Sir Keir Starmer has proposed giving start-up loans to 100,000 new UK businesses and creating a new “British recovery bond” in a bid for Labour to forge a “new partnership with business”.
Starmer’s set piece speech outlined his party’s new economic policy direction under his leadership, saying that “for too long Labour has failed to realise that the only way to deliver social justice and equality is through a strong partnership with business”.
The Labour leader said the new bond would “raise billions to invest in local communities, jobs and businesses” and “could help build the infrastructure of the future – investing in science, skills, technology and British manufacturing”.
Further details on the bonds, i.e. what the yield would be or how much a Labour government would want to raise, were not given.
Starmer said the debt instrument would be a way for savers to get a return in a time of low interest rates, while also contributing to building new UK infrastructure.
Julian Jessop, fellow at the free market Institute of Economic Affairs think tank, said he struggled to see the point of a recovery bond.
“People can already buy gilts and National Savings, or invest in UK businesses using private vehicles,” he said.
Starmer said the 100,000 loans would be “a start in addressing” regional inequalities throughout the UK.
“I know there’s no vision of a future where Britain fulfils its potential in which business does not thrive,” he said.
“That’s why, if I was prime minister, I’d back a new generation of British entrepreneurs.”
The address was touted as an opportunity for the Labour leader to tout his pro-business credentials and provide more detail on what his agenda would be in office.
The speech was a clear break from the Jeremy Corbyn era, with Starmer saying that under his leadership “Labour’s priority will always be financial responsibility” as he called for the UK to pay back its coronavirus spending over the medium to long-term.
However, his speech did channel several past Labour Prime Minister’s, including Clement Attlee and Harold Wilson.
The Labour leader said he sees the Covid recovery as akin to a post World War II period when Attle’s government introduced the welfare state and NHS.
“I believe there’s a mood in the air which we don’t detect often in Britain,” he said.
“It was there in 1945, after the sacrifice of war, and it’s there again now.
“It’s the determination that our collective sacrifice must lead to a better future.”
Conservative party co-chair Amanda Milling said Starmer’s new policies had been stolen from the Tories.
“Keir Starmer said this speech would deliver his big vision for the future of the country, a ‘policy blitz’ with ideas to rival Beveridge and relaunch his failing leadership,” she said.
“But there are only two new policies – one taken from the Conservatives and the other from the CPS, the think tank co-founded by Margaret Thatcher.
“After ten months of Keir Starmer all Labour has to offer is others’ ideas, empty rhetoric and calling for things the Government is already doing.”