Below is an open letter sent to the Prime Minister and opposition party leaders, calling for all state support for businesses to serve the wider public good, signed by Positive Money and leading civil society groups. It comes after Positive Money polling revealed that two-thirds of the public agree that bailouts should come with social and environmental conditions attached. You can read more about our polling and latest report here.
The Rt Hon Boris Johnson MP
10 Downing Street
Cc: Rt Hon Rishi Sunak MP, Rt Hon Sir Keir Starmer MP, Rt Hon Ian Blackford, Rt Hon Sir Ed Davey MP, Elizabeth Saville-Roberts MP, Caroline Lucas MP
3 July 2020
Business bailouts must build an economy that works for everyone
Dear Prime Minister
The Government yesterday announced a bailout loan for Celsa steel, including conditions for the company on employment, climate change and tax use. This is bold action to support a vital business for the UK economy. But as we wait for full details of the loan conditions, we are concerned that all future Government support for businesses serves the wider public good.
Deciding to bail out major companies offers a crucial moment for redefining the rules of business behaviour in the post-Covid economy. Will we prioritise a fairer, more secure and sustainable economy, or will we deepen existing inequalities and increase our vulnerability to shocks?
We believe that all bailouts should be conditional on meeting wider social goals. Public money must not be channeled into inflated executive salaries. Climate targets and environmental protection must be hardwired into business performance. And companies must commit to building a healthier, more equal society: paying their share of tax, creating good jobs that are paid fairly, and eliminating racial, as well as gender, discrimination in their pay structures.
This is the moment for a new deal that prioritises what matters most to ordinary people: their pay, their taxes, the natural world around them, and equality within their communities. As such, we ask that any businesses receiving financial support must be required to:
- Adopt near-term climate targets in line with the Paris Agreement and clear, transparent plans to meet them, without reliance on offsetting
- Prioritise job retention
- End artificial tax avoidance arrangements and tax haven structures, publicly disclose where profits are made and who benefits, and publish their tax policy
- Implement a moratorium on dividend payouts and share buybacks for the duration of the coronavirus crisis
- Make a commitment to fair pay and restrict the gap between the least and the most paid
- Ensure pay auditing processes include ethnicity pay gap reporting.
In addition, Government must conduct a meaningful Equality Impact Assessment of all business support programmes and must publish the findings.
The Covid-19 pandemic has highlighted in stark relief the inequality and fragility in our economy. Going back to ‘normal’ would only leave us more vulnerable to future shocks. We call on you to ensure that businesses play their part in building a more secure, fair and sustainable future for everyone.
Carys Roberts, Executive Director, Institute for Public Policy Research
On behalf of
Dr Justin Thacker, National Coordinator, Church Action for Tax Justice
Rob Harrison, Director, Ethical Consumer
Paul Monaghan, Chief Executive, Fair Tax Mark
John Sauven, Executive Director, Greenpeace UK
Luke Hildyard, Executive Director, High Pay Centre
Miatta Fahnbulleh, Chief Executive, New Economics Foundation
Robert Palmer, Executive Director, Tax Justice UK
Richard Murphy, Director, Tax Research UK
Dr Wanda Wyporska, Executive Director, The Equality Trust
Dr Katherine Trebeck, Advocacy and Influencing Lead, Wellbeing Economy Alliance
Mary-Ann Stephenson, Director, Women’s Budget Group
Will Stronge, Director, Autonomy
Danielle Paffard, Build Back Better
Neil McInroy, Centre for Local Economic Strategies
Mathew Lawrence, Director, Common Wealth
Colin Hines, Convenor, Green New Deal Group
Hannah Martin, Co-Exec Director, Green New Deal UK
Fran Boait, Executive Director, Positive Money