Labour leader Ed Miliband called today for "responsibility" on pay from those at the top of society as he addressed a summit of business leaders in London.
Mr Miliband said Labour wanted a "strong relationship" with business and promised there would be "no going back to the penal tax rates of the 1970s" if he won power.
But he warned that the credibility of the free enterprise system was under threat if middle and lower-income workers see their living standards stagnate while the richest continue to enjoy ever-increasing wealth.
Speaking at The Times CEO Summit to an audience including News Corporation chairman Rupert Murdoch and chief executives of companies such as Goldman Sachs, Santander and Vodafone - as well as Lord Mandelson, who famously said New Labour was "intensely relaxed about people getting filthy rich" - Mr Miliband warned that there was "an issue about rewards at the top" in Britain today.
He said: "For the system of free enterprise and the system of wealth creation to continue to command credibility, we do need to make sure that pay and performance are linked.
"The excesses we have seen at the top in parts of the financial services industry in the past do none of us any good.
"Just as it is right to say that those at the bottom of society should show responsibility, so it is right that those at the top show responsibility too.
"We have got to make sure that reward is in proportion to effort in what we do."
Mr Miliband gave his backing to shadow chancellor Ed Balls's call for a temporary cut in VAT to give a boost to economic growth.
But he said that scrapping the 50p top rate of income tax for those earning more than £150,000 was "not a priority for us" - though he did not rule it out from Labour's next election manifesto.
"How do we sustain support for the free enterprise system that we all believe in?" he asked. "Partly, you don't do it by cutting taxes for those right at the top when other people are facing real economic hardship."
Mr Miliband assured his audience that under his leadership Labour would not adopt a confrontational stance towards business.
"I want to signal very clearly the importance I attach to Labour having a strong relationship with you," he said. "New Labour brought about a number of innovations for the Labour Party. One of them I intend to keep is that strong relationship with business."
And he added: "I want to celebrate wealth creation in this country. We are not going to go back to the penal tax rates of the 1970s under a future Labour government. That is not what we are about, because we must be a country that celebrates enterprise and rewards those who work hard and do well."
But Mr Miliband said that in recent years there had been a phenomenon of "hollowing out" of middle-income jobs which denied members of the "squeezed middle" the financial security they previously took for granted and left them anxious that their children might face lower living standards in the future.
While salaries at the top rose sharply over the past decade, those in the lower and middle-income brackets had experienced wage stagnation since around 2003, he said.
"One of the issues we are looking at is how, as a country, we can make sure we move towards that higher-skill, higher-wage model that we need," he said.
"The low-skill, low-wage model is a model which is a recipe for continuing to see that stagnation in living standards.
"There's an issue about how we make sure those who work hard and do the right thing are rewarded."
He added: "I get a sense from people of anxiety and fear, not just about the cuts that are being made, but about where is this country going, what sort of jobs are our kids going to do in the future, how are we going to pay our way in the world?
"Unless we can answer those questions, we are never going to get that sense of optimism and a sense of a country that is going forward and moving in the right direction."
Conservative Party co-chairman Baroness Warsi said: "After appointing three leading trade unionists as business advisers, it's no surprise that Ed Miliband felt the need to deny that he would take Britain back to the 1970s.
"With Peter Mandelson attacking Ed for relying on union money and Tony Blair's criticism that Labour is moving away from the centre ground, it's clear that Ed Miliband is the weak leader of a divided party."