With the party conference season in full swing, the news has been full of conflicting views about how to get the UK’s faltering economy back on track.
As a business owner you know the pain of the times we are living in, so you may be pleased to hear that one organisation has decided to tell the Government exactly what it should do to boost the UK’s business prospects.
The Institute of Directors’ Route Back to Growth report outlines 15 proposals which it says “could make the UK one of the most competitive advanced economies in the world by 2020-25”.
The proposals include a second round of quantitative easing (whereby the Bank of England injects new money into the financial system to try to boost banks’ lending, and in turn the wider economy) and also cutting the top rate of income tax from 50% to 40%.
“I think there is a despair around Britain as a whole, and around British business, about the way the economy is trending,” new IoD director general, Simon Walker told the BBC.
Driving growth was urgent, he said, and although the government was on the right track, it ought to be going “faster and further”.
The IoD’s other proposals are:
- Cutting corporation tax to 15% by 2020. It currently stands at 26% and the government plans to reduce this to 23% by 2014
- Improve labour market flexibility
- Ring-fence transport, energy and IT and telecoms spending
- Ensuring that energy policy “does not sacrifice UK competitiveness for green credentials”
- Expand free school provision with profit incentives
- End the £100,000 personal allowance taxation “anomaly”
- Intensify competition policy, both domestically and within the European Union
- Carry out radical civil service reforms to promote deregulation
- Reduce political influence over infrastructure planning
- Greater decentralisation of public sector pay
- No watering down of public sector pension reforms
- Reduce public spending to 35% of GDP by 2020
- Repatriate key employer power rules from the EU
The IoD wants the Bank of England to spend an initial extra £50bn on quantitative easing (QE).
Minutes of the Bank’s last Monetary Policy Committee meeting indicated that the Bank is looking at the possibility of more QE.
The full version of the IoD’s Route Back to Growth Plan can be read here
What do you think of the IoD’s plans? Would they make make a difference to your business?