Labour calls for 'responsible and better' capitalism

 

Chuka Umunna called for the government to "foster better business practice" to create a "better capitalism"

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Labour has called for "more responsible and better capitalism" and policies to tackle excessive executive pay.

Shadow business secretary Chuka Umunna said increasing transparency was the key to addressing high salaries.

His comments echoed those of Labour leader Ed Miliband who has challenged David Cameron to match Labour's pledges on the issue.

The coalition is expected to announce its policies on executive pay later this weekend.

In an interview with the Guardian, Mr Miliband said: "If one of the big battlegrounds of British politics is going to be who is really going to take action on executive pay, I say 'bring it on'. I promise you they are not going to steal a march on us in this area.

"Does anyone really believe that David Cameron came into politics to create a more responsible capitalism? The public are not going to buy it."

Mr Miliband's comments follow criticism that he does not have a credible economic plan.

Labour peer Lord Glasman said the party "show no signs of winning the economic argument" under Mr Miliband, in an interview with the New Statesman earlier this week.

Transparency

Labour's measures to tackle high executive pay include increasing transparency by simplifying remuneration packages.

Companies should also publish a pay ratio between the highest paid executive and the company median average - and the government could publish a league table highlighting the biggest pay gaps.

Accountability could be promoted by putting an obligation on investors and pension fund managers to disclose how they vote on remuneration packages.

Labour also wants a repeat of the bank bonus tax - to increase "fairness".

Mr Umunna said excessive executive pay was "symptomatic" of the "kind of capitalism that has grown up in this country over the last 30 years".

Explaining what he meant by "responsible capitalism" he said: "It's about looking at what we can do to foster better business practices, behaviour, successful business models that tackle unfairness, and the cost of living crisis at home, the problems we're finding domestically, and actually produce more competitiveness for British companies abroad."

"It's about saying the status quo that's existed is no longer serving businesses and people in society."

'Undermines trust'

Labour was not against people being rewarded for taking risks and creating jobs, he explained.

But there was a problem when pay awards appeared to "bear no relation to performance" - a situation that "undermines trust in the whole system", he said.

Labour said it accepted in full the recommendations of the High Pay Commission and urged ministers to do the same.

The commission was set up by pressure group Compass, with backing from the Joseph Rowntree Charitable Trust, to investigate boardroom pay.

Its year-long inquiry found that the pay of top executives at a number of FTSE companies had risen by more than 4,000% on average in the last 30 years - and said the disparity between what top executives and average workers earn has been building for many years.

Deputy Prime Minister Nick Clegg said in December the government would announce new plans to "get tough" on excessive boardroom pay in January and may legislate if necessary.

 

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  • rate this
    +2

    Comment number 607.

    569.The_Gambler-"...The answer, as anyone with half a brain has been saying for years, is where *between* capitalism and socialism, is the best point for our economy? That's the hard question. Which is why no one addresses it head on"

    We've had a 'mixed' economy, with greater or lesser Govt involvement for more than a century

    The question is not just hard to answer, it's impossible

  • rate this
    +1

    Comment number 606.

    454.marie
    "Looking after the elderly ... but discouraging those who don't need it not be dependent on the state."

    Problem is, this discourages people from providing for their own future -> unless you want to go back to a society where state provision resembles the Victorian workhouse.

    People who offer simple solutions to complex problems are either present fools or future tyrants. Think.

  • rate this
    +1

    Comment number 605.

    Further to 580
    In modern capitalism, spending is the circulation of the blood (money), if one part of the economy reduces spending then circulation is impaired & growth reduced but what we have at the moment is all sectors (Govt, business, banks & people) dramatically reducing spending almost bringing circulation to a halt & causing the patient (world economy) to be very sick.

  • rate this
    -1

    Comment number 604.

    The Gambler 586

    I am going to be pedantic I am afraid. I never said the theory was bad, I said that the principle was.

    It is a long time since I read Marx but from what I remember he believes that capitalism oppresses and alienates the working man by removing him from not only the end product of his labours, but by denying him full value for those labours

    That in principle is bad

    Please refute

  • rate this
    +1

    Comment number 603.

    587.scot
    'we are picking ourselves up with SNP'
    You are buying nationalist lies and need to wake up and smell the coffee. How many more instances of Salmond 'misquoting' economists and informed reports that state Scotland will fail if they dump the Union do you need to see the truth! Salmond is buying independence from the Scottish people by refusing to accept much needed austerity measures.

  • rate this
    +1

    Comment number 602.

    515. Assynt

    493.Billythefirst
    There is a lot of ill informed comment about Thatcher's so called deregulation.
    -----------
    Accept that she would not, personally, have endorsed the leveraged based wizardry that ensued in the 2000's, however, she paved the way for the free market unfettered competition merchants to start peddling their sub standard wares onto an unsuspecting public.

  • rate this
    +5

    Comment number 601.

    Wow that sounds good!

    What else can we have that they could do betterer than the current lot?

    Betterer trains, betterer schools, betterer NHS, betterer job opportunities, betterer more lowerer taxes.

    Just like that, Labour will make it betterer!

    What a pity they spent 13 years getting the UK into a dire debt situation, only marginally betterer than Greece!

    Its pathetic. Must do better!

  • rate this
    -1

    Comment number 600.

    212.catbenny
    so according to your stupid idea the few have even more while the majourity have even less so tell us einstien who pays for everything when your idea has the mass who have nothing paying for everything with choclate buttons fool while the greedy few who have everything pay for nothing what a good gormless tory you really are

  • rate this
    -2

    Comment number 599.

    yewlodge@97 "Who will pay TAX"!
    answered by kingtutter@145 US!

    doctor bob @64: who to "run the world"?

    Back on The Waterfront, 2015
    New Coalition on the brew
    (Differently Useless)
    Reprising Marlon Brando
    Cameron's last words
    To washed-up Osborne
    Recognizing, too late
    "I could've made it, Georgieā€¦
    Whatever multinationals said
    Could'ha shared at the gate"

    Income-Share MUST be: Democratic Way.

  • rate this
    0

    Comment number 598.

    Where in this article does it say that there is going to a drive to bring prosecutions to those that caused these financial problems that lead to the collapse of 2008?

    Oh....

  • rate this
    +2

    Comment number 597.

    Please understand that the Labour Party is not now, nor has ever been a socialist party in the full Marxist definition of socialism. Labour was founded as a vehicle for increasing working class representation in mechanisms of govt and as a result improve the lot of ordinary working folk. These working folk believe in a mixed economy which has always been Labour's platform.

  • rate this
    0

    Comment number 596.

    535. Tom Carter
    That's alright then.

  • rate this
    +4

    Comment number 595.

    I don't think greater transparency will help the actual problem at all. The governments seem to be constantly agonising about the 'Economy' which by their definition seems only to revolve around big business in London, not very helpful or thoughtful for us small business types. All this and they are still ignoring the elephant in the room; being the Financial Transactions Tax or Robin Hood Tax.

  • rate this
    -2

    Comment number 594.

    Better capitalism is communism but the way there is full of troubles. Communists are around again and will show you the way to make things rather than share your laundry chores. This capitalist service economy makes you a servant, communism will make you master of your own hands.

  • rate this
    +1

    Comment number 593.

    The trouble with Labour is they think you run a country by paying in credit.
    Labour cannot pay pay for their idealist politics and in fact no one can.
    Labour a wast of a vote the last people they support is the WORKING class.

  • rate this
    -2

    Comment number 592.

    Just political talk.
    We are all aware that cpitalism is in need of rorm, but how to is the question
    The answer is NOT socialism, which the Labour party has, and will again, lumber this country with.
    The best ideas I have heard of the reform of Capitalism have come from the New Right and tey are realistic but the oppostite to which Labour and their failed dogma want (and their union masters)

  • rate this
    +4

    Comment number 591.

    Capitalism = Greed. Have Labour learnt nothing from the failure of New Labour?

  • rate this
    +2

    Comment number 590.

    NO NO NO, New Labour should be calling for Socialism, Not Capitalism. They should be planning for renationalisation of all the utilities, for the common good and not for proffit, that includes a real public transport infrastructure. Not this Mickey Mouse privatley owned thing we currently have, which is the laughing stock of Europe...

  • rate this
    +4

    Comment number 589.

    Miliband will always do what is best for the Labour party just as Cameron will always do the same for the tories.
    No-one will do what is best for the country. We need a Statesman not a party politician
    There are millions of people in the country who are hardworking, honest and can always be trusted to do the right thing.
    Unfortunately not a single one of them will ever be in a position of power

  • rate this
    -1

    Comment number 588.

    577.Galileo2011
    Couldn't agree more - Labour and Ed Milliband should focus on core Labour values: nationalisation, spending, creating an unsustainable public sector, punitive taxation of the successful whilst spending on the wasteful, and lest we forget lots of spin and a few illegal wars wouldn't go amiss!

 

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