Nick Clegg To Reveal Plans For 'John Lewis' Style Economy

Clegg Plans 'John Lewis' Style Economy

The deputy prime minister revealed plans to give workers more of a share in business to create a "John Lewis economy" on Monday.

Liberal Democrat ministers are to explore ways of getting employee ownership "into the bloodstream" of the British economy - including the introduction of a right for workers to request shares in their companies.

In a speech on Monday, Nick Clegg argued employee-owned firms tend to perform better, which helps boost growth, and promotes "responsible capitalism".

At an event hosted by the City of London Corporation and the Centre Forum think tank, he said the concept of employee ownership has been a "touchstone" of liberal thinking since the 19th century.

"We don't believe our problem is too much capitalism - we think it's that too few people have capital," he said.

"We need more individuals to have a real stake in their firms. More of a John Lewis economy, if you like...

"Firms that have engaged employees, who own a chunk of their company, are just as dynamic, just as savvy, as their competitors. In fact, they often perform better.

"Lower absenteeism. Less staff turnover. Lower production costs. In general, higher productivity and higher wages. They weathered the economic downturn better than other companies."

Lib Dem business minister Ed Davey will be in charge of the drive within the government to work out the barriers to employee ownership so that they can be removed.

He will be looking specifically at the possibility of introducing a universal right for employees to request shares in the companies they work for. Clegg will host a summit on the issue later in the year.

A source close to Mr Clegg said: "Nick wants to see real change in the way we do business, and firms that give employees a real stake.

"He is pushing his government colleagues for real, early, radical action on this.

"Employee ownership is part of a long liberal tradition of economic reform - putting power in the hands of workers to build a more responsible capitalism."

But shadow business secretary Chuka Umunna accused Clegg of following Labour's lead on responsible capitalism.

"The question for both him and Nick Clegg is whether they have the courage or the conviction to make the change that is needed," he said

"If Nick Clegg wishes to follow Labour's lead in promoting shareholder activism and engagement, that is welcome."

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