Home Business News Say hello to Labour's new small business minister

Say hello to Labour's new small business minister

by LLB Reporter
22nd Nov 11 7:07 pm

Is he a Bennite lefty or a free-market champion? Charles Orton-Jones grills the latest addition to Labour’s shadow business team

Toby Perkins. Who’s he? Even political obsessives will need to do a sly Google.

In fact he is the new shadow small business secretary, going head to head with Mark Prisk. If he’s unknown it’s because he is one of the new-boys in parliament. Perkins won Chesterfield in the 2010 election, a gain from the Lib Dem Paul Holmes in what would be Labour’s only capture from its two rival parties in England.

When Labour’s rising star Chuka Umunna got promoted to shadow business secretary in October, Perkins got the nod to take the post. Not a bad start to his career.

But what is he like? Will Perkins be a defender of capitalism, decrying the insidious build-up of laws and costs burdening entrepreneurs? Or will he prove to be, like one former incumbent of his Chesterfield constituency, Tony Benn, a menace to wealth-creators?

I got on the phone to his PA and set up an interview.

Prior research was thin. Perkins left school before doing his A Levels and held a variety of sales jobs. He’s 41. And, hallelujah, has his own small business, an online shop called Club Rugby selling rugby kit.

Perkins meets me at the security gate of Porcullis House. The rugby angle becomes apparent. He must be 6’4’’.

I ask him to fill in those biographical blanks.

“I have been in business my entire working life. I left school when I was 17. Started off in a sales role. Worked in IT sales, telephone sales and trade sales. Then I went into the recruitment industry, worked for Prime Time Recruitment which is one of the larger nationwide recruitment firms. At the time I was there they were the second fastest growing firm in the UK on the Sunday Times Fast Track. I was there for seven or eight years, from 1995 to 2003.”

After a stint with a headhunter he set up ClubRugby.co.uk. “There were two aspects to the business. There was a website which sold pairs of boots, shirts and headguards, and also a side selling to rugby clubs, schools, army teams and so on, selling them shirts and tracksuits with their sponsors’ logos on.”

As a keen player he knew the trade well. At his peak Perkins played second row for Derbyshire and Sheffield Tigers, no mean feat.

The stock was stored in his spare room and garage. Perkins explains that the beauty of the business was that it gave him a flexible income and lifestyle as he pursued his goal of running for office. Eighteen months ago his wife quit her job to run the business and he focussed more and more on campaigning.

Was it a successful venture? “It was a lifestyle business,” says Perkins. “The business didn’t grow as fast as if its main purpose had been for me to run a successful business.” But, as he points out, his plan worked perfectly: he is now an MP and he’s got a nice business too.

Onto politics.

How can he improve the lot of the poor beleaguered small business manager?

Perkins talks about the need to create “the right environment for entrepreneurs”. He says: “The biggest problem now is the lack of confidence in our broader economy. This is affecting everything businesses are trying to do. Because if your customers don’t have the confidence or the money to make investment decisions, then life is going to be very difficult.

So what does he propose?

“We have a five point plan which would specifically address some of the issues, such as putting money into consumes pockets and encouraging businesses to hire.”

Labour’s plan, scripted by Ed Balls, does indeed offer a few ideas to help small firms, such as National Insurance exemptions for one year for firms who hire the unemployed, but these policies cost money. Borrowing more money to fund them might push up gilt yields, pushing up interest rates and do more bad than good.

Perkins is well briefed, and pitches into the standard rebuttal: The cuts are leading to even greater borrowing, the government needs to stimulate growth before cuts etc. It’s on message stuff, but Perkins is earnest enough and animated enough to suggest it’s what he’d be saying even without fear of the whips.

I move onto tribunals. Small firms have been whacked by soaring employment tribunal claims – up 56 per cent in a year according to the CBI. Equal pay claims have a mere one per cent chance of success. How does Perkins propose to deal with this avalanche of tribunals?

“There is clearly a problem there”, he says. But: “We are in the process of a policy review”. (Right, so we won’t be getting a scoop today). He does suggest holding tribunal hearings in secret to avoid reputational damage for firms unfairly targeted though. And he rejects the Tory proposal to limit claims to workers employed for two years, and to demand deposits for claimants.

The next issue rattles him. I ask about Ed Miliband’s conference speech in which he distinguished between “producers” and “predators”, and promised to tax and regulate them differently. How can we tell the difference? And how will they be taxed differently?

At first Perkins doubts this is what Miliband said. I produce the quote. He pauses, then waffles for 30 seconds. As coherence returns he says: “What it is absolutely not about is going through the Yellow Pages and putting people onto two different piles with two different tax rates.”

But he can’t identify the “predators”. Not private equity. And he adamantly declares the City workers to be “wealth creators”, even maligned folk like derivatives traders. Not all his Labour colleagues would agree. Possibly not even his party leader.

He regains confidence with a monologue on the need to encourage responsible capitalism, and the use of tax breaks such as R&D tax credits to encourage the right sort of business behaviour.

He rules out anything like a salary cap, briefly floated by Miliband and endorsed by many left-wing campaigners, including many of Chuka Umunna’s former colleagues at the Compass lobby group.

His views are pretty much what the CBI is saying.

At the end of the interview Perkins offers a glimpse of a more left-wing, interventionist philosophy. I ask about the conflict between Labour’s desire for greater income equality, and the goal of many entrepreneurs to get rich.

“There is evidence, that has been accepted by all parties, that we as a society, the more equal a society the happier it ends up being. That is not just about those people at the top, but is also about those at the bottom. On a fundamental level, if you have a very unequal society it is bad news for everyone in society.”

Gulp! This is the language used by anti-capitalists and high tax advocates. Is there a Bennite streak in Perkins? It seems not. He explains that he sees no conflict between wealth creators getting rich and a more equal society. If we focus on helping the worst off, he says, we can reduce the gap without hobbling good businesses.

On Europe, Perkins says he’s pro-EU and opposed an In-Out referendum, though has never supported scrapping the pound for the euro, and wants no further political integration: “We must be masters of our own destiny.”

On that, we part ways.

Conclusions? Like he was in his rugby days, Perkins is a reliable team-player who knows the pack drill. Don’t expect gaffes or off-message rants.

Entrepreneurs and small business owners are likely to find him a constructive, if a bit cautious, voice, for their interests. Having run a small business gives him credibility.

Sadly, we will have to wait until the policy review is ready before Perkins has any big policies to shout about. Then we’ll find out what sort of a role this chunky Chesterfield lad is destined to play in the Westminster soap opera.

Toby Perkins MP tweets at @tobyperkinsmp

What do you think of Toby Perkins? Carry on the discussion on the LondonlovesBusiness.com LinkedIn group

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