Labour accused of 'shocking' lack of understanding of business, CBI boss says
CBI chief Rupert Soames warns ministers may misunderstand how firms operate as October economy contracts
London — Rupert Soames, outgoing chairman of the Confederation of British Industry, said Labour shows a 'shocking' lack of understanding of how businesses operate in comments that echo long-standing tensions between the next government and Britain's biggest employers. In an interview with the BBC, Soames argued that ministers struggle to put themselves in the shoes of people who run companies and suggested he never subscribed to Labour's pre-election outreach to business leaders, known in Westminster as the prawn cocktail circuit. His remarks come as official data showed the economy contracted in October, cooling expectations for a swift recovery and complicating the new government's task of growth.
Soames told the BBC that when he meets MPs and ministers he finds it 'really, really shocking how little understanding they have of the world of business.' He warned that Labour politicians sometimes view business leaders as 'rampant capitalists' and said there are too few ministers with direct experience of employing people. 'It does disappoint me that on one hand the government has very few people who have worked in business in a way that has involved them employing people and on the other hand they translate that into saying, we won’t listen to the people who have,' he said.
Soames said he never believed Labour's pre-election charm offensive and recalled sitting in meetings with shadow ministers who dutifully noted the pearls of wisdom offered by business figures but appeared not to absorb the messages. '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 comments come as Labour frames growth as its top objective, a stance that has alarmed business groups wary of higher taxes and more stringent worker rights. Labour leader Keir Starmer has said growth is Labour's number one mission, but business voices have warned that proposed tax increases and changes to employment rules could raise costs for firms of all sizes and complicate hiring.
Official statistics published in recent days showed the economy contracted in October, underscoring the fragility of the post-pandemic recovery and the challenges facing whichever party forms the next government. The data arrived as Labour pressed its economic plan and as the CBI and other business groups called for pro-growth policies that balance investment with prudent regulation.
Industry observers cautioned that the rift between political rhetoric and the practical concerns of employers remains a defining feature of the policy debate. Soames, who has led the CBI during a period of political volatility, emphasized that his criticisms are not an attack on business itself but a call for policymakers to better understand how employment decisions are made and how firms respond to taxes, regulation, and skilled labor shortages.
As Soames prepares to step down in the coming months, the CBI's message to politics is likely to remain an influential but contested voice in Britain’s macroeconomic policy. The outcomes of the industry group’s engagement may shape how the next government designs and implements growth-oriented policies.
This dynamic underscored the broader strain between business leaders and Labour’s economic agenda as the country heads into a new political era, with data suggesting the recovery will require careful policy calibration to support investment, hiring, and productivity.
