Starmer warns companies to end ‘low wages and cheap labour’

Starmer warns companies to end ‘low wages and cheap labour’

Labor leader Sir Keir Starmer will warn businesses on Tuesday that the days of “low wages and cheap labor” from abroad must come to an end as both major British parties reject calls from companies for looser immigration rules.

Starmer will promise that a Labor government will form a “new partnership” with business, but warn it will not support unrestricted immigration to fight labor shortages.

In his strongest remarks on immigration yet, Starmer will say at the CBI conference in Birmingham: “Let me tell you: the days when low wages and cheap labor were part of the British way of growth are over.”

Tony Danker, director-general of the CBI, the UK’s largest business lobby group, argued on Monday for a looser immigration regime, but the issue is seen as toxic by Starmer and Conservative ministers, especially in key working-class fringe seats.

Immigration Minister Robert Jenrick said on Monday: “Our ambition is to reduce net migration. We think that’s what the British public wants – that was one of the driving forces behind the vote to leave the European Union in 2016.”

In his speech, Starmer will outline a migration plan where “every move on our points-based system – whether through the skilled trades route or the labor shortage route – will create new conditions for business.

“We expect you to come up with a clear plan for higher skills and more training, for better wages and conditions, for investments in new technology,” he will say.

Labor is on a charm offensive with British business, trying to capitalize on many executives’ concerns about the political and market turmoil fueled by the Tory leadership race and Liz Truss’ ill-fated ‘mini’ budget.

While Chancellor Jeremy Hunt was criticized by business groups last week for not announcing strong policies to boost growth in the fall statement, Starmer will say Labor would make this a priority.

“I’ll put it simply: every company in this room has a growth strategy. A nation needs one too,” he will say.

Prime Minister Rishi Sunak, in his speech at the conference on Monday, pledged to “re-ignite the UK’s engine of innovation” and pledge support to innovative companies and entrepreneurs.

Sunak said the UK would introduce the “most attractive visa regime in the world” for entrepreneurs and skilled technical workers.

As chancellor, Sunak advised on a replacement scheme for the “super deduction” tax benefit that expires in April. But on Monday he declined to say whether he would consider a new scheme next year to boost investment, instead referring to existing schemes such as the annual investment deduction.

Hunt last week pledged to keep up government R&D spending, but shocked the start-up community by scrapping widely-used tax deductions that have spurred innovation. Sunak did not comment on this move, but pointed to improved R&D tax benefits for larger companies.

In separate remarks at the conference, David Bunch, chair of Shell’s UK operations, said the oil company would “evaluate” its £25bn investment in UK projects on a case-by-case basis after the government increased windfalls for energy companies.

“If you raise more taxes, you have less disposable income in your pocket and you have less to invest,” says Bunch.

Sunak has also committed to drawing up plans to help energy-intensive companies deal with rising gas and electricity bills; The government support will expire in March next year. But he said all aid would be directed to the businesses most in need.

“We recognize a particular problem with a group of industries that are very dependent on energy and we need to make sure we have a plan in place and you can expect the Chancellor to address that.”

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