Labour Conference: Blair seen by business as bulwark against old guard

Tony Blair wooed business leaders before the election and gave them government jobs but they still fret about his party. John Rentoul looks at research into what business people really think of Labour.

"A lot of Labour activists will say, `We've worked 20 or 30 years for social justice, for all these values, and now there aren't any, this is a business person's Britain we are building'." The director of a food and drink conglomerate seemed to have the measure of the threat.

Business leaders think Tony Blair is the personal bulwark against the old Labour desire to "meddle". "The whole show depends on him," commented one. Asked to rate him out of 10, they gave him eight or nine, with one "10 out of 10". The Prime Minister's instincts were those of "the modern business agenda", said a company chairman.

That is what they, and thousands like them, said before the election too. When I followed Mr Blair around the country for his "business breakfasts", the message was always the same.

They liked what he said, the way he said it, his shirtsleeved no-nonsense style. It was his party they were not sure about. No matter how "new" the leader was, the old prejudices about Labour kept asserting themselves.

So the most impressive thing the Government has done so far was that "it has not disappointed", according to a group brought together over business-convention food and a glass of wine in central London.

Where policies had changed, this had been advertised well in advance. Gordon Brown, the Chancellor, was praised for the way the windfall tax had been handled: "They said they were going to do it, they've done it, and the way they've done it has been managed in such a way that it hasn't made everyone run screaming about the place."

Independence for the Bank of England was also applauded as "very smart, very directional and slightly unexpected". But Mr Brown was condemned for the pounds 5bn-a-year tax on pension funds: "Shareholders feel very threatened by it," said an oil company manager, warning that her company might feel less loyalty to Britain as a result.

Meanwhile, the policies which produced friction and heat at the election turned out to be a non-issue. Neither the minimum wage nor the European Social Chapter was mentioned spontaneously in our discussion last month.

Surprisingly, perhaps, most of the group felt that if the Government clashed with the unions it would not give in to their demands. The Government will "have to act like they've said they'll act, and that will be to tough it out", said one.

Less surprising was the acclaim which greeted Mr Blair's willingness to bring in business leaders to advise and serve in his Government. "The fact that [Lord] Simon is now advising the Government is a good move. You couldn't get a better business leader," was one comment on the appointment of the former BP chairman as European trade minister.

The Government's determination to shift unemployed youngsters from "welfare to work" was also welcomed. " `Off the dole', or whatever it's called, is a fantastic thing - if they really were able to deliver something on that it would be a major change," said a company vice-chairman.

The food and drink conglomerate director said: "The more you enfranchise people and make them significant contributors to society, the more they will buy your bloody products."

The group dismissed constitutional reform as "small potatoes", and had few opinions about either home rule or electoral reform.

Although the group did not think the Government would run into trouble with the unions, they insisted that Labour was not - or at least not yet - the party of business. And they remained pessimistic about its long- term prospects. Not just because they were cynical about politics, but because they thought the Labour Party, and even Mr Blair himself, still clung to a belief in interventionism. Where they had had dealings with government ministers, our business people found the "New Labour guys very much easier to work alongside", but felt that there was still a "very substantial amount of Old Labour thinking around".

A Tory-voting chairman was most analytical: "I don't believe that Labour at its heart has changed its attitude to business." On the other hand, he admitted, "the manifesto positions it has taken mean that it will where possible adhere to the promises it has made, and I think there is an intention to do that. However, when the proverbial hits the fan economically, then that spin-doctoring commitment will be put to the test ..."

When asked if they were "afraid" of Old Labour, the group agreed, unanimously. But the important message is that if Mr Blair can hold his nerve, maintain his distance from trade union interests and deliver economic stability and growth, the scene is set for a historic shift of business people's assumptions about politics.

Opinion Leader Research convened a group discussion among eight directors, managers and partners on 20 August. They represented an oil multinational, a cosmetics company, a firm of City solicitors, a food and drink conglomerate, a nationalised industry and three small businesses.