Presence at the Labour conference is a little like being embedded with the military. The narrative is controlled by party managers who seek to manage what delegates see and hear.
The real world is blotted out.
Keir Starmer and Rachel Reeves appear to believe that ploughing funds into an uneconomic steel plant in Scunthorpe and offering a loan guarantee to a rich company such as Jaguar Land Rover is going to set Britain back on the road to prosperity.
The latest economic data shows just how dismal prospects are ahead of next month’s Budget.
Today’s survey from the Institute of Directors, colleagues of working people, show business confidence is at the lowest level for almost a decade.
Directors are more fearful about rising costs and on inflation than at any time since 2017.
Clueless: Keir Starmer and Rachel Reeves appear to believe that ploughing funds into steel and offering a loan guarantee to JLR is going to set Britain back on the road to prosperity
The Chancellor’s claim that the cost-of-living battle is being won because pay awards outstrip inflation is a chimera.
Higher wages must be paid for and, unless accompanied by productivity gains, fuel surging prices.
Latest data from the British Retail Consortium shows shop prices climbed at an annual rate of 1.4 per cent in September, up from 0.9 per cent the month before, and by the largest amount since March 2024.
Food price inflation, which hurts less-well-off families more than anyone else, rose by 4.2 per cent.
Overall consumer prices are up 3.8 per cent, the fastest increase among the G7 richest nations.
Deputy Bank of England governor Clare Lombardelli has cautioned that central bankers need to be careful about assuming that inflationary trends are temporary.
This was the misjudgment made by her boss Andrew Bailey in the aftermath of the pandemic and energy price shock, which followed Russia’s war on Ukraine.
In the first half of the year, UK growth was stronger than across the rest of G7. But it is now moving in the wrong direction, tumbling from 0.7 per cent in the first quarter to 0.3 per cent in the three months to June.
It is not just business experiencing a confidence shock. The Office for National Statistics reports consumers hoarding cash with the share of disposable income saved up to 10.7 per cent. Households are fearful of further tax rises and more inflation.
It might be seen as an achievement that Starmer and Reeves, with pledges not to veer from the fiscal rules, managed to surf Labour’s conference without sending gilt yields soaring.
But it is worth recalling that government borrowing costs already are the highest in the G7. That is no vote of confidence.
Sick note
Nowhere is Labour’s neglect of business being more felt than in the UK health sector. AstraZeneca has planted a big flag in New York.
There is concern that it might soon be joined by Britain’s totemic replacement limbs, sports care and wounds specialist Smith & Nephew.
The £11billion London-listed outfit revealed that its finance director John Rogers is being allowed to move to the US where he will join chief executive Deepak Nath.
The company has tried in the past to shift its share quote to America so that leading executives could earn more money. It was prevented from doing so after spirited objections from investors.
But if at first you don’t succeed, try, try and try again! S&N’s argument is that it earns 54 per cent of its income in America where much of its manufacturing is now done.
If every FTSE 100 company deployed the same weak justification the rush for the door would include Shell and BP, Diageo, Unilever and many others.
Business Secretary Peter Kyle needs to call in the chairs of AZ and Smith & Nephew without delay and read them then riot act. UK plc cannot risk losing its science-based cutting edge.
Game over
Nor can there be complacency about erosion of the creative sector which contributes up to 10 per cent of national output.
Donald Trump is taking fresh aim at overseas-made films threatening a 100 per cent tariff on movies – everything from Star Wars to James Bond.
Meanwhile, the highly leveraged private equity takeover of Electronic Arts, which works with brilliant UK game designers, leaves British gaming vulnerable to defenestration.
Another sector left out of Starmer’s feeble US trade deal.
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This article was originally published by a www.dailymail.co.uk . Read the Original article here. .