Marks and Spencer chair: Labour’s new deal for workers could hurt investment
The chairman of Marks and Spencer has said Britain may risk being unable to attract investment if Labour’s new deal for workers is rolled out upon winning the next general election.
Leader of the FTSE 100 retailer and former Conservative MP Archie Norman told The Sunday Telegraph that one of the UK’s biggest problems was a “lack of growth in productivity and investment”.
He said: “Any incoming government should consider carefully whether a package that reduces flexibility, makes it more costly to hire people, and seeks to bring unions back into the workplace will help attract new investment.
“Of course there are exceptions, but in a knowledge-based economy most businesses are very focused on building motivated, engaged workforces.”
Labour has pledged “a new deal” for working people if it comes to power, which includes banning zero-hours contracts, ending fire and rehire, and scrapping qualifying periods for basic rights.
Labour is working with some City hot shots including former Bank of England governor Mark Carney to help attract the vote of business leaders and unlock investment.
But one Labour insider admitted to The Sunday Telegraph that party officials had “not done a great job of being super clear” with business on its workers rights reforms.
They added: “This is a core part of our economic offer, it’s not something we want to hide in a cupboard.
“Investors are still ringing us every week, those looking at an IPO want to know what we think. The idea that Labour could damage investment is just for the birds.”
Labour’s new deal for workers has been criticised before.
Business leaders have been particularly concerned about Labor’s plans to draft in rights for leaders from “day one”, which could mean an end to probation periods, making it harder for employers to sack workers.
The chief executive of Currys, Alex Baldock, previously said he would “very loath” to see probationary periods axed.
“The colleague and the business get a chance to take a look at each other before both sides commit,” he said.
The business man, who has led Currys since 2018, also told the Daily Mail the policy could make “businesses more hesitant to hire in the first place”.
Jonathan Reynolds, Shadow Business Secretary, told City PM “The greatest threat to incoming investment is this Conservative government, who have presided over a high tax, low growth economy and are now planning yet more unfunded tax cuts that threaten our economic stability.
“Labour are a proudly pro business, pro worker party and our plans will help businesses and workers alike. Business leaders aren’t asking for a watering down of workers’ rights.
He added: “They want the policy certainty they need to make long-term investments, stable Corporation tax, action on business rates and late payments. That is what they will get under Labour.”