Labour to curb pay in the boardroom

A crackdown on profits in the privatised utilities and new curbs on boardroom pay will be at the heart of Labour's industrial strategy under plans to be unveiled next month by Margaret Beckett, the party's trade and industry spokeswoman.

In a 60-page policy document, Vision for Growth - a new industrial strategy for Britain, Mrs Beckett will also set out proposals for radical changes in competition policy and support for exporters.

Billed as the product of the biggest consultation exercise ever undertaken among companies by a political party, the document will commit Labour to a root-and-branch overhaul of the privatised gas, electricity, water and telecommunication industries.

The present system of capping prices charged by the industries would be replaced by one where excess profits will be divided between customers and shareholders.

The individual regulators of the utilities would be made more accountable; boards of non-executive directors would be appointed to advise them and records of how decisions are reached would be made public to remove the "culture of secrecy" surrounding their work.

On directors' pay, greater disclosure requirements would be introduced and companies' boards forced to obtain shareholder approval at annual meetings for remuneration packages.

The policy document also envisages the appointment of an expert panel to advise on corporate governance issues and company behaviour, building on the work of the Cadbury and Greenbury committees.

Labour would streamline competition policy by integrating the Monopolies and Mergers Commission and the Office of Fair Trading into a single Office of Competition and Consumer Standards. It would introduce legislation to tackle anti-competitive practices and fine firms operating cartels and restrictive agreements. The system of supporting British business efforts abroad would also be overhauled with more use made of overseas Foreign Office staff.

The Labour leader, Tony Blair, will launch what the party calls its business prospectus at a conference in London on 4 September setting out general pledges on the economy, Europe, education and small firms.

But the Beckett document will put real flesh on the bones of the party's policy on industry. It is the result of a year-long consultation organised through Labour's Industry Forum which has 210 corporate members including BAA, Hanson, ICL, Tesco, British Gas, Glaxo Wellcome, NatWest and the Burton Group.

The forum set up six task forces to examine policy and obtain input from industry and commerce. This work was complemented by breakfast seminars addressed by Mr Blair and Mrs Beckett - known as the bacon-and- eggs offensive - attended by over 4,000 business people.

The document is designed to answer criticisms that little is known about Labour's industrial policy beyond the windfall utilities tax that the shadow Chancellor, Gordon Brown, intends to impose, and its support for a national minimum wage and the Social Chapter.

Andreas Whittam Smith, page 13