UPDATE: UK Prime Minister Keir Starmer is poised to deliver a critical address at the Labour Party conference in Liverpool today, with major implications for his leadership and party unity. This conference, taking place from October 8-10, 2023, marks a pivotal moment for Starmer, who faces growing pressures from within his party and rising challenges from rival political groups.
Starmer’s party members are demanding substantial policy changes, including the abolition of the cap on child benefits and a firmer stance on the Israel-Gaza conflict. Competing parties, including the Greens and the newly formed Your Party led by former Labour leader Jeremy Corbyn, threaten to siphon off crucial votes, putting Starmer’s leadership at risk.
Adding to the urgency, the economic landscape is shifting dramatically. Recent data reveals that unemployment is rising, job vacancies are declining, and business confidence is deteriorating after Chancellor Rachel Reeves announced a staggering £25 billion increase in payroll taxes. The CBI reports that the tax burden on businesses has reached a historic high of 30.5% this financial year, causing widespread discontent within the corporate sector.
The pharmaceuticals industry, including major players like Merck and AstraZeneca, is halting investments in the UK due to dissatisfaction with the drug pricing regime. Meanwhile, oil and gas producers are cutting jobs in response to increased windfall levies imposed by Reeves. Business leaders are clamoring for reassurances that there will be no further surprise tax hikes, especially from the banking sector, which is particularly sensitive to fiscal changes.
Starmer’s address today is seen as a crucial opportunity to mend ties with the business community, which felt alienated after last year’s conference. A previous ‘business day’ event was criticized for charging corporate delegates £3,000 without granting them access to key ministers.
The stakes are high as Starmer must navigate these complex dynamics. He needs to convey a clear message that will restore confidence among businesses and investors. Reports suggest that Labour may soften its stance on banning new exploration licenses in the North Sea, offering a glimmer of hope to the oil and gas sector. Furthermore, the pensions and investment community is eager for commitments to maintain the current tax regime encouraging savings.
As the conference unfolds, the bond market is also closely monitoring Starmer’s words. Recent comments from Andy Burnham, the mayor of Greater Manchester, have drawn comparisons to former PM Liz Truss, whose tenure ended due to adverse market reactions. Reeves emphasized the importance of fiscal discipline in her recent speech, warning that any loss of market confidence could lead to increased costs for ordinary voters.
Starmer’s address may set the tone for Labour’s approach to economic management and its relationship with both the business community and voters. As the UK currently pays a premium to borrow from the bond markets, any positive signals could yield significant financial benefits.
In summary, today’s address at the Labour conference is more than a routine speech; it’s a critical juncture for Starmer, with the potential to reshape his party’s direction and restore confidence among businesses and voters alike. The political landscape is shifting rapidly, and all eyes will be on Liverpool as developments unfold.