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The Guardian - UK
The Guardian - UK
Politics
Jasper Jolly

Labour to seek ‘stable position’ with Europe rather than reopen Brexit debate

Jonathan Reynolds speaking at the conference in London: he is standing in front of a backdrop with logos of firms including Aviva, Drax, Heathrow and Microsoft, with his hands raised in a gesture; he is in his 40s with close-cropped receding hair and a greying beard, and wears a dark suit with white shirt and tie.
Jonathan Reynolds said ‘practical trade-based agreements’ would be better than constitutional arguments. Photograph: Lucy North/PA

Labour would rather have stability in the UK’s relationship with Europe than try to seek accelerated economic growth by rejoining the EU’s single market or customs union, the shadow business secretary has said.

Addressing the British Chambers of Commerce (BCC) conference on Thursday, Jonathan Reynolds acknowledged that Brexit had been “very difficult for businesses” because it had erected trade barriers, but said reopening the debate would be worse.

With less than a week to go until polls open in the general election, Reynolds was trying to woo business leaders at the London event with a pitch that emphasised policy stability and encouraged businesses to invest.

Some business leaders and economists have said Labour’s hopes to grow the economy – and thereby pay for improved public services – could flounder without improved access to EU trade. But Reynolds argued that returning to the tumultuous debate over Brexit would be economically harmful because businesses would hold back investments further.

“You could not relive the argument and provide people with the assurance they need that we are moving to a period where British politics is going to be in a stable position rather than frankly causing you more difficulties,” he said.

“The practical, trade-based agreements that we put forward, rather than the constitutional arguments around customs unions or single markets, are a genuinely better way to do that.”

Kemi Badenoch, Reynolds’s Conservative counterpart, appeared later at the same event. She portrayed a Labour government as a threat to the sector and said her party believed in the “power of business to do good”.

However, the business secretary focused much of her appearance on “my favourite topic, of course, the divisive topic of identity politics”.

Badenoch compared Labour plans to monitor ethnic pay disparities to apartheid South Africa, saying she thought that the policy – an idea previously proposed by the Tory prime minister Theresa May – was “morally repellent” and claimed Labour wanted ethnicity to influence pay.

Labour’s manifesto does not say ethnicity should influence pay. The party has pledged to “enshrine in law the full right to equal pay for Black, Asian and other ethnic minority people” as well as make larger companies report the gap between pay for disabled and ethnic minority employees and the broader workforce. The Conservative party introduced similar gender pay gap reporting in 2017.

Shevaun Haviland, the BCC’s director general, told the conference that the political parties must stop “walking on eggshells” and try to improve the UK’s relationship with Europe, notably on aligning food and drink regulations, VAT and mutual recognition of professional qualifications. However, she added that Reynolds was right that “businesses don’t want a renegotiation”.

Amanda Blanc, the chief executive of the FTSE 100 insurer Aviva, told the conference that “an air of weariness and cynicism hangs over our economy” and that some of the “doom and gloom” was justified. However, she said she was optimistic that stable public policy after the election would allow businesses to invest in growing the economy.

Labour’s emollient message to business contrasts with 2019, when it lost the last election under the leadership of Jeremy Corbyn. Reynolds said the party’s relationship with business was “one of the most visible ways that Labour has changed since 2019”.

He was challenged at the conference by the owners of one business who said they were concerned about Labour’s pledge to give workers stronger rights, such as statutory sick pay and parental leave, from their first day of employment rather than after two years.

Fintan and Alison Galvin, a couple who serve as the chief executive and chief people officer of the Surrey-based software company Inv Group, said they were concerned that the changes would make it riskier for them to hire and train new workers.

“It seems very anti-business,” Alison Galvin said. “All of a sudden to have this potential curveball … You’ve got your probation period, but then after that what does that all look like?”

Fintan Galvin said: “To grow a business you’ve got to take risks. Anything that enhances a risk profile of employing a person is bad.”

Reynolds said he did not believe that Labour’s changes would affect the company’s recruitment practices, and he invited them to meet him to discuss their concerns.

During the election campaign Labour has also avoided making surprise policy announcements, mostly sticking with longstanding policy. Reynolds defended the party against accusations of running a boring campaign.

“I’m told by some commentators they don’t think Labour’s campaign is exciting enough,” he said. “Look, my friends, we’re not pitching you a new Netflix series, you know, we’re not putting on politics as entertainment.”

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