Friday, February 3, 2023

Growth: CBI fires warning shot over Government’s bow

The Prime Minister and Chancellor ended 2022 by successfully stabilising the economy after fixing the economic fallout of last autumn. It has been a vital first step, executed very well. But as they try to get growth going in 2023, the Government cannot take small decisions: they need to take big ones to ensure the UK is not going backwards but forwards. The Government is likely to comfortably meet its economic targets this year, but sustaining growth thereafter depends on taking some very big decisions right now, not waiting until 2024.

In a major speech today (Monday) at UCL, the

CBI Director-General Tony Danker is calling on the Government to take some big decisions to sustain growth beyond this year.

In a speech at UCL he’s expected to acknowledge that the PM and the Chancellor ended last year by stabilising the economy, and that the year’s economic targets will be hit – but now’s the time for decisions that will keep sustain growth.

He’ll say: “Growth still matters. This is people’s livelihoods and life opportunities. The PM set out less than a year ago what is needed to transform our economy. The ideas are there. Let’s stop second guessing ourselves and get on because there is money on the table to capture right now.

“Our international competitors in Europe, Asia and the US are going hell for leather on green growth and getting firms investing. We are behind them now and seem to be hoping for the best.” Early data shows that the UK could stay stuck in a low growth trap as the major drivers of productivity grind to a halt. This makes the Chancellors Spring Budget a key point in the Government’s turnaround strategy. But there is grave concern that the Government could “shy away from the hard decisions that can reverse the UK’s trajectory’ with a General Election on the horizon.”

 

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