With growth plunging, inflation surging and British business staggering under the vast £75billion burden of Labour taxes, the economic outlook has rarely been more alarming.
But just when you thought this Government could sink no lower in its efforts to destroy what remains of profit-generating enterprises, the shadow of Angela Rayner has arisen to deliver yet another trademark blow – this time with a sinister twist.
It is nothing short of hair-raising to discover that, buried amid documents outlining the powers of the new £60million Fair Work Agency (FWA) – a pet project of the former deputy prime minister before she resigned amid controversy – is a new ‘enforcement’ policy, including what amounts to a police force with powers to raid businesses, seize documents and arrest employers for alleged misdemeanours.
The launch of the FWA, yet another expensive quango to discipline and demoralise the nation’s wealth creators, could hardly have come at a less opportune moment.
The 26-page document describing its powers was slipped out by the Department for Business and Trade while all eyes were glued to events in the Persian Gulf – and no wonder.
The scale of potential intervention from the FWA is Stalinist and more in keeping with what might be found in an authoritarian state.
At a stroke, the Labour Party – which strained every sinew in reaching out to commerce in the run-up to the July 2024 election – is declaring corporations and small businesses alike to be the enemy.
The possibility that enforcement officers will demand access to the workings of small and medium-sized businesses is particularly frightening. Many smaller firms, the backbone of the British economy, already live in terror at the prospect of a surprise visit from government VAT inspectors, who wield powers of search and confiscation.
Adding a new layer of intrusion when it comes to, for example, the employment of part-time workers (previously hired on now-banned ‘zero hours’ contracts), can only hurt fragile business confidence.
The Institute of Directors, whose members include many medium, and smaller-sized enterprises, has expressed outrage that, with just two working days’ notice, trade union officials can demand access to firms’ books and papers, a hugely expensive process in terms of staff time and bureaucracy.
Worse, should employers seek to avoid this burden, they face a formal visit from the FWA’s new army of government enforcers.
The new FWA regime will be an existential threat to a number of businesses, most notably in the hospitality industry, which depends on younger, often part-time workers.
The intrusive new rights of search and entry have even alienated the normally compliant employers group, the Confederation of British Industry (CBI).
Its work and skills chief, Matthew Percival, said that allowing FWA officers to ‘access every workplace on a weekly basis risks adding disruption and distracting employers from their core focus of creating jobs’.
The CBI makes a plea for a return to the practice of the past, when employers and unions would come together to agree new rules.
Voters will find it astounding that a Government which proved so hapless at dealing with public sector unions should now subject the private sector to the poisonous fruits of socialist dogma.
Remember, Labour dished out £11billion in pay awards – including to health service workers – in its first month in office. Yet Health Secretary Wes Streeting’s reward for his generosity (with our money) is a long-running stand-off with resident doctors.
The Government is now inviting those same trade unions to mount intrusive inspections of employers, with FWA enforcers hovering in the background if, for some reason, the unions are not allowed through the door.
Not only is this destructive, it is confrontational and anti-British. What happened to compromise?
As a young City journalist, my introduction to covering politics was the sight of the Brothers and their CBI counterparts trooping into Downing Street to settle their differences over beer and sandwiches.
This included an earlier occasion when the Strait of Hormuz was blocked – in the aftermath of the 1973 Yom Kippur war – and Britain was gripped by a wage-price spiral. It wasn’t a perfect way to do business, but it offered the prospect of agreement.
It was a civilised, mature and very British response to dealing with the nation’s economic problems.
Who would have thought we’d reach the position in which we now find ourselves – in which, as the new legislation makes clear, Rayner’s FWA has powers of forced entrance, arrest and ‘referral to prosecution’ if it finds ‘serious, deliberate or persistent non-compliance’ with rules to protect workers.
The FWA is a child of Rayner’s Employment Rights Act, of course, against which much of the business world has fought tooth and nail.
This ill-judged piece of legislation, which became law in December, rips up Britain’s flexible Labour market.
The introduction to the Act claims it will allow the United Kingdom to escape the blights of ‘low growth and low productivity’, yet the effect has been the opposite.
Together with the taxes Rachel Reeves, the Chancellor, has rained down on businesses, Rayner’s folly has helped drive unemployment to 5.2 per cent of the workforce, the highest level since 2021.
Youth joblessness (among 16 to 24-year-olds) has reached more than 16 per cent, the worst among our advanced European neighbours.
Bureaucracy, regulation and fear of intrusive practices are driving employers overseas. Only yesterday artificial intelligence pioneer OpenAI revealed it is halting investment plans in Britain because it has had enough of the regulatory environment.
The departure makes a nonsense of Labour’s pledge to turn this country into a powerhouse of innovation.
Indeed, American companies will be appalled at the prospect of Angela Rayner preparing an assault on Downing Street, should – as seems likely – next month’s local elections go badly for Labour.
What, I wonder, do Labour-friendly businesses make of it all? Soon after Starmer came into power, and as the Employment Rights legislation started to make its way through Parliament, the likes of the Co-op and power giant Centrica lined up with trade union chieftains to sing its praises, apparently convinced that growth and employment were bound to follow.
They cannot have imagined Rayner’s shock troops raiding premises, seizing evidence and arresting employers.
One might have hoped that Reeves, who is desperate for growth, would have interceded. Who better to nip this in the bud and ensure Rayner’s new employment Stasi were allowed nowhere near Britain’s vital wealth creators?
Sadly, no one seems capable of stopping the Left’s march to the commanding heights of the British economy, or what remains of them.
Even out of office, ‘Red Angela’ and her backers are frightening the nation’s employers – with good reason – and trampling on British values in the process.
