What is the new Business Council for?

I am old enough to remember the heyday of the National Economic Development Council (NEDC). During the heyday of tripartism from 1962 to 1979, the Council provided a meeting point for government, business and unions. Indeed, the 'Neddy Six', the six TUC members of the NEDC, provided a key interface between the unions and the government. Neddy limped on under Margaret Thatcher until it was painlessly put to sleep by John Major.

Nowadys government wants to be seen on good terms with big business. Tony Blair's stated ambition was to make Labour 'the natural party of business'. He particularly liked talking to chief executives of big American organisations and shadowy bodies like the Multinational Chairmen's Group. However, when the European Round Table of business leaders went to No.10 shortly after Tony took up residence and asked him to take Britain into the euro, to their chagrin they were told 'no can do'. And the reason was, of course, that Gordon would not countenance such a step.

Now Gordon is in No.10 and the emphasis is on transparency as well as inclusivity. He has set up a business council made up of fifteen business leaders, more of half of whom are knights or dames. They read like a list of the business great and good and inevitably include such ubitiquous figures as Sir Richard Branson (who might well be our president if we had a republic) and barrow boy made good Sir Alan Sugar. On the government side at the first meeting last week were Gordon himself, His Master's Voice (Alastair Darling) and the business and skills secretaries.

The stated purpose of these worthies is to act as a 'sounding board' for the prime minister, 'giving him a strategic business perspective on government policies and operations'. When the council met last week the agenda included 'human capital, globalisation and climate change.' The first meeting lasted two-and-a-half hours (and the business leaders won't have got much sustenance given that No.10 probably uses the cheeseparing Government Hospitality Service who were in evidence at No.11 and seem to have some connection with Buck House).

What was not discussed was the ongoing row about Capital Gains Tax which has set much of business opinion against government. Sources close to No.10 said that business leaders had been warned in advance not to mention the pre-Budget report.

Alsatair Darling held his own meeting on the subject with Britain's 'four main business groups' (presumably the CBI, the Institute of Directors, the Chambers of Commerce and the Federation of Small Businesses). The Government is apparently willing to consider 'marginal' changes to the CGT decision, but has ruled out any reinstatement of the taper relief or indexation allowance.

I don't think this was a very well thought through decision and it could damage what has generally been an effective relationship between New Labour and business. However, whether the Conservatives will be able to make much political capital out of it is another matter. It's a big issue if you are a small business person (although it doesn't seem to have percolated the thinking of my daughter who is active in her local chamber of commerce). However, as of last week, only 13,578 has signed the relevant petition on the Downing Street website and 600 people have joined a Facebook group called 'entrepreneurs against the abolition of taper relief.' Sounds fun.