CBI chief says Labour shows 'shocking' lack of understanding of business

Rupert Soames, the outgoing chairman of the Confederation of British Industry, has accused Labour of a 'shocking' lack of understanding of the world of business, telling the BBC that MPs and ministers often fail to put themselves in the shoes of those who run companies. Soames said he has found it striking how little grasp there is among some Labour politicians of the practicalities of employing people and managing growth within firms of different sizes.

Soames recalled dozens of meetings with shadow ministers in which he said business leaders were dutifully listened to but not truly heard. He described a pattern in which Labour figures would take notes and nod along as executives offered insights, then fail to translate that input into policy. He said it was his sense that the government is a group that finds it hard to put itself in the shoes of large, medium, and small businesses, and that this disconnect extended to the way it frames employment and growth challenges.

Soames also rejected Labour's pre-election outreach as a charm offensive that did not reflect genuine engagement with business leaders. He said he never believed in Labour’s so-called prawn cocktail circuit and argued that some business figures who participated in the events were drawn by optics rather than real dialogue. "I sat in countless meetings where shadow ministers were sitting there with their notebooks and dutifully taking down on the pearls of wisdom that were coming from business people. I don’t think they were really listening at all. A lot of that was in my view quite performative," he said.

The remarks come as official figures showed the economy contracted in October, complicating the government’s growth ambitions. Soames argued that policymakers should understand the real-world costs and challenges of employing people, not merely advocate broad policy aims. He suggested that Labour’s approach, if it continues to hinge on higher taxes and more expansive worker protections, could raise barriers for employers and slow hiring, echoing concerns voiced by business groups amid a shifting policy landscape.

Keir Starmer has said that growth is Labour’s number one mission, but business leaders have grown wary as the party signals tax hikes and new rights for workers that could affect hiring costs and management flexibility. Soames’ critique underscores a broader tension between Labour’s stated economic aims and the operational realities faced by companies across the economy. The CBI, as the UK’s main business lobby, has long pressed for policies that balance growth with productivity, investment, and a flexible labor market. With October’s GDP surprise complicating the political calculus, business leaders and policymakers may continue to scrutinize how the next government would translate campaign promises into enterprise-friendly policy.