CBI seeks cut in tax and staff protection
One of the nation's largest business organisations, the CBI, is calling on the Chancellor to reduce taxes and lower employment rights in an "all-action Budget" on March 23
The CBI's Director-General, John Cridland, says in a letter to George Osborne that ministers should "signal a road map for reducing the 50p tax rate", a measure put forward by Labour but retained by the Coalition as part of their deficit-reduction programme. The CBI argues that "mobile talent needs a good reason to do business in the UK".
Controversially, the CBI is calling on the Government to return to the pre-1997 position on employment rights, where an individual only has a right to claim for unfair dismissal after two years, rather than the one-year threshold now in place.
That, says the CBI, would "give companies more time to assess the potential of a new employee, thereby giving firms the confidence to hire new staff without the threat of a tribunal if it doesn't work out".
The organisation is also asking for the employment tribunals system to be strengthened "to weed out weak and vexatious claims". Although David Cameron has dropped vague hints that he may look again at the legal position on industrial action, especially in essential public services, there has been no sign that ministers want to reduce employment rights as such.
The CBI's Mr Cridland said: "This Budget must demonstrate a relentless focus on growth to help get the UK working again. We need an all-action Budget, which boosts exports, investment and jobs. And we want to hear more about how the planning system will genuinely deliver swift decisions on infrastructure and less about abolishing the Infrastructure Planning Commission."
As the shortage of credit continues to damage the prospects of medium-sized corporations unable to tap capital markets, the CBI suggests that the Government encourage the creation of a new corporate bond market for mid-caps to increase the supply of capital.
Ian McCafferty, CBI's chief economic adviser, added: "The Government has been right to stay the course on its fiscal consolidation plans to bring the current budget deficit back to balance by 2015. As spending cuts put household spending under ever greater pressure, the Budget must create the right conditions for businesses to invest and grow."