an open mind… but not be too surprised if the Left and the unions aren’t too comfortable about it.

  5. John P reid says:

    Starmer was the leader of the 2nd referendum for remain you Only have to look as to why Starmer won the leadership of FPBE “boll@cks to Brexit” orange book Democrats joined the Labour Party to vote for Starmer because he was the architect of the second referendum , if he wasn’t in charge of that ,
    when he did that three years ago he guaranteed he was gonna be the next leader and it also guaranteed be was never going to be prime minister

  6. Anne says:

    For many companies, higher overheads cancel their capacity to hire and invest, killing future jobs and revenues. For others, particularly energy intensive manufactures, this makes the difference between viability and going out of business. What is required is an energy plan which maps out requirement that is affordable, reliable and secure which fuels the nation. The country is still heavily reliant on gas but the race is on to move away from fossil fuels. There is a push for more renewable energy projects such as wind and solar but they alone cannot provide Britain’s future energy needs. As an island nation we perhaps not taken full advantage of tidal power. This is a method of converting energy from tides into useful forms of power, mainly electricity. Nuclear power is also an energy provider. Rolls Royce have been commissioned to build 16 small modular reactors. However, a solutions to the ‘safe’ storage of radioactive waste has yet to be decided. A system which may help with this problem is a fusion plant, which is perhaps seen as a step towards a greener nuclear power. In theory, fusion promises a safer, carbon free energy source that produces very little radioactive waste.

  7. Maybe it’s time for the party to change its name Jonathan. What do you think? The Business Party maybe? Then again we may as well all just join the Liberals. They can add another extra bit to their name.

  8. wg says:

    Good point, Danny Speight – I have been making this point for a long time now.
    The Labour Party seems to be about anything but labour.

    The Labour Party that I grew up with defended the UK worker from exploitation and undercutting: what do Labour offer now – an unending stream of cheap and ready-trained labour from other poorer countries.

    Furthermore, I have never understood how we are protecting our climate when we see our natural environment destroyed by continual economic growth models based on that population growth.

    The average person on the street will look at the above piece and go back to feeling completely overwhelmed.

    Labour, Tory, LibDem et al. – never have the people of this country felt so badly led and so devoid of hope.

  9. Tafia says:

    Leicester East MP Claudia Webbe, Labour, has been found guilty of one count of harassment against a 59-year-old woman at Westminster Magistrates’ Court.

    District Judge Paul Goldspring tells the Court he is considering a custodial sentence which – unless Webbe stops proteting her “innocence” is almost inevitable. Even a suspended term would automatically trigger a recall election and cause a civil war in the local Constituency Labour Party, currently chaired by disgraced Labour ex-MP Keith Vaz (of washing machines, rent bioys and cocaine infamy), who is after the slot himself or if not possible lining his daughter up for the candidacy whereas Starmer is pushing a parachute party loyalist. Vaz is threatening to stand as an independent if he or his daughter do not end up candidates, and exploit the fact that the constituency has a high percentage of traditionally Labour-voting Indian hindus who are deeply opposed to the Labour Pary’s position over Kashmir.

  10. Vern says:

    Business is not about to throw its support behind Labour anytime soon Jonathan. Nothing has happened in the last 10 years to suggest they would be better served by a Labour Govt who have made it perfectly clear that those earning more should be taxed more. That is not much of an incentive.

  11. John P Reid says:

    Labour will lose the next 2 elections then do electoral pacts with the Libdems
    Whether labour will lose working class votes knowing that & it’ll be enough to win in 2033 is anyone’s guess
    Maybe Taiwo or Clive Lewis as leader?

  12. A.J. says:

    Vern is almost certainly right, you know – even if Rachel Reeves does launch a sustained prawn cocktail offensive. Maybe ‘Ang’ doing a bit of lap-dancing would do the trick.

  13. Landless Peasant says:

    Starmer needs to rebuild the links between Labour, the Leftwing, the Working Class and the Unions if he wants to ever win an election. We don’t want New Labour Mk.II after all, we had enough of that under Blair, never again.

Leave a Reply