Labour Together said new business taxes designed to fund six months of unemployment payments worth 80 per cent of a worker\u2019s last salary would cost firms less than complying with the Employment Rights Bill, which passed its final stage in the Lords on Tuesday<\/a>. <\/p>\n The paper states that the government should \u201cscrap 80 per cent of the Employment Rights Bill and buildout unemployment insurance\u201d. It adds: \u201cThis could be funded by higher taxes on employers (cheaper than the compliance cost of ERB) and small contributions from workers.\u201d<\/p>\n Stressing that Britain must take advantage of its \u201cagility and openness\u201d and double down on its economic strengths, it also argues that the government should aim to have \u201cthe most flexible markets\u201d of economic superpowers such as the US and China. <\/p>\n \u201cCountries that make it easiest for companies to restructure their operations are also those that do the most R&D in frontier sectors like biotech,\u201d Labour Together\u2019s paper reads. \u201cAnd easy firing means easy hiring, which benefits both firms and workers.\u201d<\/p>\n While explicitly rejecting \u201claissez-faire economics\u201d, the text also says that new technology makes the \u201ccreative destruction\u201d of job losses inevitable, adding: \u201cThe government has started to make our land market more flexible with planning reform, and to strengthen our capital markets. There is much more to do. And it is going backwards on labour market regulation with the Employment Rights Bill.\u201d<\/p>\n \u2022 Angela Rayner\u2019s next move has the Labour Party on tenterhooks<\/a><\/p>\n It adds that unemployment insurance would help laid-off workers see new technology as \u201can opportunity, not a threat\u201d.<\/p>\n The paper also suggests ending all capital spending in the southeast of England, a proposal that has enraged Labour MPs in the region, and a new deregulation drive in the water, energy and digital sectors. <\/p>\n It is the second eye-catching intervention from the think tank, whose advisory board includes the New Labour grandees Baroness Morgan of Huyton and Alan Milburn, this month. <\/p>\n Last week, The Times revealed that Labour Together was surveying party members<\/a> on their preferred candidates for a leadership election, a move that was met with shock and anger among allies of the prime minister \u2014 whose own 2020 campaign to succeed Jeremy Corbyn was masterminded by the group, which was then led by Morgan McSweeney. <\/p>\n Its new suggestions for the government\u2019s economic agenda explicitly cite Tony Blair\u2019s government as an inspiration. The paper, The brave churn of technology \u2014 a political economy for Labour in the 21st century, is not attributed to a named authored but opens with the words: \u201cTony Blair was right.\u201d<\/p>\n It goes on: \u201cTechnological change, like globalisation in the 2000s, is the defining fact of our age. For both our prosperity and safety, the UK needs to be at the frontier of the revolutions in AI, robotics, biotech, energy and other technologies.<\/p>\n \u201cOur project must be to harness these revolutions, not slow or stop them. Our old growth model is gone. We need to find a new one.\u201d<\/p>\n The paper also calls on the government to \u201cthrow the might of the state\u201d behind the Oxford-Cambridge corridor, with the aim of tripling its size with new housebuilding and commercial development, increasing state spending on research and development to the 1 per cent of GDP spent in South Korea and Germany, and divert more government resources to developing the economies of Birmingham, Leeds, Manchester and Liverpool, which would be given greater power to raise their own taxes. <\/p>\n The southeast of England should \u201cpay for its own stuff\u201d the think tank says<\/p>\n GETTY<\/p>\n![\"Commuters](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2025\/12\/\/bf1e1c95-e94d-4205-887a-7fc22700ef51.jpg\")
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