Whatever Mayism maybe, it is certainly no friend of corporate Britain. The Conservative party manifesto launch signalled a departure from the Tories previously held pro-business, neoliberal policies. Stricter rules on takeovers and mergers, as well as corporate pay and governance have received lukewarm reactions from The City, with one business leader calling out Theresa May for her inability to listen to the needs of companies according to the Financial Times. The British Chambers of Commerce, which represents 75,000 UK companies said some of the proposals in the document would increase upfront costs, regulatory obligations and uncertainty.
I understand the British people’s discontent with bankers and corporate bosses following the 2008 financial crash, however if Theresa May is determined to govern in the national interest, then now is not the time to be piling on excessive, unnecessary rules for corporations which need flexibility, in order to adapt themselves to the ever evolving political landscape Brexit has presented.
In regards to takeovers and mergers, the manifesto states the following;
‘We will update the rules that govern mergers and takeovers. This will require careful deliberation but we can state now that we will require bidders to be clear about their intentions from the outset of the bid process; that all promises and undertakings made in the course of takeover bids can be legally enforced afterwards; and that the government can require a bid to be paused to allow greater scrutiny’
This proposal will mean any takeover deal will be legally binding and gives central government the ability to intervene in the takeover process if deemed necessary. In addition, this proposal is already enshrined in UK law in the 2006 Companies Act, in addition to the 2002 Enterprise Act, which allows government to prevent mergers. There is also a self regulatory ‘Takeover Code’ dictating the terms and conditions of takeovers/mergers. According to the Institute of Directors, updating the Takeover Code would be a more efficient and effective way of protecting companies. CEO’s are more qualified to determine the longevity of a merger, not bureaucratic career politicians.
‘The next Conservative government will legislate to make executive pay packages subject to strict annual votes by shareholders and listed companies will have to publish the ratio of executive pay to broader UK workforce pay’
It is this proposal which has faced the most criticism, and rightly so. Such information should not be in the public domain, since when did Tories believe in name and shaming individuals simply because they bring home a seven figure salary?
Carolyn Fairbairn, head of the CBI said “the next government’s intentions on executive pay would be best served by developing the existing regime to focus stricter votes on those cases that warrant greater attention”. What’s worse is the lack of content, a mere two and a half lines for a proposal that will cause a rift through corporate Britain, as well as ignite disputes between workers and bosses over pay which could trigger union action; a hypothetic scenario, but one that could become reality if introduced.
True blue Conservatives believe in the ability of business, not government, to create a working environment that allows workers to thrive and profits increase. However the manifesto states;
‘we will change the law to ensure that listed companies will be required either to nominate a director from the workforce, create a formal employee advisory council or assign specific responsibility for employee representation’
British Retail Consortium employment and skills policy adviser Fionnuala Horrocks-Burns said, businesses already employ a variety of different models to ensure the views of their workforces are heard by their board. Strengthening this voice is a positive step to support employee engagement and productivity, but there must be flexibility in how individual businesses do this in practice. How can flexibility be ensured when legislation enforces businesses to adopt a certain model of employee representation?
Theresa May has called for a ‘Great Meritocracy’, based not on where you come from, but in your ability to succeed, yet in her manifesto she has pledged to charge businesses a £2,000 levy for hiring migrant workers – hypocrisy at it’s finest. Surely if an individual has the correct qualifications and skills, his/her nationality is irrelevant?
The manifesto states;
‘Skilled immigration should not be a way for government or business to avoid their obligations to improve the skills of the British workforce. We will double the Immigration Skills Charge levied on companies employing migrant workers, to £2,000 a year by the end of the parliament, using the revenue generated to invest in higher level skills training for workers in the UK’
In response Ed Cooke, chief executive of Revo said, “the moves to reduce immigration and increase punitive measures for firms employing non-EU workers will have a disproportionate effect on the retail and retail property sectors, which contribute more than £20bn in taxes to the economy. Given the ongoing economic uncertainty and wavering consumer confidence, retailers in particular would be forgiven for thinking they are fighting a war on two fronts, should these policies be implemented”; yet again, another example of Mayism gone mad.
These are just four proposals out of many more that will unnerve Corporate Britain, and indeed Conservative voters, such as myself. When asked if the manifesto set out her own doctrine, Theresa May stated there is no Mayism – there is good, solid Conservatism. It would seem the prime minister does not have an understanding of what Conservatism is; Conservatism would never reject the free-market, nor would it despise individualism or call ideology dangerous as her manifesto suggests.
Now is not the time to be pilling on excessive, unnecessary rules and regulations. Let us make a success of Brexit by freeing up our over regulated markets.
Below is a link to the Conservative party manifesto 2017, which I encourage readers to read: