Another day, another Labour policy report. Keir Starmer will launch a review into supporting start-up businesses today, which will include proposals to create a state-backed group to link investors with venture capital firms – inspired by France’s technology finance scheme.
The plans also hope to encourage universities to convert discoveries in academia into million-pound companies. The UK has not excelled at this before. The struggle to monetise the discovery of the super-material graphene at Manchester University is one example.
Much like Gordon Brown’s devolution proposals on Monday, this review is part of Labour’s broader focus on economic growth. And the same caveat applies: these are policy proposals not Labour’s plans for government. We won’t know what Labour would do in government until we all sit down to read the manifesto (don’t pretend you won’t).
Beyond the policy proposals, the report signals the strength of the relationship between Labour and business. If you were to speak to members of the shadow cabinet they’ll often be complaining/welcoming another night spent courting businesses. Suits were omnipresent at the party conference in Liverpool in September, and donors have returned with the cash. The party’s courtship with industry has only deepened since the implosion of Liz Truss‘s government. It helps when your opponent is forced from office because of the market reaction to their policies.
But what will that relationship with business look like? An “active partnership” is one phrase Labour uses. It signals a more muscular state and chimes with Starmer’s mixed messaging during a speech delivered at the Confederation of British Industry in November. Yes, we will try to minimise trade barriers with the EU. But we will expect British businesses to look to “homegrown talent” before relying on people from abroad.
Lisa Nandy, during her Orwell Memorial Lecture on Tuesday (published on the NS website), argued that “rentier capitalism has been allowed to run riot”, in a sceptical look at the effects of globalisation. “Every place must be able to make a contribution again to our national prosperity,” she said.
Don’t expect Starmer and Rachel Reeves to rail against rentier capitalism today. Different tones, different audiences. And there are divisions within the shadow cabinet over how far to go. But Labour is prepping the ground for a more interventionist state, which hopes to influence businesses to change the way they operate.