Coalition must help business
BUSINESS leaders broadly welcomed the establishment of a new UK coalition government yesterday, but called for a “clear and achievable” plan to help business.
Establishing a comprehensive broadband network across the East Anglian region, carrying out public sector cuts, and putting business growth at the top of the new Government’s agenda were all on the enterprise community’s wish-list as it welcomed the emergence of what it hopes will be a period of stability.
Paul Winter, chairman of the Suffolk branch of the Institute of Directors warned that the national deficit could not be cured by taxation alone, and believed an increase in VAT would be on the cards in the new Government’s emergency budget.
Cathy Arbon, president of the Suffolk Chamber of Commerce, said the organisation was looking forward to working with the new coalition Government and the county’s MPs during a critical time for the economy.
“We will judge the new administration on the basis of what it does to promote business recovery,” she said.
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“The chamber wants to see the delivery of a clear and achievable plan for business over the first 90 days of a new administration – a plan that puts business growth at centre stage.
“Fixing the public finances must be at the top of the agenda. The Conservative-led coalition must be absolutely clear about where spending cuts will fall, and about the need to curb relentless growth in the size and cost of the public sector. They must also follow through on their promise to roll back the planned employer National Insurance rise in any emergency Budget.
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“The next 90 days are crucial for recovery. We need concrete proposals to reduce red tape and taxation burdens on business, action to move the economy away from consumption and the public sector and towards exports, and commitments to improve key business infrastructure.”
Mr Winter said the future remained unclear, and a lot would depend on the strength of the new coalition.
“It is pleasing that a decision has now been reached and the fact that it is a formal coalition should provide much greater stability than some form of informal agreement,” he said.
“Whilst full policy details are still unclear, particularly as to which parts of each party’s manifesto will be dropped, we do know that we will have another Budget in the next 50 days. That Budget will set the tone for the new Government and has to address the very serious financial situation the country faces. It has to set out a clear plan for reducing public expenditure. The deficit can not be cured by increasing taxation alone although I suspect a rise in VAT will be in the Budget.
“The new Government also needs to set out a clear agenda for business and how they will help business grow the economy. It is business which will ultimately ensure the future prosperity of the nation. Government can only enable that. It is therefore pleasing to see that the proposed increase in National Insurance next year will be scrapped.
“It remains to be seen how well the coalition lasts. For the sake of the country it is to be hoped that it does go the full term.”
David Burch, East of England area policy manager for the Federation of Small Businesses (FSB), said: “We welcome anything that’s going to end any uncertainty about the future direction of the country.”
A snap poll of its members carried out after the election found the majority wanted to see a reduction in the budget deficit, and the majority wanted this done through a cut in public spending, sooner rather than later, he said.
“It’s about ensuring the recovery remains on track and we do actually reduce the deficit and return the UK to growth,” he said.
“We need renewed economic stimulus to help small firms to create jobs. We need access to finance.”
Broadband was a key issue for the regon, he added.