On Monday 14th December 2020, The Rt Hon Dr Liam Fox MP (former UK nominee for Director-General of the World Trade Organization and previous Secretary of State for International Trade), delivered a Keynote Speech (virtually) to the Sunderland Conservatives.
The Conservative Party must be the champions of Small Businesses
Well thank you Anthony [Chairman, Sunderland Conservatives] for that introduction, and it's lovely to see at least little bits of some of you this evening if not all of you.
It would have been so much nicer to do it over dinner but that's where we are these days.
So tonight, I thought I would try and take us back into non-Covid politics a little bit, because, as we turn the corner with the vaccine programme, we will need to focus on the traditional battleground of the economy. This will be all the more urgent if the EU do not reach a deal with us on our future trading relationship.
I think it’s worth reminding ourselves that we are the most successful Party in a Western Democracy. By 2024 we will be 14 years into another period of Government again, having led or been the Government since 2010.
I think we need to occasionally just ask ourselves why. In recent political history we have been in office for more years than we have been out of it, because at its core we believe in what the British public believes. Our defence of the United Kingdom, our belief that the capitalist free market system provides the best route to prosperity and the funding of the public services, that we believe about the first duty of Government is the sound defence of its people - all those things do chime with the British people.
Above all, at our most successful, we are the Party of meritocracy.
But having great noble aspirations is not enough to be a successful Government you need to provide the means of achieving them as well.
That is the difference between campaigning and governing. In campaigns you have great bold ideas, you have great sentiments, great rhetoric, in Government you must deliver policies that provide those outcomes. We should also express what we believe in clear and easy terms.
When I did some speech writing for Margaret Thatcher, I used to marvel at her ability to be able to express complex ideas in very simple sentences, it is one of the greatest attributes of any politician, with the possible exception of Ronald Regan, that I've known in my political lifetime.
So where do we need to take our debate? I think we need to think about the post-Covid recovery and think, post-Brexit, what kind of economy we want to have, with or without a deal. I believe that stuffing the public sector with even more money is not the answer. This must be a private sector led recovery but more explicitly a Small Business Recovery.
There may be a time when we want, quite justifiably to put more funding into the public sector, but not yet. We must get back to the habit of making sure we have the money in the bank before we start spending it and get back to standard conservative fiscal and economic ideas.
I think that to do this we need to set ourselves three primary priorities.
The first thing is to understand that with a private sector recovery, sustainable prosperity will come through real wealth creation and not just the standard definition of growth. Anyone, and most Labour Governments have done it, can spend tomorrow’s taxpayers’ money today and call the increased activity growth.
Real wealth creation comes when we take unique ideas from individuals and turn them into goods and services that don't currently exist – or improve those that do.
We have a great ability in the United Kingdom to do this, as we have throughout our history because we are naturally innovative, we’re naturally creative, we’ve got a great ability to turn ideas into those goods and services. Post-Brexit we have the opportunity to re-shape our economy by utilising these strengths, but we must also address our weaknesses.
For example, we are great at start-ups, but we must accept that we have been pretty poor when it comes to scaleups, our ability to provide the funding and the confidence for those small businesses to remain in the United Kingdom and grow and sustain their enterprises for the long term.
As David Davis said in a very good article recently, we've done more to improve the profitability of Silicon Valley than anyone else, because we produce the ideas, but we’ve been unable to keep them in the UK because scaleups are too difficult.
Secondly, if we're going to have those scaleups, we need to have investment. Britain, as you probably know, is the third biggest destination in the world for Foreign Direct Investment, after the United States and China.
And we know why.
Our investors tell us why they put their money in Britain. They will say the number one reason we put money in the United Kingdom is your legal system, it is transparent, it has a great reputation, it is fair and reputable, and we understand it. That is something that we take for granted ourselves, but it's something in which investors place a great deal of importance.
As they say, we will put money in an economy where we can make money, where we can move money, and we can re-move our money when we want, and our legal system underpins those freedoms.
The second thing that investors will say is the flexibility of your labour market, by which they mean also the flexibility of labour law in the United Kingdom.
Then they will say the stability of the regulatory framework. Then they will say the taxation system, which of course is very favourable to investing companies. Then they will say access to higher education. It is one of the tremendous achievements for the United Kingdom, not a huge country by population to have four of the top ten global universities; the US has got five and Switzerland has one. The ability to work alongside these great institutions is a big draw. We’re in a good time zone for trading. We have great access to Tech. And we’ve got great IP laws. The advantage of being English-speaking is a welcome historic accident.
Knowing all these advantages, we must treasure, foster and develop them all to maintain our global position. Post-Brexit we must accentuate our strengths and utilise all our natural advantages to create a more competitive and more prosperous country for our people.
Thirdly, we must put at the centre of our thinking the role of our SMEs. It is key for our economy and it is key for the Conservative Party.
Just as we were the Party of ownership of property and shares in the 1980s, with council house sales as our flagship policy, now we must be the Party of small business.
Small Businesses are the lifeblood of our economy. They are the ones who we will need to provide the jobs in the post Covid19 recovery, just as 63% of all our jobs today come from SMEs.
We need to be the Party of every corner shop owner who stays open late at night and opens early in the morning, every business person who does without family holidays to try and get their business off the ground, every white van man and woman and every white coat man and woman in our innovative Tech sector.
They should always regard themselves as being championed by the Conservative Party and we are lucky because we have a Leader at the present time who is able to reach a lot of those voters in a way that others cannot do. I want a new mission for the Conservatives.
I don’t want to just be proud of being a Conservative.
I want to be excited about being a Conservative.
I would like to see us adopt a ‘Small Business Test’. I would like to know how everything we do is perceived by every small business in Britain. I would like every bit of legislation, every regulation and every bit of taxation to pass The Entrepreneur Test, The Small Business Test. I would like to see the Chancellor build it into his next budget.
At all times we must ask “Is what we are doing good for those small businesses across our country”. Post-Brexit, with or without a deal, we must build our recovery on the skills, innovation and sheer hard work of those who will enable us to compete globally by building the businesses of the future on which our national prosperity and social cohesion will depend.
It is important to spread prosperity across the whole United Kingdom and we should have the same appeal to those small businesses whether in Scotland or Wales or Northern Ireland or any region in England.
All these ideas are how we make ourselves appealing as a genuinely national Party, by creating an economic agenda that speaks to every part of our United Kingdom. It means creating real opportunity, real prosperity and real employment. It is part of what I have called ‘Liberation Conservatism’ and it is key to our electoral success and our national transformation. Thank you.