A Labour government would prioritise state procurement of British goods and services, support firms to ‘onshore’ supply chains and train Brits for jobs in the country’s future growth sectors, its leadership revealed over the weekend.
Shadow chancellor Rachel Reeves spoke about the party’s three-point post-Brexit economic plan to “buy, make and sell more in Britain” while appearing on the BBC’s ‘The Andrew Marr Show’ yesterday (4 July).
According to the Guardian every public body would be told to award more contracts to British firms, with a new law requiring them to give details of how much they are buying domestically and from overseas.
Labour would also review all major public infrastructure projects to identify how more materials could be sourced from the UK and how British workers could be trained for work on them.
Bodies awarding contracts would also have to look at the social, as well as the economic, benefits of each contract bid.
Interviewed in the Telegraph, Reeves said the government had missed opportunities to work with industry groups to ensure that contracts go to British businesses.
“Other countries know this, they know that procurement is strategically really important, which is why in France... they wouldn’t be using British steel to make submarines and frigates,” she said. “And in the US not a single stage of military uniforms is made outside the United States of America”.
Reeves also pledged government support for businesses seeking to set up factories in the UK in order to ‘reshore’ or ‘near-shore’ production “so that their supply chains are less complicated and shorter”.
The plan would also see a push to create more skilled jobs in the UK for future growth sectors such as green technology, fintech and digital media.
According to City AM, it largely mirrors Joe Biden’s “Buy American” plan which saw the President push an economically protectionist agenda.
Trade Union Congress general secretary Frances O’Grady welcomed the policy, saying: “We need to build a fairer and more resilient economy as we emerge from this pandemic. That means strengthening UK manufacturing and investing in homes, transport and other vital infrastructure.”
Not that simple
However, Peter Ungphakorn, a former WTO official, told the FT that the party’s proposed policies could face difficulties in international trade law.
Although the UK is no longer is required to comply with EU procurement laws post-Brexit, the World Trade Organization’s state procurement agreement forces all members to open public purchasing to overseas bidders.
“Unless Starmer, Reeves and the Labour party are interested in trampling all over Britain’s promises to the EU, US and other signatories, then their ability to implement this with any real impact on jobs is limited,” he said. “To comply with the WTO agreement, we’re talking about buying pencils, not building wind farms”.
Labour also criticised the government’s draft legislation overseeing the recognition of overseas professional qualifications in the UK over the weekend, describing it as not “fit for the purpose”, according to the FT.
The Professional Qualifications Bill aims to allow foreign professionals to work in Britain with regulators given autonomy to assess their qualifications.
However, the list of professions and regulators has had to be redrawn after some key bodies and qualifications were missing, a situation the business minister Lord Grimstone admitted was “not good enough”.