George Osborne fingers red tape in bid to boost UK Economy – 2551
- 30 November 2010
The verdict on the UK economy from the Office for Budget Responsibility (OBR) may have been a qualified ‘good' yesterday, but the true impact of public sector job cuts remains a significant unknown in its predictions. Chancellor George Osborne knows he has to do all he can to stimulate private sector demand by encouraging businesses to set up and stay in the UK.
With this in mind, the Chancellor has said that he is planning a ‘brick-by-brick' dismantling of the red tape that has been seen as stifling British business. He announced his intention to reduce corporation tax in May of this year, but has now said that he will address employment law, health and safety bureaucracy and improve support for exporters. The OBR predicted a 6% rise in exports, but the situation will have to improve further if the Government is to achieve the hoped-for re-engineering of the UK economy.
The details of the Chancellor's new changes are detailed in this Telegraph article, which has prompted a flurry of responses. For example, cynicalengineer comments that there is no mention of help for the home grown SMEs who are supposed to be filling his employment black hole: "My small company develops new equipment systems and 80% of the sales are exports but somehow we will be falling through the gaps and paying top level corporation taxes. The big wheeler dealers somehow pick up all of the goodies."
On the Independent website, some go even further: Bob_T thinks: "So while the poor pay more taxes the corporates get a hand out. I see GSK are investing a little in manufacturing in the South of England, this is welcome news after they exported so much manufacturing to Singapore and India. Not sure it is a sensible move to allow companies to duck their responsibilities. I suspect the corporates save much more in tax than they spend in investment. The secret is to make it far more expensive for companies just to up and leave."
The Chancellor gets more support on the Daily Mail website: Jake says: "Good move and about time something serious was done to improve unemployment."
Will Osborne's move do the job? Red tape has certainly proved a problem for small and large businesses alike. The British Chamber of Commerce highlighted the problem in May of this year after a report said the cost to business had risen to £88.3bn in 2009.
However, as this article by Martin Leuw, CEO of the IRIS Software Group, suggests, the proof will be in the execution. He says that the Government has shown that it understands the needs of business, but new regulations being proposed on employer pension schemes, changes to the default retirement age and extensions to flexible working rights for employees goes against its stated intentions.
What regulations do you think should go?
- Beware Europe-based financial advisers 'passporting' into the UK but operating to much lower standards on charges and disclosure
- Metal madness - why I'm a gold sceptic
- Under 25s relying heavily on credit to cover housing costs
- Paragon Bank sweeps the best buy rates
- Buy, sell or hold? Mindful Money's weekly shares watch: Barclays, ITV & Diageo
- Government names the banks and building societies who will offer Help to Buy ISAs
- Investors urged to “China-proof” their investment portfolios as shares crash
- Pensions freedom fraud increase has the "makings of a national scandal"
- Four funds for courageous commodity contrarians
- "Chinese contradictions and Western hypocrisy"