UK’s Starmer opens key summit with vow to rip up red tape
The world’s top banks say the country has a ‘very real opportunity’ to grow its economy through attracting foreign investment
PRIME Minister Keir Starmer vowed to scrap regulations holding back UK growth, as he seeks to soothe concerns among international investors after a rocky first 100 days in power.
Starmer pitched his vision to at the International Investment Summit in London, which was attended by top business leaders from companies including Alphabet, Brookfield Asset Management and BlackRock.
“We will make sure that every regulator in this country takes growth as seriously as this room does,” Starmer said in his speech, adding that ministers will “rip out the bureaucracy that blocks investment”.
On a panel with former Google CEO Eric Schmidt, Starmer said winning a large parliamentary majority in the July election meant his government could take a longer-term view on the economy, thinking in terms of “years not months.”
Schmidt said he was “shocked” that Starmer’s centre-left Labour Party said it was in favour of growth while in opposition, but that there was “plenty of money” ready to come into the UK if he delivered on his rhetoric on wealth creation.
The summit is a key part of Starmer’s promise to boost annual GDP growth to an ambitious 2.5 per cent. Yet companies are still awaiting details on swathes of Labour’s economic plans from taxes to industrial strategy.
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Starmer was dealt a blow days before the summit when Bloomberg revealed that Dubai-based DP World put the announcement of a £1 billion (S$1.7 billion) investment at its London port on hold after Transport Secretary Louise Haigh criticised the employment practices at the company’s P&O Ferries arm.
Business Secretary Jonathan Reynolds said on Sunday that the investment will still go ahead and said Haigh’s comments didn’t reflect the government’s position. He told Sky News that he “had to have a conversation” with DP World after the reports last week.
“It’s not the government’s position to boycott them, but we are clear, we do not want this country competing on fire and rehire. We are changing that,” he told the BBC.
Starmer will hope the summit can help his government turn the corner after a difficult first 100 days that has been marred by a scandal over freebies, a backlash over cuts to winter fuel subsidies for the elderly and the departure of his chief of staff, Sue Gray.
He was spared the embarrassment of holding the summit without an investment minister.
Just days before the conference, former Darktrace chief executive officer Poppy Gustafsson was named as the new UK investment minister, ending a three-month search that saw the first-choice candidate, Benjamin Wegg-Prosser, pull out.
Business leaders and ministers have gathered at Guildhall in the City of London for the summit and will later head to a reception at St Paul’s Cathedral that will also be attended by King Charles III. Sky News reported that private-sector investments worth more than £50 billion are set to be announced.
Agenda items include Chancellor of the Exchequer Rachel Reeves speaking on a panel with BlackRock boss Larry Fink. British banks Barclays, HSBC Holdings and Lloyds Banking Group are sponsoring the event alongside M&G and Octopus Energy.
In his speech, Starmer said Labour – which won a landslide victory in the Jul 4 election – has a “golden opportunity” and wants to harness private sector money to “rebuild our country”.
The prime minister got a welcome boost when some of the world’s biggest banks said in a letter to The Times newspaper that it was “time to invest in Britain”. The 14 signatories of the letter – which included UBS, JPMorgan Chase and Goldman Sachs – said the UK has a “very real opportunity” to grow its economy through attracting foreign investment.
Labour is hoping that an acceleration in growth can ease the pressure on the public finances and generate more money to pump into public services. However, it has added to economic headwinds in recent months with dire warnings over the state of the public finances that have rattled business and consumer confidence.
Reeves has set the stage for a tight-fisted budget on Oct 30, with reports suggesting that capital gains tax could be targeted.
On Sunday, Reynolds refused to rule out raising employer national insurance contributions to help generate extra revenue for the Treasury.
In an interview with Bloomberg Television at the event, Barclays’ CS Venkatakrishnan warned against hitting banks with tax rises at the budget. “Banks are among the highest taxed entities in the UK, we’re an important part of the economy,” Venkatakrishnan said. “I always say it’s really important for the UK to recognise that the financial industry is in its national interest.”
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