The British government must loosen migration rules, reform the planning system and extend tax relief for urban businesses in this week’s autumn statement or risk condemning the country to a decade of no growth, Britain’s largest business group said.
The CBI, which represents the country’s largest employer, has urged British Chancellor of the Exchequer Jeremy Hunt to not ignore growth in his tax and spending update on Thursday, when he reveals how the government plans to fill an estimated ￡55 billion (US$64.93 billion) hole in public finances.
Hunt has said he would make “difficult decisions on public spending and taxes” to lower British debt as a share of GDP. He has pledged to sketch out a growth plan, but is not expected to pledge any funds for the effort.
Photo: Reuters
CBI director-general Tony Danker said he recognizes that stability is the government’s priority, but warned Hunt that businesses would scrap investment plans for next year if there is only talk of growth in the autumn statement.
“The chancellor has said he will set out a plan for growth on Thursday, but if this is only warm words, it won’t stop businesses pulling back from investment. It must tackle the real barriers we face right now,” Danker said.
“In the past three weeks, I have talked to hundreds of firms who need to decide this month whether to invest for next year or whether to go into hibernation — in fear of predicted recession and no action from policymakers,” he said.
“With fiscal and monetary policy tightening, we need many more pro-growth policies for our economy if we’re to avoid a decade of no growth,” Danker said.
The government does not need to spend much money to reassure business, he added.
Loosening migration rules to help firms fill job shortages, streamlining the planning system to speed up decisionmaking and bring forward private investment, and tailoring financial reforms to make it easier for asset managers to invest in “pro-growth projects” would cost nothing, but would signal that the UK is open for business.
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