Attack on four-day week
CBI chief accuses Labour of ‘closing door’ on economy
Carolyn Fairbairn: plans would harm those Labour is trying to help (pic: Terry Murden)
CBI chief Carolyn Fairbairn, CBI Director-General has accused shadow Chancellor John McDonnell of “hanging a closed sign on the door” of the British economy.
She launched a scathing attack on his plan for a four-day week outlined at the Labour Party conference, noting that it comes on top of plans for higher taxes and mass re-nationalisation.
Ms Fairbairn said business shared Labour’s ideals of a fairer economy but said the party had to root its policies in reality rather than ideology.
Mr McDonnell told delegates in Brighton that the average working week in the UK would be cut to 32 hours within 10 years under a Labour government.
“We should work to live, not live to work. As society got richer, we could spend fewer hours at work,” he said. “But in recent decades progress has stalled and since the 1980s the link between increasing productivity and expanding free time has been broken. It’s time to put that right.”
The proposals for a shorter working week were welcomed by the trade unions. TUC general secretary Frances O’Grady said: “It’s time for working people to share in the benefits of new technology.”
But Ms Fairbairn challenged the plans as being bad for the economy. “Business shares the Shadow Chancellor’s aim of a fairer economy. But too many of Labour’s policies would make this harder to achieve, harming the very people they are trying to help,” she said.
“Who would turn down a four day week on the same pay? But without productivity gains it would push many businesses into loss. The inclusive ownership fund grabs headlines, but would amount to a tax on workers, pensions and savings. Add these ideas to mass renationalisation, rising business taxes and ongoing Brexit uncertainty, and we risk hanging a closed sign on the door of our open economy.
“A growing economy built on fairness can only be delivered if business and government work together. Yet here was a speech from the Shadow Chancellor with no mention of the huge contribution business makes, its importance to jobs, investment and prosperity. Only through partnership can a net-zero economy be achieved, wages increased, and new technologies harnessed to the benefit of all.
“Business has ideas and ambition to match Labour’s. It is time for Labour to root its polices in reality, not ideology. Firms have consistently offered to help shape an economy where prosperity is shared more widely. That offer still stands.”
Adam Marshall, Director General of the British Chambers of Commerce, said: “Businesses were hoping to hear much more from John McDonnell about how a Labour government would create the best possible environment for growth in every region and nation of the UK.
“We need to work together to fix our infrastructure, improve skills and training, and deliver the ‘net-zero’ carbon target.
“With Brexit and global trade uncertainty to contend with, Labour should be reaching for the carrot rather than the stick in its approach to business and economic growth, in the interests of all our communities.”
Federation of Small Businesses (FSB) chairman Mike Cherry, said: “Every effort must be made by Labour to reach out to the small business community as its policy agenda is developed.
“The party needs to remember that many small firms have very limited resources and are already up against spiralling employment costs. Very few have dedicated HR personnel and the luxury of excess cash flow.