Former Labour Treasury exchequer secretary Kitty Ussher has delivered a stinging critique of her party for indulging in the “politics of envy” and “hysteria” in its stance towards financial services.
Speaking at a fringe debate on producers vs predators at the Labour autumn conference in Manchester yesterday, Ussher said the current debate is “unhealthy and counter-productive”.
At last year’s Labour conference, party leader Ed Miliband argued that British business was split between “producers” that created wealth and “predators” that extracted it for no social benefit.
Arguing in favour of so-called predators, Ussher said: “I think this debate is unhealthy the way it is at the moment. Call me old fashioned but I do not think the Labour party is at its best when it is pursuing the politics of envy. I do not think it is at its best when it takes one part of our country and pits it against another part.
“When we do that they rub their hands with glee in France and Germany because they know it was not the size of the financial services sector that caused the recession. They had a deep recession too even though their banking sectors are half the size of ours. They want a bit of what we have got which is a world class financial sector.”
Ussher, who stepped down as a Labour MP at the last election, has called for a more balance debate.
She said: “If there is one thing that leads to policy mistakes it is an atmosphere of hysteria and that is the type of atmosphere we sometimes have here. A one-sided debate is unhealthy and counter-productive.”
Arguing in favour of producers, Stoke on Trent MP Tristram Hunt said the UK needs to rebalance its economy away from financial services and towards manufacturing.
He said: “When you look at the recent economic crisis and Britain’s debt to GDP ratios, then it did not all go wrong because the last Labour government was too profligate or because spending money on schools and hospitals made Lehman Brothers go bust. It was because our tax base became too narrow as it was predicated on the financial services industry.
“We made the mistake of not questioning the goose on how it was laying the golden egg and became reliant on the financial services sector making our economy became unbalanced. When the crash came we were not prepare for the consequences so we have to be on the side of producers.”
Evolve Financial Planning director Jason Witcombe says: “I agree with Kitty Ussher. It would be nice to have a more balanced economy but tit for tat politics does not serve any useful purpose. Constantly criticising is not constructive.”