Jeremy Corbyn MP, Leader of the Labour Party, speaking at the CBI’s annual conference on 19th November.
Thank you Carolyn for that introduction. You became the Director-General of the CBI shortly before I became Leader of the Labour Party, and since that time Labour and the CBI have always had a very constructive and fruitful working relationship, which will no doubt continue in the future as we set a path for a more successful and prosperous society.
It is a pleasure to be here today, addressing you at such a crucial time in our country’s politics and national life. It’s a time of huge decisions that could shape our future for a generation or more: decisions about our relationship with the European Union, of course, but also about the kind of economy we want to have.
When I spoke to your conference last year I said that even though we were then seventeen months on from the referendum, the situation was more precarious than ever. Confusion at the heart of government was creating unprecedented uncertainty for business and workers across the country.
If I said the same today that would count as something of an understatement. Instead of national leadership, we have a Government in complete disarray. As soon as the terms of its Withdrawal Agreement from the EU were set down on paper, the Government began to collapse in on itself. And now the Conservative Party is trying to decide whether this crucial moment for our country is also the right time for a party leadership election.
That the Government has mishandled two years of negotiations is now hardly a controversial view, subjecting businesses and their workforces to months of uncertainty. Some perhaps hoped that the length of the negotiations might at least be a sign that the Government, rather than negotiating with itself more than with Brussels, was driving an effective and hard bargain to get the best deal for our economy.
Now we know the answer. After the events of the past week, many people and many businesses will be confused and anxious. The Prime Minister has negotiated a botched, worst-of-all-worlds deal which is bad for Britain, leaving the country in an indefinite halfway house without a real say.
The Withdrawal Agreement breaches Theresa May’s own red lines and doesn’t deliver the strong economic settlement the country needs to support jobs and industry. The deal makes no mention of retaining frictionless trade with Europe and offers only minimal protections for workers, consumers and our environment, while hard-wiring further potential restrictions on state aid for industry.
Labour has always said we respect the result of the referendum, but we cannot respect the shambolic way in which this Government has bungled these vital negotiations. This is after all a deal that was immediately denounced by the Brexit Secretary who was supposed to have negotiated it, as well as his predecessor. Labour will vote against the Government’s deal and if the Government cannot get its central policy through Parliament, then we will demand a General Election. But if we cannot secure a General Election, then we have been clear that all options must remain on the table, including a public vote.
Terry Sargent, the Chair and CEO of steel giant Thyssenkrupp in the UK – and a lifelong Conservative voter – recently said the Tories have “failed business”. They “aren’t making decisions for business” he said, “they are making decisions to prevent an implosion in their own party.”
The result of this skewed priority is a Brexit deal that is simply not good enough. Rather than ending the uncertainty of the last two-and-a-half years, the agreement the Government has negotiated locks in uncertainty for another two, three, four – who knows how many more years?
If a comprehensive future relationship is not agreed by January 2021, which few believe is likely after the experience so far, then those negotiations would have to be put on hold because the focus would inevitably shift from negotiating the future relationship to negotiating an extension to the transition period – meaning another period of further uncertainty.
And if the transition period can’t be extended, Britain will be locked into a backstop from which it cannot leave without the agreement of the EU, with no time limit or end point and no say for Britain, sowing the seeds of a backlash in years to come.
And that’s only the Withdrawal Agreement. The Outline Political Declaration that was also published last week, which is supposed to signal our future relationship with the EU after Brexit, runs to a mighty seven pages.
So after two whole years, the fruits of the Government’s efforts to outline our trading future can be set down on just seven sheets of paper – with no ambition to negotiate a new comprehensive customs union, no clear plan for a strong deal with the single market, merely a vague commitment to go beyond the baseline of the WTO, no determination to achieve frictionless trade or even the Prime Minister’s downgraded ambition for trade to be “as frictionless as possible” (meaning further uncertainty for business), and only the scantest mention of workers’ rights, consumer rights, or environmental protections.
After all the speculation about which adjective to use before the word Brexit — hard, soft, clean, red white and blue, the Prime Minister is trying to take us into a blindfold Brexit, a deal designed to get her through to the next stage of the process without anyone being able to see where we’re heading as a country. It’s a leap in the dark, an ill-defined deal with a never defined end date.
A blindfold Brexit, followed by further years of botched negotiations on our future relationship with the EU with most of our leverage already thrown away, risks seriously damaging British industry and the wider economy. The Government is trying to force through this bad deal by threatening us all with the chaos and serious damage to our economy of a no deal outcome.
But the Prime Minister knows that no deal isn’t a real option. Neither the cabinet nor Parliament would endorse such an extreme and frankly dangerous course.
Labour will not countenance a no deal Brexit. I fully understand why business, which knows how disastrous no deal would be, is so concerned at the prospect, and why some might feel under pressure to support any deal, no matter how botched and half-baked, to avoid a worse outcome.
But the threat simply isn’t realistic. If the Government believed no deal was a genuine option, it would have made serious preparations, but it hasn’t. Indeed, shortly before he quit, the former Brexit secretary revealed that he had only just found out that the UK is “particularly reliant on the Dover-Calais crossing” because we are, as he put it a “peculiar geographic entity” – by which I think he meant an island. Well, we’re only talking about 10,000 lorries a day arriving at Dover handling 17% of the country’s entire trade in goods, worth an estimated £122 billion last year.
The choice between Theresa May’s deal and no deal is a false choice, designed to scare people into backing the Government. So Labour has set out an alternative plan for a sensible jobs-first agreement that could win support in Parliament and help bring our country together.
First, we want a new comprehensive and permanent customs union with a British say in future trade deals that would ensure no hard border in Northern Ireland and avoid the need for the government’s half-baked backstop deal. Businesses and workers need certainty. The Tories’ sticking plaster plan for a temporary customs arrangement, with no clarity on how long it will last and no British say, can only prolong the uncertainty and put jobs and prosperity at risk.
Second, a sensible deal must guarantee a strong single market relationship. Talk of settling for a downgraded Canada-style arrangement is an option popular only on the extremes of the Tory Party. It would be a risk to our economy, jobs and investment in our schools, hospitals and vital public services.
Third, a deal that works for Britain must also guarantee that our country doesn’t fall behind the EU in workers’ rights or protections for consumers and the environment. Britain should be a world leader in rights and standards. We won’t let this Conservative Government use Brexit as an excuse for a race to the bottom in protections, to rip up our rights at work or to expose our children to chlorinated chicken by running down our product standards.
A good Brexit plan for this country is not just about what can be negotiated with Brussels. It must also include a radical programme of investment and real change across our regions and nations. Brexit should be the catalyst to invest in our regions and infrastructure, bringing good jobs and real control to local communities and people.
If the Prime Minister is unable to negotiate an agreement that can win a majority in Parliament and work for the whole country, Labour’s alternative plan can and must take its place.
The deal I have outlined has always been possible, putting the economy and jobs first, as both Labour and the CBI have argued in different ways for some time. In January, Carolyn called for the UK to remain in a customs union with the EU for the long term. And we agree with the CBI too on the need for a deal that guarantees a strong single market relationship. There is a better deal to be had and it’s not too late to achieve it – if the Prime Minister has the courage to change course, or stand aside and let Labour take the reins.
The responsibility for how we got to this point certainly lies in Downing Street, both with its current incumbent and her predecessor.
But there is a bigger story to tell. In 2016 the country voted to leave the EU against the economic backdrop of post-crash Britain: a million families using food banks, over 4 million children living in poverty and real wages that are lower today than they were in 2010.
In towns and cities hollowed out by industrial decline and neglect, with boarded up shops and closed youth centres, many people voted for Brexit as an act of protest against a political system that simply wasn’t delivering.
At the root of this was Britain’s profoundly unbalanced economy, chronic under-investment and failed economic policy. That needs to change.
The shape of our economy after Brexit will not only be determined by the text negotiated in Brussels. It will be driven by political decisions about the direction we wish to take as a country. We could try to carry on as before, with economic thinking that has fuelled instability, insecurity and crisis. Or we can embrace change and build a more equal and prosperous society that meets people’s hopes and needs.
So today I not only want to talk about getting a good deal with the EU but about getting a good deal for all our country’s people.
You may be working for a big company, struggling with increasing personal debt, striving to meet excessive rent or mortgage payments. You may be running a small business, scraping by week to week awaiting payments to come in to cover ever-rising overheads. You may be employed in the public sector having barely seen a pay rise in 10 years but working harder than ever as many of your colleagues have lost their jobs Or you may be surviving in the precarious economy as one in every nine working people now are, maybe getting paid the minimum wage on a zero-hours contract, instantly sackable, never knowing for sure whether you’ll have work from one day to the next.
When people such as these think about the economy – of course they’re asking what’s in it for me?
Household debt is rising, rents are rising, utility bills are rising, while the public services we rely on are shrinking in terms of what they can provide; social care, the NHS and children’s education.
Last week almost unnoticed amid the drama of cabinet resignations, Professor Philip Alston, the United Nations Special Rapporteur on extreme poverty and human rights, published a damning report on poverty in the UK. He found that a fifth of the population, amounting to 14 million people, are living in poverty. He catalogued what he described as the “dramatic decline in the fortunes of the least well off” and said our rates of child poverty are “not just a disgrace, but a social calamity and an economic disaster.”
The fact is that wealth hasn’t trickled down. Instead, rigid and outdated economic thinking has helped create a situation where 20% of Britain’s wealth is in the hands of just 1% of the population making us one of the most unequal countries in the EU. Inflated boardroom bonuses haven’t made our economy stronger or more successful. Corporation tax cuts haven’t increased investment and growth or put more money in workers’ pay packets. And financial deregulation didn’t deliver self-regulating markets but an era-defining economic crash from which we are still struggling to recover.
It could not be clearer, business as usual isn’t working. And when the rules of the game aren’t working for the overwhelming majority, the rules of the game need to change.
That means a new settlement for business and a stronger say for the workforce where government will drive a higher rate of investment in infrastructure, education, skills and the technologies of the future. The largest businesses that can afford it will pay a bit more towards the common good.
So we will repeal the 2016 Trade Union Act and roll out sectoral collective bargaining to ensure that working people can be fairly represented through their trade unions. At the Labour Party Annual Conference in September we set out proposals to give workers a say, and a stake, in larger businesses. We will legislate to ensure a third of the seats on company boards are reserved for elected worker-directors. And we will give employees a stake in company profits by asking big businesses to transfer shares to be held by workers in trust.
Despite the frenzied reactions in certain sections of the press this certainly isn’t about any kind of war on business, rather the opposite. Labour recognises the vast and vital contribution businesses make to our economy and our society. And at the heart of that contribution are your employees. They have an interest in the long-term success of your company – their company. They have in-depth knowledge of its day to day workings. They have so much to contribute and giving them a real voice will strengthen, not weaken, the business. Workers create profits. Giving workers a share in them isn’t just fair, it’s good for business.
We believe our plans are necessary, not just to create a fairer economy that can command public legitimacy, but to rebuild our economy for the 21st Century and raise productivity and investment in every region, nation and community. We share an understanding of the urgent need to increase public investment in the economy and if the public is going to invest on the scale needed then people need to feel they have a real say over their economic future.
The UK is the only major economy where investment is falling not rising. That is holding back our economy, innovation and productivity. The failure to invest means Britain’s productivity is 15% lower than that of other major economies.
So a future Labour government will develop a comprehensive Industrial Strategy to rebalance our economy, reduce our reliance on the financial sector centred in London and the South East and increase prosperity in every region and nation of the UK. We will follow the example of Germany and Canada in establishing a National Investment Bank and a network of Regional Development Banks. These will provide £250 billion of private lending capital to emerging businesses and co-operatives across the country, getting the money to where it’s needed and filling the gaps in lending left by private banks.
But as well as the lending gap we are also determined to close the skills gap. Labour will create a National Education Service to provide both vocational and academic training to anyone who wants it throughout their life. That is the best way to ensure people are equipped with the skills they need to flourish. Because education doesn’t just benefit the individual who receives it, it benefits the economy and society as a whole.
We recognise that to close the skills gap we cannot close ourselves off from the rest of the world. When the Tories talk about high skilled immigration, what they actually mean is high wage immigration. That won’t solve the shortages of nurses, care workers and builders we desperately need and vital to rebuilding an economy that works for all.
There is nothing to gain from false competition between good and bad migration which only whips up division and hatred. Having seen the consequences of this government’s hostile environment with the Windrush Scandal, few will be convinced that this government is capable of delivering either a fair or efficient migration system.
Britain’s infrastructure – its roads, its railways and its telecommunications desperately needs an upgrade. That is why Labour is also planning to create a National Transformation Fund. This will provide a further £250 billion, making sure we have the infrastructure we need to achieve our potential.
We’ve been talking a lot today about the urgency and importance of the choices we face over Brexit but in a very real sense the most serious and pressing challenge we face of all is the potential decimation of our planet. That’s why it’s our policy to aim for 60% of heat and electricity to come from low carbon or renewable sources by 2030 and to achieve net zero emissions before 2050.
The Conservative Government has overseen a 56% fall in investment in renewable energy over the last year. The next Labour Government will put our environment centre stage.
That doesn’t have to mean sacrifice, it’s a huge opportunity for businesses, jobs and communities. We will create 400,000 high-skilled, well-paid green jobs, cutting emissions and generating employment at the same time by increasing the production of offshore wind power sevenfold, doubling onshore wind power, trebling solar power and launching a £12.8 billion fund for home insulation.
These are bold plans but they are necessary if we are to meet the climate crisis head on and upgrade our economy for the 21st Century.
To tackle the greatest challenges facing our country today we shouldn’t fear change – we should embrace it. Deep-seated change is needed to avoid a damaging Brexit that will hurt enterprise, jobs and living standards, and instead use it as a catalyst for economic transformation.
Change is needed to prevent the destruction of our environment that endangers all of our futures. And change is needed to tackle the huge inequality that has distorted the economy and fractured our society.
A senior figure in public life recently warned that: “an economy in which the returns to capital are greater than the returns to labour is one in which support for capitalism is going to decline.”
This isn’t a quote from me or from John McDonnell. They are the words of the former Conservative Chancellor, George Osborne.
And he was absolutely right.
Business in Britain today faces a great future if it embraces the change we need for our economy and our society.
Labour is ready to lead that change and I invite you to join us to make that change together. To rebuild our economy and our country. So it really does work for the many, not the few.