BUSINESS needs to play its part in raising standards of living if it wants workers to keep faith in being part of a global economy, according to Ed Balls.
The Shadow Chancellor said the alternative was to drive workers into the arms of smaller parties who want to “cut ourselves off from the world economy” which would put companies’ ability to trade internationally at risk
He was speaking as he launched Labour’s “Plan for Britain’s Prosperity” in Yorkshire which includes proposals to increase the minimum wage to £8 an hour by 2020 and encourage more companies to pay the higher ‘living wage’.
The party has also promised every school leaver with the necessary qualifications would have access to an apprenticeship under a Labour government.
Mr Balls said: “I think that people know that if we are going to keep Britain as an open economy, trading around the world, we’ve got to show working people that they are going to benefit from that.
“So, I think in the end, the minimum wage going up and decent tax credits and jobs and apprenticeships for young people, a national health service which works; I think businesses know that without those things you are instead going to see people’s living standards under pressure and small parties rising up saying ‘why don’t we just cut ourselves off from the world economy?’”
Labour hopes to secure the support of business with policies including an unambigious commitment to keeping the UK in the European Union, the most competitive corporation tax rate in the G7 and the promise of a business rates freeze for smaller firms.
Mr Balls said: “I think that the way in which manufacturing for a country like Britain can succeed in the future is not going to be competing with China or India to do mass production at low cost because the reality is wages are going to be lower in China and India.
“The way in which you succeed is by being ahead of the competition all the time, it’s all about the innovation.”
He added: “It’s good to support our large manufacturers as well, the Jaguars and Nissans are having to be hi-tech and innovate, but the new ideas and the new large companies for the future start in places like this, this is where the ideas are so we’ve got to do more to support them.”
Mr Balls launched his plan during a visit to engineering firm Advanced Actuators, in Silsden, just weeks after David Cameron and George Osborne unveiled their “Long Term Economic Plan for Yorkshire” in Leeds, including their ambition to create a “northern powerhouse” through devolution of powers and money to northern cities.
Manchester has agreed to move to have an elected mayor in return for devolved powers. A less extensive devolution deal was struck with South Yorkshire where there are not plans for a mayor. A similar agreement with West Yorkshire is expected by the Budget next month.
The Shadow Chancellor said: “I think the idea that a Tory Chancellor from London is saying unless Leeds and West Yorkshire or South Yorkshire do the same as Manchester and have an elected mayor we are going to give you a second class devolution package. I think that’s insulting and totally counter-productive.
“Labour will not short change Yorkshire, we will offer bigger devolution than the Tories, much bigger, and we are not going to have any strings attached by saying you’ve got to have an elected mayor for West Yorkshire or South Yorkshire when it’s clear nobody wants it and it wouldn’t work.”
During his visit, Mr Balls met workers and apprentices on the factory floor before holding a roundtable meeting with local businessmen and women.