£4.2bn Budget plea to boost growth
A leading business group has called for a £4.2 billion Budget boost to help firms drive economic growth and create jobs, including help to recruit unemployed youngsters.
The British Chambers of Commerce (BCC) said the Chancellor should use spending "wiggle room" to bring forward changes it believed would stave off stagnation and weak economic growth.
The chambers said next week's Budget should include a number of initiatives, including scrapping planned increases in business rates, introducing a capital allowance scheme for medium sized firms, and doubling the amount of money available for wage subsidies for firms taking on young people.
Ahead of its annual conference in London on Thursday, the BCC also called for increased airport capacity in the South East, reform of the planning system and de-regulation of the labour market.
Director general John Longworth said: "George Osborne faces one of the most challenging Budgets in recent years. He can either take bold steps to create growth in the economy by introducing measures to support business, or shy away and face the spectre of economic stagnation. He has to pull out all the stops to boost British business by providing them with a Budget for growth. Firms need an environment in which they can thrive, create jobs, and export our goods and services abroad.
"Without a strong and prosperous private sector, we will be unable to provide the public services we all want or need. The Chancellor must stick to Plan A, but use the wiggle room he has to scrap the 5.6% business rate rise that will cripple many businesses.
"Firms must be incentivised to invest through a capital allowances scheme, and encouraged to take on young people. The Government can do this by doubling the Youth Contract to £2 billion, or by making changes to employer National Insurance contributions.
"Business also wants to see reforms to employment law and the planning system significantly speeded up. Regulations must be slashed, and access to finance improved so as not to choke off recovery. Without concerted action in these areas, the potential for businesses to grow will be limited, and so will the economic recovery."
Meanwhile, a separate report by the Federation of Small Businesses showed that confidence in smaller firms had improved in recent months despite rising overheads and continued problems accessing new finance. A survey of over 3,000 companies showed confidence increasing for the first time in a year, with over half planning to grow in the coming 12 months.
Chairman John Walker said: "The Government must bolster this confidence by doing everything in its power to remove the barriers to growth which our members have highlighted. That means taking action against rising energy and regulatory costs, looking at the proposals the FSB has put forward to give small businesses realistic alternatives to bank finance, and putting small business concerns at the heart of key government decisions through the creation of a US-style Small Business Administration."