A challenge for Labour on the development of jobs and businesses in Britain

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What can the Liberal Democrats offer Labour voters who don’t like the way their great party is heading under Jeremy Corbyn? What, particularly, has our party to offer the working people of this country who have seen their standard of living drop under the Government’s austerity programme and can’t expect better if Brexit happens?

As the party that supports neither unbridled capitalism nor full-blooded socialism, we allow markets to operate as freely as possible, but intervene to ensure they are well-regulated and competitive, and to offer individual citizens greater powers and rights. “We want to build a new economy that really works for everyone”, states Paper 133 for the Brighton Conference on jobs, businesses and communities. It’s a substantial paper that’s been in the making for two years. What is in it for ordinary families where people have all sorts of insecure ill-paid jobs that just don’t bring in enough for any kind of comfortable living these days?

The paper proposes to protect workers at the bottom end of the market, who need core rights – minimum wage, sick pay and holiday pay for both employees and the developing category of ‘dependent contractors’ – by establishing a Worker Protection Enforcement Authority to ensure their rights. A Good Employer kite mark should promote good firms. And since there should be a shift in focus from quantity of work to its quality and towards job satisfaction and training, a National Skills Strategy is proposed with a Minister for Training and Skills to take responsibility for its development and implementation.

In the jobs market there is now demand for high-skilled workers and for the low-skilled, but with weak growth in between. With young people probably needing to retrain multiple times in their lifetimes, the paper proposes Lifetime Learning Entitlements, with individual ring-fenced funds for adults to retrain, plus enhanced apprenticeships. The existing apprenticeship levy should be expanded into a wider Skills and Training Levy, with 25% of the funds raised to go into a Social Mobility Fund targeted at areas with the greatest skill needs, intended to drive upskilling across under-represented and disadvantaged demographic groups.

Another proposal is to set immigration policies to support growth and meet key skills gaps. With student input seen as hugely beneficial, a British equivalent of Canada’s International Mobility Programme is proposed for professionals to be hired on fixed-term contracts, and a Training Up Britain Programme to allow highly-skilled migrant workers to mentor British workers to develop their skills.

Unions are seen as vital in protecting worker rights and increasing diversity, but since their numbers have fallen drastically especially in the private sector, a Union Innovation Fund to support them in their work is proposed, and a Right of Access to enter workplaces, and also to contact workers digitally subject to sensible conditions.

The section of the paper dealing with improving business welcomes the opportunities that new technology can bring, but recognises that public trust in businesses is very low. It proposes that to promote responsible and sustainable businesses there should be a new Companies Act for the 21st century. Directors of large firms will be expected to include in their corporate purposes the long-term interests of stakeholders, the community and the environment.

A topical issue considered, whether providers of data should be compensated for its being used in AI and other products, concludes that companies using such data should indeed provide financial compensation, and the proceeds of such data usage could support the creation of a Citizens Wealth Fund, to invest wealth on behalf of all UK citizens.

With many other detailed proposals for the development of jobs and businesses for individuals and communities, this paper and the motion F28, along with other motions on taxation reform in the Brighton programme, show how much Liberal Democrats can potentially contribute to our people’s economic future through our progressive policies.

* Katharine Pindar is a long-standing member of the Lib Dems and an activist in the West Cumbrian constituency of Copeland and Workington.

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37 Comments

  • Katharine Pindar 3rd Sep '18 - 3:47pm

    Thanks, David, for your support and the information about the useful German models. But there is much more in our own paper also. Section 3.3.7 begins, ‘To broaden ownership and strengthen participation, we will promote more employee stakes in listed companies. This builds on changes made by the Coalition government in 2014 to allow for employee ownership trusts – a special form of employee benefit trust – under which shareholders are able to sell their shares to the trust without paying capital gains if certain conditions are fulfilled. ‘ (further detail follows)

    Then in the next section, ‘We now want to go further and consider establishing a right for employees of large corporations to require the creation of an ownership fund. These could be funded from a small fractional levy on senior executive options and/or annual shareholder dividends – the amount set by the company itself – and over time build up a shareholding with dividends payable to employees. ‘

    This is followed by a section (3.3.9) on having more employee ownership, which concludes, ‘So we will make it explicit government policy to encourage the creation and maintenance of more mutuals, co-operatives, social enterprises, community interest companies, and to support additional moves to increase employee ownership.’

    (Like you I am really interested in this. I only picked out eye-catching ideas from this very thorough and detailed paper in the hope of them attracting publicity, which we so much need to get our excellent detailed plans across.)

  • Innocent Bystander 3rd Sep '18 - 6:14pm

    But this is 100% employee focused.
    It’s 0% for employers.

  • “We now want to go further and consider establishing a right for employees of large corporations to require the creation of an ownership fund”

    This may be a good idea (the devil will be in the detail as always), but it’s worth remembering that 99.9% of businesses in the UK are small or medium sized, and they collectively employ around 60% of private sector employees. So this proposal will have no impact on most workers.

    I’m more interested in what policies we have to help SMEs and start-ups.

  • Katharine Pindar 3rd Sep '18 - 8:17pm

    Well, chaps, I think the encouragement of ‘mutuals, co-operatives, social enterprises and community interest companies’ sounds like supporting small businesses to me. Then there’s section 3.3.13 which wants to ‘Extend the scope of the existing ‘public interest ‘ test when considering approvals for takeovers of … strategically significant companies by overseas-based owners to recognise the benefits to the UK economy, workers and consumers of protecting UK companies (particularly medium-sized enterprises with growth potential and innovative technology) …’

    Or how about (I hope somebody on the Working Group may think I’m earning a drink at Brighton!!) section 3.5.8? – ‘We propose expanding the remit of the British Business Bank to catalyse a major increase in private finance for direct lending to fast-growing medium-sized enterprises, so-called ‘gazelles’, with ambitious plans to exploit technological innovation.’ (So, better bound into action, you attractive SMEs!)

  • Innocent Bystander 3rd Sep '18 - 8:41pm

    ” catalyse a major increase in private finance for direct lending to fast-growing medium-sized enterprises, so-called ‘gazelles’,”

    This is just the empty jargon that “Dilbert” and “The Office” are built on. There is already a vast amount of money looking for these money making start up gold mines. Read the business press. There is a shortage of good propositions and they are already funded but there are a huge plethora of snake oil salesmen peddling dead ends at someone else’s expense who will delight at taking money off the ignorant and desperate politicians.

    “(So, better bound into action, you attractive SMEs!)”

    Why not bound into action yourself? Those exhorting others to found and succeed at making quality businesses now hugely and vastly outnumber those who are prepared to risk everything for an idea. (If they do they soon will be despised as being the “elite”). Set up a high tech business yourself. Risk your own retirement money and home and you will discover, almost instantly, how lightweight and irrelevant these magic solutions are.

  • @Katherine – most small businesses aren’t “mutuals, co-operatives, social enterprises or community interest companies”, nor are they “strategically significant”, but they are collectively significant employers right now.

    I worry about the eulogising of mutuals and co-ops in Lib Dem circles as it gives the impression that we think that normal companies, most of which are owner-managed, are somehow the “wrong” kind of small company.

    Co-operatives should be encouraged where appropriate, but normal SME companies employ about 16 million in the UK, whereas co-operative account for less than 250,000.

  • William Fowler 4th Sep '18 - 8:10am

    I think the govn should stay out of the small business area completely, there are plenty of funding sources for good ideas such as Seedrs.com, the only thing it needs to do is make sure the taxation is an incentive. The good news is that exponential growth is possible for good ideas, the bad news is that no-one is going to risk their money if they have to hand almost half of the profits over as tax.

    Large companies involved in cartel type practices – energy companies, loan sharks etc – do need heavy regulation and resetting of pricing, so plenty for LibDems to do in this area using the existing political infrastructure (and the rule that for every new minister created two should be cancelled should be rigorously followed – the last thing votes want is more politicians).

    Given that a huge EU market may end up being filled with complex tariffs, customs inspections etc some help for small exporters will be needed post Brexit, although opening up of the US market if tariff-free will be a boost for people selling via eBay et al.

    Do agree that workers should have a share of a company and a share in the profits but the flipside of that is if the company is running at a loss that would have to be reflected in lower salaries… at least everyone will then have the incentive to work hard.

  • So now the Labour party is, according to Vince, a ‘great party’ (apart from Jeremy Corbyn, of course); a ‘great shame’, that under Milliband, it came in for such condemnation from our leadership.As for the jibe about ‘full-blooded socialism’?

    As for the rest; a wish list to attract workers. I look forward to part 2; a wish list to attract employers.

  • Peter Hirst 4th Sep '18 - 4:21pm

    Sounds good as does the policy motion. The challenge is making it work in practice. There must be sufficient reserve and flexibility in the system to help those who fall through the inevitable cracks.

  • Katharine Pindar 4th Sep '18 - 6:23pm

    Let’s hope we get the chance to see many of these ideas put into practice, Peter, and not merely by other parties deciding to steal some of our clothes. To me the most important result the paper and motion can have is if it can give some hope to ordinary working people, particularly young people, that they can have opportunities in future for better, lasting and decently paid jobs, with some protection and help from government, encouraging but regulating businesses where necessary. I hope we will work towards that, and not accept the current provision of so many unstable ill-paid insufficient jobs which so many people have, or resign ourselves to future large-scale unemployment with the backstop of a ‘citizens’ basic income’.

  • Innocent Bystander 4th Sep '18 - 7:18pm

    “other parties deciding to steal some of our clothes”

    They already did. The NEDC was set up in 1962 but there was an Economic Planning Board in 1947 (and many such initiatives since and all have disappointed).
    The private funders will find, and snap up, the ‘gazelles’, the Govt directed British Business Bank will fund the smooth talking, lobbyist driven, politically connected three legged hyenas with no teeth and haemorrhoids.

    But on a positive note, please be reassured that there is no chance of anyone stealing this “box full of wishes and dreams that will never come true”.

  • Innocent Bystander 4th Sep '18 - 7:52pm

    David,
    I believe you said your Dad was a “Tiffy” pilot and that means humbling courage in which I stand in respect and awe. A genuine hero.
    But I doubt that the textile weaver is still there or at anything like its former size if it is.
    As to John Lewis – a recent quote from the Grauniad

    “The John Lewis Partnership has said it will make no profit in the first six months of this year and is to close five Waitrose stores as tough trading on the high street takes its toll.”

    And your third example is a publisher with 21 employees.

    For reference Amazon has 575,000 employees and is not a co-operative.
    Samsung has 489,000 and isn’t one either and Hyundai has 200,000 and has made more ships this week than the UK has this century.
    We need wealth creating businesses on a grand scale to leave some tools for our grandchildren to make a living with and a serious confrontation of our problems not some insipid ‘Life Learning Contract’ (ideal for the perpetual student on UBI) or talk of the government finding ‘gazelles’.

  • Katharine Pindar 5th Sep '18 - 12:12am

    @ Mike Tuffrey. Thanks, Mike, I’ll look forward to the working group’s summary of the paper in advance of the drink! I know there is a great deal in your very thorough paper which I wasn’t able to touch on, such as the rebalancing regionally which is important, and to give so much material some shape was a challenge I think you have largely risen to.

    Yes, it had to have some potential usefulness as you say which could be pointed out on the doorsteps. It also had to have some eye-catching new ideas, because getting Lib Dem policy noticed at all these days, other than that we are anti-Brexit, is a major task. And to me, as my headline implies, it was important that we could say to Labour voters, and their disaffected MPs, ‘This is what we have to offer the working people of this country. Can you do as well?’

    I think you may have succeeded. And as one of the members who attended your Consultation session at York last year and appreciated it, I’ve been interested ever since to learn the outcomes, and felt frustrated by the necessary delays, as you must have been yourselves. Well done all!

    @ David Raw. Thanks for adding such an interesting and worthwhile bit of history there, David: good to read., especially with your father’s personal connection.

  • Innocent bystander
    Post WW2 Japanese government support of its industry certainly bore fruit.
    In recent years the Japanese government has adopted a more laissez faire policy towards its economy.

  • Nonconformistradical 5th Sep '18 - 7:01am

    @Innocent Bystander
    “For reference Amazon has 575,000 employees and is not a co-operative.”

    Amazon seems to have a track record as a not very good employer (it isn’t difficult to find criticism of its employment practices scattered around the web).

    That’s OK is it?

  • Innocent Bystander 5th Sep '18 - 8:52am

    @David,
    I think there were a few philanthropic industrialists in those days. I am an engineer, not historian, but didn’t Rowntree, Lever and Salt also build “model” villages for their employees?
    Anyway, the key there is “1891”. Britain was the undisputed richest place on earth and there was plenty of opportunity for those with (Quaker??) beliefs to share their immense wealth. Not so easy in a debt ridden, collapsing basket case which is what we are today.
    @Ian post WW2 Japan (and Germany) benefited from much US aid and were able (=forced) to desist armament manufacture and turn to consumer goods. Cold War UK had neither advantage.
    @Non…the great conundrum for western political parties (especially the LibDems) is how a Socialist and a Capitalist can happily co-exist under the same duvet.
    Compounded, of course, by every other nation finding a different balance point and all competing with each other. Ultra generous employee rights have to end up on the cost of the finished goods and sold into markets where they don’t enjoy those rights and refuse to pay for yours. As to Amazon, to work for them you have to apply and if you find you don’t like it you can freely leave and work somewhere else.

    Just some other points
    1. those who propose we should become more like Germany must accept we then become less British. (Not that I disagree).
    2. the insipid and feeble proposals presented here have been tried before so many times before that I have lost count. Politicians have actually very few levers indeed at their disposal which can affect business progress. None are pulled in this document and the ones that might work aren’t touched ( because they are too scary to touch).
    3. business support won’t work, in the UK, because we won’t ask hard questions. Ponder why HS 2, Smart Meters, Crossrail, Railway Electrification are all late and cost multiple times what they should. Where does that missing money go? It is stolen of course, but because it is stolen via a hundred page contract of legal jargon we neither notice nor complain.
    4. time to get nasty.

  • Katharine, an optimistic piece.

    The reforms to apprenticeships sound good making them high-quality with a sector-recognised qualification.

    Instead of saying we will ensure that all jobs will be secure, empowering and provide a sense of value and belonging with development opportunities and that pay enough to live on relative to local living costs we use the weasel words that we will encourage business to provide these things.

    A new higher minimum wage for zero hour contracts looks like a good thing. However we don’t say at what level it should be set. Do we think it should be the medium earnings rate? It was once predicted to be £15 by 2020.

    The paper implies that by 2020 the ‘Skills and Training Levy’ will only raise £3 billion and there is a pool of 3 million people who could be on an apprenticeship. This means if we only managed to get 1.5 million people on an apprenticeship there would be only £2000 to pay for the training per apprentice.

    Is increasing public funding of R&D to 3.4% only after 10 years ambitious enough?

    We say we want to expand the British Business Bank which provides credit and ‘business advice services’ to small and medium ‘enterprises’ to ‘fast-growing medium-sized enterprises’ and to invest in slower growing regions, but we don’t say how much extra funding this will provide over what time scale.

    Is £5 billion enough for a new Housing and Infrastructure Development Bank? Does it really replace the €6 invested in the UK in 2016 by the European Investment Bank?

    There are ideas about supporting balanced growth across the UK. One of which is to expand the British Business Bank to have a role to “help rebalance the UK economy geographically” but nothing about how much money we will give for this.

    @ Innocent Bystander and expats

    I didn’t read the paper the way you did. I read it as tinkering at the edges and not doing enough for workers and especially I noted its lack of a commitment to full employment, a voluntary job guarantee or meaningful training guarantee. I think these last three would be needed if we truly wanted to be a challenge to Labour on the economy.

  • Innocent Bystander 5th Sep '18 - 1:33pm

    Labour’s economic vision is Venezuela and God, only, knows how we will survive that.
    As I said, this is entirely employee focused and is nothing but more duties and obligations on employers, more load on the tax system and with no benefit or help at all.
    The apprenticeship stuff is a ludicrous myth (even though almost all politicians are totally devoted to it).
    Don’t believe me? Just nonsense?
    It’s easy to test.
    Pick up the ‘phone and try and get a plumber, sparky or chippy.
    You won’t have any problem at all. There are plenty looking for work.
    But still, if politicians didn’t have the apprenticeship myth to cling to they would have to face reality.
    Do you have employment for these new apprentices? Or will they end up flipping burgers after training? Do you think the high tech firms (the few we have left) don’t train anyway and just don’t have full time vacancies for anymore?
    Who will give a “job guarantee”? What sort of job? Where? Doing what? Where will they get the money from?
    Still, all these initiatives will create employment. All the schemes will need entire infrastructures to deliver them, big offices, CEOs, mega salaries, consultants, implementers and secretariats and the money will all disappear into the pockets of these scalpers and none to the intended targets.
    It happens every time.

  • innocent Bystander 5th Sep '18 - 3:47pm

    David,
    ” the vast majority of Labour MPs, ”
    if you mean my Venezuela comment then I should enlarge (but I didn’t say Labour MPs just Labour). I have frequently, over the years, purchased, two or three times a week the journal the Morning Star. The newsagent says I am the only purchaser he has ever met and they all go back unsold (apart from mine). Corbyn is no newcomer to me. He has written for the MS for years and years and I have read umpteen of his columns. Venezuela and Cuba have been his economic models for ever. My use of the word “Venezuela” is absolutely fair. He also hates the EU which he regards as a capitalist plot to globalise the masses.
    Now as to the “rank and file” Labour MPs I too have met and have great respect for some (not all though). But they have their own consciences to look to. One I admired was Jamie Reed of Copeland who resigned rather than pretend to follow a leader he fervently disagreed with. Those who are down below the parapet hoping that someone else will “do something” allowing them and their more balanced view of socialism to re-emerge are less admirable. I would like to know what you think a centre ground Labour MP should do in today’s situation. Stay and fight might be OK, cut and run also, but stay and hide whimpering in a corner hoping the Momentum toughs won’t come and get them if they mind what they say??
    So I can defend my words as long as the Labour party follows the leader it has chosen.

  • Nonconformistradical 5th Sep '18 - 3:58pm

    @Joseph Bourke
    “We do need to remember that politicians are elected to do a job, enact legislation that will improve the lot of society as a whole.”

    I wonder if you are living on a different planet from me. I really hadn’t noticed tory politicians with any interest in anyone except their own kind and the devil take the rest of us. labour’s constant class warfare refrain doesn’t make me think any differently about them either.

  • Innocent Bystander 5th Sep '18 - 4:57pm

    David,
    J. T. & J. Taylor seems to have gone in 1966 but I have seen photos of their Batley Mill and it looked huge! On Google earth it seems to be still there and now refurbished and occupied.

  • Katharine Pindar 5th Sep '18 - 5:30pm

    @ Michael BG. Intelligent, thoughtful weighing up of options in the paper and suggesting how the policies need strengthening seems to me a most useful and constructive comment, thank you Michael. I hope the Brighton debate may include more of the same.

  • Nonconformistradical 5th Sep '18 - 6:38pm

    @Joseph Bourke
    what does their own kind mean?” Those who might actually benefit from tory policies…. I see no evidence that tory politicians care a hoot about the less well fortunate in our society – any more than it appears (to me) that some labour politicians care about anyone who doesn’t support their socialist vision.

  • David Evershed 5th Sep '18 - 10:03pm

    “As the party that supports neither unbridled capitalism”

    The Conservative Party created the Competition and Markets Authority and thus is like the Liberal Democrats in not supporting unbridled capitalism.

    We should find ways of differentaiting ourselves from other parties.

  • Katharine Pindar 6th Sep '18 - 9:16am

    @ David Evershed. That’s a pretty amazing comment, I think, David. How much of this suggested policy on jobs and the economy, or our suggestions for land-value taxation and wealth taxes, could possibly be adopted by the Conservatives? Haven’t we distinguished ourselves pretty strongly from them in our values in the past and those reaffirmed since 2015? in relation to both major parties, it seems to me we strike a position both idealistic and pragmatic which most people not personally locked into preserving inequality or still upholding class conflict could see is good for the country.

  • Katharine Pindar 6th Sep '18 - 12:31pm

    We surely need to be giving serious consideration now to the final report of the IPPR Commission on Economic Justice, entitled Prosperity and justice: a plan for the new economy https://www.ippr.org/cej. I have read the Executive Summary, and think it would be good if one of our members could compare its conclusions to those of our own report. Its ten-point plan includes the intentions to promote investment-led growth, rebalance the economy, give workers greater bargaining power, and pursue ‘managed automation’, all of which sound pretty compatible with our plans, at first glance.

    I only want here to mention one idea from this report, which I actually read in the Times review of it. Apparently there is a proposal for the public ‘to be rewarded’ with an extra day’s bank holiday every time productivity grows by an agreed amount. This sounds to me a scatty idea which would cause great disruption to business and school planning. What I would like us Lib Dems to develop instead is an idea that a three- or four-day week for working should become more of a norm in the future, if jobs become scarcer through technological advance with robots and AI. This would seem likely to help with under-employment, and be very popular with workers. What do people think?

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