The view from Labour Party conference: back in business?

Away from the King’s Dock in Liverpool this week, a sense of panic pervaded. Only a few days after Kwasi Kwarteng’s “mini budget” of huge, unfunded tax cuts, the pound continued to slide sharply. At the same time, the cost of government borrowing was also exploding.?

However, inside the Labour Party’s annual conference on Merseyside, there was calm, unity and a sense of purpose. Keir Starmer’s Labour Party now leads the Tories by 17 points, according to YouGov polling on 27th September?and is readying itself for government again. Barring the kind of 1992-style upset that still haunts Labour, it’s now more likely than not that Labour will win the next general election.?

One of the most noticeable things about Labour Party conference this year was the return of business (and businesses). The Business Forum, where companies pay for access to events attended by Shadow Ministers and party officials, sold out in July. Elsewhere, conference-goers were queuing out of the door to get into overflowing receptions hosted by big business. Among others, this included Sainsbury’s, Google and Lloyds. Notably, the energy company E.ON, who last year donated to the Conservative Party, also had a stall in the reception hall.

With the memory of Jeremy’s Corbyn leadership firmly in the past, and one senior City figure calling the Conservative Party a “doomsday cult”, the political terrain is now open for a pro-business Labour Party. During his speech, Keir Starmer told party members , “on climate change, growth, aspiration, levelling-up, Brexit, economic responsibility [Labour is] the party of the centre-ground”. But beyond the rhetoric, what was announced?

Starmer set the tone at the start of the week by stating that a Labour government would deliver 100% clean energy for Britain by 2030, establishing the UK as a ‘clean energy superpower’. However, the?announcement that really stole the show was the creation of Great British Energy - a new state-owned but commercially operating, energy generation company. The announcement typified Labour’s announcements during conference – state intervention in the economy to drive growth and prosperity throughout the country, with a focus on clean energy. The company would be funded by seed capital from Labour’s planned ￡8bn National Wealth Fund, which Shadow Chancellor Rachel Reeves had announced earlier in the week. According to polling carried out by think tank Common Wealth, 72% of voters backed the idea of a state-owned energy company.?

Shadow Business Secretary Jonathan Reynolds also pledged – as part of Labour’s Industrial Strategy - to create an ‘Industrial Strategy Council’ to assess the effectiveness of government policy. The proposed council would be on the same statutory footing as the OBR – designed to send a clear message to businesses that Labour is listening. Keir Starmer also committed to scrapping business rates and overhauling skills and apprenticeships.?

Another big priority for a new Labour government would be the reform of the housing sector. A target for 70% of homes to be privately owned was also announced, with Starmer pitching Labour as the “party of home ownership in Britain today.” New measures would include a mortgage guarantee scheme for first time buyers, and a reform of the planning system. Shadow Levelling Up Secretary Lisa Nandy had also committed to more social housing earlier in the week.

Taken together, Labour’s pro-business approach was welcomed. The CBI commented that, “business welcomes the ambitious plans from Labour on how green growth…can transform the economy.” Meanwhile, Michael Moore, Head of the British Private Equity and Venture Capital Association told the FT, “people have taken a lot of comfort from the fact that senior Labour figures are listening and engaging with business”.

Faced with a floundering Conversative party that has been more dogmatic than pragmatic over the last five years, business seems to be taking the Labour Party seriously again. This comes after a concerted effort by Keir Starmer and his Shadow Chancellor, Rachel Reeves to court this key constituency since he became leader. The clamour by big companies to engage at Labour Party conference this week was proof that these efforts are paying off – and praise for the policies announced was almost universal. However, it will be only at the next election when we see if the party has managed to convince UK companies – and the wider country – that it is truly back in business.?

Keeley Toft , Associate Consultant, Fourtold