Britain’s opposition Labour Party said on Tuesday it would prioritise economic stability if it won a national election on July 4, with its finance policy chief saying she would focus on spurring successful businesses.
Less than a week after Prime Minister Rishi Sunak shocked not only opposition parties but his own Conservatives by calling an early election, frontrunner Labour has repeatedly told voters they can trust a “changed party” to govern after 14 years out of power.
The party said it alone could provide the stability needed for investment, buttressing its argument with a letter of support signed by more than 100 business leaders.
“Stability, investment, reform – you’re going to hear those three words a lot from me because they are the ingredients of a genuine plan for the future,” Labour’s finance policy chief Rachel Reeves told an audience at a Rolls-Royce factory.
“This Labour Party is the natural party of British business,” she said, adding that Labour’s manifesto – its agenda for government – would bear the imprint of years of engagement with businesses large and small.
Under leader Keir Starmer, Labour, about 20 percentage points ahead of the Conservatives in surveys, has moved towards the centre after veering left under his predecessor, Jeremy Corbyn.
Reeves described the party as “pro-worker and pro-business”, and repeated her pledge that corporation tax would be capped at its current rate for the duration of the next parliament.
She said she was proud to have received the backing of current and former bosses in retail, advertising, travel and finance, who said in their letter that Labour had shown it had changed and should be given a chance to shape the future.
The letter stated: “We are in urgent need of a new outlook to break free from the stagnation of the last decade and we hope, by taking this public stand, we might persuade others of that need too.”
Signatories included the boss of the supermarket chain Iceland, the chairman of the retailer JD Sports, the former UK boss of advertising giant WPP, the former CEO of car maker Aston Martin and the founder of a childcare company that once included Sunak’s wife Akshata Murty as an investor.
Business investment in Britain has fallen far behind that of its peers since it voted in June 2016 to leave the European Union.
In the third quarter of 2023, it stood only 1.6% above its mid-2016 level, compared with increases of 8% in Germany and 28% in the United States and France, according to a Reuters analysis of OECD data based on gross fixed capital formation, minus dwellings and government.
The Conservatives say they have had to steer the economy through the COVID pandemic and the spike in energy prices that followed Russia’s full-scale invasion of Ukraine, and that a recent drop in inflation shows the economy is back on track.
They say business is concerned about Labour’s plans to protect workers’ rights, but that the Conservatives have a “clear plan” that businesses can rely on.
After an underwhelming start to the election campaign, Sunak has proposed tax cuts for millions of pensioners – the section of the electorate most likely to vote Conservative.