Speaking before a business audience including senior politicians at the CBI Annual Dinner, CBI President John Allan identified the Brexit gridlock and Labour's renationalisation plans as "threats" to the UK's future.
On Brexit, he highlighted the ever-growing cost of the ongoing negotiations, and issued a plea to all politicians to "do whatever it takes and do it fast” to resolve the mess.
Commenting on the Prime Minister’s decision to bring back the Withdrawal Bill, he added: “Be in no doubt political failure today means economic failure tomorrow. We need to find a way through.”
On renationalisation, he argued the plans risked investment at a time when the UK needs to remain open to the world.
But his answer for both threats was the same: change how we do politics in this country, and take a fresh approach in business to strengthen the partnership between the two.
Forging a better partnership is vital for the UK to tackle longer-term challenges, including climate change, infrastructure and skills, he said.
Ambassadors, Secretaries of State, ladies and gentlemen – welcome to the CBI’s Annual Dinner.
I’d like to start by thanking our charity this evening – Mind.
Paul Farmer, Mind’s CEO, has done much in recent years to place mental health on a par with physical health. He’s here with us, and I know he will welcome your support for Mind this evening.
I’d also like to thank our strategic partner this evening, Lloyds Bank. Congratulations, Antonio and your team, for your brilliant work over the past year.
And one person who I know will be pleased to see Lloyds Bank tonight will be our guest speaker. The Chancellor of the Exchequer.
Chancellor, as you know, in the past year UK companies paid almost £200bn into the exchequer. Not only enough to fund our NHS, our defence, and our international aid, but all three.
According to PwC, Lloyds is the biggest tax contributor of all, so we’re especially grateful that they’ve managed to find just enough left over make tonight’s event possible.
Now, tonight I began by talking about tax, because the tax contribution it is the clearest example of what, at the CBI, we call the essential partnership. Between business and government. And it is essential.
Because one can’t operate without the other. Any responsible government and any responsible business community will always want to strengthen that partnership.
Tonight, I want to set out how that could be achieved and what a strengthened partnership might deliver.
But first, I want to address two threats to that partnership.
One year ago, my predecessor, Paul Drechsler, stood on this stage and called for an end to the Brexit logjam. The negotiations, he said, had been held up at customs. And where are we now?
Unthinkably, in much the same place. And that has come at an ever-growing cost.
£800 billion pounds of financial capital moved out of the UK. In 2018, four successive quarters of falling investment – the longest such period since the financial crisis. UK stockpiling at a rate unseen since records began. The closure, cancellation or relocation of great businesses and their production lines. And all the while our international competitors are pulling ahead.
So, tonight I have a plea. From the heart of business, to the heart of politics. Resolve this gridlock. Do whatever it takes, and do it fast.
The Prime Minister’s announcement today has offered Parliament a way forward. A new opportunity for MPs to resolve this mess. Businesses up and down the country will be urging them to take it. If not, the uncertainty will become far more acute.
It’s not for business leaders to tell politicians when to trigger democratic events. I won’t do so tonight. But be in no doubt that political failure today means economic failure tomorrow.
We need to find a way through.
Yet that’s not the only threat facing business now, not the only risk to that essential partnership between government and business.
Last week, the Labour Party announced its plans to re-nationalise the National Grid. The latest company the Labour Party wants to take into state ownership.
So I have a message there, too.
These plans will harm the people they are supposed to help. Pensioners. Employees who today benefit from an employee ownership scheme. People dependent on charities which have invested in the industries under threat. People now asking: is my money – my savings – my income - at risk?
Yet Labour’s proposals are not just a threat to these industries but to investment in our country at a time when it’s most needed. And above all, to that essential partnership between business and government.
End to adversarial politics
And it’s that partnership – that essential partnership – I want to talk about now. Because there is a path away from Brexit paralysis and ideological positioning. A way for us to harness the joint potential of government and business, public and private, state and citizen, and to address the greatest challenges of our time.
But it requires change on both sides.
Change in politics
The first – is change to how we do politics in this country. Because what we have learnt from Brexit isn’t that consensus on the big questions is impossible but that it is essential.
The age of adversarial politics is – necessarily – over.
Yet as a country we are used to governments winning big majorities. And it’s easy to still consider that the norm. But it’s not.
No party has won – and sustained – a strong majority in this country for nearly 15 years. And with a country divided, it’s not likely to happen soon.
That has implications for business. Which above all else needs long-term vision, stability of policy.
It was a good first step for both main parties to try and work out a solution on Brexit. Even if it ended in failure, it shows that proved that compromise is conceivable, if challenging.
But we need to extend that approach. And create a new, consensus-building politics. One that acknowledges new electoral realities. That provides long-term certainty for our big national projects. Infrastructure. Skills. And climate change.
Yet political change alone is not enough. We need a fresh approach in business too. A new approach that acknowledges the problems politicians are trying to solve and helps provide the answers.
Sometimes, much better answers.
And that’s our offer to the Labour Party. Let us work with you, and we can find solutions that succeed.
In the past week, we’ve seen some brilliant examples of how to do it right. Julian Richer converting Richer Sounds into an employee ownership trust. BT spending £50 million pounds a year on shares for its employees. And Capita appointing employees to its board.
It can be just the beginning.
Last week we published a report which shows that if businesses improve how they engage their people we could give the economy a productivity boost worth over £100 billion pounds. Addressing the great national challenge of our time.
There’s not just one way to do it. But it works best when business and government work together.
We saw it again last week in the West Midlands. The first Local Industrial Strategy. Let’s build on it, and secure long-term, ambitious local industrial strategies in every part of the country.
So in conclusion – think what this approach could deliver. Business and government together.
On climate change – that’s how we’ll meet the net-zero challenge. On infrastructure – we’ll better connect London with the North, and the UK with the rest of the world. Finish HS2, Crossrail, and High Speed 3 in the North. And on digital skills – transform work itself. Through an education system that promotes the fundamentally human skills: creativity, problem-solving, resilience.
Through businesses that invest in their employees at every step of their career. That’s what our partnership could achieve.
The American screenwriter, Gene Roddenberry, put it so well: "It isn't all over. Everything has not been invented. The human adventure is just beginning."
And with a willingness to compromise, to think boldly, the adventure goes on tonight.