Lord Michael Spencer: The Future of Enterprise

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0:42Spend less time searching and more time actually interviewing candidates who check all your boxes. Listeners of this show will get a$75 sponsored job credit at Indeed.com slash podcast. That's Indeed.com slash podcast. Terms and conditions apply. Need a hiring hero? This is a job for Indeed Sponsored Jobs. Welcome to Jimmy's Jobs of the Future. A couple of weeks ago we were at the heart of the City of London at the Guildhall at the Centre for Policy Studies Margaret Thatcher Enterprise Conference. It was an amazing day filled with speakers looking at how we grow the economy. I chaired a panel with Alex Baldock, the CEO of Currys, and Greg Jackson, the Chief Executive and Founder of Octopus Energy.

1:24The media partner for the day was The Telegraph and it was a really inspiring afternoon of speakers. But at the side of it, I actually spoke to one of Britain's most famous industrialists, one of the most consequential business leaders of the last four decades, Lord Michael Spencer. He founded iCap way back in the day and was one of the first fintech companies to ever exist in the city of London. He has been a friend and a mentor over the years to me. So it was great to sit down with him and talk about his role as chairman at the Centre for Policy Studies and how they're recruiting for a new executive director who is going to take over from the great Robert Colville.

2:07So we were specifically speaking about that, what the Conservative Party and more broadly the right wing of politics needs to be doing in these years of opposition to think about the future, think about how it lays the groundwork, because I think anyone that is seeing what's going on in politics at the moment can see that some of that thinking has not been done by parties in opposition before. So without further ado, here's Lord Spencer. Make sure you subscribe so we can continue to get bigger and bigger guests.

2:45Well, welcome to Jimmy's Jobs of the Future. Pleasure to have you on. You know I wanted to be here. It's a pleasure to be here. Of course. What does make up your days now? Lots of things. Mostly good things. Obviously, before I had for many years, as you know, I ran a public company, ICAP. Long story, I won't bore you with it now, but it was a great story. I started the company in 1986 with 50 ,000 quid. 20 years later as a FTSE 100 company, didn't raise$1 between 1986 and 2006, built it into the biggest wholesale brokerage firm in the world, 60 odd offices, 5 ,500 staff, and world leader in our space.

3:30But that business was taken over in two stages in 2017 and 2018, after which suddenly in 2018 I was no longer chief executive of a company the same company I'd been CEO of for 30 years I mean long enough and I funnily enough I didn't suffer any remorse at all I'd worked in the city since 1976 to 2018 apart from one year in Japan all in a small part of the city around London Wall, Finsbury Circus, Broadgate. And astonishingly, I knew every bar, every restaurant, every Millcombe Cranny, the Bank of England, all the banking houses, I knew pretty much all of them. And suddenly I was out. Suddenly I was out.

4:25But I knew what I was going to do. I had a small office in the West End in Sloan Street and I went there to basically run my private portfolio of business interests through my private vehicle company called IPGL, but that's not what you really want to talk about. You want to talk about some of the other stuff. And I've, as you know, to your father, I have been involved in the Conservative Party for a very long time. And even as an undergraduate, unusual in those days, in the 70s, I was a Conservative then, and I remained Conservative, and I got caught up by the mid-late 70s Thatcher revolution.

5:11Yeah. And I saw it firsthand. I remember what the UK was like in the 70s. I was a student in the 70s. I remember the winter of discontent. I remember the three-day week. I remember all those ghastly things that we went through. And I was a fervent Thatcher believer. And so I really stayed with the party all along, although my business career distracted me. But, and I worked for Cameron, as you know, for three years being his treasurer, his fundraiser from 2007 to 2010. Being treasurer is a tough job. It really is. But I actually really enjoyed it. I enjoyed it because I believed I was on a project that was important.

5:53Yeah. That I believed in. I thought Brown was steadily destroying our economy, which he was. that Cameron and Osborne were the best people to turn it around, which I thought they were, and they were. And so I felt proud about taking on that campaign. And although raising money for politics is bloody hard work, I actually enjoyed it because I decided early on if people weren't going to give me money, I wasn't going to take it personally. You've got to have a thick skin. You've got to expect rejection. And I just went around selling a story. Do you care about who's in power or not? Do you care about elections?

6:30do you actually want the conservatives to win if you don't want the conservatives to win i really won't bother you anymore at all but if they say yes i do want the conservatives to win yes we need the conservatives to back in power for all the reasons we will no doubt come to again in a moment i said well just so you know politics doesn't come for free so if you want it to happen i need you to help financially and you try and make it a journey which you take your supporters on which is fun interesting they feel they're part of a campaign you know can't part of a uh a campaign a crusade well maybe that's too strong a word so i did that for three years i told cameron i'd do it till the election because honestly our ceo footsie 100 company what you know what i was quite a busy job anyway i got a full-time job i didn't need another one anyway um so i i i stopped doing that then but I stayed in touch with the party of course um and I've always remained friends with Cameron Osborne and and most of the team from that generation and CPS so anyway anyway I um unrelated to all that's going on the conservative party I was um Morisarchi was stepping down as chairman of this CPS after a long period in 2019 and I was approached if I would like to take it on And I thought that's a brilliant opportunity.

8:00I mean it's a proper interesting job. I think the CPS is without doubt, for me at least, easily the leading centre-right think tank. I mean, it was clearly critical in the ideas and philosophy and the thinking and the research behind Thatcher's critical revolution, if you care to call it that, when she came into power in 1979. and I absolutely believe that Thatcher absolutely was responsible for turning the UK economy around from being a basket case and it was a basket case in the 70s. I remember it. I remember being, and it sounds awful, but being really slightly ashamed to be British and yet I felt very proud at one level to be an Englishman and at another level I felt rather ashamed when people said, gosh, your poor old country is not what it used to be.

8:59Sick man of Europe. You know, turn off, you know, will the last person who leaves turn off the lights, you know, that sort of little jives that people made. And I felt really, and so I really, I, you know, it's what Thatcher did to turn around the economy from being smothered by socialism. You know, on the surface, socialism sounds so fair and generous must redistribute things so everyone is treated the same and everyone of course it doesn't all they do is they basically smother the entrepreneurs the creatives so anyway i i jumped at the chance of being um chairman of the cps and what's what's the think tank do and what does the chair of think tank do as a result well my job i'm i have a very strong view part of different from when i was working in business the chairman does not run the think tank or the company for that matter.

9:56The chief executive runs it, or in this case a director, Robert Colville, an exceptional. He'd been doing it before our drive for about five years and indeed has been, he's been there ever since then. Sadly he's retiring now, as you know, for perfectly understandable reasons. So he was director and he had a good, a really good pedigree. He was a very capable, very hard-working very bright guy I obviously met him spent some time with him we got on well and I thought you know what actually helping the CPS to prosper and build its connections build its network which I'm I'm good at I mean I'm I look at Robert to be the intellectual behind it a lot of not all of the ideas I certainly have ideas myself but the organizer who can run the business my job is to chair it get a board together that support it put an effort into raising financing financing is obviously important and provide some guidance and help help network help bring people in to to support us to to spread the word because we're we're we're effectively an evangelical organization what other skills because like you say part of the reason that way of chatting is that you are recruiting for a new executive director kind of day-to-day leader what are the other skills that you're looking for in that role i think uh i mean it's all it's a difficult when you're losing somebody as who's been as outstanding as robert who's been for a sentinel you know a sentinel leader the good news is he's leaving the organization in great shape so that's a good thing so actually we've already got a large number of candidates come forward and some very very good names too uh what do we need we we want somebody who can get out there and not only just do the work and the research i mean i want us to build the intellectual framework and politicians um even in the shadow cabinet don't really have the time to go there all the resources to go there and think of come on what are the 10 big things that we need to do, how do they work, what are we going to do it and by the way you need to prepare before you get into government I mean look at the absurdity of the current government for all their bullshit about the Conservatives being well, not without some degree of bullshit anyway, you know the Conservatives have been in power for 14 years where the hell were they preparing in that 14 years what the hell were they doing for all their criticism of the Conservative Party they were so totally unprepared I mean it would be funny if it wasn't serious.

12:49It has been the worst incoming administration that I can think of. Mind you, thank God we had never had a foot administration. Thank God we never had a Kinnock administration. Thank God we didn't have a Jeremy Corbyn administration. But, you know, Tony Blair, and, you know, there are many things one could criticise him about, came in with a clear plan of what he was going to do. And it looked professional and it looked slick. Starmer and crew have looked like a bunch of absolute clowns. I mean, it would be funny if it wasn't so serious. So the core to our job, as I see it in the CPS with the new director, is really to put in the legwork and the intellectual exploration and discovery of, right, what are the policies that we're going to do?

13:36Of course, we all know the big picture. The big picture is we believe that lower taxation encourages growth. I really do believe that, by the way. I'm not saying that as some mantra. You know, lower taxation encourages growth, more individual freedom encourages growth, less regulation, you can over-regulate. All of those things we all see as the big picture stuff. But what are the details? What are the real implemented details here? What's the sequencing? and I think that's very very important work to do and that's what the CPS hopefully should be a resource to do and focus on and I see that as our principal objective.

14:17If you ask me is there anything particular I'd like a new director to do, I would say that Robert does very well in terms of producing published output. He writes a very good column for the Sunday Times as you know, pretty much every week. He has significant connections within the Conservative Party, particularly, although we have engaged with reform too, by the way. We had at the conference today Robert Jenrick, recently X-Story, speaking. And we also have our own blog you know capex um which is being pretty successful but i think what certainly the board have reflected to me and we've got a very strong board of the cps i think we want somebody who's going to do more um uh more media in um not just the print media yeah broadcast broadcast yeah so broadcast maybe you know go on tv maybe go on question time maybe do i mean to be honest with you we need to work out what they want to do but maybe maybe do a sort of regular more regular podcasting but i mean we want basically one of the things that's come out again and again for example in the conference today is um and i think uh greg jackson made the point that polling for no is alec baldog when polled the public at large would prefer that prices were fixed rather than and you know 80 voted that fixing prices was a good thing little realizing that actually that is a slippery slope to a completely sclerotic economy and we need to be verbally making these arguments of why is business important?

16:17Why are we mad to be trying to chase out billionaires from our country? Why don't we thank people for being rich as opposed to loathing them? I mean, the socialists loathe rich people. They really do. And we shouldn't. We should be grateful. We should be thanking them for living in our country. We should be trying to get the billionaires back. Of course we should. They make a massive contribution to our economy. And yet we seem to think it's irrelevant when lots of our talented youngsters are leaving our country in droves. I mean, I remember in the 70s, we had a brain drain leaving the country.

17:02And since then, we've had obviously a complete reversal of that. But the brain drain of talent is going out of the country. Do you think we've got a brain drain happening again now? Yes I don't think I know I obviously won't tell you who but I know large numbers of personal friends who have said you know what we don't trust this government we're out I mean loads How has politics changed in the years that you've been involved? You've always been sort of like adjacent to it Yeah and so it's interesting the role that you're recruiting for in terms of like it needs to create intellectual framework powerhouse for the party but also take that to the country as well a little bit right remind people why business and enterprise is good which i do think was both what greg and alex were saying in their session that actually it's you know that's not a given anymore no no absolutely not and very it's one of the things that's frustrated me in the past 20 years the conservative politicians have not often made the case for why business is so important why highly paid people are valuable to us why by the way why we why we don't why why did we the conservatives gave up on the non-doms which is madness to me every single one of the major non-doms i believe has left this country yeah and that is at enormous cost to us and who who you know and Only the extreme left are happy because they love punishing.

18:39If we've got a brain drain, do you also think that we've got a talent attraction problem with Westminster as well? I think they're unconnected. I think the problem with Westminster is on multiple levels. To start with, I think MPs are badly underpaid. I was in Singapore last week and I think an average MP in Singapore gets paid, I think I was told 450 ,000 US dollars a year or thereabouts. I think our MPs are materially underpaid. Okay, so they pick up bits extra with financial support, but secretaries and so forth. I think the intrusion into their private lives as well is pretty brutal.

19:27And of course we've had tragic incidents of violence in recent years. And I do think that we do need some reflection on how can we make this job genuinely more attractive, not just financially, but as a job that people can live a normal life and respect and things that go with that. It seems extremely adversarial in the House of Commons, from what I encounter, whereas the House of Lords, which admittedly I don't go to very regularly, bump into your father occasionally, I think the atmosphere there is much more collegiate, much more cooperative.

20:19Any final thoughts on where you think the sort of future of think tanking, the kind of intellectual right needs to go? I think they perform a very important task, a very valuable task. And we've got a lot of good think tanks in the UK. Arguably too many, actually, on the centre-right. I won't comment about which ones I think are the best, but we've got some good ones. And each, to and away, has their own... Niche is probably the wrong word, but their own focus. You know, CSJ, which I've been involved with, Centre for Social Justice, set up by Ian Duncan Smith more than about 25 years ago now, obviously focuses very much on welfare and I think has done an extremely powerful job.

21:12Policy exchange has really built its gap more really about foreign affairs, military, but it does delve elsewhere. Probably the most similar to us is Onward. yeah um iea has got some space of its own new new boss there with dan hannan game there yes yeah um but i think probably i think i'm interested talking to americans they consider that we are financially microscopic yeah you know the think tanks like the brookings institute there have proper money.

21:50Resolution Foundation is very well funded, although they're slightly on the other political spectrum to where I am. But yes, that's maybe something I'll work on now. But how do we get more money? Because I do think it's true that a lot of British politics, it's not just the salary of politicians, it's also the amount allowed to spend on election campaigns is microscopic compared to America. We might not want it as high as that, but we are trying to persuade... No, no, we don't want it as high as that. And bear in mind, a presidential campaign now comes to several billions of dollars, billions of dollars, not hundreds of millions.

22:32There's a price involved in politics, like you said, with your old job of treasurer of the Conservative Party, right? In fairness, I'm not quite as au fait now I used to be about party fundraising I wouldn't like it to see it suddenly becoming dominated by mega money yeah it's not dominated I mean you might say the left is dominated by trade union trade union contributions which it is which it is and which I think is a pity for for labor because you know i would say their recent employment bill which is a shocking and destructive bill to the economy and actually to what they care about to employment it will actually cost jobs it won't try i mean sometimes their thinking is so extraordinary to me that they they they um they seem to get sort of vicarious pleasure out of um kicking business um hurting business and hurting business people, thinking somehow that will resolve in better outcomes.

23:44Yeah. And look what happened on Stamp Duty, not Stamp Duty, Employers NI. They thought, wow, great, we can give all those business people a kick in the groin, great news, raise some money, blame it on the Tories, Bob's your uncle. Actually, it's cost a lot of people their jobs, and they didn't even think that could be possible. The understanding of how business works in the Labour Party I would say is all but non-existent exactly well Alex Bolduc saying that their margins 2 % across the business so if you put extra costs on business goes to what is what do you think is going to happen exactly I know I just go up and we're gonna have to make people redundant like it's yeah yeah it's not rocket science no but the socialists genuinely believe that business banks wealthy people billionaires have got unlimited amounts of money you can just you know almost like um um Dennis is he Dennis Healy's famous words of squeeze them till the pips squeeze well I mean the exodus of people has given answered that question for you and also the shrinking of it net investment into the UK tells you the story as well yeah I mean we have no hope of generating sustained economic growth in this country with the Labour Party using policies that it is adopting at this moment.

25:12It just won't happen. Well we must get you back to talk for longer soon but thanks for organising a brilliant day here at the CPS conference. It's been fascinating some of the business people that you've been able to put together. It's very nice to see you again.