Karen Buck

Working hard for Westminster North

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My article for the Wood and Vale



Business is the beating heart of the economy. Businesses create jobs. Businesses generate wealth. And as the economy keeps changing we need to support and nourish ‘start-ups', small businesses and innovation. Government does not do the job of business, but good government can shape the framework within which business flourishes. For there is a powerful myth that government is a dead weight on the wider economy, making the job of business more difficult. In fact, businesses both large and small, rely on what good government can ensure. At the practical level, the private economy needs sound infrastructure - efficient transport has never been more crucial than it is now. Businesses need skills - and skills start in our schools and colleges. (A quick glance at London business organisation, London First's ‘Manifesto for Jobs and Growth' makes the point well). In addition, employees get sick, and need the care of the health service. Working parents rely on childcare (a substantial part of which is now publicly funded). The social security system shares the burden of sickness/disability; unemployment and pensions. In recent years, low wages have required a vast level of public spending on ‘in-work' benefits, such as Tax Credits and Housing Benefit and, indeed, these benefits acted as a massive stabiliser in the economy during the financial crisis, when employees' earnings fell sharply.

At the more abstract level, business also needs governments to set and uphold the law and negotiate the rules within which economies operate, including the framework for international trade. Businesses want a fair, open and stable environment in which to trade, which is why so many are anxious about the prospects of us lurching into an exit from Europe. And, of course, governments stepped in to protect the banking system when the banks ran into trouble a few years ago.

But, on the other side of the equation, society has a reasonable expectation of what business will do. That includes paying fair taxes on the activities carried out within this country; offering a decent deal to employees, serving consumers honestly, and meeting certain standards in areas ranging from financial transparency to environmental protection.

Unsurprisingly, the wider public takes a dim view of the behaviour of big companies which do a great deal of business in Britain, but avoid paying tax on it, or who shift offshore to cut their tax liabilities. On far too many occasions, the Parliamentary Public Accounts Committee has exposed examples of blatant tax avoidance. Sometimes it is the tax payer who loses, sometimes it is small businesses and suppliers, sometimes it is the consumer. Story after story has appeared of corporate bad behaviour, from the fixing of exchange rates to the exploitative use of zero-hour contracts, from over-stating profits to potential breaches of the code of practice in relation to the suppliers of major companies, from misselling Payment Protection Insurance to the energy giants not passing on savings to customers fast or large enough as the oil price plunges... the list goes on.

All too often, even the worst behaviour seems to go effectively unpunished, and in some cases is even apparently rewarded by massive pay-outs. Not only does this shock the public, all those businesses that do uphold strong professional and ethical standards are also damaged by stories that undermine trust. We have a common interest in everyone playing by the rules.

I want a constructive relationship with business at every level. I want stability regarding our position in Europe, more help to small businesses, such as our proposed cut in Business Rates, and investment in infrastructure and skills, with a particular emphasis on boosting quality apprenticeships. There is nothing wrong with a healthy debate about the specifics of these and other policies, but let's have this in the spirit of partnership and a shared interest in a strong, healthy society and economy.

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