H/Advisors Cicero - Cicero UNPLUGGED: Labour Party Conference

by James van der Graaf, Director, and Sophie Bowman, Associate

1 October 2024

Keir Starmer addressed the Conference hall last week as the first Labour Prime Minister to do so in 15 years in what should have been a celebratory affair for the party faithful. However, barely three months into his premiership, any notions of a honeymoon period have been quickly dispelled, with a Government beset by a series of own-goals and missteps.

The Government believe this is distracting from the significant progress that has already been made. Channelling his inner Gordon Brown from 2009, Starmer reeled off a list of steps the Government has already taken – from launching Great British Energy and reforming the planning system, to the levelling-up of workers rights.

Party Conference provided an opportunity for the Government to try to seize back control of the narrative. While clearly the busiest Labour Conference in a very long time – with most fringe events having queues out the door – the level of excitement was muted. The sobering impact of realising just how tough governing is actually going to be with this inheritance was clear.

Both the Prime Minister’s and the Chancellor’s speeches sought to show that they can adapt to the challenges of Government and reassert the primacy of their five national missions.

“Light at the end of the tunnel”

The Labour Party was effective in Opposition in pitching itself as the party of business, aligning itself with the business mainstream and embracing industry-friendly policies.

However, there is growing concern among the Parliamentary Labour Party that their doom and gloom approach was having an adverse impact. Many MPs are sitting on small majorities and desperate for the Government to offer some hope.

Others were concerned that the downbeat approach was impacting business confidence. The Government’s partnership model with business to deliver its central mission to kickstart economic growth relies on businesses investing and buying into UK PLC. Ahead of the International Investment Summit next month that will seek to show that the UK is ‘open for business’, Party Conference was a tacit acknowledgement that this messaging has gone too far.

The ambition around the Industrial Strategy and National Wealth Fund – key pillars of the Growth Mission – were welcomed but need concrete plans to build momentum. The response to Business Day was somewhat underwhelming, with industry leaders complaining of a lack of access to Ministers and a lack of clarity on key policy files.

In events across Liverpool, Ministers and MPs were very frank that they are new in role and are still getting to grips with their briefs and specific priorities. There remains enough goodwill that people do accept this and are willing to give them the benefit of the doubt, but it won’t last forever.

Going for growth

The policy agenda emerging from this year’s Conference was relatively thin on both quantity and detail. Nevertheless, the Government still announced some significant developments for its growth agenda on areas including workers’ rights, energy, skills, devolution, healthcare and housing.

Deputy Prime Minister, Angela Rayner, announced that the long-promised and highly debated Employment Rights Bill will be tabled in Parliament next month, just in time for the Government to fulfil its promise of introducing legislation in the first 100 days. Alongside this, Business Secretary, Jonathan Reynolds, confirmed the legislation would mean a maximum probation of about six months, an area which has reportedly been a key area of contention between him and Rayner.

Elsewhere, the Chancellor’s speech promised delivery on manifesto commitments, including breakfast clubs and a tax avoidance crackdown. However, her speech left a lot to be determined at the Budget. The Government also frustrated businesses with its confirmation that the industrial strategy will not be published ahead of the International Investment Summit, with only a consultative green paper accompanying the Budget, and the intention of publishing the full strategy in Spring 2025. On the energy front, the Government announced its intention to headquarter GB Energy in the UK’s oil and gas capital Aberdeen, a development that, whilst expected, will attempt to assuage concerns about the Government’s support for jobs in the region.

A significant month ahead

Attention now turns squarely to a potentially pivotal October for the Government that sees the International Investment Summit take place on 14 October and a first Budget for Rachel Reeves on 30 October.

The Chancellor said that tough decisions will be worth it and will “forge the conditions for businesses to invest and consumers to spend with confidence”. All eyes will now turn to the Investment Summit and the Budget for a credible plan to deliver this. These big set piece engagements with business really do matter.