Labour has won the 2024 general election by a landslide, ushering in a new government for the British people.
While business groups have been quick to offer their congratulations to the new prime minister Keir Starmer and the Labour Party, they remain eager for the incoming government to act quickly to implement their policy proposals.
Confederation of British Industry chief executive Rain Newton-Smith says British companies need the new government to “hit the ground running”. “Setting out a positive vision for the UK economy and leaning into our international leadership should be top priorities for the first 100 days,” she adds.
Similarly, the British Chambers of Commerce is calling for “action from day one” to close the skills gap, grow British exports and boost productivity.
Business leaders will be watching with great anticipation to see which of Starmer’s many manifesto commitments will be delivered.
Labour’s manifesto pledges for technology
Artificial intelligence
Labour has pledged to create a Regulatory Innovation Office to bridge existing regulatory functions across government and speed up approval timelines. This would be a “pro-innovation body” designed to set targets for tech regulators and end uncertainty for businesses.
New, binding regulation on AI models will also be introduced, aimed only at the biggest “frontier” players in AI.
Labour has promised to build a National Data Library to centralise government research projects, including for AI, and help to deliver data-driven public services. Although all the details are not yet clear, Labour promises this data library will have strong safeguards – and all projects will supposedly be for the public good.
Jacob Beswick, a former government AI advisor at DSIT, welcomed the AI investment. But he said further clarity would be needed around how the new Regulatory Innovation Office would develop its capabilities and guidance – and how it would “support industry with investing and ultimately operationalising these technologies”.
Meanwhile, Rashik Parmar, CEO at BCS, the Chartered Institute for IT, added that the Starmer government has a “unique opportunity to take a positive view of AI and high-stakes technologies, making sure they transform the lives of everyone in the UK”.
Parmar called for the new government to back chartered status for tech professionals, holding them to the “same expectations of competence and ethics as regulated fields like accountancy and medicine”.
Digital
Former shadow secretary of state for science, innovation and technology, Peter Kyle is expected to be part of Starmer’s cabinet. He plans to expand the Department for Science, Innovation and Technology (DSIT) to become the “the digital centre for government”. In a speech at London Tech Week in June, Kyle suggested DSIT would become a resource for other departments, driving their use of data and data sharing in order to accelerate Labour’s five “missions for national renewal.
Caroline Carruthers, author of The Chief Data Officer’s Playbook and CEO at global data consultancy Carruthers and Jackson, believes ethical data sharing across departments would be a positive move, provided it’s genuinely about the wellbeing of citizens and the government is clear about how their data is being used.
“Establishing a framework that ensures effective governance and reliability of the data being shared is an important first step,” Carruthers says. “We know departments struggle to share data, which is why you end up with situations where citizens get ‘lost’ in the system and data gets siloed across areas such as education or healthcare.”
Labour’s manifesto pledges for finance and the economy
Tax
The new government has ruled out increases on income tax, national insurance and VAT but has left its options open on capital gains tax and pension tax relief.
In the manifesto, Labour committed to tackling tax avoidance by closing the loopholes in Sunak’s non-domicile plan and cracking down on tax dodgers. To address this, the incoming government is proposing a wider range of tax schemes to be reported to HMRC and strengthening the department’s powers to enforce payment of tax in investigation cases.
The party has committed to capping corporation tax at 25% and to retaining a permanent full-expensing system for capital investment and the annual investment allowance for small businesses.
Labour’s exact roadmap for business taxation is yet to be revealed, but it has promised to “level the playing field between the high street and online giants”.
Green finance
Labour has promised to make the UK the “green-finance capital of the world”, mandating that UK-regulated financial institutions and FTSE 100 companies develop credible transition plans that align with the climate goals of the Paris Agreement.
But there are still lingering questions around the scope and detail of transition plans, as well as the enforcement of such mandates. Namely, whether or not there will be penalties for those who fall short of climate goals remains an open question.
The stock market
After mounting signs that the UK stock market was struggling, a Labour victory seems to have brought about new confidence among investors. Following election results, world equity markets reached record highs, the FTSE 100 rose 0.38% on opening and the pound lifted against the dollar.
James Igoe, head of the Manchester office at investment management firm Redmayne Bentley, is hopeful that a Labour victory could inspire a stock market revival. “It is crucial the party makes the UK economy more attractive and enhances liquidity in the market, especially from overseas investors,” he says.
“Foreign investors have, for some time, considered the stock market to be a function of the UK’s leadership,” he continues. “Arguably, a Labour government reduces the risk premium on UK stocks if it can deliver greater stability over its term in office.”
Labour’s manifesto pledges for HR
Workers’ rights
Labour has promised to strengthen workers’ rights and its manifesto included approximately 60 changes to employment law and regulation that it has promised to make within the first 100 days of taking office.
These include changes to the minimum wage, banning zero-hours contracts, ending the practice of fire and rehire and introducing day-one rights for sick pay, parental leave and unfair dismissal. A new enforcement body has also been proposed to ensure that companies adhere to employment regulation.
However, many of the proposed changes to employment law still require clarification, according to Sarah Tahamtani, partner and head of employment at law firm Clarion. “Implementing legislation within 100 days of forming government will ultimately hinge on businesses being aware and prepared for these major changes in people management,” she says.
Skills
Labour has set out several proposals to help address the skills gaps that are present in the British labour market. This will include the introduction of a new public body called Skills England, improved work experience opportunities for young people and replacing the apprenticeship levy with a growth and skills levy.
Chartered Institute of Professional Development chief executive Peter Cheese is positive that these changes can help increase apprenticeship provision and allow more companies to upskill their workforces. However, he adds that partnership with employers will be crucial to ensure these new policies are a success.
Starmer’s party has also announced plans to reform the points-based immigration system and link it to skills policy. The manifesto also warned that employers who flout the visa system and break employment law will be barred from hiring workers from abroad.
Addressing economic inactivity
Jobcentre Plus and the National Careers Service will be brought together to help more people into work and address the issue of economic inactivity. As part of this change, Labour promises the service will be “responsive” to the needs of local employers.
There is the potential for the Work Capability Assessment to be replaced under the new Labour government, as part of its plans to help more disabled people into work and address the backlog of Access to Work claims.
Labour also pledged to help employers to hire ex-offenders, but it has not provided detail on how this would be achieved.
Pay gap reporting
In the manifesto Labour proposed a Race Equality Act, which will legally guarantee equal pay for Black, Asian and other ethnic minority workers.
Disability and ethnicity pay gap reporting will also be made a requirement for all large employers and will be handled similarly to current gender pay gap reporting rules.
