“It’s the economy, stupid.” Bill Clinton’s campaign manager put it rather crudely in 1992, explaining the primacy of his economic recovery plan in helping to secure business support and unseat an incumbent Republican president. The same holds true for Britain today, although Keir Starmer has phrased it rather more elegantly in the first of his five “missions”, which commits a Labour government to securing “the highest sustained growth in the G7”. But how is Labour’s case to be made when the Conservative Party has held a historic monopoly over claiming to be “the party of business” that can be trusted with the economy?
Well, the Tories have certainly assisted in recent years by trashing their own historic brand, from Boris Johnson’s infamous “f**k business” jibe, to last year’s Truss/Kwarteng mini-Budget meltdown. But nobody I know in the business community believes that Tory incompetence on the economy will be enough to convince businesses to support Labour. This has always been one of Labour’s greatest electoral challenges, as Ed Miliband found to his cost in 2015, when Labour was painted – however unfairly – as an “anti-business” party.
To establish its economic credibility, our members are clear: Labour must do nothing short of replacing the Tories as the natural party of business.
Three things are needed to achieve this historic turnaround. First, Labour must heed Harold Wilson’s warning from the opposition benches in 1972, when he and a few far-sighted allies in the business community founded the group now known as Labour Business, the party’s affiliated business membership group, of which I am chair. “If we don’t listen to business,” he said, “there is no reason why business should listen to us.” Second, Labour must make clear that it is unashamedly pro-business. That was a difficult message to get across in 2015-2019 when the then Labour leader’s first-hand experience of business was limited, to say the least. At the same time, Labour must not be ashamed to assert that it is still a pro-worker party committed to a partnership of government, businesses and trade unions. Otherwise, what distinguishes Labour from the Conservatives?
Today, I am pleased to say that the “pro-business, pro-worker” mantra, coined by Labour Business to encapsulate our view of a successful partnership economy, is on the lips of every shadow cabinet member I listen to, from Angela Rayner to Rachel Reeves and Jonathan Reynolds. Successful businesses are already on the same page. Third, Labour needs to explain what it means to be “pro-business”. The people I speak to in industry want to know: what policies will Labour deliver in government to earn this moniker?
We already have promising indications of the direction of travel, which businesses and trade unions can support. These include business rates reform, a modern industrial strategy, updating the planning system, reforming the British Business Bank and unlocking institutional investment, setting up a National Wealth Fund to invest in new industries, and a Green Prosperity Plan worth £28bn year as soon as affordable. The bare bones are there. But businesses want to see more before they go public in declaring their support for a putative Labour government trusted to deliver economic growth. A public imprimatur from businesses won’t guarantee election victory, but it will boost Labour’s economic credibility, which is an essential condition for success at the polls.
That is why the members of Labour Business will be working with all businesses and all trade unions over the coming months to ensure their voices are heard before the ink is dry on a manifesto. This must be unashamedly, and in detail, pro-business and pro-worker.
This article originally appeared in a Spotlight supplement. Read the full edition.