The Chancellor should lay foundations allowing firms to navigate a more uncertain economic outlook, invest for the future and get all regions firing on all cylinders. Rarely has there been a more important Autumn Statement, says the CBI in its submission for 2016.
While the economy has shown resilience in the months since the vote to leave the EU, economic uncertainty continues over the UK’s future relationship with the EU and its impact on firms’ investment plans. In the short-term, the Government needs to stimulate confidence and investment, while over the longer-term, balance productivity growth across all regions with an ambitious plan for infrastructure investment.
The CBI is proposing:
An increase in average Public Sector Net Investment spending this Parliament to 2% of GDP (it is currently forecast to fall to 1.7%) This would increase average annual public investment by £6 billion. Part of this should go to essential local transport infrastructure including through the Local Growth Fund, which was five times oversubscribed in the latest funding round. This investment will drive productivity by increasing the scale of regional labour markets
Fast delivery of over £425 billion worth of planned infrastructure investments with clear timeframes and implementation plans, in particular on roads and rail investment including the transformation of the A303/A30/A358 corridor to Land’s End to an Expressway and the dualling of the A1 from Newcastle to Scotland
Increase the Annual Investment Allowance – a vital allowance for mid-sized firms – to £1 million until the end of 2018 to increase the attractiveness of near term investment
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