Starmer guns for growth

Sir Keir Starmer insisted today that Britain will be “open for business” under a future Labour government, as he tried to persuade the global elite of his party’s capitalist credentials at the World Economic Forum in Davos.

In a speech to some of the world’s top business leaders and politicians (though notably fewer than usual), the Labour leader called for a “clean power alliance” of the countries doing most to tackle climate change in order to bring down energy prices, and said that Labour would coax global investors back to Britain.

Taking a swipe at the Conservatives and the absent Rishi Sunak, Starmer quoted UN figures showing that between 1997 and 2010 the UK accounted for 8 per cent of global Foreign Direct Investment, but this fell to 4 per cent under the Tories, between 2010 and 2021.

But Starmer queered his pitch on growth by promising there would be no investment in new oil and gas fields in Britain under a Labour government. “Obviously [oil and gas] will play its part during [the transition to green energy] but not new investment, not new fields up in the North Sea, because we need to go towards net-zero, we need to ensure that renewable energy is where we go next,” he said. It would mark a massive policy shift for the UK at a time when energy independence should be top of the agenda. 

Shadow chancellor Rachel Reeves is also attending the “billionaires’ jamboree” (as Jeremy Corbyn once put it). She and Starmer were acting as ambassadors for Britain, Reeves said, seeing as the prime minister and chancellor, Jeremy Hunt, hadn’t bothered to turn up. Sunak chose to stay away because of more pressing domestic issues, he said.

It’s been left to business secretary Grant Shapps, representing the government in the Swiss Alps along with international trade secretary Kemi Badenoch, to make the case that the Tories are still the only ones to be trusted when it comes to business. Shapps highlighted a PwC survey of global CEOs showing that the UK ranks third in the “most important” countries for businesses to invest in – one place higher than last year and behind only the US and China.

Unfortunately for the Tories, the backdrop to the war of words in Davos is billionaire industrialist and keen Brexiteer, Sir James Dyson, attacking the government for its “short-sighted” and “stupid” economic approach. Dyson warned that “growth has become a dirty word” during Sunak’s spell as PM, and that the Conservatives were keeping the country locked in a state of “Covid inertia”.

Michael Gove, the levelling-up secretary, hit back, insisting the government is “unlocking the animal spirits” of the economy. Not all his colleagues would agree. There’s a big split emerging in the Tory party, with many MPs sympathetic to Dyson’s view that the plan for growing the economy – if there is one – is woefully inadequate.

Sunak and Hunt, however, continue to argue that tackling inflation takes precedence over stimulating growth. But seeing as the slight tempering of price rises since October has everything to do with global market forces and nothing to do with government policy, it’s hard not to see inflation as a convenient excuse for the failure to get growth going. 

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