Business chiefs rally in defence of free markets

Construction of Astute Boat 5
The UK's business leaders said free enterprise must be protected to create jobs

British business chiefs have this weekend responded to a call from the Chancellor to defend and promote the market economy as it comes under attack from Left-wing advocates of renationalisation and of large-scale Whitehall intervention.

The chief executives and chairmen of some of the county’s biggest employers have lined up to tell the Sunday Telegraph that free enterprise must be protected to create jobs, invest in productivity, raise living standards and pay for public services.

Business leaders have begun speaking out as polling shows rising public support for state ownership of swathes of the economy and greater market intervention, as planned by Jeremy Corbyn. At the Conservative Party conference, Chancellor Philip Hammond called for more vocal support for the economic system in a rearguard action he said was not about party politics.

Philip Hammond said he expected business leaders to stand up for free enterprise

Sir Mike Rake, chairman of BT and Worldpay, said: “It is vital that business helps to remake the case for free trade and responsible capitalism.”

Sir Philip Hampton, chairman of the drug giant GlaxoSmithKline, which employs 16,000 people in the UK, warned that interfering in markets would damage public services.

He said: “Profitable businesses providing good jobs are needed to provide the tax revenues to support public services.”

“Countries that don’t have good tax revenues from market-based businesses have poor public services.”

That view was echoed by Alistair Cox, chief executive of Britain’s biggest recruiter, Hays.

He said: “Free markets and private enterprise are the cornerstones to building successful economies.

“Successful economies create employment, provide livelihoods and supply the funding for the vital public services societies need.”

Centrica chief executive Iain Conn is battling Tory intervention in the form of planned energy price caps, but nevertheless backed Mr Hammond’s defence of free markets.

He said: “Encouraging free and open markets is critical to the UK’s productivity and economic future, especially after Brexit.”

“Very close cooperation and partnership between Government and business will be essential.”

Severn Trent chief executive Liv Garfield said: "I’m neither a politician nor an economist.  All I can tell you is that, pre-privatisation, the water sector struggled to invest properly to protect the environment and to deliver reliable services. That has now changed.

"We need to make further progress, not turn the clock back."

Barbara Judge, chairman of the Institute of Directors warned that “excessive state intervention by politicians of any party” is damaging. There were widespread calls instead for business to get more involved alongside government in tackling the challenges that have undermined faith in the market, such as high house prices, creaking infrastructure and squeezed wages.

Virgin Money chief executive Jayne-Anne Gadhia said “economic prosperity relies on delivering a better form of capitalism” and said anything but an enterprise-led economy would “leave people materially worse off”.

Clive Bannister of the FTSE 250 insurer Phoenix Group said that history demonstrates that “whether the UK has had a government of the Left or the Right, it is a well-functioning market-led economy which has helped deliver higher general living standards.”

Jayne-Anne Gadhia called for 'a better form of capitalism'

Mark Reynolds, chief executive of the construction giant Mace, which is behind a massive housing project on the Olympic park site in East London, said: “We recognise that we couldn’t deliver growth and innovation without a functioning free market economy.

“Trust in the market is key – any knocks to investor confidence at this sensitive time could limit the UK’s ability to deliver the housing and infrastructure we need.”

BAE Systems chairman Sir Roger Carr said “anything that makes this country more competitive and particularly more productive in the global market economy is in the national interest”.

The strongest rebuke to Mr Corbyn’s policies came from Morrisons chairman Andy Higginson, who said he had “lived through the shambles of state enterprises whether that was the railways, the Post Office or British Leyland”.

He added: “The benefit of competition within free markets not only allows companies to work properly, it mitigates the worst aspects of capitalism with regulators and regulation. A balance of this is by far the best way for business rather than the clueless, inefficient and hopeless way of the suggested alternative.”

Water companies are being targeted for renationalisation by Labour.
Mr Higginson’s comments were in contrast to his supermarket rival, Tesco chief executive Dave Lewis. Asked to respond to Mr Hammond’s comment that he expected business to speak up for the market, Mr Lewis said: “I’m sure he has lots of expectations.”

Ian Cheshire, chairman of Debenhams and Barclays UK, said: "Business must always speak out to explain its role in society, how we are creating wealth, paying taxes and, where it can, going further to be a force for good.

"We can't leave talking about this to others and nor can we assume the case is accepted, but let's always share what we have actually done not just some vague or defensive words about capitalism."

Additional reporting by Jillian Ambrose, Ashley Armstrong, Lucy Burton, Tim Wallace and Iain Withers.