THE UK’s main bosses’ organisation, the CBI, has turned on the Labour government with a vengeance over the increase in employers’ National Insurance Contribution (NIC) and Labour’s promised Employment Rights Bill.
Speaking on BBC Radio 4’s Today programme yesterday, CBI chairman Rupert Soames said Labour Chancellor Rachel Reeves had ‘bruised’ business confidence by expecting companies to fill the black hole in public finances.
The increase in NIC announced by Reeves in her Autumn Budget has destroyed the cosy relationship that she and Keir Starmer built with the corporate bosses in the dying months of the last Tory government.
What the bosses did not expect was Reeves increasing their NIC (or a tax on business as they insist it is) despite the fact that the vast bulk of any increase will be passed on to workers in the form of wage freezes, price increases and cut backs on employment.
If Reeves thought that passing the pain onto workers and their families through increases in the cost of living and increased unemployment would be acceptable to the corporation bosses, then she was badly mistaken.
Instead they have turned on her, placing the blame for the inevitable increase in inflation and unemployment squarely at the door of Starmer’s government.
The bosses are demanding an end to Labour playing the role of being a government for workers and business, and get on with the job of smashing the rights of workers and an austerity war on public services.
Soames told the BBC: ‘In filling one hole, it’s created another, and that hole is a hole in the confidence and trust that business has in the government.’
The justification given by Reeves for increasing NIC was to help fund improvement in the NHS – but this is not a priority for the CBI.
They are demanding a government that will curb the UK’s massive national debt by imposing super charged austerity cuts across all public services including the NHS.
Soames heaped criticism on the proposed Employment Rights Bill, saying that if it is carried out ‘you’re going to find people laying people off and less likely to employ.’
This Bill, not expected to come into force until 2026, is supposed to strengthen workers’ rights but already companies are laying off staff in anticipation while piling on the pressure for Starmer to drop it entirely.
The crisis swamping the Reeves and Starmer plans to ‘grow’ the economy took a further hit yesterday when the Treasury auctioned off another £1 billion of government debt on the international money markets which attracted significantly lower level of demand than previous sales.
Those institutions that did buy are demanding much higher levels of interest on their loans, pushing government debt level repayments even higher and making vicious austerity cuts to public spending unavoidable for Reeves and Starmer.
Yesterday’s sale saw the most expensive terms imposed by the financial institutions buying government debt since 2004.
With British capitalism being crushed by debt and all Labour’s promises to grow the economy out of recession in tatters, all Starmer could do was to make a speech on Monday pledging to avert catastrophe by making the UK a global powerhouse in Artificial Intelligence (AI).
To achieve this utopian dream, Starmer proposed to throw open data from the NHS and every public service they hold on everyone in the country to private companies to be harvested for profit.
Starmer appears to believe, as one commentator in the Telegraph observed, that some ‘magic robot’ will save the British economy.
With no ‘magic robot’ the only solution for the capitalist class is to enforce a class war against the working class to impose the economic crisis on their backs.
For the powerful working class the only way to resolve the crisis of capitalism is to force the trade union and TUC leaders to immediately call a general strike to bring down the Labour government and establish a workers’ government and a socialist planned economy.
Join the WRP and Young Socialists to build up the party necessary to lead the British socialist revolution to victory and dump bankrupt capitalism in the dustbin of history where it belongs.
There is no time to lose.
