Business lobby groups on Friday criticized a key speech by Chancellor Jeremy Hunt on the government’s plans to boost economic growth, complaining that it did not deliver on new policies.
Hunt used the speech to highlight the government’s “growth plan”, and focus on the “four Ices” of enterprise, education, employment and everywhere else – a reference to reducing regional inequality.
He also signaled that the March 15 Budget would not contain large tax cuts, despite calls from some Conservative MPs, as it should focus on tackling high inflation.
With Britain poised for recession, Hunt admits the country has key weaknesses including low productivity, a skills gap and low business investment.
But he said the discussion “declinism about Britain is just wrong”, adding that the UK has a great opportunity to use the regulatory freedoms stemming from Brexit to boost sectors including technology, life sciences, clean energy, creative industries and advanced manufacturing.
Speaking to executives from companies including Meta, Microsoft, Amazon, Apple and Google, Hunt said: “I want to ask you to help the UK become the world’s next Silicon Valley.”
He went on to say that the government understands the need for lower taxes in the medium to long term.
He also indicated that he is focused on solutions to Britain’s labor shortage, saying he wants people who retired early during the Covid pandemic to return to work. “England needs you,” he said.
But Kitty Ussher, chief economist at the Institute of Directors, complained Hunt did not have a new policy to announce, saying the speech “E for empty”.
He said there was a “gap in the chancellor’s rhetoric”, adding: “While of course we need to make sure that companies operating at the frontier of new technologies can come to the UK and thrive, the path of future growth also depends on millions of individual decisions taken by small business leaders in all sectors.
Shevaun Haviland, director general of the British Chamber of Commerce, said that beyond some of his existing promises – including using the EU-era insurance regulatory reform known as Solvency II to unlock infrastructure investment – there was “not a bit of meat” in Hunt’s speech.
Stephen Phipson, chief executive of Make UK, which represents manufacturers, said there were a number of “devastating big picture issues in the absence of an industrial strategy, which is affecting some of our strategic sectors”.
Craig Beaumont, head of external affairs at the Federation of Small Businesses, suggested that the test for Hunt will be whether the ideas in the speech become policy in the March Budget, “when we hope that it will follow the day with a bite”.
Tony Danker, director general of the CBI, said Hunt was actually “shifting gears to renew the focus on growth”.
“And we hope the Budget less than two months away will show strong action to move forward,” Danker added.
After the speech, Hunt met with a group of tech founders and investors to talk about ways to boost innovation in the UK.
Romi Savova, chief executive of PensionBee, a financial technology group, said that “fintech is recognized as a top priority, actions speak louder than words”.
“We have yet to see the next steps in the approach to data protection in the UK, banking is going down on an international scale and the lack of pension guarantees keeps the pensions sector in the dark ages,” he added.
Tim Pitt, partner at Flint Global and former adviser to Philip Hammond as chancellor, said Hunt is a “refreshing balance of realism and optimism”, “identifying the area”. [of] wisdom [that] can make a difference”.