The Lib Dems’ war on wealth

Vince Cable will address the Liberal Democrat conference later on today. Tim Farron’s indulgent speech yesterday is a tough act to follow, but Cable has chosen a subject to titillate delegates: curbing high executive pay, bolstered by the popular mantra of no more reward for failure. He signalled his intention yesterday in an interview with the Sunday Times, with further details in the Guardian. The Business Secretary will try to ensure that workers and shareholders are represented at directorial level. He will also strive to diversify the membership of remuneration committees to include union reps and low grade employees. Finally, he will push for greater pay transparency in top companies, forcing all listed companies to publish the value of their executive pay in addition to insisting that companies justify bonuses before independent remuneration committees.

On the face of it, these measures may not sound all that dramatic. But Cable’s language is set to rouse. The Guardian reports that he will say “[These measures will be essential for] reducing our appalling inequalities of income and wealth, and creating a responsible capitalism. I want a real sense of solidarity, which means a narrowing of inequalities.”

Under both this government and the last, the Business department has already considered excessive executive pay – hence the talk about an equal pay commission and pay caps at the end of the last parliament. Benedict Brogan reveals that Cameron’s Downing Street and the Treasury have battled hard to quash proposals that they see as counter-productive. Their failure speaks volumes for the Liberal Democrats’ determination to use the twinned issues of wealth and taxation to differentiate themselves from the Tories. Danny Alexander, Nick Clegg, Simon Hughes, Tim Farron and now Cable have all made stern statements on the subject at this conference; fairness and equality were the most common words in the Lib Dem’s lexicon. The Tories may simply ignore these interventions and dismiss them as symptoms of the annual dose of Conference Fever. But, on current form, one wouldn’t count against the Lib Dems choosing defiance over compromise.

UPDATE: Downing Street is at pains to say that executive pay is one of its top priorities.