Amid irresponsible businesses and eye-watering bonuses, where are the one nation Tories of today?

By 11.10.12BlogSeptember 2nd, 2020No Comments

Luke Hildyard’s article from Monday’s Daily Mail

(This article originally appeared in the Daily Mail)

Ed Miliband’s speech last week claimed the philosophical tradition of ‘one-nation’ Toryism for his own ‘responsible capitalism’ agenda. In doing so, the Labour leader no doubt intended to prompt the question ‘where are the one nation Tories of today?’

Historically, ‘one nation’ Conservatives were seen as the party of business. And David Cameron’s party continues to enjoy considerable support from the business lobby too. But the one nation creed was inextricably linked to paternalism. It was exemplified by business leaders who wanted to make a profit, but were also mindful of their responsibility to their employees, and the welfare of society as a whole. A philosophy far removed from the modern international business elite, who make their money from speculation, asset-stripping and financial engineering that does little to benefit the wider economy.

It is no accident that the ideology of de-regulation, globalisation and soaring executive pay packages is termed ‘neoliberalism’, suggesting a historical link not with the Tories, but the Liberal Party, their great nineteenth century rivals.

Despite this, Miliband seeks to portray Cameron as the leader of a party dedicated to letting irresponsible businesses do exactly as they please. It is a dangerous characterization for the Conservatives, because it contains an element of truth. Since the late 1970s, the Tories have been in thrall to neoliberal economists such as Milton Friedman, who said that ‘there is one and only one social responsibility of business – to use its resources and engage in activities designed to increase its profits.’

The eye-watering level to which top pay packages have risen is the most obvious example of how this kind of thinking has become ingrained at the top of British businesses. Companies offer their executives millions of pounds worth of share options in order to align their interest with those of shareholders. Top Tories such as Boris Johnson have defended these enormous increases in executive incomes, while George Osborne spoke this weekend of the risk of driving top earners overseas. Yet FTSE 100 Chief Executive pay packages 185 times the national average are not coherent with important Conservative principles. They do not reflect the recipients’ hard work, their talent, or their contribution to the economy in proportion to the rest of the population.

There are, however, some Conservative MPs who recognise that executive pay has got out of control. Hexham MP Guy Opperman is a board member of the High Pay Centre, and recently authored an essay contrasting the community-focused businesses in his own Northumberland constituency with the lack of responsibility demonstrated by the banking sector. Cameron ally Jesse Norman produced a pamphlet on ‘Crony Capitalism’ last year attacking crony capitalism and corporate and financial excess.

Both Opperman and Norman are speaking at a High Pay Centre fringe event at Conservative Party Conference on Tuesday, looking at how to rebuild public trust in business. The Tories must ensure that their voices, and others in support of the Conservative traditions of one nation paternalism, are clearly heard.