A winter of discontent could shatter Labour’s chances

Strike action and Starmer’s umbilical relationship with trade unions marks the end of any election dream

‘We’re not just a pro-business party,” declared Sir Keir Starmer last Thursday. We’re proud to be pro-business”. In the early 1990s, after over a decade in the political wilderness, Labour set out to woo Britain’s business community. Party bigwigs held countless private lunches and dinners with boss-class executives across the City of London and beyond.

“Forget the hard Left” was the message from Labour’s high command. “We’re the party of enterprise and low tax”. Tory grandees scoffed at this “prawn cocktail offensive” – a nod to that perennial mid-market starter. But just a few years later, with many business leaders onside along with millions of centrist voters, Labour won a landslide that began 13 years in power.

Last week, the prawn cocktail offensive was back – this time with jumbo-sized prawns. On Thursday, opposition frontbenchers addressed what Sir Keir called “Labour’s biggestever business conference”, held at Canary Wharf, that east London citadel of go-getting capitalism.

The Labour leader vowed to make Britain “the high growth start-up hub of the world”, as a packed hall of senior business leaders and lobbyists – mindful Labour is about 20 points ahead in the polls – listened politely.

Speakers included the bosses of

HSBC, Microsoft UK and insurance giant Aviva. Among the 350 attendees at the all-day schmooze-fest were delegates from Amazon, BAE Systems and the BVCA investor lobby group.

Such an audience will have been reassured that Jeremy Corbyn’s shadow chancellor, modern-day Marxist John McDonnell, has been replaced by Bank of England economist Rachel Reeves.

Last year, Reeves vowed that Labour would scrap business rates – the tax many business owners hate the most. And on Thursday, she highlighted Labour’s new Start Up, Scale Up study. The party wants to drive “patient capital” in UK pension funds towards “greater investment in homegrown businesses”, said Reeves – an idea appealing to financiers and industrialists alike.

During the three months to September, Labour’s campaign war chest was boosted by almost £2.8m of donations – raising more than the Tories for the first time since Corbyn became leader in 2016. What could turn out to be a major weakness, though, with the public’s patience being tested by an intensifying wave of strike action, is Labour’s still umbilical relationship with the trade unions.

Unions control a third of the votes on Labour’s ruling national executive council and send around half of all delegates to the party conference. They also continue to channel millions of pounds a year into Labour’s coffers – which makes it almost impossible for Sir Keir and his team to criticise the organised labour movement, not least during the most serious period of industrial action in a generation, as the UK braces itself for a Christmas of discontent. The widespread industrial action scheduled from this week until the end of the year will cause major political shockwaves. Already, we’ve seen bus drivers, RMT train drivers and Scottish teachers go on strike. From tomorrow, Royal Mail postal workers, the train drivers again and then Royal College of Nurses staff will refuse to work. We can then look forward to action from rail engineers, Border Force staff, airport baggage handlers, ambulance staff in England and Wales, more postal strikes, yet more rail strikes plus stoppages from national highways workers.

In some senses, industrial action isn’t surprising. Inflation is sky-high, with the consumer price index 11.1pc up over the last year and wages just 5.4pc higher – a hefty real-terms pay cut. But few expected coordinated strikes on this scale, designed to cause maximum chaos, piling pressure on the Government in particular, given that the bulk of the stoppages have been called by public sector unions.

Warnings that the UK faced a 1970s-style “winter of discontent” were widely derided. Those dismissing such concerns failed to understand that while unions now cover only 25pc of the workforce, down from 50pc in the 1970s, the majority of public sector employees remain unionised.

The question now is could the vote-winning powers of Labour’s prawn cocktail offensive be outweighed by the general public’s dismay when, after weeks – perhaps months – of debilitating strikes, the party’s leadership still refuses to criticise its trade unions paymasters.

Labour strategists know that, as things stand, the next general election represents their best chance of victory for more than a decade. That’s why the likes of Sir Keir and Reeves are making such business-friendly noises. Although Labour’s election prospects are on the up, it may be that strikes, given the public sector focus, amount to an opportunity for the Tories.

“If union leaders are not going to be reasonable, I must do what I need to keep people safe,” said Rishi Sunak last week. The Prime Minister promised “tough new laws” to curb strikes and to outlaw stoppages by ambulance workers and firefighters early next year, extending the ban already applying to police and prison guards to all emergency services.

After what we’re about to go through, such a move could prove to be popular. And Labour would be forced to fight it. The UK’s forthcoming strike misery will test the Government. But if union leaders go too far, with Labour financially obliged to back them, prolonged industrial action could be the Tories’ salvation.

‘Unions continue to channel millions of pounds a year into Labour’s coffers’