Chuka Umunna: 'It is plain, Camerkozy austerity is not working'

Youth has not hampered the shadow business secretary's attacks on the coalition's industrial strategy, nor on the veteran Secretary of State

This Chuka Umunna is cheeky. First, he set the hare running by forcing the controversial Beecroft report out into the open, prompting accusations that Vince Cable is a "socialist and anti-business".

Now Mr Umunna is inviting the coalition's Business Secretary to join Labour in opposition: "It's clear to me that Vince should leave government and join us. He and I could then work together on an industrial strategy to get the country growing again. Like us, Vince wants more active government support for business but is in a straitjacket; constrained by road-blocks at No 10 and No 11."

So now he wants to crack open the coalition? The young shadow business secretary grins, knows it was a playful jibe but worth the shot: "We would welcome Vince with open arms. Beecroft has been a shambles and no way to create policy. These employment law changes are a poor substitute for growth."

In case you missed it, the Beecroft report into employment law caused an uproar when it was published last week because of its controversial proposal for dismissal reform. It was this "firing at will" clause for businesses with fewer than 10 workers that Mr Cable attacked and which produced a counter-attack from Adrian Beecroft, the author of the report who was commissioned by the business department to come up with ways to reduce red tape. But it has backfired, with even the big guns of business privately admitting they are appalled at this reform.

Mr Umunna claims the Beecroft fallout is toxic for David Cameron: "It's as bad as cutting the 50p tax, the pasty and granny tax all in one. In the old report, which has been doctored, Beecroft wrote that high unemployment 'is a price worth paying'. Norman Lamont said something similar about unemployment being a price worth paying in 1992 and who was his adviser? Cameron.

"There is a real ideological shift to the right going on. First William Hague attacked companies for being lazy and now they are having a go at workers' rights. We have the third-best record for labour relations in the world. Now, in the middle of recession with people fearing for their jobs, is not the time to make them feel scared."

Mr Umunna's decision to call for an emergency debate on Beecroft on Monday came after another leak in last weekend's papers. But it wasn't a surprise; he's been trying to flush Beecroft out of government on "public interest" grounds since part of the old report was first leaked last year. "I've been working on getting it out into the open since last October after parts of the report were leaked. Our Freedom of Information request was turned down and then in April we asked the information commissioner to investigate why they kept refusing to publish it and I think it's this that made them leak it again."

We met for tea on Tuesday in the café at Portcullis House, next door to the House of Commons that Mr Umunna entered two years ago as MP for Streatham. It's the day after Beecroft broke but the day that Christine Lagarde, head of the IMF, published her annual forecast for the UK and managed with her Gallic shrewdness, to combine praising the Government's Plan A but suggested that should the economy get worse, it may be time for a mini-Plan B. "Lagarde is clever. She is not going to criticise George Osborne, is she? He was her main sponsor to head the IMF. But she was clear that the UK needs more to get demand up and growth going."

Mr Umunna is not a deficit denier, quite the reverse: "But it's plain that the Camerkozy school of austerity alone is not working. We need more fiscal stimulus – cuts in national insurance or VAT for example and more infrastructure projects." Following the revised GDP figures on Friday, he adds: "This is a no-growth Government with its head in the sand. It blames businesses, the people who work in them and now the eurozone when countries like Germany and France are not in recession and we are."

That's why a joined-up industrial policy would be top of the agenda if Labour were in power, one that backed innovation and manufacturing in the private sector as the American, German and Singaporean governments do.

"This is not about picking winners because that doesn't work. But Government should actively support sectors such as food manufacturing, biotech, the digital and creative industries, aerospace and others where we excel."

Mr Umunna is a fan of Lord Heseltine, the ex-Tory minister, who heads a review into how spending departments can work more closely with the private sector: "Heseltine and I share the view that state can do so much more as an enabler of private growth. So do Vince and David Willetts."

Ouch. Lord Mandelson, is another big beast he talks to, drawing on the ex-business secretary's experience. He's a "massive fan" of Alistair Darling, the ex-chancellor, and says pages "313 to 318" of his biography are worth reading on industrial policy.

Mr Umunna grew up in Lambeth, the son of an Irish-English mother and Nigerian father, into what he's described as an upper middle-class family. He was intrigued by current affairs from an early age, he says, wanting to know what words like inflation meant when he was eight or so. Surrounded by law – his uncle was the leading libel lawyer, Patrick Milmo, and his grandfather was the High Court judge, Sir Helenus Milmo QC, one of the prosecutors at the Nuremberg trials – it's entirely natural he became an employment lawyer. But there's politics too; his father, who ran an export-import business, was always interested in politics and was running for state governor in Nigeria when he died. Mr Umunna was 13.

But it wasn't until Tony Blair's victory in 1997 that he became excited by politics. He was 19.

"Tony's first term was modern European social democracy at its best and I have huge respect for him, although I disagreed with him later on Iraq and the drift to neo-liberal economics." He talks often to Mr Blair: "He's still a great election strategist."

His political career was shaped working for his local MP, Keith Hill, in Streatham, and then four years ago was picked to go for the seat: "I'm from Lambeth, and a Londoner so it was perfect. As a young black man of mixed heritage I didn't think there would be many opportunities so I jumped at the chance."

It's been a dizzy rise and he was "flabbergasted" to get the business department job. But he was spotted early on by the Labour high command, shining while on the House of Commons Treasury Select Committee when he put the chief executive of Barclays, Bob Diamond, on the spot about the bank's tax avoidance schemes, asking him how many subsidiary companies Barclays operated in offshore centres. Mr Diamond didn't know.

On banking reform he would like to see the new Vickers legislation, creating a firewall between retail and investment banking, brought forward from its 2019 date. But the area where he would push most is promoting more competition between the banks – breaking up Royal Bank of Scotland would be a start – and more channels for small business lending.

How does he see Labour's role in the financial crash? "We are humble and most certainly not hubristic. We supported light-touch regulation – but then, so did Cable and many other ministers." And what if there were an election tomorrow?

"Hmm. Let's not forget that the Conservatives haven't won an election since 1992 – that's 20 years. Cameron says it's the LibDems who are stopping him from doing the more supply-side Tory measures but actually it's public opinion. He knows the public wouldn't stand it.

"But we don't take for granted that the public has forgiven us yet, either. Austerity is hitting the people living in our constituencies hardest so we can see the impact first hand."

I have a last question, one asked by several colleagues when they knew I was meeting the man some say is the UK's Barack Obama. He must hate being asked the Mr Obama thing all the time but, even so, I do. "Look I'm flattered but I'm aware that this sort of hype is dangerous."

That aside though, people still wonder if he is too good to be true; smart, polished, clever, ambitious, Labour's next leader etc... His face screws up: "Oh no, I'm flawed like everyone else." So what are his flaws? "I'm too sensitive to criticism and I am a workaholic. I love my work so much that it's not work to me. I still pinch myself every time I walk through these doors. My political mother, Tessa Jowell, told me to remember that we are only ever temporary here. I keep that in mind."

Keep your eye on Mr Umunna; he's one cool cat.

Curriculum vitae

Born October 1978

Education English law and French law at Manchester and Burgundy universities, followed by Nottingham law school

Career

2002-2006: A corporate employment law solicitor

2006-2010: Lawyer at Rochman Landau

May 2010: MP for Streatham

June 2010: the Treasury select committee and parliamentary private secretary to Labour leader Ed Miliband

May 2011: Shadow minister for small business and enterprise growth

October 2011: Shadow secretary of state for business, innovation and skills

Interests Board member of Generation Next, a social enterprise for young Londoners, chair of London Gangs Forum, member of Compass, the Fabian Society, and the GMB and Unite unions

Marital status Single but much sought after

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