CBI assess the first year of the Coalition Government
- Published on Tuesday, 07 June 2011 09:37
- Posted by Scott Buckler
The CBI has published its assessment of the first year of the coalition Government, against 12 priorities the business group set out before last year’s general election (June 7th)
At the CBI’s annual general meeting, held in London yesterday , Sir Roger Carr was formally elected President of the UK’s leading business organisation.
Sir Roger, Chairman of Centrica plc, takes over from Helen Alexander, chairman of the Port of London Authority. He is expected to serve a two-year term in the role.
In the CBI’s report, The Coalition Government One Year On: the Business Perspective, the Government is given credit for its swift and decisive action on the deficit, for its reform of business taxes, for prioritising trade and investment, and its approach to enterprise and industrial policy.
However, the CBI believes that Government policy has been less effective in reforming the energy market, and progress on a number of policies, including moving to a low-carbon economy, increasing labour market flexibility, and reforming public services has been slow.
Commenting on the CBI’s assessment of the Government’s progress one year on, Sir Roger said:
"The Government must be commended for its actions to put the UK’s public finances onto a firmer footing, vital for getting confidence back into the markets and bringing public borrowing down to a more sustainable level.
"But if we are to accelerate the pace of recovery, the Government must work harder in laying the right foundations for businesses to grow and business must respond accordingly.
"We don't expect the Government to provide all the solutions but it can and must set the right framework. It can do this by removing roadblocks like overbearing regulations, providing incentives through the tax system, encouraging investment in infrastructure, facilitating when necessary, and reforming our public services.
"Get this right and business can be energised to capitalise on opportunities that only government can provide."
Commenting on areas of Government policy, which require urgent action, CBI Director-General John Cridland said:
"There’s much the Government should be given credit for in a busy and productive first year. Acting decisively and swiftly on the deficit has certainly laid a firm foundation for future growth.
"But now we need to see delivery on the ground. Some areas, like energy, low-carbon policy and public service reform, are still in need of urgent action."
On energy, he said:
"Energy market reform is the single most pressing issue for businesses and is a source of great uncertainty. We have yet to see details of major reforms to electricity markets. The new carbon floor price cannot be allowed to compromise the competitiveness of our heaviest energy users, and must not become little more than a tax raiser.
"The Government must also commit to consulting on any future changes to energy tax, as we don’t want a repeat of the recent counter-productive hike in North Sea oil and gas tax."
On public services, he said:
"We called on the Government to reform public services, which is vital to ensuring the books balance. Immediate cost savings of £6bn may have been found, but progress on reducing duplication and waste in the public sector has been mixed. The need to re-engineer service funding and delivery has received less attention, creating a fresh imperative for action this year."
On banking, he said:
"The banking system is in better shape because of actions taken by the Government and its regulators, but the Government must promote the competitiveness of UK financial services and the City of London."
On employment, he said:
"The 30-year old legal framework of industrial relations needs modernising and the intention to reform the employment tribunal system must be converted into practical, workable change to encourage firms to take on staff."
Mr Cridland added:
"Where overlapping policy objectives pull in different directions, decisions must identify and prioritise growth above all, ensuring the phrase “Britain is open for business” is a reality not an aspiration."
Welcoming Sir Roger’s appointment as CBI President, Mr Cridland said:
"Sir Roger joins us at a critical time for UK businesses, as we work with the Government to secure private sector growth. Sir Roger brings with him a wealth of business leadership, with extensive experience as Chief Executive and Chairman of some of the UK’s most successful companies.
"I look forward to working together to ensure that the voice of business and the concerns of members are heard during the testing times ahead."
The President is a key voice for members of the CBI, playing an important part in the organisation’s activity, meeting ministers, promoting UK business internationally, and chairing the CBI Board.
Sir Roger said:
"I am delighted to be taking on the role of CBI President, especially at such a critical moment for the UK economy. The role business has to play has rarely been as crucial as it is today.
"During my Presidency, my twin objectives are clear – encouraging the Government to set the right environment for businesses and energising businesses to capitalise on the opportunities that the Government can provide.
"We have no reason to believe that government can solve all the problems. But we have every reason to work together to fulfil our potential and rebuild lasting strength in our economy.
“I look forward to working with John Cridland and the CBI team to make sure that the voice of business continues to be heard loud and clear both at home and overseas."
Helen Alexander was formally elected Deputy President at the annual meeting.
Mr Cridland added:
"I am pleased that Helen is continuing her work with the CBI as Deputy President. She has done a fantastic job on behalf of CBI members as president in the UK and internationally, reaching out to new and important areas, such as the creative industries, and championing the benefits of boardroom diversity."