Tickets sold out so quickly for today’s Labour party conference “business day” that it was dubbed the corporate equivalent of Glastonbury.
The hundreds of bosses who landed a £3,000 pass earlier this year will now be hobnobbing with politicians in Liverpool, hopeful they can cement relationships and sway key policies. Inside today’s “CEO creche”, as one guest calls it, workers’ rights reforms and a potential tax raid will be top of the agenda.
There’s no denying that Labour has worked hard on its pro-business image. The Treasury has made such an enormous effort liaising with bosses that insiders say Downing Street is getting frustrated.
“I think unions will be more angry than businesses will when they see the employment bill [next month],” a Whitehall source says.
“The focus on business has been so much so that No 10 are saying, ‘you’ve overcorrected’”. Another Whitehall insider said there are meetings with bosses about looming workers’ rights plans “virtually every day now”.
Yet tensions are bubbling beneath the surface. Polls are showing rising fears in corporate circles about how the looming workers’ rights overhaul, a top priority of the Deputy Prime Minister Angela Rayner, might land.
Sir Keir Starmer’s warnings about the state of the economy and the likely need for tax rises in next month’s Budget have caused consumer confidence to plunge, according to data provider GfK.
Some are questioning why Business Secretary Jonathan Reynolds has criticised Amazon for ordering staff back into the office full-time, after he argued that the online giant was ignoring evidence on the benefits of home working.
“I’m not sure why that’s government business,” says one businessman, although Amazon workers are apparently furious.
Ministers need to use this week’s Labour party conference to press reset on relations. Despite the constant hum of Whitehall roundtables chugging on behind the scenes to thrash out workers’ rights reforms, confusion reigns.
A business executive who has been in many of these meetings says there can be so many people around the table that nobody wants to stand out as the rude one in the room. People are holding back on saying what they really think.
Although executives have largely said publicly that everything feels hunky-dory, polls suggest business fears are widespread.
The Confederation of British Industry (CBI) said earlier this month that a survey of its members, which include FTSE 100 giants such as AstraZeneca, Unilever and GSK, found that 62pc predict a decline in the UK as an attractive place to invest and do business over the next five years.
The CBI said the “main change in perceived future threats to competitiveness” was a looming overhaul of rules on flexibility, which 58pc of businesses think will have a negative impact. The Government is preparing to make flexible working a default, meaning bosses turning down requests must justify why they are not acquiescing.
The biggest issue for many business leaders has been a lack of clarity. Many bosses are not against a reform of workers’ rights in theory, but there’s a huge difference between “day one” employment rights which kick in from the very moment a new staffer walks through the door and rights that aren’t really triggered until six months later.
That issue has been the subject of “intense” debate between deputy leader Angela Rayner and Reynolds, who favours a longer probation period than Rayner does.
It is now looking highly unlikely that day-one rights really will be from day one, but leaders are growing weary of second-guessing policies which could have such an enormous impact. With so much still being debated, boardrooms have abandoned hope of clear answers when the Government publishes the details of its much-anticipated employment bill next month.
A crunch meeting held on the eve of the Labour conference, between Rayner, Reynolds and trade unions, could result in plans shifting yet again.
The lack of detail frustrating businesses isn’t just isolated to workers’ rights. City veterans will be searching for clues about tax raids in the Autumn Budget at next month’s investment summit, after a speech by Sir Keir in Downing Street’s rose garden gave little away. He has warned that his party’s first Budget “is going to be painful” and the threat of higher taxes has meant rumours are now rife.
Private equity chiefs fear they are about to lose their carried interest tax perk, which is taxed as a capital gain of up to 28pc rather than the top income tax rate of 45pc. Jon Moulton, the boss of private equity firm Better Capital, says “many think the battle is already lost so will vote with their feet”.
Corporate Britain largely welcomed Labour’s landslide election victory following the turmoil under the Conservatives.
But as Sir Keir keeps talking in vague terms about tax rises and bosses continue to scratch their heads about what workers’ rights reforms will mean in practice, hope is dwindling. Labour is on the brink of a battle with businesses. Bosses want more detail on policies and to have something they can feel excited about. More detail, less gloom.
That needs to start now. The decision to cut winter fuel payments to millions of pensioners has hit popularity ratings, while government leaks about Sir Keir’s chief of staff Sue Gray have raised fears about internal chaos.
It was this time last year that Sir Keir told a room full of influential corporate leaders in Liverpool that Labour is now the party of business. “If we go into government, you will come with us”, he told the crowd. Now is his time to prove it.
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