Labour leader calls for change in boardroom

Ed Miliband called for an overhaul of corporate governance in boardrooms as he demanded a “more responsible capitalism” in the UK.

The Labour leader told a business audience that the government should consider whether shareholders’ voting rights should vary depending on how long the shares had been held. He also questioned whether companies’ long-term strategy was undermined by having to produce quarterly reports.

But Mr Miliband did not set out concrete proposals on boardroom remuneration other than repeating his policy of wanting an employee on the remuneration committee of every major company.

The comments came amid mounting fears of a double-dip recession and record youth unemployment which hit 1m on Wednesday.

The Labour leader repeated his call for the government to “change course” on its economic policies as he addressed an event organised by the Social Market Foundation think-tank at the headquarters of Arup, the engineering group.

“Don’t believe those who would tell you any change in course will make us like Greece,” he said. “As the managing director of the International Monetary Fund said, the markets are as worried about the lack of growth in the economy as they are about debt levels.”

Sir Mervyn King, governor of the Bank of England, for example, slashed the bank’s growth estimate to about 1 per cent in both 2011 and 2012, noting that there would be “weakness in the economy over the next few quarters”.

Labour claimed the government could be forced to borrow up to £109bn more than planned over the next four years – although the claim was dismissed by David Gauke, economic secretary to the Treasury, who branded the claims “absolute nonsense”.

Mr Miliband said during his speech that the borrowing and growth figures marked “an economic turning point”.

“The argument for a new, more responsible capitalism is hard-headed, not soft-hearted.

“It is based on paying our way in the world, building long-term wealth and delivering rising living standards for the majority of people,” he said.

“Knowing what we know now, about our economy, about growth prospects, it would be the height of irresponsibility for the government to carry on regardless.”

During a question-and-answer question Mr Miliband was asked about the sale of Northern Rock but said he would have to “look at the details” before deciding if taxpayers had got a good deal.

He criticised the recent cut in solar “feed-in tariff” subsidies, saying people were “outraged” by what the government had done.

Mr Miliband criticised plans to make it harder for staff to take bosses to employment tribunals, saying that the government was only offering “more of the same” in its backing for a “hire and fire” mentality.

The Labour leader said the unions and the government had a responsibility to prevent strikes in the coming months.