Labour Conference “Business Day” – what you need to know
John Healey’s first major speech as Chancellor was the centrepiece of “Business Day” at the Labour Party Conference in Liverpool yesterday.
Prior to the Chancellor taking the stage, business leaders enjoyed a breakfast of smoked trout and granola pots in the company of Jonathan Reynolds, the Business Secretary, followed by a short fireside chat with Andy Burnham.
It was all very chummy, but did the charm offensive work? What did we learn about the prospects for high-growth companies and the investors who back them? A few observations from Liverpool:
Lots of hope, not so much growth: The chancellor used the word “hope” (at least) 10 times in the opening part of his speech. Growth was far less obvious as a theme and was only really discussed towards the end of the speech. There is some mitigation: The conference’s main slogan is “Hope Again” and the positive vibes approach of the Burnham government has been a welcome departure from the Starmer administration’s inability to talk up the UK’s successes (see below) – but the absence of growth as a core part of the speech is a concern. Healey, I am told, addressed growth more directly in private meetings after the speech.
Scaleups are central to the mission: In the fringe events and in conversations around the conference there was much talk of supporting scaleups– making the chancellor’s lack of growth focus even more perplexing. There were encouraging noises made about identifying the scaleups of the future and creating better business conditions for existing star performers.
Startups less prominent: Healey made reference to “half the world’s most innovative companies” being in Britain and called out the life sciences sector, but there was little else to cling to for startup founders (apart from some welcome engagement from ministers on EIS and SEIS). This feels like a change of tone from previous governments, who have seen talking up startups as a way of planning for the future without making any real commitments.
AI, everywhere and nowhere: The now daily warnings of AI’s existential threat were front of mind, as was the opportunity the technology provides to British companies (and the threat to jobs). There were a few broad mentions in the major speeches, but most of the action went on in fringe policy meetings. It is evident that Kanishka Narayan, the AI minister, is popular with the business community and seen as a man who “gets it”.
Tax, the elephant in the room: Hanging over every conversation was next month’s budget and the prospect of further tax rises. Many privately feel it is inevitable, with some fearful talk about equalising CGT with income tax. This would clearly be a huge blow to entrepreneurs and will be the subject of furious lobbying from business groups over the next month.
Iron adherence to fiscal discipline: A central theme that ran through all the briefings. The chancellor’s message of “hope” was the good cop part of the speech, which was followed by a very bad cop in the form of what the FT called a “stern lecture” on the importance of fiscal discipline. It was this constant refrain that convinced lots of observe
rs that tax rises are coming (because spending cuts aren’t).
No more leaky ships: Budgets for years have been characterised by fevered speculation, policy kite flying and outright leaks. This year feels different. In an extended interview with The Sunday Times, Healey refused to speculate, or even come close to speculating, on the contents of his first budget. That carried on into the conference and looks set to continue over the next month, much to the frustration of journalists.
The return of storytelling: A regular criticism of the Starmer government was its inability to talk up its achievements, to the detriment of the economy. Burnham and his cabinet have changed that narrative to a more positive storyline – to the guarded approval of businesses.
– written by Peter Evans, Deputy Managing Director