The City seeks winners. It likes to get in early, ahead of everyone else, and reap the extra reward.
That’s what is occurring with the growing love-in between the Square Mile and Labour. The polls suggest Sir Keir Starmer is going to sweep to election victory. So, the banks, law firms, accountants, insurers want to cosy up, to ensure their concerns over policy and regulation are heard. Of course this is not going to lead to a love marriage, but it could herald a relationship in which, for a period at least, they maintain a healthy respect for each other. Ideologically, they are poles apart, always will be, no matter how much Starmer and Rachel Reeves go out of their way to stress they’re sensible, okay people really.
No matter, too, how lavish the wine and food laid on for them in top floors of executive dining rooms.
The pinstripes’ calculation is simple. Labour is heading for No 10 and they’re better than the alternative.
The pinstripes’ calculation is simple. Labour is heading for No 10 and they’re better than the alternative.
Business is fed up with the Tories. It cannot forgive them for Brexit, for the insulting, lackadaisical attitude of the Boris Johnson administration, followed by a month of chaos under Liz Truss.
Rishi Sunak has worked hard since to persuade the bosses of his adherence to caution and responsibility, that the Tories can, after all, be trusted with running the economy. That’s as maybe, but the City is also feeling unloved by a party that should be doing its utmost to listen and to respond positively and meaningfully. Red tape has not been cut, despite the promises. Taxes remain punitively high for businesses, yet the Tories are meant to stand for low taxation. The City is losing out to rival centres in Europe and around the globe as an attractive place in which to operate. Its hegemony is under threat. How has this been allowed to happen? Financial services for so long were the backbone of the economy, to be nurtured and developed.
The City is losing out to rival centres in Europe and around the globe as an attractive place in which to operate
Meanwhile, another Tory initiative, levelling up, has led, as they see it, to levelling down in London. This disillusion is not down to Sunak alone — much of it comes after 13 years of Tory rule. A reset is due.
The last occasion this was the prevailing City mood was in 1997. Then, too, the poll findings were pointing in one direction. Big business scrutinised Tony Blair and liked what it saw. As with Starmer, Blair came in on the back of a Labour leader that those who see themselves in the vanguard of enterprise most definitely did not warm to. For Neil Kinnock, read Jeremy Corbyn. Gordon Brown and Ed Milliband were similarly viewed as too Left-wing. Blair, a north London lawyer (the same as Starmer), knew how to speak their language. They gave him the benefit of the doubt. That’s happening again.
They’re wary of Starmer’s intentions towards the utility companies. But, so the reasoning goes, better to work with him than against, keeping the enemy close, making sure he understands.
There will be a honeymoon. Then comes the reckoning. Starmer will be doing well if he can maintain the City’s support for a second term. For him that could come at the expense of deeply alienating Labour’s traditional supporters. That’s all for the future. For now both sides are enjoying the novelty of each other’s company.
