Sheffield Chamber of Commerce has called on the Government to ‘focus the firepower’ of the forthcoming Budget on long-term issues – and avoid the short-term tactic of ‘goodies and gimmicks’.
Ahead of the Budget on November 22, Richard Wright, Sheffield Chamber’s Executive Director, said the Chancellor of the Exchequer Philip Hammond must deliver ‘bold action’ and ‘big measures’ that have a long-term impact on growth and productivity.
Richard Wright said: “Because Brexit is not much more than a year away, this autumn’s Budget seems more vital than most – as this is the moment when Government must set the foundations of our economy post-Brexit, even though we don’t know the terms of our actual relationship with Europe then.
“In general we get input from our members that business will support bold action by the Chancellor – and additional borrowing if needed to deliver infrastructure. Yet Philip Hammond must resist calls for short-term giveaways, and focus his firepower on measures that deliver the growth and productivity that will underpin higher wages and future success.
“It would be tempting for the government to think tactically, and offer a ‘sugar hit’ of goodies and gimmicks this November. While it may provide a quick dose of political popularity, when it wears off, we’ll still be left with a sluggish economy and none of the reforms that will give people and places opportunities for future success.
“Instead, the Chancellor must show his mettle with big measures that address the long-term, structural issues which continue to thwart investment, productivity and growth. The biggest single issue facing our region, and the country is the national debt that we continue to build and at the core of that is poor productivity compared with our major competitors in the world.
“While of course businesses want the best possible Brexit deal, if we don’t create the conditions for growth at home, we won’t be in a position to meet the challenges, or take advantage of the opportunities, of our new place outside the EU.
“The first step should be tackling the ever-higher up-front cost of doing business in the UK. Costs such as the National Living Wage, Apprenticeship Levy, Insurance Premium Tax and pensions auto-enrolment – to name but a few – are putting increasing pressure on firms and, taken together, dampen their ability to invest and recruit.
“This Budget cannot simply be an extension of the status quo. The Government must be brave and rise above short-term electoral calculation to put our long-term success first. Anything less will be an abdication of its responsibility.”