David Cameron has defended the market and free enterprise but said reforms must be made so everyone can benefit from them.
The prime minister outlined his idea of a “socially responsible and genuinely popular capitalism” in a high-profile speech in London. Cameron said capitalism could be “the best imaginable force for improving human wealth and happiness”.
However, he accepted that the public’s confidence in capitalism had been shaken by the financial crisis and the slow recovery from the economic downturn.
Cameron said: “We won’t build a better economy by turning our back on the free market. We’ll do it by making sure that the market is fair as well as free.”
He continued: “I want these difficult economic times to achieve more than just paying down the deficit and encouraging growth.
“I want them to lead to a socially responsible and genuinely popular capitalism. One in which the power of the market and the obligations of responsibility come together.
“One in which we improve the market by making it fair as well as free, and in which many more people get a stake in the economy and share in the rewards of success.
“That’s the vision of a better, more worthwhile economy that we’re building.”
Labour leader Ed Miliband has been keen to stress the importance of “responsible capitalism” in recent months and has called for “predatory” businesses to be treated different to companies which make long-term investments in the country’s economy.
But Miliband expressed doubts as to whether Cameron was “serious about this agenda”. He said the prime minister should be judged on his deeds and not his words, and challenged him to tackle rising train fares, the “rigged” energy market and rip-off bank charges.
Cameron highlighted a number of speeches he made about concerns over how the economy operated, including one following his election as leader of the Conservatives in 2005 when he vowed to stand up to business as well as stand for it.
The prime minister said it was important to “use this crisis of capitalism to improve markets, not undermine them” and the Tories are well-placed to carry out the task.
“We are the party that understands how to make capitalism work; the party that has constantly defended our open economy against the economics of socialism,” said Cameron.
He added: “So where others see problems with markets as a chance to weaken them, I see problems with markets as an opportunity to improve them.”
Cameron said the Conservatives knew the free market’s failings as well as its strengths.
He said: “No true Conservative has a naive belief that all politics has to do is step back and let capitalism rip. We know there is every difference in the world between a market that works and one that does not.”