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Westlake Legal Group > Posts tagged "CBI"

Andrew Smith: Invest in regeneration. How the next Conservative Government can deliver for the North.

Andrew Smith is a Conservative Councillor in Westminster and a consultant for Cicero Group. He writes in a personal capacity

The North is the key battleground in the general election. The path to delivering a Conservative majority runs through a ‘red wall’ of Leave supporting Labour seats, running from North Wales through the North West, Yorkshire and the North East.

As someone born and brought up in Bradford in Yorkshire who came to political consciousness during the years of Eric Pickles’ leadership of Bradford City Council, I know that that the Conservative message can have a strong appeal to towns and cities of the North.

Many of these areas have faced real economic hardship due to economic change. One of the reasons for the strong Leave vote in many of these seats was the sense that these areas had been left behind. Once proud industrial heartlands have suffered from the loss of skilled jobs.

Our Conservative approach needs to be focused on offering a different future for these areas. As well as the promise to deliver on the Prime Minister’s Brexit deal, we need to show how our approach to the economy can help to support growth in the North.

Conservative support for rebalancing of the economy and revitalising areas which have suffered from industrial decline is showing signs of success. Just one example is Rotherham’s Advanced Manufacturing Park. Now home to world-beating research and production, from firms such as McLaren and Boeing.

In his speech to the CBI this week, the Prime Minister set out how he wants to build on that success. He set out a positive vision of how a future Conservative Government can deliver for the North, through investment in public services, and better connectivity through fast broadband and 5G.

Transport infrastructure, unlocking investment was at the heart of Boris Johnson’s success in London. Now as Prime Minister, he made it clear that he wants to deliver the kind of investment in regeneration that he delivered as Mayor of London across all areas of the country.

He spoke about Northern Powerhouse Rail, which promises to transform the economy of the North though highspeed rail connections between the economic centres of the region. Hopefully with a station for my home city of Bradford.

Investment in buses and local road improvements were also part of the offer. This is spot as buses are too often neglected in the national policy debate. Investment in better bus service would bring huge economic benefits, especially in areas outside of London.

One issue which Johnson didn’t mention but needs to be part of our offer to the North is HS2. As someone born and brought up in Yorkshire, I been a long-term supporter of the project. While the scheme might be unpopular in the Chilterns it has strong support amongst business and the public in the North and the Midlands. It is a shame that uncertainty about its future is likely to linger with the publication of the independent review of the scheme delayed until after the general election.

The message from the North has been clear: both HS2 and Northern Powerhouse Rail are important for the future of the region. It seems that the Prime Minister agrees, and hopefully a clear commitment to both these schemes will make it into the manifesto.

He was able to set out this optimistic vison of supporting growth across the UK through investment in public services and infrastructure thanks to Sajid Javid’s plan to boost to investment spending while balancing the books on current spending.

Johnson’s “categorical assurance” that Javid will remain as Chancellor if we win the election is also good news for voters in the North. The Chancellor is northern-born, with a clear personal commitment to delivering investment which will boost economic growth.

Using low interest rates to fund investment to unlock the potential of the Northern Powerhouse was at the heart of his policy platform during his run for the leadership and clearly will continue to be a priority for him in the Treasury. I hope that we will see more of the Chancellor during the campaign explaining how his sensible economic plans can help support investment to boost productivity, while at the same time maintaining the Conservative’s record of fiscal discipline.

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Like or dislike Johnson’s Corporation Tax freeze, it’s an acutely targeted message

In a campaign which hasn’t involved many attention-grabbing announcements thus far, yesterday’s speech by the Prime Minister to the CBI was a rare headline-maker. Normally, the format for these big third-party events – the WI convention, the Police Federation, the CBI, IoD and FSB conferences – is pretty set: politician stands up, politician delivers speech, politician seeks some approval, politician hopes not to incur audible or visible wrath of audience. Sometimes it works, sometimes it doesn’t, but that’s basically it.

Or at least that used to be it. The reason Boris Johnson’s CBI speech was so striking was that it turned that idea on its head – instead of a supplicant, come to beg for their favour, Johnson used the CBI conference as a stage on which to distance himself from…the CBI. Using that particular setting to announce the postponement of Corporation Tax cuts was a canny piece of comms, which effectively made the event an opportunity to signal the Prime Minister’s values, a message strengthened by being at the expense of his host and audience.

And it is about broadcasting the Government’s values, above all else: rather than simply announce more spending on public services and try to downplay or simply separate out cancelled tax cuts, they actively chose to link the two. The CBI were told:

“We are postponing further cuts in corporation tax. And before you storm the stage and protest let me remind you that this saves £6 billion that we can put into the priorities of the British people including the NHS.”

There are obvious resonances between this tactic and the Vote Leave campaign. The money for the NHS touchstone, the amplifying of the message by behaving counterintuitively, and, of course, the hijacking of the CBI’s conference in order to do it. It isn’t just trolling for amusement (though I’d be surprised if there wasn’t some laughter about the idea when it was first proposed), it’s done for effect.

It’s a political rather than simply economic shift in policy. The Prime Minister himself has said – rightly – that lowering Corporation Tax has increased revenues in recent years. You might argue that the Laffer Curve is a curve, and therefore that such dynamic returns might diminish as the tax rate goes lower and lower, but notably Johnson did not do so. Such arguments might be right or wrong, but what’s notable is they don’t seem to enter the calculation.

Instead, there appear to be three reasons why he feels it necessary and worthwhile to pursue the policy.

First, it offers a very visible answer to the Labour critique that the Conservatives prioritise business ahead of public services.

Second, it provides a clear and understandable answer as to where some of the fiscal wriggle room might come from to finance spending on infrastructure – £6 billion by Johnson’s account.

Third, Labour have created the space for a Conservative Prime Minister to be a bit less generous to business and yet still be the safer option. The prospect of arbitrary nationalisations at unknown prices, share hijacks, forced delisting of companies who fail to fulfil as-yet secret targets, and goodness knows what other measures all sound a lot more painful than simply continuing to pay the current rate of tax.

There will be plenty of Conservatives – including, I confess, me – who dislike this step as an economic and fiscal decision. But the fact is we aren’t the target audience. Where, after all, are we going to go?

Instead, Johnson was speaking directly to the voters he is seeking to win over in December. Contrary to stereotype, that conversation isn’t just about Brexit, it’s about far more. About public services, about opportunity, about security (economic at least as much as military), and about fairness.

His audience don’t hate business, even big business. They don’t thirst to see it bashed for the sake of it. They understand that a massive tax raid on their employers would not be good news for employees, jobseekers or, ultimately, schools and hospitals.

But they believe in fairness, very strongly. And if they are unlikely to be enthusiastic about business-bashing taxation, they are equally unlikely to prioritise large businesses for further help. They feel their families and communities are in more pressing need than the people who own and run large businesses. They want measures that will affect their lives directly, and a sense that their priorities are being considered.

Yesterday we saw Johnson very publicly state that the NHS is a higher priority for him than the members of the CBI. I wouldn’t be at all surprised to see him go on to target new business measures at small enterprises, in a further finessing of the message towards the enterprises that his desired voters are more likely to be keen on, or to run. The boardrooms of the City, it seems, will have to wait their turn.

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Richard Patient: At last the Conservatives have realised the CBI is the voice of big business, not all business

Richard Patient is an entrepreneur, and founder of property communications company Thorncliffe | Your Shout.  He was London Chairman of Business for Britain during the EU referendum.

It will surprise no one to learn of the antipathy towards the Confederation of British Industry held by Dominic Cummings, given the well-publicised stunt at the CBI conference four years ago.  Then Vote Leave portrayed the CBI as the ‘Voice of Brussels’, in a dig at the Confederation’s then (and since dropped) slogan ‘Voice of Business’.

What may come as a surprise to some is the general scepticism towards the CBI of many high-ranking advisers in Number 10, and not just among the Vote Leave alumni.

Of course, the CBI were never the Voice of Business, merely the voice of their members, and they remain a well-funded and still well-respected lobby group.  The fact that the Prime Minister chose their conference for a major speech will be a source of contentment for their bosses, but is mainly due to the media pack being there rather than any general good-will towards the organisation.

Number 10 know that when Labour attack big business, they are onto something.  Our new voters, those from the working class constituencies that the Tories will be relying on to form their majority, at not just this election but also the next, still recoil from the 2008 banking crisis when the banks feathered their nests at the expense of the rest of us.

These voters know that homes are too expensive, yet see Persimmon bosses awarding themselves over £100 million bonuses.

They see private companies recoiling from risk, but taking the profit, in the case of PFI hospitals and Carillion.

And they see high streets failing, whilst the big e-commerce companies like Amazon offshore their profits to other countries.

That’s not to say the Tories are not the party of business – they are, and always will be.  Business continues to fund much of the Conservative party – but go to dinners like the Carlton Club political dinner last night and you will find there is a massive leaning towards entrepreneurs, those who have started their own business or who lead their companies to make them world-class.

Take Ben Elliot, the Co-Chairman of the Party, who not only started his international luxury lifestyle company Quintessentially, but is also a non-executive of another British success story, YouGov.

Look at Peter Cruddas, a former Party Treasurer – the son of a Smithfield Market worker, he founded CMC Markets and is also a major philanthropist.

Or Anthony Bamford, who still runs the award-winning and acclaimed JCB.

What Number 10 knows is that big business will always lobby for special privileges for this market or that.  Of course they will always couch the argument in terms of quality, standards or safety.  They have been very good at that, particularly within Brussels and the Single Market, which imposes standards for all irrespective of the good for each country or market.  Coming out of the EU and driving trade deals with other countries will halt some of the inexorable demand for new regulations, and over time will reduce burdensome regulations in the UK.

Not so long ago, SMEs and companies smaller than 20 employees – which constitute a massive proportion of the UK economy – were shielded from much of the regulation that faces large companies.  Now, all companies face the same legislation, so a company with five employees has to face the same burdensome laws as a company with 20,000 employees.  Of course larger companies prefer this, as they can employ armies of compliance officers, HR teams and environmental health officers, whilst the MD of the small company has to be a master of everything.

That’s not to say regulations on quality, standards or safety, will go down.  They won’t, and the Government has made that plain in terms of environmental and employment criteria.  That also fits in with their need to keep long-term the once-Labour voters that they appear to be winning during this election.  In some cases, pressure from new voters will mean the Government will impose higher standards, and intervene more.  But if they do so, they should remember that they are imposing burdens not just on the larger businesses that can cope but also on the smaller ones that find it harder.

Over the past 30 years, it has been easy for ministers to take regard of the voices of the CBI and their members.  They are the ones who employ lobbyists and they are the ones that find it easier to gain an audience with politicians, both Labour and Conservative.

But the general direction of many in Number 10 is to widen out this reach.  Take housing, where a revolution needs to take place.  We’re likely to only be able to build the number of homes we need if the Government makes it easier for smaller companies to become major players in the market.

Look at procurement, too.  The Government faces a choice soon as to whether it replicates the OJEU regulations, or makes the system much less onerous, open to a wider pool of companies.

Or take ecommerce, where a tax system needs to be devised to help smaller companies compete.

There are senior people in Downing Street who understand all of this, some of whom have come from big business themselves and who now want to turn gamekeeper.  The CBI will have to work harder and smarter if it wants to retain tits once formidable influence.

The Conservatives have always been the Party of the entrepreneur and the smaller business.  What better way to show this that to go after these SMEs and smaller entrepreneurs and form an army that will help give an intellectual backing and funding to the party as it prepares the big battle towards the next election in 2024.

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WATCH: Johnson tells CBI he plans to put corporation tax cuts on hold

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WATCH: Labour has businesses thinking ‘we’re next’, says CBI’s Fairbairn

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Iain Mansfield: Brexit by October 31. Stop using the Left’s language. And stand for skilled workers. Essentials for our next Prime Minister

Iain Mansfield is a former senior civil servant, winner of the Institute of Economic Affairs Brexit prize and a Conservative councillor candidate. He writes in a personal capacity.

Our next Prime Minister will take office at the most challenging time since the 1970s. Not only is there Brexit – an issue of fundamental national importance, that has destroyed the last two Prime Ministers and poses an existential challenge to the future of the Conservative Party – but the old political assumptions are changing. Across the West, traditional voter coalitions are shifting, as citizens reject centrist compromises. Flatlining productivity, unaffordable houses and millions of voters feeling abandoned, either culturally or economically, are just some of the challenges they will face.

Many of those who voted for David Cameron in 2010 are lost to the party, alienated by Brexit. In Britain today, age and education level are better predictors of a person’s vote than class. To win a general election, our next Prime Minister must forge a new coalition of voters that unites the traditional Tory shires with the left-behind Leave voters in the Midlands and North. Even more importantly, they must deliver authentic right-wing policies that address the causes of ordinary working people’s dissatisfaction. People want change and, if the Conservative Party does not deliver it, they are likely to seek answers in the flawed blandishments of Jeremy Corbyn’s socialism.

In that context, there are three essentials that our next Prime Minister must prioritise for the good of the people, the nation and the party:

  • Leave the EU by 31 October, on WTO terms if needed.
  • Openly champion conservative values rather than speaking the language of the left.
  • Reposition the party as the natural home of the skilled working and lower middle classes.

Leave the EU by 31 October, on WTO terms if needed

Not only is delivering on the outcome of the referendum a democratic imperative, it is vital for the continued existence of the party. Recent polling shows that, if we have not left the EU, the Conservatives are likely to suffer devastating losses in a general election; these figures could be even worse if large numbers of members, councillors or even entire associations defect to the Brexit Party. Many members have held on over the last few months purely out of hope that the next Prime Minister would deliver where May failed: another betrayal in October would see these members permanently lost.

Leaving with a deal is preferable, if some changes to the backstop can be agreed and Parliament will pass it. If not, as I have argued previously on this site, we have nothing to fear from No Deal. Preparations for such should be put into top gear on the first day in office. The Prime Minister must make clear that they will under no circumstances ask for an extension; and that they are, if needed, prepared to systematically veto any measure put forward by the EU on regular business if the UK is for some reason kept in. While every effort should be made to secure a deal, if it cannot be reached, Parliament must be faced with the simple choice of permitting a WTO exit or voting no confidence in the Prime Minister – a gamble, admittedly, but one that is preferable to another disastrous extension.

Openly champion conservative values rather than speaking the language of the left

In recent years too many Conservative politicians have allowed our opponents to define the playing field. We cannot beat the socialists by adopting the language and assumptions of socialism. Our next Prime Minister must stop feeding the narrative of identity, grievance and division, with its assumption that an individual’s potential is defined by their characteristics, that so-called ‘burning injustices’ are solely the responsibility of the state to address, and that the government always no best.

Changing the narrative will be a long endeavour. The systematic appointment of those with conservative values into key ministerially appointed positions; an authentically right-wing approach to policy making in Whitehall; and the withdrawal of state funding from the network of organisations that maintain the left’s grip on the policy narrative are essential. But over and above this, the Prime Minister must be willing to personally stand up and champion individual liberties and freedoms; to condemn progressive authoritarianism and to be visibly proud of Britain, our culture and the rich global heritage of our citizens.

Reposition the party as the natural home of the skilled working and lower middle classes

Young, metropolitan graduates may once have been natural Conservatives, but no longer. There is little hope of reversing this in the immediate aftermath of Brexit. Instead of squandering our effort here, our new Prime Minister should instead make the party the natural home of the skilled working and lower middle classes, particularly in the midlands and north.

Such voters have a natural affinity to the traditional conservative values of low tax and individual liberty, but also greatly value and rely day-to-day onn strong public services. This places the Conservatives in a difficult position after a decade of austerity: Labour made hay campaigning on cuts to police numbers and falls in per pupil spending in 2017. But how to fund significant increases in core services without raising taxes or alienating core Conservative voters, such as via the disastrous proposals on social care in the 2017 manifesto?

To find the funding the next Prime Minister must be bold enough to slay the progressive sacred cows that soak up billions annually in public funding. Three immediately spring to mind:

With the additional £15 billion plus a year, the Prime Minister could at a stroke increase police funding by 25 per cent (£3 billion), boost school funding per pupil by 20 per cent (£8 billion) and increase spending on social care by 20 per cent (£4 billion). And then split the proceeds of further growth between public services and tax cuts.

As well as this, we should champion the interests of the high street, enterprise and small businesses and oppose crony corporatism. Multinational companies that make use of aggressive tax avoidance, abuse their market position or actively work against UK sovereignty should not enjoy government grants, procurement or time in No. 10. Fundamentally, our next Prime Minister should spend more time listening to the Federation of Small Businesses and less time listening to the CBI.


As members, we have two candidates set before us. Both are able politicians and tested leaders who represent the best the Parliamentary party has to offer. As we assess who should be not just our next leader, but our Prime Minister, we should do so against their ability to deliver these vital elements.

Both have committed to delivering Brexit by October 31 – but which one has the ability, the genuine will and the courage to do so by any means necessary? Both are true-blue Conservatives – but which one will truly champion our values, taking the battle to our adversaries with the eloquence and conviction of a Thatcher or a Churchill? Both recognise the importance of reaching out to new voters – but which one can devise and push through the policies needed to unite the Tory shires with the Leave voters of the north? Consider carefully and cast your vote.

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com 

Graham Gudgin: If the EU delivers No Deal after all, there will be little to fear – and much to gain

Dr Graham Gudgin is Policy Exchange’s Chief Economic Adviser. He is a visiting Professor at the University of Ulster and Chairman of the Advisory Board of the Ulster University Economic Policy Centre.

Many like to claim that No Deal is off the table, but it remains the legal default position on April 12 – and the EU may not be bluffing in suggesting that it is now the most likely endgame. It has of course been decisively rejected in the Commons – but so has almost everything else. Decisive parliamentary rejection has hardly been a bar to reclaiming options from the dead.

What is certainly true is that there has been little cool consideration of what no deal involves. The Cabinet Secretary’s letter to last Tuesday’s cabinet meeting claimed that No Deal would lead to recession and currency depreciation. One could almost hear the laughter in the aisles as the civil service once more tried its hand at economic prediction.

Historians are likely to judge the demonisation of No Deal as one on the great triumphs of the Remain campaign. With impressive discipline, Remainers ubiquitously link the phrase No Deal to the adjectives ‘catastrophic’ or ‘disastrous’. In this, they have been greatly helped by the BBC and other media which invariably allow such descriptions to pass with no attempt to elicit any evidence.

The idea that No Deal would greatly damage the UK economy started early with detailed studies by the Treasury and other economics groups during the EU referendum campaign of 2016. Their absurdly mistaken short-term forecasts damaged the department’s credibility, but the its equally flawed long-term impact estimates live on, and were cited recently by John McDonnell as the key evidence for Labour’s aversion to No Deal. Nor has the Bank of England been much better, with its estimates for No Deal jumping all over the place.

CBI assessments of No Deal

All of this has muddied the water for what should have been a serious national debate, but this has not taken place. The CBI’s assessment of its opposition to no deal is unfocused and vague. The CBI website’s comments from individual businesses are limited to say the least. Most fear delays at ports, and appear to ignore positive statements from HMRC, Calais and other ports. They seem to be reacting to alarmist press reports rather than to up to date information. Ford views a no deal Brexit as ‘catastrophic’ (that word again) but much of its reasoning (‘border friction, a deteriorating economic outlook, further sterling devaluation and tariffs’) is speculative and outside its direct expertise.


The potential dangers from no deal come largely from high tariffs facing and the threat of border delays. Tariffs of 10 per cent or more would affect car and food producers but account for only four per cent of UK exports. Since firms have already benefitted from a 15 per cent depreciation of Sterling, even a 10 per cent tariff on car exports into the EU would not be decisive. The UK’s own published tariff regime would be one of the most liberal in the advanced world. Many tariffs which only protect continental producers but raise prices for UK consumers would be abolished. The average tariff on imports would fall to an estimated 0.7 per cent versus 7.7 per cent for the EU now. This would make the UK an attractive place for international firms to invest because the vast bulk of imported components (including car parts, electronics and machinery) will be tariff-free.

Non-Tariff barriers

Much of the concern over a ‘WTO exit’ has revolved around ‘non-tariff barriers’ to trade. Here again, preparations and agreements over recent months mean that the picture is much brighter than usually claimed. The UK has agreed rollovers of ‘mutual recognition’ agreements with key non-EU trade partners, and many UK firms have acted to transfer product registration and safety certification to EU approved bodies. A range of contingency measures and memoranda of understanding have secured the future of finance at least until a free-trade agreement can be negotiated.

Dangers for food and agriculture

The CBI and others rightly point up the dangers to agriculture which has important exports to the EU facing tariffs of 20-40 per cent or more, enough to make some trade in food completely uneconomic. However, this affects under two per cent of UK exports and the CBI makes no mention of the authoritative AFBI study which concluded that UK prices and output would rise for most farming commodities.

The reason is that UK food producers would replace imports from the EU which face high tariffs into the UK. Proposed UK tariffs steer a sensible middle ground between higher prices for UK consumers and higher incomes for UK farmers. The main exception is UK lamb production, where the large EU market could be devastated by high EU tariffs. Much of sheep farming is however already heavily subsidised, and can be further subsidised to maintain farm incomes.

On sensitive agricultural products, there are worries that the entry of animals and goods would be prohibited unless the UK is “listed” as meeting EU sanitary standards. However, the EU has announced that it will “swiftly” list the UK to allow the entry of live animals and animal products from the UK. The French authorities have arranged for any food safety checks to be undertaken inland from Calais to avoid congestion.

Customs Delays

The risk of major delays at ports is now remote even for food products. Calais port says that there will be no more checks than today. On the UK side, HMRC says it will prioritise a free flow of goods. Eurotunnel has made it quite clear that its services and business model remain unaffected by Brexit. Government claims that large numbers of firms with EU markets have not signed up to HMRC’s new customs procedures are irrelevant. Firms will do so as they need to.

Air travel and Safety Concerns

Air transport was another supposed danger area. But the EU, despite previous threats, has now agreed to allow British planes to fly over, land in and return from the EU27. Meanwhile, the UK has 111 bilateral agreements in our own right which continue unchanged. Of the 17 negotiated via the EU, virtually all – covering 98 per cent of the passengers carried – have been successfully renegotiated. The Government has also said that there will be no implications from the UK leaving Euratom including on the flow of radioactive isotopes for the NHS.

Other safety regulation concerns have evaporated. Car manufacturers have swapped their approvals over to the recognised Swedish body, with other industries taking similar steps. The EU has also agreed to extend EASA design, production and maintenance approvals for aerospace firms temporarily, with a permanent solution to follow.


Fears of a ‘no deal’ Brexit are hugely exaggerated, not least because ‘no deal’ is not what will happen under any circumstances. A series of mini-deals between the UK, the EU and non-EU countries, plus unilateral preparations by the UK, means that most of the building blocks for a managed ‘no deal’ Brexit are already in place.

Moreover, the assumption that leaving without a deal means we will never have a free trade deal with the EU is not true either. In reality, “no deal” would not last very long, since both sides have strong mutual interests in quickly agreeing at the very least a basic free-trade agreement with no tariffs or quantitative restrictions.

It would even be possible to avoid new tariffs altogether using GATT’s Article 24, as long as a mutual intention was announced to begin free-trade negotiations. Temporary side deals would need to be made permanent, but since these are mutually advantageous no issue of principle should be involved. All of this seems manageable as a means to securing an independent trade policy.

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com