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24 April 2023

Why the collapse of the CBI could be a gift to the Conservatives

The Tories and their associates are busy preparing right-leaning alternatives to Britain’s biggest business group.

By Will Dunn

The Confederation of British Industry (CBI) is facing a fight for survival. Many of the largest members of Britain’s biggest business group have either paused or ended their relationship with it after the sacking of its director-general, Tony Danker, who was accused by a colleague of sexual harassment. Two other women have alleged that they were raped by colleagues while working for the CBI.

Jeremy Hunt has told Sky News that he sees “no point” in continuing to deal with the CBI, but that it’s “incredibly important” to him as Chancellor “to have someone I can turn to that speaks for British business”.

As luck would have it, a replacement has already been proposed. The new initiative, called BizUK, was announced over the weekend, though it says it is “not looking to replace the CBI”. It says it will be “a temporary, time-limited initiative, focused on helping businesses communicate new thinking ahead of the next general election”.

While the CBI, which was founded by Royal Charter in 1965, is an expressly apolitical organisation, there are signs that BizUK would be different. It’s the creation of WPI Strategy, a lobbying firm with strong links to the Conservative Party.

WPI was founded by Nick Faith and Sean Worth. Faith is a former director of communications at the right-wing think tank Policy Exchange and a regular contributor to Conservative Home. Worth is a fellow Policy Exchange alumnus who worked as head of the Conservative Party’s policy unit and as a special adviser to David Cameron. With another former Conservative special adviser, Lewis Sidnick, Worth set up a company called the Conservative Business Network. The latest MPs’ register of interests also details a business connection between WPI Strategy and the Conservative MP Bim Afolami, whose consultancy company Warre Constable provides services to WPI.

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[See also: Tony Danker, head of the CBI: “We’re failing to keep up with EU stimulus for green investment”]

At the same time, the Conservative Party itself is beginning a new business engagement initiative. Rishi Sunak spoke today (24 March) at a government “Business Connect” event, which appears to have been hastily organised – invitations reportedly went out on Friday – amid the collapse of the CBI.

The truth is that the crisis for the CBI represents an opportunity for those on the political right to replace what they have long seen as an inconvenient organisation. The group campaigned against Brexit in 2016, having polled its members and found that 80 per cent felt remaining in the EU would be better for business. “F*** business” was the response from Boris Johnson, while Jacob Rees-Mogg disingenuously claimed that the CBI was an EU-funded organisation (0.6 per cent of its income comes from providing data services to the European Commission).

After the referendum, the CBI continued to warn against a no-deal Brexit and joined forces with its old adversary, the Trades Union Congress, to urge the government to negotiate carefully in a process that had profound implications for millions of workers and businesses. When Carolyn Fairbairn, the director-general at the time, was given a damehood for her services to business in 2019, Priti Patel, the home secretary, described the award as “a stain on our democracy”.

The right never forgave the CBI for having represented the views of its members against Brexit dogma. Danker’s project was to rebuild the relationship with government – the Telegraph snorted that this made him “an upgrade on the hopeless Carolyn Fairbairn” – but calls for its dissolution continued.

[See also: Building the business case for growth]

The Truss-Kwarteng “mini-Budget” was an exercise in what can happen when more ideological or partisan lobbyists are central to policymaking. The Autumn Statement was the work of a government in thrall to the free-market Institute of Economic Affairs, which represents a smaller range of (undisclosed) interests; the transposition of its ideology into fiscal policy brought the UK to the brink of economic disaster. The CBI condemned both the mini-Budget and the replacement plan (or lack thereof) from Jeremy Hunt.

Compounding the problem for the Tories is the fact that since the Truss episode, Labour has led polling on which party would be best at running the economy. Rachel Reeves, the shadow chancellor, has conducted hundreds of meetings with businesses, and in December 400 senior executives attended Labour’s one-day business conference in Canary Wharf (almost twice the audience attending Business Connect today).

No one would dispute that the CBI needs investigation and extensive reform, but a well-represented business community can also be a vocal opponent to the economic incompetence of a reckless government. The Conservatives know this; it looks as if they’d be only too happy to start claiming the voice of business as their own.

[See also: UK corporate leaders group: we are trailing in the global race for green growth]

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