The Association of Corporate Treasurers (ACT), while remaining firmly politically neutral, has a role to play in understanding, informing and influencing policymakers on behalf of its members. Ahead of the General Election, we published our Manifesto outlining five key steps for the next Government to consider first for business: funding availability, investment confidence, resources (talent & skills), sustainable finance and technology.
In the past, we had not attended the annual political party conferences but this year the Labour conference in Liverpool provided a good opportunity to understand the new Government’s priorities, after their 14 years in opposition, and to get to know a few of Labour’s Members of Parliament, of whom 200 were newly elected in July 2024. What follows is a personal reflection on attending this conference.
From a corporate treasury perspective, the headline speech was given by the Chancellor of the Exchequer, the Rt Hon Rachel Reeves MP. Her speech has been widely reported in the media and was generally well-received. How did it address the challenges outlined in the ACT’s Manifesto? After a “political” introduction, she referred to the “premium on economic security in an uncertain world”. She pledged her forthcoming budget (30 October) would have “real ambition to fix the foundations [of Britain]” having “stability paired with reform” [such that] businesses could invest with confidence in new industries. She referred to entrepreneurs struggling to access finance and exporters tied up in red tape. She promised to publish plans for a new industrial strategy for Britain in October. She also repeated pledges not to increase personal [income] tax but said she would extend the oil & gas levy. Readers may recall that she had already promised to publish a ‘fiscal road map’ to accompany the budget. Other measures pertinent to our Manifesto included reform of the pensions system and the creation of a National Wealth Fund.
Overall, her speech was encouraging for recognising the need for stability and access to funding as precursors for investment leading to growth but – as others have commented – her repeated emphasis of a “£22 billion black hole” necessitating tough decisions, combined with the lack of detail pending her forthcoming budget announcements, means that the jury is still out on the impact for businesses. Nevertheless, we welcome the repeated assurances - from the Chancellor and other senior figures - that this Government is keen to work in partnership with businesses to achieve economic growth. That “on message” theme of partnership with business was largely repeated by the Rt Hon Jonathan Reynolds MP, Secretary of State for Business and Trade. He added that “we need a trade strategy that resets our relationship with the EU while delivering opportunities around the world”.
In addition to the headline speeches, the conference provided useful networking opportunities with many other professionals working within the financial services ecosystem - including representatives of the Financial Conduct Authority, various trade associations and banks. Some were new contacts, and others were familiar faces for the ACT’s Policy & Technical team. For example, I was pleased to be invited by Giles French, CEO of the Association of Foreign Banks, to hear his panel session on promoting and facilitating Foreign Direct Investment into the UK. A common theme in that FDI session was the need for better aligned and quicker planning decisions to shorten infrastructure timescales (which should help reduce the inherent risks of large projects).
At a meeting hosted by H/Advisors Cicero, HM Treasury Economics Secretary, Tulip Siddiq MP, talked enthusiastically about the new Government's priority and steps for economic growth - including the international investment summit on 14 October. Inevitably, we have to wait for the Chancellor's budget on 30 October for more policy details, but a key positive message (to my ears) was her willingness to work in partnership with businesses to promote growth. In a brief conversation with the Minister afterwards, I was grateful for an opportunity to highlight the role of corporate treasurers in financing business investment.
The current focus of the Pensions Minister, Emma Reynolds MP, is upon the 27,000 Defined Contribution (DC) pension schemes (her call for evidence closed on 25 September). Defined Benefit schemes she called a "different animal" likely to be a later focus – so corporate sponsors and trustees of DB schemes will want to monitor those developments closely. The Minister said the £2.4 trillion UK pensions industry is the third largest in the world, and she wants to see more of it invested in the UK and to ensure it delivers better returns and retirement outcomes. Competition needs to shift from cost to value. Auto-enrolment has been a great success in the UK (for the majority of workers), and the Government is also looking at other countries such as Australia, Canada & the Netherlands to see what could be learnt from them. She agreed that there needs to be an appropriate balance (of pension risk) between the individual, the government, and the pensions industry. She is a fan of [DC scheme] pooling to deliver better long-term returns. There was a brief discussion of the interpretation of "fiduciary duty" for DC trust arrangements and the need for individuals to have access to appropriate advice (about their pensions at key life stages) and to have a clear Pensions Dashboard.
The guest speaker at the City of London Corporation’s Conference Dinner was Rt Hon Darren Jones MP, Chief Secretary to the Treasury. He reiterated certain themes from the Chancellor of the Exchequer’s earlier speech (while carefully avoiding any budget details). The Minister's short-term priorities included Infrastructure, the new Industrial Strategy publication, and working with the City of London on Financial Services. Chris Hayward, Policy Chair of the Corporation, said the City was ready to work with the Government to support capital flow across all regions of the UK to attract foreign direct investment and to drive forward pension reform.
The range of fringe events at a party conference is fascinating. My primary focus was on financial services, but I managed to squeeze in a session on the advocacy of proposals to try to move the UK to a 4-day week and another on "the future of Artificial Intelligence regulation in the UK" (with the Undersecretary of State, Department for Science, Innovation and Technology). The AI debate was about the rights of individual citizens to know when decisions affecting them personally had been made by AI tools.
