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Private sector for growth, say Cameron and Clegg

The Coalition Government reaffirmed its hopes in the private sector to deliver growth for the country.

As part of the Government’s mid-term review, David Cameron and Nick Clegg said they will publish specific sector strategies in the coming year, as part of the wider national industrial strategy.

The Government’s intention is also to “aggressively pursue the deregulation agenda” and to promote the growth of high-tech industry by completing the network of ‘catapult’ technology centres.

Changes to legislation in the labour market will bring extended flexible working; a new employment status of “employee shareholder”; reforms to the employment tribunal process and introduction of recommendations from the Nuttall Review of employee ownership.

On exporting, the Government promised to establish a “UK Export Finance” body worth £1.5bn, providing loans to overseas buyers who purchase capital goods and services from British exporters.

Elsewhere in the review, a further extension to Small Business Rate Relief from April was reiterated from the Chancellor’s Autumn Statement, and a reduction in the small companies tax rate to 20%.

In a press conference Mr Cameron said further consultation on how to attract private investment into motorways would take place, and plans for the extension of HS2 high speed rail line north of Birmingham.

John Cridland, CBI Director-General, said: “The Coalition deserves high marks for its commitment to tackle the deficit and its plan for growth, but in some cases its delivery has been disappointing. “Growth-boosting measures like house, road and rail building are getting too bogged down in the planning and procurement process.

“We don’t need a flurry of new announcements, but we do need to see the Coalition’s ideas translated into action now.

On public services reform, Mr Cridland added: “The Government has been far too slow to open up public services to independent competition. This is the only way to meet budget constraints and maintain service quality.”

Head of Policy at the Forum of Private Business, Alex Jackman, said: “In terms of business, the Government has made progress in some areas, but it’s got a lot more to do.

“David Cameron said on every issue that Britain’s wealth creators have demanded action, his government has taken action. However, this is not quite the full picture.

“The facts are he has met them halfway, or compromised on many. The government has been bold, but it could have been brave and gone further. The good news is that Michael Fallon the Business Secretary seems to be making the right noises, and we like the way the Government is getting involved in the prompt payment debate.

“We are also pleased to see Government has gone some way to readdressing the employee powers too, by extending to two years before claiming unfair dismissal, looking at Acas to do more, and introducing settlement agreements.

“But on the flip side the Coalition has been incapable of a sensible public debate on going further in employment rights at times and we think there is still more to be done.

“They are deregulating, but at the same time extending the right to request flexible working to all and changes to parental leave will increase admin burdens on business.

“So while the Government has been moving in the right direction and appears to be doing the macro things more or less right – that is reducing the deficit and keeping interest rates low – the burdens on business are slowing, not stopping altogether.”

Graeme Leach, Chief Economist at the Institute of Directors, said: “In the second half of this Parliament the Government must redouble their efforts to enact radical reform across the board. There have been many good moves so far, chief among them the crucial work on deficit reduction and the commitment to deregulation.

“To inspire business confidence and get the economy moving we need to see more, though. On tax simplification, slashing red tape and setting the private sector free to grow we need to see the coalition put the pedal to the metal.”

This was posted in Bdaily's Members' News section by Tom Keighley .