On the surface, the latest controversy to befall this government appears to have already blown over. The row was sparked by the Transport Secretary Louise Haigh’s admission that she has boycotted P&O Ferries since their mass firing of staff in 2022 (and her encouragement of others to join her). This apparently offended the ferry company’s owner, Dubai’s DP World, enough to threaten its own boycott of the International Investment Summit in London beginning on 14 October. Keir Starmer reacted in characteristically managerial fashion (“I think we’ll resolve that”) by rebuking Haigh and distancing the Government from her comments. And DP World have put their toys back in the pram and will be attending the event after all. But, while perhaps a small victory for “grown-up” politics, the row has exposed a more structural fragility in the UK economy – and our loosely principled government’s desperate need to please overseas investors.
Louise Haigh, the MP for Sheffield Heeley, is from the moderate left of the Labour Party (she expressed regret for nominating Jeremy Corbyn for the party leadership in 2015 and has since been an enthusiastic supporter of the pragmatic Andy Burnham). Since July, she had shown herself to be one of the government’s rising stars, making a string of well-received mainstream policy announcements. Given that backdrop, Haigh’s ministerial candour last week is all the more surprising. And her boycott of P&O Ferries – in particular the revelation that she had instructed her department “to have absolutely no contact with P&O Ferries or DP World unless it is literally on safety grounds” – is admirably principled, even if it is the stuff of student politics.
But, by prioritising the schmoozing of visitors at its much-trumpeted investment jamboree, the Government has demonstrated that such principles count for little in the globalised capitalist economy. P&O’s mass dismissal in 2022, it must be remembered, was outrageous enough to attract even the ire of Boris Johnson and Grant Shapps (the latter suggesting that customers might “frankly wish to vote with their feet and where possible choose another operator”). But Labour have chosen to forgive-and-forget, largely in order to welcome the DP World’s proposed £1bn investment to expand its London Gateway port. In truth, the investment was never likely in doubt – just the timing of its announcement and whether the predictable photoshoot of Keir Starmer and Rachel Reeves dressed in high-vis and watching containers unloaded in Thurrock would go ahead.
It might be tempting to absolve Labour of blame for its predicament. The economy that the new government has inherited is parlous and the country’s infrastructure is threadbare. But much of this hollowing out occurred during the previous Labour government’s tenure. The sale of P&O (with its ports, ferry business and thousands of employees) to Dubai’s DP World took place in 2006 without a murmur from the Blair government. Ports are a fundamental asset to any trading nation. Dubai, the contemporary equivalent of early-modern Venice, understands this and now controls over 60 ports around the world. It is a stark sign of the UK’s decline that its largest ports are mostly foreign-owned and that any expansion of its port capacity is now apparently so dependent upon foreign investment.
Senior figures in Downing Street were said to have been furious at Haigh’s talk of a boycott, suggesting that it might undermine the pro-business culture that the new administration has been so keen to project. Instead, they should see the row as a reminder of Britain’s weak bargaining position. Keir Starmer and Rachel Reeves might want to consider the wisdom of selling long-term key infrastructure assets to overseas buyers for short-term capital (the £9bn Lower Thames Crossing and the troubled HS2 extension to Euston are two projects currently thought to be open to private investment). In seeking to appear grown-up and managerial, the government risks appearing weak and desperate. There is a fine line between Britain being open for business and Britain putting out a begging bowl.
The government might also reflect on what it really stands for. In a fortnight when the government has provided details of its Employment Rights Bill (“a new deal for workers”) and is also hosting the International Investment Summit, it needs to decide where its loyalties ultimately lie. When push comes to shove, will it stand by British workers, or is it more preoccupied with appeasing the sensibilities of global capitalism?
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