Labour's big pitch to big business

Keir Starmer today promised to "do the hard yards" to fix the economy, in a critical bid to win over businesses ahead of the next election.

Unveiling his party's plan to reverse wage stagnation and boost growth, Starmer said the attendance of 400 corporate leaders at the launch event, in central London, showed the "depth of the changes we've made to transform the Labour Party's relationship with business". That tickets reportedly sold out within hours "suggests it is pushing on an open door", said the Financial Times's leader column.

It is the culmination of a remarkable journey for the party since 2019. After the 2008 financial crisis occurred on Labour's watch, Jeremy Corbyn's time as leader did little to improve the image of Labour's economic competence. But five years on – and following Liz Truss's disastrous short-lived tenure as PM – the tables have turned, with research by polling firm Redfield and Wilton Strategies suggesting the public now trust Labour more on the economy than the Conservatives.

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'Boring, snoring' right-hand woman

Labour's new-found reputation for fiscal responsibility is largely down to the party's shadow chancellor, Rachel Reeves.

Once a Labour outcast, dismissed by Corbyn as too right-wing and derided by a TV executive as "boring, snoring", her "relentlessly pro-business, pro-caution approach chimes with the 'no drama Starmer' image that the Labour leader had cultivated", said Politico, "in contrast to the chaotic governing Tories".

Such is the sway that the former Bank of England economist now holds over the party, she topped The New Statesman's "left power list" last year, beating her boss into second place.

Crucially, Starmer "needs business help to deliver the growth that is at the heart of his agenda", said the FT. Although "little detail" has been provided yet, said Sky News, the headlines set out today include a promise "to get Britain building again after 14 years of stagnation"; "plans for skills to drive growth"; "the need to partner with business to make work pay for working people"; "backing British business"; and "creating the stable economic conditions required for delivering growth".

'Unhappy times to come'

The new-found love-in between Labour and business is not without its critics, however.

Yesterday, Reeves announced the party would not reinstate the cap on bankers' bonuses scrapped by Liz Truss – "less than 100 days after her own Treasury team lambasted the move", said Steerpike in The Spectator. "The move is part of Labour's big push to prove they're on the side of business," said the columnist, and "tells you everything you need to know" about the current Labour Party.

Then there is Labour's £28 billion-a-year Green Prosperity Plan. The fate of the flagship economic policy "has become the Ark of the Covenant", said Andrew Marr in The New Statesman, "furiously contested between Israelites and Philistines". As reported last year, the true figure has been diminished by already committed government spending, "and had been put off until the midterm of any Labour government". And "it may soon disappear completely", Marr predicted.

After what Steerpike called "another Labour U-turn" on the economy, some – including Scottish Labour leader Anas Sarwar – have signalled that the party must ensure "fairness" alongside its attempt to win over business in the hope of boosting growth. 

James Schneider, Labour's director of strategic communications under Corbyn, went further. He told Politico there are "unhappy times to come, given that on current trends, and applying Labour's publicly stated policies to trend outcomes, most people in the country will be less well off two years into Labour governments than they are at the beginning".