The role of business in rebuilding out of this crisis and fashioning a new kind of innovation economy where productive businesses, the state, and citizens work together to create wealth, reduce inequalities and ensure that globalisation works for many more people is vital – it would be impossible without enterprise.  You enter public service to make a positive difference to as many lives as possible – the truth is, during my time parliament, I came to realise that there is even more capacity to do this in the private sector, which is why it was always my intention to return to it.

Of course, there are different business models, practices and behaviours.  Since my time as Shadow Business Secretary I have been a vocal advocate of long term value creation, as opposed to the fast-buck, and of firms that not only seek returns for shareholders and investors, but prioritise looking out for other stakeholders – employees, customers, suppliers and communities – as well.  It is for this reason that ensuring environmental, social and governance factors (“ESG”) are properly integrated into corporate decision making is so important. Afterall, business and society are mutually dependent – there is no such thing as a “free” market given that the private sector relies on the state to maintain our roads, provide a digital infrastructure, sustain a national health service and so on.

This perspective is based not only on hard evidence but also life experience.  I was born into a family of entrepreneurs and would have not had the opportunities I had were it not for the power of enterprise.  After leaving full time education, I spent just under a decade working as a corporate employment lawyer – at the coalface of the “S” in ESG – in the City and for industry.  I then spent a decade in various senior roles in Parliament leading on public policy which had ESG at its core.

This is why I am now throwing my energies into working as a strategic corporate advisor to companies on business-critical issues that impact on reputation and their narrative – ESG in particular.

The first steps in this new chapter have involved me working with three companies, mainly in a non-executive capacity, to help their leaderships build value in the long term for investors and shareholders, in addition to delivering for other stakeholders and society as whole. Each seeks to maximise returns for investors but are conscious that this must go hand in hand with delivering shared value for stakeholders and society too.

Advanced is the UK’s third largest software company and I sit on its board as a non-executive director.  Advanced is the UK’s third largest provider of business software and services, with a £254m turnover, over 19,000 customers and 2,400 employees with operations in the UK, Australia, Canada, France, India, Ireland, and the US.  During the pandemic it has paid all staff for their time in isolation, whether sick or at risk but unable to work from home – even those who fall outside of the sick pay policy which include those still within their first six month probationary period.  As a signatory to the Social Mobility Pledge, Advanced has a radical recruitment process which is non-biased and not based on one’s CV or background but on candidates completing two aptitude tests.

Signal AI’s Artificial Intelligence-powered solutions provide communications professionals, compliance and risk experts, in-house and agency teams, and senior business leaders with the information they need to be in the know. The company, for whom I’m working as an advisor, has raised over $49.5 million in investment from four funding rounds and has over 150 employees.  At the start of the lockdown the company gave every employee £200 in order to help them adjust to working from home, and a fruit and veg pack.  They also offered their services free to parts of government to help the country deal with corona virus.

Finally, at the start of the year I was delighted to join Digital Identity Net UK, which is a UK-curated company that provides consumers with a single gateway to the validated identity data held about them by their banks and other trusted custodians of transactional and behavioural data. This empowers the consumer to leverage their identity, decide who has access to it, and how they share it, to build a better quality of digital life.  The founders believe corporate responsibility is entirely compatible with significant revenue and profit generation so the firm will fund a Social Benefit Trust, with a progressively defined portion of profits, to promote wider social benefit by charitable giving There is a special social purpose clause written into the constitution of the company and the investor base is diverse, not dominated by any one individual or organisation.

I am looking forward to working with these great, innovative companies, and with others, investors and shareholders – here and abroad – in building a new stakeholder economy in the wake of the crisis in the months and years ahead.

Instinctively, many corporate leaders will want to steer clear of the rancorous debates which, in the U.S., will crescendo into November’s presidential election. Hiding away, getting on with returning to profit, trying to improve the battered share price and restoring a decent dividend will preoccupy many CEOs. Some will quietly drop commitments to look out for other stakeholders and the environment, citing the pandemic as an excuse.  This would be a huge error, not least because around a third of U.K. workers surveyed don’t have confidence in their firms’ leaders’ approach to navigating the current crisis, with a global survey showing that less than a third of respondents believe CEOs are doing an outstanding job dealing with coronavirus.

When it comes to the pandemic, there have been false comparisons made with times of war.  There are those who predict that once this crisis passes we can look forward to advances similar to those that followed World War II.  The societal changes and post war consensus of the 1940s were a by-product of the shared experience of people of all backgrounds and classes fighting side by side against fascism, leading to a collective demand for greater equality thereafter. It was against this backdrop that the 1945 U.K. Labour administration was elected which went on to create our National Health Service, which is playing such an important role in saving lives today. 

There was also a determination to prevent the world being ravaged again by the division and forces that led to the war. So from 1941 U.K. Prime Minister Winston Churchill and U.S. President Roosevelt led the establishment of the liberal international rule-based order which, ever since, has underpinned liberal democracy and trade across the globe, and guarded against authoritarianism and oppression. This struck a chord with President Roosevelt’s “New Deal” with the idea that nations would work on a multilateral basis to “improve labour standards, economic advancement, and social security.”

However, although we may now be fighting a war of sorts, albeit against an invisible enemy—coronavirus—we have been doing so separately in our own homes, in our own family units. Yes, our incredible key workers are putting themselves at risk to keep us safe but the great mass of our populations have had to stay indoors and abstain from doing things–they have not had to face the horror of leaving home, picking up arms and risking life and death in the same way as the war generation. Furthermore, the experience of coronavirus is not equally shared. For example, in the U.S. and the U.K. it disproportionately kills people of colour, and the people and places with the lowest incomes are the most vulnerable to job losses.  

And, far from precipitating international co-operation akin to what we saw under Roosevelt and Churchill, today we have witnessed countries going it alone, dealing with this crisis in a haphazard and uncoordinated way. The current U.S. President, Donald Trump, has even turned on the very international institution—the World Health Organisation—under whose auspices world leaders should be coming together to solve this global problem.

This is very tricky terrain for the C-suite of any company to navigate.

Many employees will return to work over the next few months hoping they still have a job, only to be told they don’t. 

The U.K.’s Office for Budget Responsibility has this morning published its latest estimate of the total cost of the government’s coronavirus policy interventions: a whopping £123 billion in 2020-21.

Quite rightly there are demands for a new social contract involving key workers being properly rewarded for their incredible work. 

Funding all of this will involve tax increases but who will be asked to pay for them?

Microsoft’s CEO, Satya Nadella, says we have seen the equivalent two years’ of digital progression in two months. Great for big tech but this will undoubtedly lead to household names in traditional sectors, like high street retail, going under. Upskilling and training redundant workers to adapt will be essential. We must also guard against further market concentration in the hands of the dominant players that are left standing and a reduction in competition (which is needed for a healthy functioning market). 

So we should use this moment to reform capitalism and foster a new kind of innovation economy where productive businesses, the state, and citizens work together to create wealth, reduce inequalities and ensure that globalisation works for many more people.   

In this context, there will be a lot of scrutiny of business, which has an important role to play, and will be operating alongside a bigger and more active state. But, as ever, opportunist, populist politicians will be looking to exploit this situation for their own cynical ends.

The populist Left will seek to use this moment to impose punitive and extreme measures on enterprise, and implement policies that will certainly not deliver growth or nurture an environment in which under-pressure firms can recover and get people back to work. 

On the populist Right, many of the main protagonists are currently in office. Their knee jerk decision making, based on ideology and emotion as opposed facts and evidence, and their wild policy ideas, have left them exposed as ill-equipped to meet the needs of this moment. President Trump’s suggestion that we inject ourselves with disinfectant provides a good example.

As ever, they will be looking for scapegoats with whom to park the blame for their incompetence.  Our countries do need to build more resilient domestic supply chains for strategic reasons to withstand the type of shock we have experienced. Yet these populists will demand a more drastic approach. There will be calls for deglobalisation and a degree of isolation as a means of protecting citizens, when this crisis has illustrated the importance of co-ordination and collaboration. 

The result—a perfect storm for companies during a pandemic induced global downturn: demands for more red tape, much more regulation, and punitive business taxation at the behest of the populist Left; and, calls for disproportionate restrictions on immigration, more protectionism, and nationalism, at the behest of the populist Right. Both will impede business and trade.

Business needs to see off this threat by acting to ensure that in a post coronavirus world a regulated, social market economy delivers the goods for more people. Everyone must play their part so CEOs need to become more vocal and activist in addressing environmental, social and governance (ESG) concerns, not less. They are in a good position to do so. Were it not for their firms’ technologies, enabling us to remain connected to our nearest and dearest, the experience of lockdown would have been a whole lot worse. If companies seize the moment and are in the vanguard of building back a better and fairer economy, those who stand in the way of enterprise will be deprived of the oxygen they need to whip up fear, anger and anti-business sentiment.

In his new UN role his focus will be on significantly shifting public and private finance markets and mobilizing the private sector investment needed to achieve the goal of limiting temperature increases to 1.5 degrees, as set out at the 2015 UN Climate Change Conference in Paris. The prime minister, not wanting to lose out on the action, has also named Carney as his finance adviser for the UN’s 26th Climate Change Conference (COP26) which takes place in Glasgow this November.

Carney has warned that “climate change will affect the value of virtually every financial asset” and the Bank will now be stress testing the resilience of the biggest financial services institutions to the physical and transition risks associated with different possible climate scenarios, and the financial system’s exposure to climate-related risk more broadly. Last month, he sided with Greta Thunberg in her clash with president Trump over the urgency of this issue – he said her warnings, that we have only eight years of emitting carbon at the current rate, if there is to be 67 per cent chance of limiting an increase in global temperatures to 1.5 degrees, were right. With regard to the climate emergency, he has said the question for every company, every financial institution, every asset manager, pension fund or insurer is: “what’s your plan?”

If we are to limit temperature level increases, not only do we need to limit our carbon emissions and reduce our use of natural resources, but we must regenerate and reuse natural assets. Since industrialisation, consumption has followed a linear model – where firms take natural materials, use them to make a product, then sell them to the consumer who later bins the material when it no longer serves its purpose. Not only does this increase energy use and generate an enormous amount of waste, but it leaves companies exposed when those finite materials dry up or the price of them increases. This is simply not “unsustainable”, in every sense of the word. 

Consequently, many businesses are moving towards a circular economy model that looks to restore and regenerate materials. Isn’t this simple recycling? No. As the World Economic Forum’s 2020 Circularity Gap Report points out, “modest improvements in waste recycling are being overtaken by the sheer volume of virgin materials being sourced and used to fuel our growth.” Also “recycling”, a broad term, can include incineration and recycling environmentally harmful products, and is itself energy intensive. However, the circular economy seeks to do more. The aim is to design out the waste in the first place, ensure the products are made to have several lifecycles, use materials that can easily BE separated and reused, and ensure the energy used in the process is renewable. 

The environmental benefits are undeniable. An Ellen MacArthur Foundation and Material Economics report estimates that applying circular economy strategies to the production of cement, aluminium, steel and plastics can lead to a 40 per cent drop in emissions from those goods alone by 2050. But there are huge economic benefits to be had too. Research by McKinsey suggests the circular economy could boost Europe’s resource productivity by 3 percent by 2030, generating cost savings of €600bn a year and €1.8 trillion more in other economic benefits. So in answer to Carney’s question, the UK becoming a leader in the circular economy must be part of our plan.

One company leading the way is the British-German owned firm, Pentatonic. I was invited last summer to Berlin to speak to their staff team about Brexit (full disclosure – they funded the trip) which gave me an insight into what they do. They describe their mission thus: “Man has already produced enough plastic and glass to fulfil our needs forever – it’s all out there, it’s just a case of reincarnating rather than burying it. And with enough creativity, each incarnation can be better than the last.” 

Launched in 2017, medium-sized and growing fast, Pentatonic co-creates products for customers using cutting edge manufacturing, allowing their clients to operate more sustainably, using the circular economy model. Their UK CEO, Jamie Hall – formerly the general manager of NikeLab, Nike’s innovation business unit – sees a huge opportunity for British firms here. Far from seeing the latest pronouncements of central bankers and bankers on the need to act on the climate crisis as bandwagon jumping, Hall told me “it’s exhilarating to see their focus on this and the viability of the circular economy as a good investment proposition.” He puts it well when he says “if you create great products at great prices which hold their value, you incentivise people to reuse which will facilitate a complete sea change, at scale, in how we operate.” Big corporations can see the business case for it – Pentatonic’s customers include Burger King, Heron Preston, New Era, Nike and Starbucks. 

So it’s a win-win all round – the circular economy is good for business and good for the environment. If the UK seizes the moment to become a world leader in this sphere, it could be great for our economy too.

It was a disappointing general election for my party, the Liberal Democrats, but that should not obscure the progress that was made. We gained 1.2 million more votes relative to 2017 with our vote share increasing by 4.2 per cent, compared with the Conservatives who gained 330,000 votes and their vote share increasing by 1.2 per cent. Our share of the vote increased in every region of the UK – in areas that voted Leave and Remain in 2016 – but we are now one seat down compared with 2017. 

As ever, we suffered from being squeezed out by the two big main parties in our anachronistic, unjust first-past-the-post electoral system. We now have 11 MPs, whereas under a system of proportional representation, we would now have 74 MPs.

In many contests, we achieved some of the biggest ever swings in election history. In the Cities of London and Westminster, where I was the candidate, we almost trebled our vote share by 19.6 per cent to 30.7 per cent, while the new Conservative MP lost 6.7 per cent and Labour shed 11.2 per cent of their vote shares respectively compared to 2017. The Tories credited the prime minister with retaining the seat but, above all, they have Jeremy Corbyn to thank for that. 

I found visceral dislike for Boris Johnson among Tory voters and strong opposition to Brexit on the overwhelming majority of doorsteps in the constituency, an area where half of the residents are non-UK born, with one in five being born in another European Union member state. However, fear of Corbyn coming to power overrode all else – so many people told me they were voting Tory for that reason in spite of hating Brexit. That is why it came as no surprise to me that Labour went down to its worst defeat since 1935 losing 7.9 per cent of its vote nationally, with more than 2.6 million voters deserting it. 

Our local campaign was a team effort. We were blessed to have a superb staff and awesome local party. I am incredibly proud of what we have achieved and cannot thank them all enough for their tremendous efforts. As I said on election night, we set out to climb Everest but, alas, although we were not far from the summit, we did not quite reach it – this was in spite of the remarkable campaign of the Westminster and City of London Lib Dems, not because of it.

I am also proud to have been part of a group of centre-ground MPs who were among the most prominent, unapologetic pro-Europeans in the last parliament who left the two main parties but lost our individual battles last week. 

The group includes Luciana Berger, Mike Gapes, David Gauke, Dominic Grieve, Sam Gyimah, Dr Phillip Lee, Chris Leslie, Anna Soubry, Antoinette Sandbach, Angela Smith and Dr Sarah Wollaston. I was so sorry to see my fellow Liberal Democrats Jo Swinson and Tom Brake, and lots of good Labour people, lose their seats too. We all stood up for our principles and what we believed in – we certainly did not choose the easy route.

Going forward, we must accept the choice the people have made both to re-elect Johnson and the Conservatives into government, and for Labour to continue as the official opposition. Now the dust has settled, it is in all our interests that they live up to the trust invested in them. I will always argue the UK is better off, safer and strong in the EU, but it’s clear we will be leaving the EU next month. 

In so doing, it is vital that we leave the EU over the course of next year in a way that minimises the damage to our already fragile economy. The official economic data released last Monday almost went unnoticed because of the election but they were sobering. The quarterly GDP figures showed no growth to October 2019. Services were pretty sluggish with minimal increases, along with falls in both the production and construction sectors. 

Things have not gotten any better since October. The IHS Markit/CIPS Purchasing Managers’ Index survey released earlier this month showed the UK manufacturing downturn continuing into November with new orders falling for the seventh month in a row. There was a decline in construction output and a renewed drop in activity across the services sector as well, with the fastest pace of decline for eight months.

Brexit uncertainty has loomed in the background so, in the short term, there will undoubtedly be a boost in confidence simply as a result of there being more political certainty on the course the country will now follow. Sterling and UK equities rallied off the back of the decisive election result and the threat of a Corbyn government receding. However, as many commentators have noted, the growth slowdown of the past three years has lasted long enough to be regarded as a trend. To arrest this decline will require substantial investment. 

Whether we see the scale of investment required will depend on the future trading relationship negotiated with the EU next year and whether a trade deal is concluded by the time the transition period expires this time next year. 

The prime minister insists he won’t extend the transition period but the EU’s chief negotiator, Michel Barnier, says it is impossible to get a comprehensive free trade deal finalised in that timeframe, leaving open the prospect of an effective no-deal Brexit from 2021.

In all probability, the transition period will need to be extended, but whether Johnson can persuade a Tory parliamentary party, which is more hardline on Brexit than ever, to do so is another matter. The biggest danger for him is that after victory in his first election, the economy goes south because he can’t persuade his colleagues to take less of a hardline position on the future relationship with the EU. In that scenario, if he does not face them down he could go the way of one of his predecessors, John Major, with disaster following an election win.

Thank you for inviting me to speak here today.

Before I start, I want to get one thing out of the way…

People keep asking for my political predictions.

What’s going to happen with Brexit? Will there be a deal?  Will there be a snap General Election?

I predicted that Labour would win the 2015 General Election…

I predicted that the UK would vote to Remain in the European Union…

And I predicted that Hilary Clinton would beat Donald Trump…

So, I’m following my wife’s advice, and I’ve stopped making political predictions.

‘I don’t know’ is the answer but I think we will have an answer by this time next year.  That’s all I will say.

I don’t blame you for asking.

Before coming into politics, I worked as an employment lawyer here in the Cities of London and Westminster, where I am the Liberal Democrat candidate at the next general election.  Almost all my clients were based in this constituency.  Most traded internationally, particularly into EU markets. 

So, I do understand just how frustrating not knowing what our trading relationships will be are for business.  And I appreciate that decisions on whether to spend, hire and invest cannot be made in isolation of from all the political volatility.

The Liberal Democrats are winning and will be decisive, when the next election comes.

What I can say is that it will be a truly extraordinary election, with some unprecedented results, and a very high level of tactical voting.  And the Lib Dems are on course to play the most decisive role in any general election in my lifetime.

It is not a question of whether we can win more support – we are already winning.

This year, in the European Elections in May, we beat Labour and the Conservatives in a national election for the first time in 100 years, scoring 20.3% to their combined 23.2% of the vote.

In the local elections in England which occurred shortly beforehand we gained over 700 councillors whilst the Tories lost 1,300 and Labour lost control of 6 councils.

In spite of our strong Remain stance, in June we overturned a Tory majority of 8,000 in a seat that voted to Leave the EU and won the Brecon and Radnorshire by-election.

Following the defections of 8 MPs, we now have 19 MPs in Parliament.

And 50,000 new members have joined our party in the last year taking our membership to over 127,000, our biggest ever.

Usually after Local and European Elections, third parties’ polling goes down.  But our polling position has stabilised at around the twenty percent level, with us beating Labour into second place in several surveys.

People tell us they are fed up with our broken two party political system with two parties at its heart who are part of the problem.  They are deeply divided and have failed to provide the clear direction the country needs.  And they have been so preoccupied dealing with their own internal problems that they cannot perform their jobs competently. 

Fundamental change is needed and our success this year tell us the public like what we are offering, with Jo Swinson being a complete breath of fresh air compared to Boris Johnson and Jeremy Corbyn.  She does the work, is on top of the detail, reads her brief, actually cares and is of a new generation.

So we say, bring on a General Election – but we must make sure a No Deal Brexit is off the table first.  We cannot carry on with the current uncertainty, a government that has no majority and a legislature incapable of properly functioning. 

That is why we published our Bill for an election yesterday which not only protects against No Deal, but also prevents the Prime Minister ramming through his flawed Withdrawal Agreement without proper scrutiny, and it fixes the date of the election as 9 December 2019 into law so that it cannot be changed by a premier who has a habit of lying and breaking the rules.

Where next on Brexit

We know business wants to end this uncertainty too.  I can understand why some want to simply waive through and make do with the PM’s Brexit proposals.

But let us be clear: Boris Johnson’s Brexit proposals only offer more uncertainty.  They will not “get Brexit done”.

If the Withdrawal Agreement is finalised, we would enter an implementation period shortly after which would expire in December next year.  We have no idea what our trading relationship with the EU will be after that point.  The type of Canada style free trade agreement the Prime Minister envisages negotiating will take several years to settle and can’t be concluded in this timeframe.

If Brexit takes place, it will also increase the risk of the splitting up of the United Kingdom, with the SNP agitating for another Scottish independence referendum and instability in Northern Ireland.

And if Brexit takes place, should the current PM still be in office and not get the kind of trade deal he seeks by the end of next year from the EU, he is more than happy to gamble the country’s futures on starting 2021 without one.

Meanwhile, the Labour Party’s position is all over the place.

Labour’s leadership are split, with some wanting a People’s Vote, and others wanting to renegotiate a Labour Brexit deal, or a jobs-first-Brexit – a contradiction in terms.

It is still unclear, even if Jeremy Corbyn and John McDonnell managed to negotiate a Labour jobs-first Brexit, whether they would campaign for or against their own deal. They cannot even agree amongst themselves on whether to support having an election.

We, on the other hand are clear – we want to Stop Brexit and Remain in the European Union.  It is the only way to quickly end this uncertainty and restore confidence back into the economy.

We aim to achieve this by way of a democratic vote of the British people, either through a People’s Vote or at a General Election.  Our preference has always been a People’s Vote but with a significant minority of Labour MPs and around half of the ex-Tory rebels in the House of Commons refusing to back it, it is clear we do not have the numbers for one which is why a General Election and a new parliament now offers the most likely way we can achieve this aim.

Until there is a democratic vote, there will be no resolution to the impasse, and we cannot hope to move on, address the real issues facing our country and heal the divisions.

Brexit is already harming the economy.  We have already witnessed a fall in the value of Sterling, higher inflation, and low or negative GDP growth – and we haven’t even left yet.

The Government’s own analysis concluded that in the next 15-years, any form of Brexit will damage our economy.  Relative to Remaining in the EU it is estimated that the kind of free trade agreement envisaged by the PM will lead to GDP and real wages being 6.7% and 6.4% lower in the long term.

Our plan for the future

So what are our plans?  The Lib Dem plan for our economy aims to tackle the causes of Brexit by investing in Britain’s future.

Let me start with where the economy is right now.

GDP growth has been under 2% in the last three years and weaker than in other G7 economies.

According to data from the Department of International Trade, the number of foreign investment projects into the UK dropped by 14% in the fiscal year ending March 2019.

Since December 2017, business investment has been falling each quarter, with the only exception being Q1 2019.

R&D investment is low – below the EU28 average of 1.9%, the OECD average of 2.3%, and lower than key competitors such as France, the US and Germany.

We have recorded a persistent trade deficit every year since 1998, with it widening from -1.3% of GDP to -1.5 of GDP in the last year.

The 2016 Brexit vote has exacerbated these underlying problems.

Jo Swinson, Ed Davey and I all understand the impact this is having on the environment you operate in, the undermining of confidence in the economy, and how this leads you to delay decisions or cancel investment plans.  And we intend to reverse it.

And we want to work with you to support enterprise, invest in the physical and digital infrastructure our economy needs, and build a balanced partnership of the public and private sectors to get the British economy moving, and ensure our economy is fit for the future.

Our record

When the Liberal Democrats were last in Government we helped provide a stable business environment – as you can see that stability fell apart soon after we left office.

Above all, we adopted an active industrial strategy and worked with business to both strengthen and modernise our economy.

We set up the Green Investment Bank – the world’s first-ever state-backed bank of its kind.  The Bank has channelled more than £15bn into green infrastructure and has funded 60% of the UK’s offshore wind generation capacity.

We established the series of ‘catapult’ innovation and technology centres to bridge the gap between R&D and industry and help ensure our most innovative ideas are commercialised and drive benefit to the UK economy.

We founded The British Business Bank. The bank is independently managed but 100% Government owned and has increased the supply of finance to smaller businesses.

We can be proud of these achievements.  However our goal is a society in which every citizen, regardless of circumstance, background or postcode, can lead a happy, prosperous and secure life. This is not the case in Britain today.

Inequalities and regional economic decline and underinvestment played a big part in creating the Brexit chaos we find ourselves in.

Anyone who thinks that the status quo is a viable business plan for the future needs a reality check.

There are different varieties of capitalism – the current model is dysfunctional and needs to be repurposed.

The kind of capitalism we need must be more inclusive and progressive, fairly distribute the proceeds of growth so all communities, regions and nations benefit from the proceeds of globalisation.  Fail to do this and the forces of the extreme and populist Left and/or Right will flourish.

This will require greater equality of opportunity, and government working together with the private sector to harness the power of enterprise and spur inclusive prosperity and growth.

The state and the market, working in partnership, both have a role – and there should be a balance between the two.

We call it a social market economy.

We will create this social market economy by investing in people, innovation and infrastructure in order to give people the tools to be competitive in our economy and ensure our country a world leader.

Ed Davey, our Shadow Chancellor, will set out our plans in detail during the election campaign but I want to highlight four pillars today and some examples of what we intend to do.

First, skills and training for a 21st century economy.

The rapidly changing nature of work means more people are changing career and need to retrain multiple times within their lives.

Even if people don’t switch career they need to be able to develop their skills to keep pace with changes in technology and working practices.

So a Lib Dem government will introduce Lifelong Learning Entitlements – individual ring-fenced funds to enable access to high-quality training schemes for adults.

A higher-skilled workforce will also boost the UK’s economic productivity, which has been lagging behind our international competitors for too long.

Again, the public and private sectors working together in a balanced partnership.

Second, we will support innovative businesses and new developing technologies, which will be the foundation of a thriving twenty-first century economy

As part of an active industrial strategy, a Lib Dem government will expand the remit of the British Business Bank to perform a more central role in the economy.

This will help tackle the shortage of equity capital for start-ups and growing firms, and providing long-term capital for medium-sized businesses developing these technologies.

A Lib Dem government will also pursue year-on-year real increases in public funding on R&D for the next 10 years, so the UK economy achieves our 3.4% GDP goal.

The flawed business rates system acts as a disincentive to investment.  We wish to replace it with a system based solely on the land value of commercial sites rather than their entire capital value, thereby stimulating investment.

Third, an economy which cares for our environment and climate.

We want to see businesses take greater responsibility for the impact they have on the environment.

That is why we want a general duty of care for the environment, to ensure that companies are avoiding behaviour in their operation and supply chains that is damaging to the environment.

This is something that more and more consumers want, and that many businesses are already doing.

So, by regulating for it, it creates a higher floor for standards,

It creates a more level playing field for businesses,

and it doesn’t penalise those who are seeking to protect the environment – but incentivises those who need to do more.

And fourthly, we will help drive regional growth.

As I mentioned earlier, our vision for the economy is one where government supports enterprise, invests in the right infrastructure, and builds a balanced partnership of the public and private sector.

A Liberal Democrat government will examine the current £270bn a year procurement budget to ensure a more decentralised and devolved approach, which will benefit regional economies.

We plan to use public sector procurement and infrastructure budgets to partner with private sector investment in order to increase regional growth in digital and physical infrastructure. This will be an important economic stimulus directed to the regions.

Achieving dynamic local economies, with vibrant, productive cities – economically connected with industrial and rural communities – requires improvements to transport.

That is why a Liberal Democrat government will be committed to the electrification of the rail network, improving stations, reopening smaller ones, restoring twin-track lines to major routes and proceeding with HS2, HS3 and Crossrail 2.

Of course, we must ensure all parts of the country have good digital connectivity.

For the avoidance of doubt: there are no mansion taxes, punitive business tax hikes, programmes to appropriate private property or policies that will lead to our key sectors and industries being walloped with new trade tariffs in our plans.  Neither Labour nor the Tories can say this.

How does our overall approach compare to the offer from the other parties?

Since 2015, this Tory government has overseen a year-on-year drop or stagnation in GDP growthfrom 2.3% in 2015 to 1.4% in 2018.

Meanwhile poverty is up with 14.3 million people living in poverty as of July 2019, that is 22% of the UK population, including 4.6 million children.

This is unacceptable for the fifth richest country in the world.

And this is before we even get to Brexit, a form of which Boris Johnson is happy to plough ahead with, despite all of the warnings of the business, academics and even the government’s own impact assessments.

Instead of listening to you these last few years, senior cabinet ministers have gone on the attack. The PM said “f**k business”, while the former Foreign Secretary said it was “completely inappropriate” for you to air your concerns on government policy. 

Consequently many business leaders I speak to believe the government provided by the Tories since 2017 has been the worst for business they can remember. Yes, they point to Brexit but, they also point to their sheer ineptitude and incompetence.

Meanwhile, under Jeremy Corbyn and John McDonnell’s leadership Labour are failing to even provide proper parliamentary scrutiny to hold the Government to account.

John McDonnell has outlined his plans for renationalising key parts of the British economy.

The CBI’s own analysis shows that Labour Party’s renationalisation plans will cost £196bn.  That’s as much as the annual spend on the health and social care and education combined.

And by their own admission, if elected a Labour Government is likely to spark panic amongst major employers and businesses, leading the party to ‘war game’ for capital flight and a run on the pound.

In our words and deeds, I would argue we are now the only main party that is pro-business, enterprise and entrepreneurship.

Conclusion

So in conclusion, The Liberal Democrats can win – and we are already winning.

In the local elections.

At the European elections.

We are the only sensible pro-business choice at the next general election.

We have a record of working with business to both strengthen and modernise our economy.

I ask you today to work with us again on this.

Whereas Labour and the Tories are two competing visions of the past – our vision is one where government supports enterprise, invests in infrastructure, and builds a partnership of the public and private sector.

The Lib Dem plan for the future of the economy will tackle the causes of Brexit by investing in the Britain of tomorrow.

That is how we build a brighter future for our country.

Thank you.

The promises made by Boris Johnson and the Conservative Government that the UK would have a whole host of trade deals in place by Brexit day have now long been seen to be nonsense, however this desperation by Liz Truss represents a new low.

This leak shows how Government ministers are willing to abandon safety standards on the food we feed our families in a hopeless attempt to try and replace the trade we will lose as members of the European Union.

The Tories’ vision of Global Britain is in tatters. Our position on the world stage is no longer being a leader in minimum standards to protect people’s welfare, but instead we are witnessing our Government try to roll these back or abandon them entirely.

This grovelling to Donald Trump to get a trade deal must stop. The route out of this mess is to stop Brexit and the Liberal Democrats will continue to lead this fight.

In a no-deal Brexit, businesses that currently only trade with EU countries will need an EORI number to trade goods into and out of the UK.  HMRC uses this number to identify the business and collect duty on their goods.

Government is flailing from one crisis to the next when it comes to no-deal Brexit preparations. It was only after the lack of preparedness among UK exporters to the EU was exposed by the Liberal Democrats that the government has acted to fast track export registration.

The Operation Yellowhammer leaks expose the government’s own analysis of the scale of the fallout a no-deal Brexit poses for the country including delays at the border, food, fuel, and medicine shortages, and rising prices in our shops.

Exporters might have the correct registrations but Operation Yellowhammer documents tell us they will in all probability be sitting in lengthy lorry queues at border crossing points. There is no form of Brexit that won’t be a disaster for our country, and the Liberal Democrats are the only UK-wide party committed to stopping Brexit.

The working assumption of the Westminster bubble is that there will certainly be an election either just before or after 31 October, the scheduled date of our departure from the European Union. This is for the simple reason that, whatever happens, it is impossible to see how Boris Johnson’s administration can govern effectively with a majority of one once parliament returns from 2 September.

That election won’t so much be “people versus parliament” as “reckless gamblers versus everyone else.”

On any measure, Boris Johnson cannot claim to speak for the “people” – it will no doubt be another lie he plasters across a campaign battle bus. Yet he became prime minister having been selected by Conservative Party members who make up less than 0.5 per cent of the electorate. 

In the English local elections in May his party got 28 per cent of the vote.  Shortly after, in the European elections – likely to be the last national election held in the UK before the snap election – his party did even worse, coming fifth with 8.84 per cent of the vote.

He has now been PM for over a fortnight and his party has been polling at between 25-34 per cent since he entered No 10. There is no doubt he is seeking to plunder support from the Brexit Party and turn his party into the Brexit Party 2.0. 

Even if you add the Brexit Party’s support – which varies from 9-17 per cent – with that of the Tories, their combined support has always come in at no more than around 45 per cent since Johnson took office. So, the government doesn’t even speak for half the people, never mind all “the people.”

Ploughing headlong into a “no deal” Brexit will be a huge, reckless gamble with people’s jobs and livelihoods. This is vividly illustrated by the first estimate of growth for the second quarter of this year published by the Office for National Statistics last week. 

It showed the economy contracted by 0.2 per cent. Manufacturing saw its largest quarterly drop in 10 years, production had its biggest decline in seven years and services (which makes up most of the economy) had its weakest quarterly performance in three years.  Brexit was THE overwhelming factor and we have not even left the EU yet. 

Ministers know that a no-deal Brexit will involve an immediate shock to the economy which is one reason why they will seek to hold an election almost immediately after exit day – if it hasn’t happened beforehand – so it takes place before the pain is really felt.

Michael Gove even floated the idea of announcing a Bank Holiday on 1 November in an attempt to delay the inevitable chaos until after people have been to the ballot box. There is a description for this type of behaviour – vote rigging.

Above all, a no-deal Brexit would be profoundly undemocratic, which is why it is vital we do all we can to stop it. Cross party discussions have been ongoing all summer on that front. 

The Vote Leave campaign was deliberately vague on many of the aspects of the Brexit they promised to the British people but there was one clear commitment given by its leading protagonists both before and after the 2016 referendum: there will be a deal.

On 8 May 2016 Vote Leave, which Johnson led, declared without qualification on its website that “the referendum will be followed by negotiations with the other 27 EU member states, following which the UK will strike a new deal with the EU based on free trade and friendly cooperation.”

Foreign secretary Dominic Raab has since tried to claim that Vote Leave campaigners warned “no deal” was a possibility but no one can find any record of this, including on its website. Indeed, in July 2017, while Johnson served as foreign secretary he asserted again that “there is no plan for no deal because we are going to get a great deal” in the House of Commons.  They could not have been clearer on this point.

Then there is the overriding mandate the 2017 general election gave parliament. When a vague Brexit was put to the British people in 2016, 52 per cent of people participating in the referendum (37 per cent of registered electors) voted for it; but when in 2017 Theresa May put a more defined Brexit to the people – of the hard variety – she promptly lost the Tories their majority.

Parties representing a majority of electors in 2017 had set their faces against a “no deal” Brexit. So any mandate claimed for a hard Brexit died at this point – something the Vote Leave cabal in government have never accepted.   

They try to deny the parliamentary arithmetic but the fact they could not get their extreme form of Brexit through the House of Commons this year has provided something of a wakeup call. Now they are seeking to force their no-deal Brexit through even if Johnson’s administration – to all intents and purposes, a Vote Leave government – has lost the confidence of the House of Commons before 31 October. 

This is definitely unconstitutional and, quite possibly, unlawful. It is certainly hypocritical given they argued for Brexit, in part, on the basis that it represented a reassertion of parliamentary sovereignty.

Let’s put aside the issue of leaving without a deal for one moment, and turn to the core question of whether we leave the EU at all. You see, if the Remain/Leave question were put to the public again in a referendum, the opinion polls have pretty consistently had Remain in the lead since 2017. Today it would be 52.2 per cent Remain to 47.8 per cent Leave.

An overwhelming majority of the more than 2 million young people, who couldn’t vote in 2016 and have since become entitled to vote, and they want to Remain in the EU. This is unsurprising given they will have to live with the consequences longer than any of us.  We also cannot forget that over 6 million people signed a parliamentary petition this year calling for Article 50 to be revoked.

The upshot of all of this is that Johnson, Gove, Raab and the rest of the Brexit elite see themselves a tribunes of the people – but they do not speak for the country. What they are seeking to do is a complete affront to our democracy.  If efforts to prevent a no deal fail in the Commons, that leaves the concept of an emergency government as the solution. 

If Boris Johnson’s Vote Leave government loses any forthcoming confidence vote, there could be a majority for an emergency government to take office with the sole aim of securing an extension to Article 50 to allow a general election to take place before Brexit. However, the person who leads that emergency government must command the confidence of the House. 

All Tory rebel MPs and, indeed, a substantial minority of Labour MPs would not give the Labour leader that confidence but would be open to other suggestions. The bottom line, though, is that for it to work Labour would have to support it and Labour has ruled out an emergency government. Shadow home secretary Diane Abbott was the latest to reject it last night. 

This is not surprising, not least because lifelong Brexiteer, Labour leader Jeremy Corbyn, will be intensely relaxed if Brexit happens – he has spent years campaigning for it. Jo Swinson, on the other hand, has made it clear that we Liberal Democrats are very open to it because, as the UK’s biggest and strongest Remain party, we are determined to do all we can not only to stop a no deal Brexit but to stop Brexit altogether.

Growth in the services sector output slowed to 0.1% in Quarter 2 2019.

The production sector contracted by 1.4% in Q2 2019, providing the largest downward contribution to GDP growth. This fall was driven by a sharp decline in manufacturing output, reflecting increased volatility in the first half of 2019.

We already knew real wages are down, poverty is up, inequality is at 1980s levels, and growth is geographically unbalanced under the Tories.  Now we have confirmation that the Tories’ plan to crash the UK out of the EU has crashed our economy. Pursuing a ‘no deal’ Brexit is a political choice without a mandate: these figures show people’s jobs and livelihoods are being sacrificed at the altar of political extremism.

The Liberal Democrats are the biggest and strongest Remain party in the UK. We are clear that any form of Brexit is bad for our economy, which is why we want a final say for the people on Brexit; and we are the only party that can get into government which is committed to stopping Brexit altogether.

In a no-deal Brexit, businesses that currently only trade with EU countries will need to apply for an Economic Operator Registration and Identification (EORI) number to trade goods into and out of the UK.  HMRC uses this number to identify the business and collect duty on their goods.

Various business lobbying organisations have been warning for months of a serious lack of preparedness amongst firms for a ‘no deal’ Brexit and how few British exporters to the EU have an EORI number enabling them to continue to trade after a ‘no deal’ Brexit.

As the Liberal Democrats’ Treasury & Business spokesperson I asked HM Treasury (HMT) for the latest figures on how many businesses that will need an EORI number to export to the EU have one, in a parliamentary question on 18th July.

However I was told by the Financial Secretary Jesse Norman MP in an answer shortly before the summer Recess on 23rd July that “data on the number of traders that would need a UK EORI number is not readily available.”

This was in spite of the fact that Government has already privately shared the most recent data with various business groups. HMT also publicly released such data at the start the year but that was before leaving the EU ‘do or die’ on 31 October 2019 became government policy.

I threatened to raise a Point of Order, complaining to the House of Commons Speaker about the unwarranted withholding of such data from Parliament, and also said he would submit a Freedom of Information Request to force disclosure of the latest data.

As a result, HMT have now provided the latest EORI numbers data which suggests less than 3 in 10 exporters that will need an EORI number to trade in a ‘no deal’ scenario have one. If exporters to the EU register for an EORI number at the current rate (up to 10,000 per month), all businesses exporting to the EU won’t be registered until the beginning of 2021 at the earliest.

The data reveals:

• Since December 2018, approximately 66,000 traders who currently trade just with the EU have been issued with a UK EORI number.
• However, based on 2018 data, HMRC estimate that there are approximately 150,000 VAT registered traders who currently trade with the EU and may therefore need to obtain a UK EORI number.
• Figures released by HMRC in February 2019 revealed there were a further 95,000 non VAT registered businesses that trade with the EU and need to take action too.
• According to HMRC the volume of businesses that have registered for UK EORI numbers to date is equivalent to around two thirds of the total value of trade undertaken with the EU, by VAT registered companies.

These figures reveal that an overwhelming majority of UK exporters to the EU are unprepared for a ‘no deal’ Brexit and will not be in a position to deal with the mountain of red tape and bureaucracy it will burden them with on 31 October. 

Pursuing a ‘no deal’ Brexit is wholly irresponsible political choice of the new administration for which there is no mandate and which will put businesses and jobs at risk.

Any form of Brexit will harm the economy and put obstacles in front of UK firms which is why Liberal Democrats not only want a final say for the people on any deal but are also the only party that can get into Government which is committed to stopping Brexit altogether.

Notes:

1. Based on HMRC figures around 245,000 businesses (VAT registered and non VAT registered) who export to the EU will need an EORI number but just 66,000 have applied for one since December 2018 – 27%.

2. HMT provided the following answer to parliamentary question (279012):

Question:

To ask the Chancellor of the Exchequer, how many (a) businesses and (b) companies (i) have an Economic Operator Registration and Identification (EORI) number, (ii) require an EORI number but do not have one and (iii) have applied for an EORI number and not received one. (279012)

Tabled on: 18 July 2019

Answer:

Jesse Norman:

Approximately 479,000 traders hold a live Economic Operator Registration and Identification (EORI) number issued by HM Revenue and Customs (HMRC). It is not possible to provide a breakdown of this data.

Data on the number of traders that would need a UK EORI number is not readily available.

HMRC have issued UK EORI numbers to all traders who registered for a number and did not already possess one at the time of their registration.

The answer was submitted on 23 Jul 2019 at 13:24.

3. HM Treasury additional data produced following notice of a Point of Order and Freedom of Information request:

• Businesses currently require an EORI number if they import or export goods with countries outside the EU. In the event that the UK leaves the EU without a deal, traders will require a UK EORI number if they import or export goods with countries in the EU (as well as countries outside the EU).
• There are approximately 479,000 traders who hold a UK EORI at present. Since December 2018, approximately 66,000 traders who currently trade just with the EU have been issued with a UK EORI number. Based on 2018 data, HMRC estimate that there are approximately 150,000 VAT registered traders who currently trade with the EU and may therefore need to obtain a UK EORI number.
• The volume of businesses that have registered for UK EORI numbers to date is equivalent to around two thirds of the total value of trade undertaken with the EU, by VAT registered companies.

4. EORI data released by HM Treasury on 28 February  2019: https://www.gov.uk/government/news/hmrc-urges-business-owners-to-make-sure-they-are-ready-for-no-deal

5. EORI guidance issued to firms by HMRC: https://www.gov.uk/guidance/get-a-uk-eori-number-to-trade-within-the-eu