‘I don’t think the only answer is to fill Parliament with people from business – it would just be enormously helpful if the Labour front bench had more work experience than someone who interned in the House of Commons gift shop.’
Britain has a new prime minister. But will Andy Burnham’s new government reverse years of stagnation?
This week on The Capitalist, I sat down with Shadow Business Secretary Andrew Griffith to ask whether Burnham is about to double down on a bigger state or finally embrace growth. We also discussed why Westminster needs more people who have actually run a company, Labour’s ‘insane’ plan to expand equal value pay claims and why putting up taxes was toxic for the Conservative Party’s brand.
Griffith argues that nationalising British Steel is a mistake – reindustrialising Britain doesn’t require more subsidies or state ownership, but cheaper energy, lower taxes, welfare reform and a ruthless assault on red tape. He also explains why business confidence depends as much on certainty as on policy itself, how Kemi Badenoch is steering the party back towards free-market principles and what a pro-growth offer to the next generation should look like.
Below, you’ll find some short excerpts from our conversation.
Marc Sidwell
Editor, CapX
On what John Healey should do first:
‘A new chancellor could come in and, if they set about reversing the most damaging decisions of the past two years – the National Insurance rise and the Employment Rights Act – they’d have the support of the Conservative Party. That would turn an economic headwind into, ideally, an economic tailwind.’
Why Westminster needs business experience:
‘What it brings is a shorthand understanding of the impact – sometimes the unintended consequences – of the decisions you make. If you’ve understood business, you realise with things like the family farm and family business death tax, that there aren’t piles of cash sitting around, and if you want to tax intergenerational transfer, that normally means you’ve got to lop off an arm of that business and give it to the chancellor. I don’t think the only answer is to fill Parliament with people from business – it would just be enormously helpful if the Labour front bench had more work experience than someone who interned in the House of Commons gift shop.’
On equal value pay claims:
‘The technical word for what they’re trying to do on equal value work is insane. It completely discards the market, the price signal, choice and individual agency – and they’re going to expand that beyond gender into race and disability as well. Good work for lawyers. I think the one reliable growth industry in the UK is lawfare and judicial review, lawyers seeking to expand their territory. Some court may come along in a few years’ time and tell a business it’s got a liability for billions. That sounds like scaremongering, but that is precisely what’s happening in the retail sector.’
On nationalising British Steel:
‘If your energy costs are two, three, four times higher than making the same steel bar in a different country, that is not a structurally profitable basis to compete, no matter how many tariff barriers the government has. The idea that the government should be doing more of that is a folly. The foundations of the Centre for Policy Studies were in making precisely these arguments ahead of the Thatcher government – and no doubt we’ll all be here again in a few years’ time, in government, trying to work out what to do with the relics of industry.’
One tax he’d abolish?:
‘Inheritance tax. It’s a values tax, so it speaks directly to the values – and it doesn’t raise a king’s ransom, so if you’ve got the choice, that’s one you can genuinely abolish. It’s almost universally a double or triple tax: you’ve acquired an asset out of taxed income, you try to pass it on, and then it’s taxed again.’
