CBI: Next government must prioritise business to achieve lasting change

CBI: Next government must prioritise business to achieve lasting change

This is a crucial moment in UK politics. Whoever forms the next government must join forces with business to drive lasting change. Their collaboration with industry over the next five years will determine the UK's prosperity for the next two decades. As the most prominent voice for business leading up to the election, we’re ensuring the issues for business Wales are front and centre as the election approaches. ?

The CBI business manifesto, co-created with members and launched in November 2023, sets out a comprehensive plan for how the next government can work with the Welsh Government in their first 100 days, 100 weeks, and throughout their first Parliamentary term.?It outlines bold policies to boost productivity and drive prosperity. We're pushing for a cutting-edge trade and investment strategy, a comprehensive Net Zero Investment Plan, and increased support for firms investing in AI to automate and enhance productivity.?

We're laser-focused on keeping the economy front and centre for all political parties. Last week inflation fell back to the Bank of England’s 2% target with interest rates widely predicted to start coming down also in the summer. This recovery chimes with our latest Economic Forecast which points to an economy that is on track to gradually pick up steam in 2024 as UK GDP growth is projected to rise to 1.0%. Momentum is expected to continue into 2025 with growth reaching an anticipated 1.9%. But, the economy is by no means out of the woods with business investment set to be weak in 2024 and with productivity lagging behind, below its pre-COVID trend. Clearly more action is needed to spur longer-term, sustainable growth.

Green Industrial Revolution: The CBI share your view that a just transition should continue to be a national priority mission. While much has been done, much more can be achieved. According to analysis by the CBI Energy & Climate Intelligence Unit, Wales has the 4th largest percentage of net zero firms in the UK. Our net zero economy accounts for 3% of jobs and 4.1% GVA. From good quality green jobs, to identifying green investment gaps, there are innovative ways to get more from a partnership with green industry.

Productive Futures Relative to UK average, Wales ranks 11th out of the UK’s twelve regions for productivity performance. Boosting the productivity of the Welsh economy, which is driven by the 1.3m workforce, running over 200,000 firms in Wales, is critical to increasing living standards and keeping ahead of competitor nations. The Productivity Institute’s (TPI) Wales Scorecard highlights the importance of investing in new technology, boosting Welsh exports, improving SME access to finance, and strengthening Wales’ offer to foreign direct investment. Many of these issues are well known, however, the emergence of quantum computing and artificial intelligence present new opportunities which we would like to explore with you.

Futureproofing the Labour Market Acknowledging the challenges faced by firms in Wales, including sluggish productivity, investing in people is a natural priority. To generate growth in our current economic condition and without increasing public sector debt, investing in the skills needed by employers, and incentivising near-market innovation, is critical. Businesses need policies that quickly ease labour shortages, revolutionise skills development, and work within a reformed immigration system. We would be keen to discuss these matters further.

However, it must go further by partnering with business to ensure that the UK is the most attractive place to start, grow and run a business. This will require bold action such as delivering a holistic cross-economy solution to the UK’s overly complex business rates system which affects businesses in logistics, transport, manufacturing, property management and healthcare as well as retail and hospitality.

Firms need government on their side as they grapple with challenges that are impossible to solve alone. The cost of doing business, global unrest, poor regulation, unreliable supply chains, a declining stock market and an ever-widening skills gap. How effectively the incoming government can partner with business will determine whether the UK thrives for the benefit of business as well as people and communities in East of England and the whole nation.

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