I'm joined by Daisy Cooper, deputy
leader of the Liberal Democrats and
Treasury spokesperson. Critical time,
just a few days ahead of the budget, but
we're here to talk about how the Lib
Dems want to understand the city of
London. Uh launched a new initiative to
hear from people who work in the square
mile and uh Daisy's going to talk me
through that. Daisy, thank you very much
for joining us here.
Pleasure. Thanks for having me.
So, I heard about this initiative and I
thought, what a good idea. Um I think
politicians of all stripes can take for
granted certain sectors. they often
aren't very good at at talking about or
admitting to what they don't know. Um
and so any effort to sort of understand
the issues that people actually work in
a key sector and it is a key sector um I
think are to be welcomed. So how did it
come about?
So I became treasury spokesperson for
the dems just over a year ago and for
the first six months I just um met as
many different people as I possibly
could both people working um for
particular organizations but also for
sort of industry bodies as well. Um, and
the same themes kept coming up time and
time again. One, there was a kind of
enormous frustration that I guess some
of the bigger parties weren't really
listening and weren't really engaging as
much as business and finance would
really want them to. I guess the second
frustration was this sense that um they
weren't really understood uh as a
sector. And the third was that they were
very curious about us as a political
party but didn't really know what our
instincts were, what we believed in or
um or what were the kind of things that
we were interested in. And it just
occurred to me that after all these
meetings, this same sentiment kept
coming up coming up time and time again.
And I thought, you know what, I really
want us as a political party to be able
to communicate at large with people who
work in financial and professional
services, not just here in the city, but
right across the UK. And I want to be
able to hear back from those people at
the same time. Um, and wouldn't it be
great if we could have an exchange of
ideas and exchange of views because
obviously, you know, there isn't a
homogeneous kind of single view on every
single topic. Um, and wouldn't it be
great if we could take the temperature
on issues in real time and hear from
people directly. Um, and so um, based on
that um, thought, I spoke to uh, a
couple of people and said, "Look, I want
to get this thing set up. Um, I need to
fund raise some money to employ somebody
to run it. Um, how about we get it going
and launch it and see how it goes?" So,
we've launched this new initiative
called Libdem City Exchange. Uh, it's um
ldcx.org.uk for anybody who wants to
look it up. Um, and we're going to be
doing two things. The first is for
anybody who signs up, they don't have to
be a Liberal Democrat party member, they
don't even have to support the Lib Dems.
If they just want to hear from us, they
can sign up to it. We'll be sending out
bulletins about the things that we're
working on in parliament and then asking
people for feedback on that um in terms
of whether they like what we're saying,
whether they think we're saying the
right things, whether they have other
ideas as well. But we'll also have some
high level roundts with particular
experts often experts who have different
points of view so that we can tease out
the sort of different views uh that
exist within the city so that we can
come to an informed view ourselves on a
whole range of different issues.
So it's interesting that you said that
you're aware that one of the views uh in
the city or in the sector is that they
didn't really associate the Liberal
Democrats with financial services,
professional services. Um the Labour
Party made a big play about being in
their own words the most pro business
government ever. Um and we can unpick
that. Um but actually it's quite often
felt to me like they're probably more at
home in the city than they are in in
many sort of market towns and high
streets for various reasons. Actually a
lot of their agenda around long-term
finance and deploying capital kind of
sits quite nicely with some of the
financial institutions here who also
like pulling big levers and moving big
money around. So I think Labour kind of
feel like they've got their their um
relationship with the city and the tries
for lots of reasons. I mean frankly a
lot of them used to work in the city. Um
also feel perhaps instinctively that
they're in touch but people haven't
always associated the Liberal Democrats
with it. And it's interesting Zion is I
think it was in some phrasing might have
been phrasing to do with this initiative
or it might have just been in your most
recent manifesto. You say very clearly
that private enterprise is the principal
engine of growth and prosperity in the
UK. Well that's you know music to my
ears. I'm sure music ears of CCM readers
etc. Why is it do you think that that
sort of
robust kind of pro- enterprise promarket
um sentiment is not something that
people have associated with the Lib
Dems?
Honestly, I think it's because we've
been a small party for a decade um and
now we're a much bigger party. We want
to use the platform that we have to
speak very clearly about the values that
we have. So um I often say to people the
values that we have today are completely
unwavering. They kind of go back deep
into our roots as a party. So, we like
to consider ourselves the inheritors of
200 years of liberal economic thinking.
You know, we are the party that fought
the corn laws. We're the party that
fought Brexit. We are a party of open
markets.
We did see we did used to see that. We
used to see that in the kind of old
orange book school of liberal thinking
and some uh people who have fallen uh by
the wayside from your party, the likes
of Jeremy Brown. Um what people like me
might have thought of as classical
liberals. Um, and I think it's fair to
say that somewhere along the way, there
is a sense now that the Liberal
Democrats are just another kind of
center-left,
you know, kind of offshoot of of of
mainstream labor thinking, just
generally that kind of territory. Are
you up for a bit more of a kind of
energetic relationship with enterprise?
Yeah, absolutely. And look, we consider
ourselves to occupy a very distinctive
political space. I completely reject the
kind of even the framing of the question
are we center left or center right. We
are distinctly liberal. So we have sort
of one strand of our history which is
fighting the corn laws fighting Brexit
being very pro-enterprise. Um seeing the
relationship between uh you know
government and private sector hand in
hand. We saw that in coalition when uh
in government when Ed Davyy was you know
launching the green investment bank and
the British business bank as well. But
there is another strand to our history
as well. you know, we are the party that
rolled out the old age pension. We are
the party that um created the idea of
free school meals and we are the party
that conceived of the idea of the
national health service then later
rolled out by a labor government. So we
do have these two strands in our liberal
history and I think they can coexist
side by side. So we are fiercely pro-
enterprise. We are uh fiercely uh pro uh
entrepreneurship and open markets but at
the same time we also are pro- social
justice. And I think if you ask most
people in the city if they identified
with both of both of those strands I
think they would say yes.
So it's probably the case that um not to
put words in your mouth but your your
most sort of robust example of pursuing
that that open market um approach is
your position on Brexit. Um but we don't
have time to get into Brexit today. So
we might invite you back to talk about
that. Um but putting Brexit to one side
in that case looking through some of the
positions of your previous manifesto and
I appreciate you probably on a process
underway to think about the next
manifesto. You can tell me if these
things still stand for example um you
pledged to reverse the reduction in the
additional bank levy and bank taxes that
came in. Do you still stand by that?
So our policy on that has evolved. So um
we did have that in our manifesto. What
we've said most recently is that given
the real crisis and the public finances
we um have said rather than having that
uh rather than reversing the sir charge
and the levy instead we have called
instead for a windfall tax uh on the big
banks. Now um I've spoken to the big
banks about this. I've spoken to people
uh in the city and what they say to me
is that they don't like the idea of the
tax but they do like the way in which we
want to spend it. So what we've said is
that of all the money that that could
raise 30 billion over the next five
years, we would use just under half of
it for two or three different things,
the first is to try and reduce people's
energy bills. Um because, you know, we
know that households are really
struggling with that right now. Um the
second is to give a VAT cut for
hospitality because we think it's really
important. That would be a progrowth
measure that would save jobs on the high
street in communities up and down the
country. I think that's really
important. And the third initiative
which I announced at our conference was
the creation of an energy security bank
which would be working handinhand with
the banks high street banks in this
country to roll out um affordable
lowinterest loans for households and
small businesses to take energy security
measures um to improve their energy
security at home. So um as I say I've
done roundts with people in the city.
They say they don't like the tax but
they like what we want to do with it.
And as far as I'm concerned as a
politician, it's my responsibility to be
honest about our choices and to explain
why we want to take them.
I suppose you're halfway there. Um, so I
mean last night, uh, in the city, the
banking industry had its big annual,
didn't it? You were probably there.
I was. Yeah.
Um, so you would have heard the case
made quite clearly that the sector
considers itself to be pretty highly
taxed. And when you tot it all up, the
cumulative impact of the corporation
tax, the additional search charge, the
levy and all the other taxes that they
pay like any other business puts them at
about 46%.
Which is far higher than the US, far
higher than much of Europe. So
they would say, and I hear this argument
also from the likes of supermarkets who
people look at the kind of, you know, on
paper the billions of profit being made
etc. And the supermarkets would probably
advance the same argument which is looks
can be deceiving. We're actually very
highly taxed. Um I think margins in
financial institutions probably better
than they are in supermarkets, but they
would probably agree on the principle
that we are a very highly taxed sector
and that there must be other places to
look because you know they are also
quite a mobile sector. There's no
god-given right why they all choose to
be in the UK and as you say not just
London but across the country. There is
a risk that you know there will there
will come a straw that breaks that
camel's back.
Yeah. No and I absolutely get that.
Look, um the cost of doing business in
this country is crazy. Like it is super
super high. Um some of that is taxes,
some of it is energy costs. Um for some
industries it's, you know, food costs.
There are lots of different costs.
There's the cost of regulation and cost
of compliance as well, right? So there's
lots of different costs. Um and we know
as a political party that um we want to
drive down the cost of living and drive
down the cost of doing business in this
country. And we haven't got all the
answers to that yet, but those are two
really significant priorities for us.
And so when we've talked about, for
example, raising a windfall tax on the
big banks and using it to ease the
pressure of doing business for high
street businesses and for households,
that gives you a sense of our kind of
direction. But what I would say about
the banks in particular is that if you
had a Liberal Democrat government, we
wouldn't just take that one measure on
its own. I mentioned earlier we occupy a
distinctive political space. We are
calling for a customs union, a bespoke
customs union with the EU, which would
boost growth uh in this country. We want
to see um you know improved EU adequacy
rules. We want to see mutual recognition
of qualifications. All of these kind of
measures would really massively boost
growth not just for the country as a
whole but particularly for the city as
well. And so we can't just do tax and
spend. We know as a party that as a
country we cannot tax our way to
prosperity. We have to invest our way to
prosperity and we get growth by working
with our neighbors. So this wouldn't be
your sort of one measure on its own. it
be part of a broader package where we
pursue a closer relationship with
Europe.
Okay. One final area I'd like to get
your thoughts on and also your sort of
expectations as to how your new exchange
project um might feed into the way you
and your party and your colleagues think
about the issue is this sort of state of
our public markets. Yeah.
Um and some of the issues that uh come
up time and time again. And it can be
quite confusing to some people to say
constantly hear that the footsie is at
an all-time high and that it's an
all-time high again. And those things
can be true. At the same time, that can
mask some some quite deeper problems
about liquidity and about u companies
coming to market in the first place.
Are you hoping that this this this
program of of of engaging with people in
the sector is going to enlighten you on
that? And what do you think about the
current state of public markets in this
country? Yeah. So, we've identified that
as one of the issues we want to discuss
in our first three um events that we're
going to organize these roundts. This is
one of our top three issues to to get
the exchange going. So, um part of it is
about having a retail culture in this
country. Um and I sort of feel quite
conflicted on this. So, I think on the
one hand we're a small island nation
with a housing crisis. Is it surprising
that people invest in bricks and mortar
rather than uh inequity for example? On
the other hand, we know that even by
other comparisons, similar comparisons,
we're not we don't have the confidence
as a nation to invest um you know all
the time as retail investors. Part of
that uh I think is around um education,
financial education and literacy. I
think that that's one thing. Um the
second thing is about um companies
having that confidence as to when to
list and whether to list and uh getting
access um access to capital in this
country. There's lots of questions. Um I
don't think we have all the answers yet
but we are very very keen to hear from
people in the city because we are
hearing different things about why
people think it is an issue whether it's
because valuations are higher in other
countries whether it's because you know
because there's more capital there
whether it's because people are listing
too quickly there's lots of different
things so we're very keen to tease that
out but that's kind of gives you a
general sort of sense of our direction
and our thinking at the moment
and how creative are you prepared to be
when you think about solutions for
example something we hear a lot from
people in the city um is the negative
impact of the way in which we tax shared
transactions in this country. So you
know this government and previous
governments have talked about wanting to
boost sort of retailer participation in
the market. Um but at the same time
they'll say but actually you know one of
the ways you could really put some
rockets under that would be to get rid
of the stamp duty on shares. Is that
something you're prepared to consider?
Yeah absolutely. I mean, I've been
looking at this issue recently. Um, and
uh, what I've seen is some of the
arguments saying if you I think the
estimates are that if you were to do
that, um, it could either be a detriment
to the Treasury, it could be a big boost
to the Treasury. And there's a whole
range of different modeling that shows
whether it could work or not.
The Treasury would just say that's four
billion quid a year, you know, and we
want it. And the argument would then go,
well, okay, maybe that's a direct line
item for you, but actually consider the
upside to the act the activity that
would emerge and to the sort of boost to
the markets.
Absolutely. So, I think it's definitely
worth trying. There are rumors the
government might do something on this uh
in the budget. Um, and they might
What else have you heard about them?
Give us all your budget rumors.
Oh, I haven't got time. Come on. Have
you seen the news?
All right. Over the last couple of
weeks, you know, we've been collecting
all the budget rumors and we've got
about 30 different items on our list of
things that we've been tracking.
What about income tax? Do you think that
they should raise income tax at all?
So we have said as a party that we don't
think that you should be taxing
struggling households and small
businesses at this time when you have
got a cost of living and a cost of doing
business crisis. We have given examples
of other ways that the government could
raise revenue but we've also said they
have got to go for growth. You know,
there is this elephant in the room which
is our relationship with Europe. And it
is so frustrating, so frustrating to us
as Liberal Democrats to hear the Labor
government say Brexit's been a bit of a
disaster, but we're not prepared to do
anything.
I can see I know that I know that it is
for Liberal Democrats. Do you feel like
you might be sort of wasting energies on
that? I appreciate there's a sort of
campaigning, you know, permanent
campaigning effort around the issue for
you and your many of your supporters,
but to to many people, you know, it's
settled until it isn't. It might change
down the line, but at the moment to coin
a phrase the chancellor uses about
living in the world that we're in, not
the one we want to see. If kind of
talking about Brexit and, you know,
improving our relationship with the
European Union, is your kind of trump
card in the growth debate, it actually
makes you a little bit irrelevant to the
current conversation, don't you think?
No, I don't think so. Because the Labor
government have absolutely squandered
the last 15 months. They could have had
a fullyfledged youth mobility scheme by
now. They could have had all sorts of
adequacy arrangements. They could have
ripped up red tape for uh exporters. Um
and they haven't. So, um this isn't, you
know, everything that we're suggesting
could be within the government's own red
lines, right? We want to go further. We
want to have a bespoke customs union,
but even within the government's own red
lines on their relationship with Europe,
if they completely max that out, uh the
estimates that we've had from the House
of Commons Library Research is that
could bring in about 25 billion pounds
per year into the public purse within
the Labor government's own red lines.
They just need to have more ambition.
They need to go uh act with more
urgency. Um and fundamentally I just
kind of of of of course the chancellor
being in power has to um meet the world
where it is. But as an opposition party
we want the country to be in a very
different place. We want a country that
is genuinely growing. And yes we're
talking about our relationship with
Europe. But there are other things we
can do as well for growth. Investing in
our skills uh reforming business rates
um you know uh giving a boost to small
businesses. There's lots of other things
we can do as well. But for as long as
Europe remains, you know, the elephant
in the room, we're going to be the party
that keeps banging that drum.
All right. If you want to bang on some
other drums, uh, alongside the Liberal
Democrats, um, then get involved, I
suppose, with their, um, uh, what do you
call it? City of London Exchange.
Libd Dem City Exchange.
Libd Dem City Exchange. All right. Um,
well, I think it is a welcome initiative
and I hope it goes well and you can come
back and tell us about um, all the
things that city workers have have told
you. So, Daisy Cooper, thank you very
much for coming in.
Thank you very much for having me.