Ladies and Gentlemen, it is a huge honour to speak to you this evening at this your annual dinner.
Of course, I am well aware of my role: I am the warm up act for Michael Portillo.
I understand Michael is due to talk about “The Trouble with Politicians” – so I am going to try to get through this without giving him any new material.
And I am also acutely aware that he is funnier than me; he has a full head of hair; and he brings with him the wisdom of age.
However, I think I can say that when it comes to our experience of retail, I may just best him. Michael starred, at the age of eight, in a television advertisement for Ribena – yes, Michael was for a while “the Ribena kid”. But I’m not sure that counts as having worked in retail proper.
I, on the other hand, worked on the shop floor at the men’s clothes’ store TM Lewin. That’s right – like so many young people, I got my first taste of work in the retail sector. And it was working on the shop floor that I first started to develop many of the skills which have stood me in good stead – understanding what a customer, or indeed a voter, really values.
In fact, when I went on to practice as a solicitor for several years before my election, I was lucky enough to count several major retailers as clients, including TM Lewin.
These experiences of what you do taught me just how dynamic this sector is and what a motor it has proven to be for our economy. When I started at TM Lewin, it had just four stores. It has since grown and now has over 100 stores including in Europe and the Far East. It is a success story I know which is repeated many times over by other companies in the sector.
So let me be absolutely clear: we in the Labour Party understand what a huge contribution everyone represented in this room makes to our economy:
- The third largest retail sector in the world.
- Worth eight per cent of our GDP.
- Providing three million jobs.
- Big chains and local retailers, cooperatives and niche independents.
- Showing others from all corners of the globe how to do things.
- The most innovative conventional retail sector, as well as leaders in online retail.
This is a record to be proud of.
People simply do not realise that a greater share of goods are bought online here than in any other major market.
So you are ahead of the game in an area that will dominate the retail landscape for years to come; well placed to take advantage of the opportunities that will arise from a global middle class, set to triple to five billion people over the next two decades.
And, at this point, let me pay tribute to Rob and Stephen and all of the team at the British Retail Consortium for everything you have done to ensure this sector’s voice is heard in Westminster and across Whitehall. Tough acts to follow, but I am confident that you will be in safe hands as Ian Cheshire takes over from Rob as chair and Helen Dickinson succeeds Stephen.
But, I know right now, that this confident future seems rather elusive. You tell me how much you are hurting. You tell me how difficult things are.
And, yes, there is a big debate in British politics about what is wrong with our economy and what it will take to get it going again. Some say one man’s debate is another man’s argument and all you politicians ever do is argue.
But I say politics is about people, it is about communities, it is about your businesses. And the simple fact is that people in our communities today are not spending money in your businesses. Right now, we have a big problem: there is an acute lack of demand.
When the Government set out its spending plans in 2010, it had a chilling effect on confidence in the economy. Tax increases and cuts to tax credits squeezed household incomes. And as cuts in public investments feed through, this continues to choke off demand and delay the recovery.
Of course the crisis on the Continent is having an effect. But France and Germany are right in the middle of that storm, and they are not in recession. Of all the countries in the G20, only we and Italy are.
It gives me no pleasure to say this because it is the people I care about and represent who are paying the price for this – at the moment in my constituency, 15 people are chasing every single Job Centre Plus vacancy.
That is why we say that the Government bears responsibility for the state of the economy. It is why we are calling for a boost to demand, as set out in our plan for jobs and growth. Common sense measures, backed by business, based on the right diagnosis.
Now, I know what you are thinking: what about the impact of stimulus measures on the public finances? That is a fair question. But here’s the thing. The longer this economic malaise continues, the more our national debt will rise, and the more permanent damage it will do to our economy:
- Investment in future capacity that doesn’t happen.
- The scarring effects on young people whose first experience of work is unemployment.
- The decline in the skills of those who have lost their jobs.
So, yes, we must bring the public finances into balance as soon as we can. But a stalled economy today means that borrowing is currently rising, not falling. And, in the meantime, we are all worse off today and will be worse off in the future.
So there must be a change of course for the sake of our country, and to prevent more permanent losses to our national wealth.
But we also need to lay the right foundations for our economy in the future – to build a more resilient, more balanced economy, generating rising and shared prosperity.
As close as you are to consumers, you know how quickly and how fundamentally this world is changing. Consumers shopping through more channels; at all times of day; increasingly focused on the shopping ‘experience’; not just on the value of a brand, but also on the values it represents.
These trends offer big opportunities for companies willing to rise to the challenge. And retailers are leading the way.
Looking around this room, I can call to mind so many great examples of retailers embracing their responsibilities to the environment, seeing the opportunities, and viewing their customers as partners in this task.
Retailers interested in improving their local communities, even measuring their community impact, looking for opportunities to source locally.
Better for society, better for the environment, and good business too.
So in retail we can see glimpses of the future economy we must build.
Because these are exactly the kinds of models, practices and behaviours that Ed Miliband and I refer to when we say we need a more responsible capitalism:
- More firms focused on building value for the long term.
- Developing their people as many in retail are doing.
- Working constructively with trade unions like USDAW.
- Part of their communities.
- Combining economic strength with social and environmental responsibility, seeing them as two sides of the same coin.
This is business, moved to act responsibly in your own interests.
But government has responsibilities too, supporting firms in making these choices. That is why the successful future for the British economy must be built on a proper partnership between productive businesses like yours and an active government, responding to the specific needs of your sector.
It is here that the British Retail Consortium has a crucial role to play in helping us to understand and respond to the breadth and diversity of your needs.
I’ve already talked about the impact of online retailing on your business models.
You also tell me that you need the playing field to be as large as possible. So you have one set of rules, for example, for selling across Europe, not 27. You need a government constructively engaged with Europe, not surly and indifferent to it.
You tell me you want a level playing field too. Level between online and high street retailers. And, of course, more fairness in the way that business rates are set. I know the BRC is examining how business rates could be reformed and we will want to consider your findings on this as part of our policy review.
In addition, we of course need our high streets to be vibrant again, at the heart of each community. Mary Portas’ report has put down a marker, but this is a difficult issue that cuts across departmental boundaries. So we hear you when you say that government needs to be much more joined up in its thinking. That is why my shadow ministerial colleagues – Harriet Harman, Hilary Benn, Jack Dromey and I – have all worked together on this, met with Mary and contributed to her work.
And this is the approach we know you want. Joined up government with all departments – not just one or two – understanding your needs as a sector, as retailers. Tackling outstanding issues to give you the certainty you need.
So I hope I have given you a flavour of the vision we have for Britain’s economy, today and for the future.
It is a difficult out there. But I have no doubt that – by making the right choices, but working together – we can get Britain back on the right path – growing again, competing again, pulling together, not pulling apart.
That is why I am so grateful for the opportunity to speak at this fantastic dinner.
Have a wonderful evening and thank you for all you have done and are doing for our country.