Labour offers counterpunch to Daily Telegraph business letter

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Labour has moved to counter a potentially damaging letter from 103 senior business executives calling on voters to embrace Conservative economic policy with a counter-missive on Wednesday from what it described as a true cross-section of British society.

The Labour letter, signed by actors, business leaders, writers, nurses and a host of low-paid workers, came in response to a pro-Tory letter that appeared in the Daily Telegraph signed by an array of leading UK businessmen, many of them Conservative donors.

Labour’s 100 signatories, including about 50 people currently working on zero-hours contracts, declare: “We come from all walks of life – this is what Britain looks like.”

They argue that the fundamental choice at the election is whether the country works only for those at the top or for all working people, including those struggling to make ends meet.

The businesspeople and other high-profile figures who have signed Labour’s letter include Trevor Beattie, the advertising guru, Susie Orbach, the feminist writer, Wayne Hemingway, the fashion designer, Dale Vince, who founded green energy company Ecotricity, Philip Hedley, director emiritus of the Theatre Royal Stratford East, and Peter Duncan, the actor. It also includes shelf stackers, farm hands and firemen.

Focusing on the issue of zero-hours employment, the letter said that the proliferation of such contracts had become a symbol of the failure of the government’s economic plan, “which has helped fuel the low-wage, low-skill economy that is letting down working people and letting down Britain”.

Although the letter risks underlining Labour’s lack of high-level business support, the organisers insist it was not designed to match the Conservative letter, but instead to make the point that everyone, not just business, has a stake in the coming election.

Labour also dismissed the Telegraph letter as a Tory stunt, adding that business needed to be careful that it was not seen to be in a cosy alliance with the Conservative party.

Chuka Umunna, the shadow business secretary, said: “This was a letter organised by the Conservative party in a Conservative-supporting newspaper. We’ve got almost 5m businesses in our country. At best you could say the people who signed this represent 0.002% of them.” He said Labour would maintain a competitive tax regime while prioritising support for small firms by cutting business rates on 1.5m small business premises.

Labour sources said 22 of the Telegraph letter’s signatories were Tory donors who had given up to £7.5m to the party.

However, Labour will be watching nervously to see if the Telegraph letter has a political impact and will be hoping that business leaders no longer have the traction with the public they once had after years of corporate scandals and excessive pay rises.

But the Conservatives continued to drip-feed details of senior businessmen who were supporting the party, such as Yo! Sushi founder Simon Woodroffe, who appeared in a 2004 Labour broadcast.

He said it would be madness to change economic direction with the job half done. “They are halfway through a job, and I know what it is like in business when you’re halfway through the job – you do not necessarily look the rosiest,” he said. “To change now, halfway through a recovery from the worst recession we have had in my lifetime, seems to be a madness”

Labour will be aware that the Conservatives have managed to fill the airwaves during the first three days of the short campaign with a series of warnings about the fragile relationship between UK business and Labour. Polls shows the Tories have managed to make the economy the number one issue again, something that will please Tory high command, since they regard it as their strongest suit.

Labour leader Ed Miliband will need a strong showing in Thursday’s seven-way leaders’ debate on ITV to put his campaign back on the front foot. It will be the only debate in which he faces prime minister David Cameron directly.

Miliband deliberately sharpened the dividing line on the economy with a call on Wednesday morning to end the use of zero-hours contracts, saying he had decided to reduce the proposed length of time that an employee could be on such terms before an employer was required to provide a full-time contract.

Miliband had originally proposed a one-year qualification period, but said he would reduce this to three months, a move that would cover 90% of zero-hours contracts and was not welcomed by employers’ organisations.

Meanwhile, the chancellor, George Osborne, said the letter sent to the Daily Telegraph showed that British business believed Labour could not be trusted to run the economy.

He said: “We have just 36 days left to save Britain’s economic recovery. A British general election has never seen a business letter like this – 103 business leaders employing over half a million people, the chairmen and chief executives of businesses that represent a roll-call of British economic success, innovation and job creation.

“We have the leaders of some of our biggest companies like BP, Dixons-Carphone, and the Prudential.”

He claimed that Labour may be planning to raise taxes for hundreds of thousands of middle-class professionals after the next election by lowering the £41,865 threshold for the 40p rate. But on a visit to a Britvic factory in Leeds, Osborne conceded it “would be very difficult” for him to live on a zero-hours contract, before adding: “There are some zero-hour contracts that people want.”

The shadow chancellor, Ed Balls, refused to rule out changing the point at which the higher rate kicked in, saying he had to be “honest” with the public that there was still a £90bn deficit to pay off. 

Powered by article was written by Patrick Wintour Political editor, for The Guardian on Wednesday 1st April 2015 22.35 Europe/London © Guardian News and Media Limited 2010