by Samuel Dale
It was an absolute delight to read the Fabian Society’s new research on paper on Labour’s woeful relationship with the private sector. It can be summed up in one damaging quote: “Business doesn’t trust Labour”.
As I have argued on this site, Labour has a horrific relationship with British business that could cost the party dearly this May.
The Fabian report, In it Together, authored by Ed Wallis and Robert Tinker and published on Friday, seeks to redefine Labour’s relationship with business.
It wants the party to make a “big, open and comprehensive offer “ and create a Charter for Business.
“Profit and social purpose are not only compatible objectives but the conditions of a flourishing economy and a healthy society,” says the Charter’s proposed vision. “Public health, environmental sustainability and strong local communities are integral to long-term business success, and cannot be delivered by government alone but by using partnerships between business and government.”
The Charter contains ideas such as not creating punitive and shock-value regulation, setting long-term targets beyond electoral cycles (something business cries out for again and again because how can you expect business to think long-term when politicians don’t?) and offering tax breaks to companies who contribute positive environmental and social change.
This is a far more intelligent and collaborative approach to business with long-term goals alongside the carrot of tax breaks to encourage good behaviour.
It is crucial too because in so many areas – pensions, long-term care, the NHS, welfare and others – the private sector is and must play a far bigger role supporting role as the state reaches the limits of what it can realistically achieve.
Miliband assumes business leaders are baddies to be battered with a stick; heavily taxed and regulated into shape without consultation rather than looking for sensible business allies he can work with for reform.
The Fabian paper states: “Current debate has been a dialogue of the deaf, with each side sceptical of each other’s motives or expertise, rather than developing the common ground which exists but is often obscured.”
This Charter could go some way to rebuilding relationships with British business that Ed Miliband has hammered for four years.
To be fair, Miliband has shown flashes of this approach by offering tax breaks for firms offering the living wage. An incentive to do the right thing rather than forcing private firms where they do not want to go. He needs to do more.
Miliband’s best chance of creating the responsible capitalism agenda he craves is to build relationships with friendly business leaders in different sectors.
The Fabian Society argument for Labour is simple: build trust, find business allies and create incentives for good behaviour. Regulation should be the hidden fist used carefully as a last resort.
It is great to see someone on the Left making the argument for Labour to work with business because such voices are rare.
Too often we hear the Russell Brand-ish take on Gordon Gecko’s infamous message: profit is bad. There is a better, more nuanced Labour alternative for reform with senior advocates such as Chuka Umunna and others.
If MIliband could fix his knee-jerk tax and regulate instincts then Labour has a great story to tell business with more sensible positions on the EU and immigration than the Tories.
But time is running out to make a decisive shift and the party’s pro-business voices to speak loudly and clearly with a better agenda. If it’s too late for May then the rebuilding of the party’s position starts now.
Sam Dale is a financial and political journalist
Tags: Business, Charter for Business, Ed Miliband, Fabians, partnership, Samuel Dale
How to get on the good side of business:-
1. Don’t even slightly suggest raising any form of tax that affects them – business rate, corporation tax, employers NI liability etc etc.
2. Don’t support any form of import/export control at all, for any reason, ever. And that includes sanctions.
3. Don’t keep saying wages are to low – you don’t pay them, businesses do.
4. Do not introduce anymore checks, controls or other forms of red tape. None. In fact reduce what already exists.
5. Don’rt ever say ‘Business has a responsibility…..’. No it doesn’t. Government has the obligation – to fuck off and mind it’s own business.
Anything other than that and business regards you openly at best as uneducated idiots who have never run a race let alone a business, and at worst as the enemy to be fought tooth and nail over everything.
Tafia.
1. Why should these be raised? They, and their administration are crippling small businesses at the moment.
2. What exactly would the controls on these be and why, especially exports?
3. What should a small company do? Rais its wages above those of its competitors unilaterally? Sounds like a certain way to go out of business with redundancies.
4.There are far too many checks, controls and red tape at the moment. What business needs is less.
5. Business does have a responsibility, to its owners, shareholders and the workforce. The same responsibilities that unions have to their members and not the public. I think Bob Crowe actually said that.
Left wing movements come and go but business is still there, always has been and always will be and I say that as someone who has started three housing coops and seen them become limited companies with professional managers as the tenants bankrupted them.
Wasnt NI increased in 2001 when labour was still supported by business
Also increase the higher rate of council tax
Good article
Dave Roberts, I was just saying what business likes and doesn’t like to hear. Rule of thumb with business is if it cost them money its just bollocks, if they make more money it’s the dogs bollocks.
John, At that time, the background work to roll out tax credits in 2003 was taking place. Tax credits enabled (and still do) employers to pay low wages safe in the knowledge that the government would subsidise them. The amount they paid extra in NI was more than offset by the amount the saved on low wages.
“Too often we hear the Russell Brand-ish take on Gordon Gecko’s infamous message: profit is bad. There is a better, more nuanced Labour alternative for reform with senior advocates such as Chuka Umunna and others”
If Chuka is unable to voice a pro business strategy as shadow minister for, er, business, is he really the man to pin the hopes of this article to?
“If its too late for May” is a bit of a giveaway, this is preparing for the fight after The Defeat.
Utter rubbish, we (business) dont believe a word of it. If Labour get elected the pound will fall, investment will fall, unemployment will rise, confidence will disappear and we’ll go broke.
You cant use the aberation of the Blair years as an example. The left are happy for a pig with a red rosette getting elected even if it means economic disaster.
Business does not want you. We are interested in pragmatism, not ideological BS. Back to your rock.
“in so many areas – pensions, long-term care, the NHS, welfare and others – the private sector is and must play a far bigger role supporting role as the state reaches the limits of what it can realistically achieve.”
Still saying this still after the egregious failure oif the private sector at Hitchingbrooke hospital?
When will the private sector fanatics take a look at their core beliefs and understand they are bunk?
Miliband doesn’t “need” to be pro buisiness. He needs to be pro people. Business success and growth follows on from that, not the other way around. 30 years of this drivel and still it gets trotted out like so much dogma.
Change the record. It is beyond scratched.
BenM, lets get some things straight about the NHS and privatisation.
Firstly, the NHS is roughly 6% privatised. 5% carried out under Labour and 1% under the Tories.
Secondly, Hinchinbrook won major national awards for patient care in May just gone, it was only after a 5% cut in funds by the Labour controlled authority that Circle had problems. The CQC report in November was a farce as stated by the Doctors who formed a protest letter about it.
I could go further and mention that every year since Cameron won in 2010 NHS spending has risen, that there are now more doctors and nurses in the NHS than there were in 2010, and that here in Wales, despite a yearly increase in the Westminster settlement, the Welsh Labour government cut NHS spending by 6.5%
Again I can list Labour authorities in England & Wales that are actively privatising more and more of their services. I can even name Labour councils that have forced existing employees onto zero hours contracts.
Labour is already signed up to and committed to on-going austerity and more privatisation
So as you said, change the record. It is beyond scratched.