CBI calls for ‘bold action’ to unleash £900bn wall of cash
Rish Sunak is being urged to ‘go for growth’
Bold decisions from the UK Government in its autumn spending review can unlock a ‘wall of investment’ from private sector investors, according to the CBI.
The business lobby group has today outlined a series of recommendations to unlock £900 billion of “pent-up” corporate cash ready to be unleashed on major projects.
It says this could “turbocharge the UK’s recovery, bring levelling-up ambitions to life and underpin the transformation to a net zero economy”.
Days after director-general Tony Danker highlighted some of the risks of failing to invest, the CBI is urging UK Government ministers to “go for growth” in its Comprehensive Spending Review and Autumn Budget to be delivered by Chancellor Rishi Sunak on 27 October.
The CBI cites ONS data showing the scale of corporate cash reserves ready to be invested as the economy reawakens from COVID – but warns the UK faces stiff international competition to claim this prize.
It calls on the government to make smart investments in skills and infrastructure, and reform taxes to reward companies which invest in research, innovation and green technologies.
Key asks of Government include:
- Stimulate longer-term business investment by committing to maintain more generous capital allowances beyond 2023, building on the success of the super deduction.
- Fundamental reform of business rates, including removing disincentives preventing green improvements.
- Require all regulators to prioritise investment, net zero and innovation as part of their core remits.
- Focus on delivering a flexible apprenticeship system, turning the apprenticeship levy into a lifelong learning levy.
- Improve people’s life chances by giving them the skills they need to succeed through individual training accounts for unemployed individuals and those with the biggest retraining needs.
- Designate energy efficiency and heat as an infrastructure priority by providing a comprehensive long-term package of funding.
- Develop and invest in the decarbonisation pathways required to reach net zero across transport.
- Deliver on the Plan For Growth and Innovation Strategy, including front-loading the commitment to invest £22bn direct domestic R&D funding by 2024-25.
- Enable business to help level-up across the whole of the UK by commissioning the CBI in the Levelling-up White Paper to write the playbook for successful economic clusters.
CBI chief economist Rain Newton-Smith said: “When we look back on this decade, it’s crucial we see a Government that took decisive action and unlocked investment.
“A Government that went for growth and made big bets for the UK getting ahead of the international competition.
“A Government that resisted the easy, play-it-safe option, and showed the ambition needed to target the big wins.
“If we miss this chance, we’ll fall back into old patterns of chronic underinvestment and regional inequality, and risk missing our net zero target. The prize on offer leaves no room for complacency.”