A BETTER PLAN FOR BUSINESS: A Dynamic, Rebalanced Economy with Strong Public Finances
The first day of the 2015 general election campaign saw Ed Miliband launch Labour’s compelling Plan for British Business at Bloomberg’s in London. His overarching vision is one where our business sector succeeds when working people succeed.
Focusing on the great strengths of Britain, as an open trading nation with a world class research base and vibrant and creative business sectors, Ed pointed to the key challenges we must overcome if we are to achieve more sustainable growth and prosperity.
Arguably the most crucial areas to tackle are productivity and a rebalancing of the economy. We have yet to return to the levels of productivity seen before the global financial crisis of 2008. Recently reports suggest France, a country often derided by the Tories for its lack of economic competence, beats the UK where French workers take only four days to produce as much as British workers achieve in five days. This explains the cost of living crisis experienced by people the length of Britain despite official statistics on inflation and benign factors such as a big fall in the oil price.
A Labour government would tackle this problem by tackling the skills issue firstly by ensuring all young people have achieved a minimum standard in English and Maths by 18 and then offering a Gold Standard Vocational pathway with a guaranteed apprenticeship at the end.
There is still a need to rebalance our economy towards business investment, manufacturing and exports, as this government has relied far too much on consumption and non-productive debt to generate the recent uptick in growth. This is not a healthy place to be given that it inevitably relies on a surge in imports and we have an unsustainable trade deficit, greater than any other developed nation.
Labour supports a strong, entrepreneurial economy, where businesses have access to various forms of finance, such as regional investment banks and crowdfunding, which will help them to expand and win new markets. One factor of huge importance to business is a stable environment as they embark on investment programmes which have timescales measured in decades. This is where Labour’s desire to nurture a long term investment culture reassures and will pay dividends.
For this reason the next Labour government would ensure Britain plays a leading role in the European Union, having a strong voice at the table and not engaging in talk of referenda as the Tories continue to do, which only adds significant uncertainty, instability and ultimately increasing costs for business.
Along with the boost to human capital through its commitment to a skills revolution through apprenticeships, following the recommendations of the Armitt Review Labour will set up an Independent National Infrastructure Commission.
Taking a more long term approach, including cutting and then freezing business rates for over 1.5 million small firms, as well as maintaining the most competitive corporation tax regime in the G7 nations, Labour aims to boost our competitiveness and growth, thereby helping to put the public finances on a sounder and more sustainable trajectory.
With Labour all businesses can prosper, from the new start-up entrepreneurs to established blue chip companies. With Labour, Britain looks outward to the world, an open economy ready to succeed and play our full part in Europe. Labour’s Plan is better for business, and better for Britain.
David Phillips is Editor of the Labour Finance and Industry Group