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Labour party leader Sir Keir Starmer began his week with an invitation to 200 businesspeople to join him in a “partnership”.
“If we do come into government, you will be coming into government with us,” he told a forum in Liverpool at what could well be the party’s last annual conference before the next general election.
“I don’t think we can do your job better than you can and I don’t think we should try.”
After a rapid succession of Conservative prime ministers and a series of cabinet reshuffles, Starmer’s pledge centred on a promise to bring stability and end the “chopping and changing” seen in recent Tory governments.
Starmer’s bid to make Labour the “party of business” — a sharp U-turn from his predecessor Jeremy Corbyn — has been a key part of the opposition leader’s effort to make Labour more electable. It has also been helped by Prime Minister Rishi Sunak’s rocky relationship with the private sector.
“The clarity from Starmer to open the day was impressive,” said Iain Anderson, executive chair of public relations firm H/Advisors, who quit the Tories this year over what he said was the party’s “fuck business” attitude, citing a sentiment articulated by Boris Johnson.
Labour has sought to take advantage of the stressed ties between successive Conservative administrations and parts of the business community, which opposed Brexit and were angered by the fallout from Liz Truss’s disastrous “mini” budget last year.
Though Sunak had sought to rebuild bridges, John Dickie, chief executive of BusinessLDN, which represents some of the UK’s biggest employers, said the prime minister had “unwound a fair bit of that work in restoring the UK’s credibility” in the past three weeks.
The prime minister first delayed the phasing out of new petrol and diesel cars from 2030 to 2035 — a decision Labour has pledged to reverse if it wins power. He then scrapped the northern section of the HS2 railway to Manchester.
Starmer’s charm offensive appears to be winning business support over from the Conservatives.
A poll of 1,000 senior business people by Savanta for public relations firm MHP carried out in September found 45 per cent believed a Labour government would be best for business, with 32 per cent backing the Tories.
The number of companies and executives paying to attend or set up stalls in Labour’s exhibition hall was significantly higher than those exhibiting last week at the Tory conference.
Labour’s advantage has been built partly on more than a year of meetings with company executives and industry bodies, spearheaded by Starmer, shadow chancellor Rachel Reeves and shadow business secretary Jonathan Reynolds.
For business, the comparatively small size of Labour’s policy teams has offered a chance for companies to influence the policies the party adopts.
At a private dinner in Liverpool on Sunday, a former Labour adviser told corporate lobbyists that there would still be moments when Labour needed “off the shelf” policies in a hurry and that this was an “opportunity” for their companies.
Business people said Labour was contacting companies with questions on specific areas on which it wants to focus in detail, such as skills and training. “There’s pre-reading,” said one lobbyist.
Starmer confirmed this in Liverpool on Monday, saying that he has told his shadow cabinet: “I don’t want you ‘engaging with business’ if you think that means just having a cup of coffee from time to time and having the same discussion every quarter.”
He has told shadow ministers to drill into how to bring about change, who should be responsible and to understand that the issues will be different in each sector of the economy, he said.
Labour’s embrace of business drew scrutiny over the weekend. Consumer champion Martin Lewis said he was “shocked” that a buy-now-pay-later company had been able to sponsor a fringe event in Liverpool and was “given a platform to argue against the planned regulation” of the sector.
Asked about the comments on Monday, Reynolds told the business forum that it was “quite a change” from previous years for Labour “to be accused of having too many businesses” at its conference. The party does not agree with the public policy preferences of a company just because it sponsors an event, he said.
Reynolds has signalled that stability is more important than tax cuts, saying slashing corporation tax was not part of Labour’s pitch. The stance has barely made ripples.
“Things like tax just aren’t that big a deal,” said a representative of one large infrastructure company. “The Tories have already increased taxes and it’s really not a red flag for us at the moment.”
Another person who attended the business day at both conferences agreed, saying: “What [companies] care about is policies on net zero, Labour’s stance on deregulation, planning.”
Landsec chief executive Mark Allan told the FT he could “see no reason” why the FTSE 100 property group would not double its £500mn-£1bn-a-year investment in the UK if the planning process was less cumbersome.
While Starmer and Reeves are “reassuringly dull” there remains in some parts of the private sector an “inbuilt scepticism” of Labour, said one adviser to large companies, who noted that more leftwing figures such as Angela Rayner were prominent within the party. “This is not New Labour,” the adviser said, a reference to the party under former prime minister Sir Tony Blair.
The head of one investment bank voiced similar concerns, saying he “would have a concern about what [Labour] might do one year post-election”.
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