Ed Miliband's speech: what it means and business reactions

The promise to business

"I will make Labour the party of enterprise and also the party of small business."

What it means: This is pretty standard rhetoric from a party leader. They tend to always give a nod to small businesses - the real proof is in the proposals pudding.

The caveats

"This new generation demands responsibility from business."

"We need a tax system for business that rewards responsibility: to pay a living wage; to provide high quality apprenticeships; and family-friendly employment."

"I remember during this campaign I met some school dinner ladies. They had to buy their own uniforms, their shift patterns were being changed at a moment's notice, frankly conference they were being exploited."

What it means: As I said on Monday, Miliband is pro-worker, and expects businesses to live up to his expectations of a fair society. He wants to make working conditions better for the individual - with a fair wage (see below), better work-life balance and generally better treatment of workers. (The sympathy for the dinner ladies examples highlights all this.) These ideas are obviously all positives for individuals in society, but will inevitably cause more red tape and headaches for employers.

The opportunity: international trade

"I want British businesses, large and small, to be able to make the most of the advantages of globalisation. New Labour was right to be enthusiastic about the opportunities that come in a more connected world: the movement of goods and services, the chance to travel, the new markets for our companies."

What it means: No clear policies laid out yet, but hopefully this means increased support for small businesses looking to trade internationally. We think UK small businesses can benefit hugely from importing/exporting and trading overseas if they do things sensibly, so this could be great news.

Migrant workers

"We have to challenge the old thinking that flexible labour markets are always the answer. Employers should not be allowed to exploit migrant labour in order to undercut wages. And if we have free movement of labour across Europe we need proper labour standards in our economy, including real protection for agency workers."

What it means: Using migrant workers and cutting costs by paying them lowly is by no means a standard among small businesses, but it is something done by a good few. Stricter regulation in this area could choke things up for small businesses, even if it means fairer working conditions for agency workers. It's a painful irony that protecting individual employees through legislation spells more red tape and difficulty for their employers.

Increase to the national minimum wage?

"I remember a care worker I met in Durham. [...] She told me that she thought a fair wage would be £7 an hour because after all she would get that for stacking shelves at the local supermarket.

"I believe in responsibility in every part of our society. That's why I believe in not just a minimum wage but the foundation of our economy in the future must be a living wage."

What it means: Miliband has made it clear he believes in a higher national minimum wage (which he calls the living wage and wants to be set at £7). How far he plans to extend this (will it be for all businesses or just those larger and more successful ones that can really afford it?) is apparently undecided - but small business owners could be hit hard if the minimum wage jumps up.

Reactions from the business world

Richard Lambert, director-general of the Confederation of British Industry:

"Companies will worry about some of the issues he raised. For example, the living wage, agency workers and the bank levy. But he was careful not to get into detail, so there will be time for debate."

Graeme Leach, director of policy and chief economist at the Institute of Directors:

"Ed Miliband says that he wants Labour to be the 'party of enterprise and small business'. How are these sentiments reconcilable with a commitment to new employment regulations for agency workers and a large hike in the minimum wage? Both measures would hurt small and large businesses, not support them. It is early days, but we detect a drift away from New Labour's efforts to talk up a pro-enterprise agenda."

Adam Marshall, director of policy and external affairs at the British Chambers of Commerce:

"During the worst days of the recession, the policies adopted by the Labour Government - including the Enterprise Finance Guarantee - helped prevent many small- and medium-sized businesses from going to the wall. However, with Labour now in opposition, our survey shows a gap emerging between business and backbench Labour MPs on critical issues such as deficit reduction and employment regulation.

"We urge Ed Miliband to make re-connecting with business, both locally and nationally, a key priority of his early months in office. Economic recovery depends on improving business confidence, and making it easier - not harder - for companies to take new people on."

Read a full transcript of Ed Miliband's party conference speech

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