Labour turns on Cable over "capitulation" to the Tories

Chuka Umunna says reforms to employment law are an attack on workers' rights.

Last week, Vince Cable was eulogised by Ed Balls as the Lib Dem who could no almost wrong. "Vince has distinguished himself by always making the argument about what's right for Britain," he said, as he beamed at the Business Secretary, sat beside him on Andrew Marr's sofa.

But Balls's colleague Chuka Umunna, the shadow business secretary, isn't feeling so charitable towards Cable. Earlier this morning, Umunna took to Twitter to criticise the Business Secretary's reforms to employment law as an attack on workers' rights. He added that Ming Campbell, who has questioned Cable's textual relations with Labour, should worry more about "Cable's capitulation to Fallon, Hancock and co. on employment law"

While Cable will today formally reject calls for the introduction of "no-fault dismissal" or fire-at-will (a proposal that emanated from Tory donor Adrian Beecroft's now-infamous report on employment law), he will announce a significant cut in the cap on unfair dismissal payouts. The current £72,000 limit is expected to be reduced to an employee's annual salary, or another lower figure. In addition, employment tribunals will be sped up, so that costs are reduced and weak cases thrown out more swiftly. Though you wouldn't know it from the right's response, 80 per cent of Beecroft's recommendations have been adopted or put out to consultation.

Continuing his assault on Cable, Umunna declared, "We're not in a recession because of the rights our constituents have at work - its cos of the govt's failed economic plan." The Business Secretary, of course, wouldn't disagree. During his appearance on Marr last week, he sagely observed, "The problem of growth is that we have a very serious shortage of demand. It's nothing to do with those supply side measures basically. It's a demand issue."

As a result, suspicion persists among the Tories that Cable's heart isn't really in it. But whatever the Business Secretary's true feelings, a third successive quarter of recession persuaded the coalition partners to strike a grand bargain on growth. You give us supply-side reform, and we'll give you a small business bank (a measure that allowed Cable to hail the end of "pure laissez-faire" economics).

Umunna's decision to respond with an attack of rare ferocity suggests that not everyone in Labour is so keen to lure the Business Sectetary from the Tories' clutches.

Business Secretary Vince Cable will announce reforms to employment law today. Photograph: Getty Image.

George Eaton is political editor of the New Statesman.

Photo: Getty
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What Jeremy Corbyn gets right about the single market

Technically, you can be outside the EU but inside the single market. Philosophically, you're still in the EU. 

I’ve been trying to work out what bothers me about the response to Jeremy Corbyn’s interview on the Andrew Marr programme.

What bothers me about Corbyn’s interview is obvious: the use of the phrase “wholesale importation” to describe people coming from Eastern Europe to the United Kingdom makes them sound like boxes of sugar rather than people. Adding to that, by suggesting that this “importation” had “destroy[ed] conditions”, rather than laying the blame on Britain’s under-enforced and under-regulated labour market, his words were more appropriate to a politician who believes that immigrants are objects to be scapegoated, not people to be served. (Though perhaps that is appropriate for the leader of the Labour Party if recent history is any guide.)

But I’m bothered, too, by the reaction to another part of his interview, in which the Labour leader said that Britain must leave the single market as it leaves the European Union. The response to this, which is technically correct, has been to attack Corbyn as Liechtenstein, Switzerland, Norway and Iceland are members of the single market but not the European Union.

In my view, leaving the single market will make Britain poorer in the short and long term, will immediately render much of Labour’s 2017 manifesto moot and will, in the long run, be a far bigger victory for right-wing politics than any mere election. Corbyn’s view, that the benefits of freeing a British government from the rules of the single market will outweigh the costs, doesn’t seem very likely to me. So why do I feel so uneasy about the claim that you can be a member of the single market and not the European Union?

I think it’s because the difficult truth is that these countries are, de facto, in the European Union in any meaningful sense. By any estimation, the three pillars of Britain’s “Out” vote were, firstly, control over Britain’s borders, aka the end of the free movement of people, secondly, more money for the public realm aka £350m a week for the NHS, and thirdly control over Britain’s own laws. It’s hard to see how, if the United Kingdom continues to be subject to the free movement of people, continues to pay large sums towards the European Union, and continues to have its laws set elsewhere, we have “honoured the referendum result”.

None of which changes my view that leaving the single market would be a catastrophe for the United Kingdom. But retaining Britain’s single market membership starts with making the argument for single market membership, not hiding behind rhetorical tricks about whether or not single market membership was on the ballot last June, when it quite clearly was. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to domestic and global politics.