Labour faces dilemma over P&O boycott amid investment concerns

Labour Party leadership is attempting to strike a balance between condemning P&O Ferries’ treatment of workers and safeguarding potential investment opportunities in the UK.

Following the Transport Secretary’s call for a boycott of the ferry company, concerns have arisen that this could jeopardize a planned £1 billion investment by P&O’s parent company, DP World.

The situation reveals a delicate balancing act for Labour, as the party navigates issues of workers’ rights, corporate accountability, and economic growth.

Criticism

P&O Ferries, owned by Dubai-based DP World, came under heavy criticism in March 2022 when it abruptly dismissed 800 British seafarers, replacing them with cheaper, primarily overseas workers.

The move sparked outrage across the political spectrum, with accusations of unethical treatment and manipulation of employment laws.

Both Labour and Conservative politicians condemned the company, and Labour MP Louise Haigh, the current Transport Secretary, has maintained her stance of strong opposition to P&O’s practices, going so far as to call for a public boycott of the ferry operator, describing it as a “rogue operator”.

She has personally boycotted P&O for two and a half years, alongside encouraging others to do the same.

This position reflects the broader dissatisfaction within Labour ranks with how P&O handled its workforce restructuring, particularly in light of CEO Peter Hebblethwaite’s admission that he couldn’t live on what the company pays its workers, despite earning a substantial salary himself.

Boycott

While Labour’s leadership remains firm in condemning P&O’s past actions, there has been a notable shift in tone from the top of the party.

Labour leader Sir Keir Starmer has been keen to clarify that Ms Haigh’s call for a boycott is not the official position of the government-in-waiting.

When questioned about whether he supported her boycott, Starmer diplomatically responded that: “it’s not the view of the Government,” signalling that while P&O’s actions were unacceptable, an official boycott may not align with Labour’s broader economic strategy.

This softer stance from Starmer appears to stem from concerns about the potential impact on the UK economy. DP World, the parent company of P&O, had reportedly been planning to announce a significant £1 billion investment in the UK at an upcoming International Investment Summit.

However, following Ms Haigh’s strong words and Deputy Prime Minister Angela Rayner’s repeated criticisms of P&O, there are fears that this investment may now be in jeopardy.

Rights

The Labour Party’s challenge in this situation lies in balancing a commitment to workers’ rights with the need to foster economic growth and secure foreign investment.

Liam Byrne, the Labour MP for Birmingham Hodge Hill and Solihull North, has been vocal in his support for Ms Haigh’s criticisms of P&O, describing the company’s past behaviour as “completely unacceptable”.

However, he has also emphasized that the forthcoming Employment Rights Bill will provide a legal framework to prevent companies from engaging in similar practices, thus implying that legislation, rather than boycotts, should be the primary mechanism for change.

Mr Byrne, who chairs the House of Commons Business and Trade Committee, underscored the need for stricter regulations on how companies treat their employees.

He suggested that once the Employment Rights Act is passed, it will ensure that companies like P&O can no longer act in the same way without facing legal consequences, viewing this legislation as the best route to safeguarding workers’ rights while still promoting a business-friendly environment in the UK.

Investment

The government’s upcoming International Investment Summit is set to be a key moment in the UK’s economic calendar.

It presents an opportunity for Britain to showcase itself as an attractive destination for global business, particularly in light of the country’s efforts to recover from the economic challenges posed by Brexit and the pandemic.

Monday’s summit is expected to highlight firms that have already invested billions in the UK, as well as enticing new investors considering the UK for future projects.

For Labour, this summit also represents a test of how the party will balance the needs of working people with the interests of big business.

While Mr Byrne stressed that P&O’s past behaviour will not be tolerated in the future, he also expressed confidence that DP World’s future investment plans could still move forward, provided that the company commits to better standards.

The government, and indeed Labour, could send a clear message: businesses are welcome, but they must play by fair rules.

Update

It has been confirmed that Dubai-based DP World still intends to attend the Government’s international investment summit on Monday, despite reports that a row over calls to boycott its subsidiary P&O Ferries had put a £1 billion investment at risk.