Labour pay pro­posal draws dis­be­lief

The Sunday Telegraph - Money & Business - - Front page - By Jack Torrance

PRO­POS­ALS be­ing con­sid­ered by Labour to let com­pa­nies’ cus­tomers vote on bosses’ pay risk hand­ing large firms even more power to dom­i­nate their sup­ply chains, busi­ness lead­ers have warned.

While the re­port ex­plains how loy­alty schemes and bank ac­counts could be used to al­lo­cate votes to con­sumers, it does not ad­dress how the scheme would work for those sell­ing to other busi­nesses. The pro­posal cre­ates the prospect that large su­per­mar­kets or con­struc­tion gi­ants could hold sway over votes con­cern­ing their smaller sup­pli­ers, wors­en­ing an im­bal­ance of power.

Ed­win Mor­gan of the In­sti­tute of Di­rec­tors said: “This eye-catch­ing pro­posal be­comes more eye-wa­ter­ing the more you think about it. Surely they can’t be sug­gest­ing that busi­ness cus- tomers would get to vote on the pay of their sup­pli­ers? Con­sumers al­ready have the most pow­er­ful vote of all, their cash, and if they can’t leave for what­ever rea­son, the prob­lem is much deeper than pay.”

The Uni­ver­sity of Sh­effield’s Prem Sikka, who led the team of aca­demics who com­piled the re­port, said it would be up to a gov­ern­ment to de­cide whether vot­ing should be re­stricted to in­di­vid­ual con­sumers.

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