WHAT DID BUSINESS LEARN FROM THE LABOUR & TORY PARTY CONFERENCES?
Good Relations attended both the Labour and Conservative conferences in September and October. Away from the sound and fury, we have had sufficient time to digest and reflect on the dominant themes emanating from both events and what this might mean for businesses over the political year ahead.
Labour’s conference was pretty upbeat and while the leader’s speech did not address the reasons for the party’s electoral defeat, nor engage strongly with the public beyond the hall, various approaches to business were revealed which will inform its policy formation in the months ahead:
Statism and interventionism
Neither Jeremy Corbyn nor John McDonnell said anything directly about the role of commerce or wealth creators. The central role that the ‘new’ Labour leadership see for government, as demonstrated by calls for policies such as a state investment bank or rent controls, was clear. For business, it will mean less talk of free market solutions and more of intervention or regulation to correct free market failures or externalities.
Corbyn has promised to repeal trade union laws, resurrect a Ministry of Labour, introduce workers’ rights legislation and put “people before profit”. Pressed during media interviews what this phase implies, Corbyn struggled to articulate an upbeat view of the role of companies in the economy, rather holding up the positive examples of co-operatives and social enterprises. With other polices, such as plans to reverse corporate tax cuts, the party’s relationship with business appears fractured, which is likely to make it more difficult for them to engage with the Labour frontbench than during Ed Miliband’s leadership.
During his leader’s speech, Jeremy Corbyn stated: “Just because I’ve become leader of the Labour
Party, I’m not going to stop being an activist.” This stance places idealism at the fore, which though it may appeal to core supporters, risks rejecting those compromises with reality with which a government may have to grapple. However, the Government’s withdrawal from a controversial prisons deal with Saudi Arabia, which Jeremy Corbyn protested against, points to how effective this campaigning can be. In shining a light on different issues, be it zero hours, arms contracts, tax avoidance etc., the Government and any companies involved with them will be forced to respond.
Corbyn has committed the Labour Party to being more consultative with party members in policy formation, but there is a danger this could make the outcomes inconsistent and non-linear. Confusion over Labour’s position on Trident and the Shadow Chancellor’s U-turn on the party’s fiscal policy are early examples of this. Understanding and tracking Labour’s positions will undoubtedly be trickier.
You can watch the key conference speeches for yourself here.
FROM THE CONSERVATIVES….
Despite the media obsession with anti-capitalist protests outside and the jostling for position amongst potential future leadership candidates, the Conservative Party had a successful conference in Manchester. It was slick, confident and, in managing to avoid any major arguments on Europe, allowed the party to portray itself as eager to deliver the job of being in government. Some common themes and positions emerged:
Small state interventionism
The party’s commitment to cutting the size of the state (and there is behind-the-scenes unease as to how polices like reducing tax credits will play out and inevitably be mitigated) contrasted against the policy dynamic of ‘targeted interventionism’ which is becoming a hallmark of the current leadership. Be it the drive to promote development of a ‘Northern Powerhouse’, the creation of a National Infrastructure Commission (a policy stolen from the Labour manifesto) or public health market regulation, the difference for businesses is that the Conservatives are interested in hearing from those who can bring evidence-based solutions or ideas to the table.
The return of Cameron the moderniser
David Cameron found himself giving his speech as Prime Minister of a majority-Tory government that few believed possible just a few months before. It was the most ‘modernising’ of his premiership and definitely a return to the compassionate Conservativism of the early days of his leadership. The speech bore the fingerprints of Steve Hilton, his former strategy director, particularly in its focus on poverty and achieving equality of opportunity, as well as the obstacles that entrench this. In tackling issues traditionally perceived as left wing, he has moved the party firmly into the centre ground. Whilst the rhetoric may have been searing, there was actually relatively little policy meat on the bone and how far the government is willing to act to address these vaulting ambitions in the years ahead will be of keen interest to business.
Focus on delivery
Following on from the small state interventionist theme above, the Government is cogniscent there is a pressure during a second term to deliver tangible results across the policy spectrum. For businesses, this means the Government will be seeking to take a pragmatic approach and is open to solutions that are cost effective (somewhat reminiscent of the old Blairite approach that they are interested in ‘what works’).
Building on the theme of devolution, there was a clear interest in bringing decision-making down to a local level in many areas from transport, planning to health. As a result, businesses seeking the ear of decision-makers will need to ensure their public affairs strategies take them beyond the city limits of London, Birmingham and Manchester, out into the towns and regions which will increasingly become the front line of innovation and decision-making.
The party avoided any serious splits on Europe, which for many was an achievement in itself. But the issue rumbles on and as the result of negotiations become clear and the referendum campaign begins in earnest, the issue will dominate politics and crowd out other policy debates and activity. There is therefore a danger that the party becomes consumed by the issue and government distracted – one to watch.
You can watch the key conference speeches for yourself here.
If you are interested in discussing how the issues raised in this brief report affect your organisation or undertaking a review to assess your position against policy priorities for any of the key political parties, please contact: