April 13, 2010 10:09 pm

Clarke off message but on form

Ken Clarke

Ken Clarke at Battersea: likens Lord Mandelson to a Bourbon monarch ‘in his coach throwing out gold coins’

Ken Clarke’s renowned tendency to veer off-message was on display on Tuesday, as the former chancellor dismissed the qualms of less-experienced shadow cabinet colleagues that the Tories might struggle to gain a working majority on May 6.

Referring to his experience on the doorstep in 1997, when it was clear the Conservatives were “going to get massacred”, the shadow business secretary confided: “This time I’m more laid back than the rest of my colleagues. I’ve been up and down the country quite a bit on the last fortnight and I think we’re going to win.”

Mr Clarke was speaking to the Financial Times at Battersea power station as technicians dismantled the stage where David Cameron had just launched the manifesto designed to end the Tories’ 13-year sojourn in opposition.

The 69-year-old Westminster veteran applauded the party leader’s call for a “big society”, dismissing Margaret Thatcher’s insistence that there was no such thing as “one of her more foolish remarks”. He was adamant that his appetite for politics has not diminished. “I’m enjoying the campaigning, funnily enough – except I feel stiffer after walking the streets than I used to.”

The manifesto’s appeal to business is in stark contrast to the Labour approach of higher taxation, greater regulation and activist industrial intervention, Mr Clarke said. He attacked Labour’s recent “enthusiasm for French dirigisme and interventionism ... which I don’t think, personally, is the way forward we would favour.”

A Conservative government would seek to avoid grants, loans and other state aid for particular companies and sectors, he said. He mocked Labour’s recent splurge of grants to companies, likening Lord Mandelson to “a Bourbon monarch [who] went round in his coach throwing out gold coins”.

Mr Clarke stressed, however, that he was “not naive” about the need to offer some incentives. “A Conservative government will wind up giving some grants, where it’s necessary to get mobile investment to come to this country,” he said.

But the Tories would dismantle much of the apparatus used by Labour to support the regions, including regional development agencies. The RDAs in their present form will all be replaced,” he said, going further than official Tory policy of leaving this to local discretion. “You need to have a go at the drawing board.”

The Tory argument for less state interference is matched in the opposition party’s stance on business tax, although Mr Clarke suggested his party has yet to calculate exactly how the £2.55bn in corporation tax cuts will be financed from allowances and reliefs. “I don’t think we have [worked that out], no. They are so complex that that is a good couple of nights’ work, trying to work out how you tidy up the raft of rebates and allowances you now have.”

The EEF manufacturers’ body has warned that the Conservative plan to axe capital allowances to fund the proposed cut in the headline rates of corporation tax could be a “disaster”. But Mr Clarke was unmoved by the lobbying, saying it was inevitable that the losers from any reform would complain. “Twas ever thus,” he said. “I do not believe that you should postpone lowering the corporation tax because some changes to the allowance system may cost some companies some money.” His enthusiasm for this “most important” tax pledge contrasted with his lukewarm endorsement of his party’s £550m “very modest low-cost tax break” to help some married couples.

Mr Clarke appears keen to ensure his pro-business agenda permeates through the rest of the shadow cabinet. Asked about concerns raised by London First, a City lobby group, that Tory plans to curb economic migrants would damage the UK’s competitiveness, Mr Clarke replied that he had already raised the report in Tuesday’s FT with Chris Grayling, the shadow home secretary.

“We obviously have to have a cap on the numbers, but we also have to make sure that competitive business has the supply of people with skills,” he said. “Chris and I will make sure that business does not find it any serious problem.”

The reassuring language complements a manifesto that is designed to send a straightforward message to companies. “This is a very business-friendly programme,” Mr Clarke said. “There’s no point cluttering it up.”

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