The Chancellor of the Exchequer, Rishi Sunak, commissioned the Office for Budget Responsibility (OBR) to produce an economic and fiscal forecast for Wednesday 23 March 2022, as per the Charter for Budget Responsibility.
Speaking ahead of the Spring Statement, CBI Director General Tony Danker is urging the Government to use the opportunity to identify Capital, People and Ideas as priorities to create a higher trajectory for growth, a lower tax economy and a new culture of enterprise.
The CBI forecast that without a permanent investment incentive to replace the super-deduction, the UK will remain bottom for business investment among the G7 in 2026.
The organisation set out a range of pro-growth policies aimed at sparking underperforming productivity growth via business investment.
A permanent investment deduction, boosting business investment by £40bn a year by 2026 and offsetting the impact of corporation tax rise.
With the current model failing to incentivise investment in the right kind of training, the Apprenticeship Levy should be turned into a Skills Challenge Fund that delivers both employer flexibility and high-quality training – as well as rewarding those firms that outperform on skills investment.
Bring agility to our new points-based immigration system by creating an independent Council for Future Skills – modelled on the Low Pay Commission – to review current labour shortages and skills gaps, and make recommendations on how to combine business action, skills policies and immigration to deliver a workforce fit for 21st
Tackle high energy prices by improving home energy efficiency through new grants for decarbonised heating systems, improving energy security and establishing new markets to get green growth going.
Creating an Office for Future Regulation by building on the success of the Solvency II announcement. Reform regulation to attract investment and become world-leading in online safety and the industries of the future.
CBI Director General Tony Danker said:
“Faced with a record tax burden, a cost-of-living crisis, wage pressures and the end of the super-deduction, firms will be looking to the Spring Statement for a clear signal that the government’s ambition will be matched by action.
“That is the time to act if we want to push the economy onto a higher growth trajectory. It takes time for policies to kick in and deliver results, so there’s no point in waiting until an autumn Budget. Without serious action, we risk the economy simply drifting towards low growth once the V-shape bounce ends. The Government cannot waste a single moment."
CBI Chief urges Chancellor to act in Spring Statement.