Key recommendations of ‘Progressive Capitalism’

Progressive capitalismThe first half of the book sets out a new Progressive political economy while the second half shows how this political economy can be used to reform a country’s institutions.  The main recommendations are:

  1. To stop the exploitation of shareholders, the government should mobilise the various bodies that represent shareholders to form a new Shareholders Advisory Board to advise all shareholders on the way they should contract and deal with investment managers.  It should also have the power to require investment managers to give investors information in a standard form about the fees they are being charged.
  2. The Shareholders Advisory Board should facilitate and promote the use of nomination committees as they are used in Sweden.  In Sweden the nomination committee is a servant of the AGM rather than a sub-committee of the Board.  They are thus a low-cost and effective way for shareholders to influence the Board.
  3. In order to reduce the number of unjustified takeovers, the government should raise the level of acceptances required from shareholders in the target company, and restrict voting in the target company to those who have held shares for more than a certain number of years.
  4. In order to increase the effectiveness of the R and D funds of government departments they should be ring-fenced, it should be made clear that they should be used to drive and support innovation in the industries which the departments sponsor, and their R and D units should be staffed by scientists and engineers with commercial experience.
  5. Regional bodies should be set-up in parts of the country which need them in order to deliver a technological dimension to regional policy.
  6. In order to increase the number of well-trained technicians, the government should develop the three institutional components of an effective system of technician training and education.  They are a well-understood system of qualifications for transferable technical skills which works in the marketplace, a system of funding young people while they acquire the qualifications, and the teachers and facilities to train the young people.  The number of University Technical Colleges should also be rapidly increased.
  7. Schools should be required to provide their pupils with an effective careers advice service, which is a combination of in-house knowledge and bought-in services, to help young people choose the careers which will make best use of their abilities, and which they think are valuable to society.  This service should be supplemented with better labour market information.
  8. A National Economic Council should be set-up to join up the work of departments in the area of economic reform, speed up decision-making and delivery, and secure collective buy-in to the government’s policies.
  9. The performance of the Civil Service should be improved by clarifying what is the responsibility of Ministers and what is the responsibility of civil servants, by giving the Head of the Civil Service the power and resources to manage it, by improving the policy-making process, and by clarifying what responsibility a Minister has for NDPBs attached to his Department.
  10. The government should implement the key recommendations of the 2011 report of the Committee on standards in public life on “Political Party Finance – Ending the big donor culture’.  These are a limit of £10,000 on the donations from any individual or organisation in any year, including trade unions; the existing limits on campaign spending in the period before an election should be cut by 15 per cent; and that existing funding should be supplemented by the addition of a new form of public support paid to every political party.

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