‘New deal’ is a mortal menace to jobs, writes JOHN LONGWORTH

Small and medium-sized business are the backbone of the British economy.

No less than two thirds of all staff on the private payroll are employed in this sector, which also accounts for more than half of all commercial turnover. 

It is no exaggeration to say that on their success depends our nation’s wealth creation and future prosperity.

That is why the first King’s Speech from the Labour Government was so alarming, particularly the passages about the expansion of business regulation and workers’ rights through a plethora of onerous legislation.

‘We will shine a spotlight in every workplace’ as part of the quest ‘to create a new social order’, said then Labour deputy leader Harriet Harman in 2010 when she was pushing her Equality Act through Parliament, a massive blueprint for state intervention.

Yesterday’s King’s Speech provided a worrying glimpse into Labour’s destructive, anti-business ideology. Pictured: King Charles III and Queen Camilla at the State Opening of Parliament 

Exactly the same words could be used about the Starmer Government’s so-called ‘new deal for working people’ which was set out in the King’s Speech yesterday.

This package was originally drawn up by Angela Rayner, Labour’s radical deputy leader and the darling of the trade unions. 

But the responsibility of overseeing its legislative odyssey through Westminster appears to have been handed to Jonathan Reynolds, perhaps because, as a moderate, he is viewed by Starmer as better at concealing the dangers inherent in the scheme.

In truth, no amount of obfuscation or deceit can hide the damage that will be caused to small and medium business. 

Behind all the upbeat rhetoric, this new deal represents a mortal threat to private enterprise and employment.

Far from enhancing workers’ rights, it will destroy their jobs and hit their living standards. 

One of the key problems with the new Government is that so few of its members have actually worked in business. 

Before they entered Parliament, most of them were employed in the public sector, political research, voluntary organisations or the trade unions.

In practice the vast majority of them earned their living from the taxpayer rather than success in the market place.

Angela Rayner herself is a classic example, for before she entered Parliament she was an official with the big public sector union Unison, while Reynolds spent four years working as an MP’s assistant.

It is because they are devoid of any real understanding of enterprise that Labour politicians can put forward measures that undermine competitiveness, increase costs and hit profitability through cocooning the workforce.

The Starmer Government’s so-called ‘new deal for working people’, set out in the King’s Speech yesterday, was originally drawn up by Angela Rayner, Labour’s radical deputy leader and the darling of the trade unions

That pattern can clearly be seen in the drive to enhance the protection of employees’ rights, which might sound laudable in theory but in practice makes recruitment less attractive.

One of the engines behind job creation in modern Britain has been the ‘gig economy’, whose flexibility is a winner for both business owners and employees. 

That is why surveys show that the vast majority of staff actually welcome practices such as zero hours or flexible working contracts.

But Labour, trapped in its rigid trade union mindset, can see only capitalist exploitation and therefore plans to impose heavy restrictions on such contracts.

Under the new deal agenda, employees will be given full protection and support from the first day in a new job, including rights to parental leave, holidays, maternity leave and access to employment tribunals.

Under Labour’s legislation, it will also become harder for firms to resist the practices of working from home and flexible working, even when they are undermining efficiency or hurting client relationships.

Having taken over the public sector, the cult of grievance and victimhood will tighten its grip on the private sector through a new Equality Act which will lead to yet more hugely time-consuming diversity monitoring and intervention by social justice commissars, who find discrimination round every corner.

The workplace will become increasingly Orwellian in atmosphere, filled with these monitoring exercises, race awareness training exercises, minority pay audits and positive action programmes.

Labour declares that ‘stronger trade unions’ are the key to more productive work places but that is nonsense, as we can see from the public sector, which is by far the most unionised part of the economy but is also the most sclerotic.

Under Sir Keir Starmer’s Labour, it will become harder for firms to resist the practices of working from home and flexible working, even when they are undermining efficiency or hurting client relationships

That is because the unions protect outdated working practices, put the needs of the workforce before the service users and weaken management’s ability to manage.

Labour, which is still largely bankrolled by the unions, is promising to repeal all the anti-strike legislation passed since 2010. The inevitable consequences will be more industrial action. 

Yesterday’s King’s Speech provided a worrying glimpse into Labour’s destructive, anti-business ideology.

New Chancellor Rachel Reeves prattles constantly about the need for economic growth. 

But she won’t get any of it if this bureaucratic, costly approach is implemented in full.

John Longworth is an entrepreneur, businessman, chairman of the Independent Business Network of family businesses and a former MEP.