Labour in-fighting clouds over its business failings

The Blair-Brown rivalry may have hogged the headlines, but the Government’s new business regulations could prove far more damaging.

I have long stopped attending the political party conferences, leaving the seaside circuit to younger colleagues. It is, in any event, a young person’s scene, with its round of all-night gate-crashing and yakking about who’s in and who’s slightly less so.

Anyone concerned with corporate issues should only go with a specific agenda, a list of target people they need to reach and a clear idea of the outcomes that they are after. It seems to me that this view is shared by a growing number of businesses – the fall-off in corporate attendance and the dwindling ranks of exhibitors in the conference halls match the increasing disenchantment with politics among voters.

This corporate exodus left the bubble of the governing party’s conference in Brighton with a more rarefied artificial atmosphere than can easily be remembered. Sure, the horribly real spectre of insurrection in Iraq hung over Brighton like the Prime Minister’s grim reaper. But, otherwise, delegates were allowed to indulge in the kind of power-game distractions that are the privilege of the truly out of touch. While Gordon Brown performed unconvincingly as a man happy to be Chancellor and Tony Blair reprised his role as humble messiah, the BBC’s Andrew Marr summed up the conference climate by saying that “forces close to the Prime Minister have seized the breakfast trolley”.

Such introspection in the face of real issues feeds an arrogance. Out in a domestic economy in which business people try to make a living, we are less concerned with whether Brown is livid with Alan Milburn because he’s Blair’s placeman for the election campaign than with whether they are making life easier or harder for our businesses. But such is the focus (rightly) on Iraq and (stupidly) on the rivalry between Blair and Brown that almost anything could be happening to industrial policy and no one would notice. They could have passed legislation making company directors wear bright red codpieces and no one would have queried it at conference.

They haven’t quite done that, but how many delegates know or care that this Friday has been dubbed Red Tape Day, because it is one of two days in the calendar that the Government has chosen on which to consolidate the introduction of all its new regulations for British businesses? It is highly symptomatic of the Government’s arrogance towards business that apparently it couldn’t care less that one of these dates, October 1, falls at the conclusion of its party conference. Had it not been Red Tape Day, but Weapons of Mass Destruction Day, or Manifesto Achievement Day (MAD), you can be sure that it would have been moved.

For the record, here is a selection of the new business regulations that go live this Friday. There is a new three-step procedure for dismissal, disciplinary action or grievance in the workplace – if an employer fails to follow the procedure, a sacking will be ruled unfair and compensation can be increased by up to 50 per cent. Amendments to disability legislation will spread requirements for disabled employees, quite reasonable for larger companies, to even the tiniest operations – stand by for the ten-staff agency above the shop to be closed because it doesn’t provide disabled access. Adjudications on equal pay will be rushed through with minimal representation from employers. The minimum wage is to be raised on a more complicated scale, with an arcane system introduced to measure wages by the number of items that workers produce – or “rated output work”.

For once, the Confederation of British Industry (CBI) has an open goal in which to score against the Government. As usual, it fluffs it, saying that all this “will take people away from running their businesses”. Care of staff, provision for the disabled and proper disciplinary procedures are not distractions from the central function of business, which the CBI seems to think is to make as much money as possible for shareholders at whatever cost to staff. They are proper functions of running a business in themselves.

The question is whether a whole new raft of regulations is the best way to ensure that businesses behave properly, or whether recourse to law should be made easier and cheaper for the aggrieved so that each case can be judged on its merits. This is the sort of debate that should be conducted, but the Government is probably right that industry can’t be bothered anymore. That’s why ministers aren’t embarrassed about holding Red Tape Day before Tony Blair’s speech-giving shirt has even dried out.

One last thought: While all this is going on, global companies continue to disenfranchise voters by running economies as they, rather than national politicians, see fit. That is not just dangerous, it’s beyond regulation.

George Pitcher is a partner at communications management consultancy Luther Pendragon

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