Is the government doing enough to restore confidence in the UK economy and help businesses feel safe in investing, developing their operations and taking on new staff?
Two-thirds of 1,200 members of the Institute of Directors (IoD) this week said they saw little or zero chance of Britain emerging from recession this year (at the last count, the economy contracted 0.7 per cent).
Almost half of the IoD’s members have postponed investment or employment decisions this year due to uncertainty about the economic outlook.
The IoD said its members want the government to do a lot more to boost confidence, such as simplifying taxes and reducing business regulation.
“Business is battening down the hatches in the expectation that the recession will continue for the rest of the year,” IoD chief economist Graeme Leach said.
“Low confidence leads to delayed decisions, and delayed decisions further undermine economic confidence – it’s a vicious cycle,” he added, urging the government to take bold steps to boost confidence.
I agree that much more needs to be done to kick-start the economy and inspire firms to get on and develop rather than bury their heads in the sand.
There’s little chance of the government loosening its austerity drive – I think that would be fair to say – so what else can be done?
I’m no expert, but one thing I think would really help would be the creation of a dedicated business bank. This could offer attractive rates, mentoring and advice, and really help get finance out to the firms that need it most.
What do you think?