The upcoming General Election is an important opportunity for Britain’s next government to adopt a clean-slate approach: to step back, review existing structures and strategies, and make considered improvements where necessary.
The next government must avoid the temptation for short-term, knee-jerk Brexit-focused policymaking, and instead prepare a durable plan for the benefit of the UK economy and business.
A sustainable industrial strategy for everyone
Any new administration must look to boost businesses confidence and establish a stable economic environment.
This includes the continued commitment to a UK-wide industrial strategy that helps businesses of all sizes to start, grow, and boost the UK’s economy and productivity.
The strategy must hone in on the barriers to growth for SMEs and scaleups, with a recognition that the challenges faced in England, Scotland, Wales and Northern Ireland will differ according to financial landscapes, connectivity, and talent pools.
Regional administrations will need to work closely with local businesses to identify effective solutions to any challenges that are holding UK businesses back.
An ambitious, UK-wide strategy sends a clear signal to international partners that the UK remains a reliable long-term business partner that is actively looking for cross-border business opportunities.
A practical approach to skills gaps
Government needs to recognise that employers are best placed to identify skills gaps and anticipate what capabilities workforces of the future will need.
To create a future-proof workforce, the right educational programmes and skills training must be put in place.
Governments, schools, and businesses alike need to look beyond traditional education routes when developing a highly skilled and agile workforce, focusing on creating a lifelong learning culture within the workplace, and boosting career aspirations for younger generations.
The first step must be a wholesale review of national careers advice and building strong links between local businesses, schools and learning providers, to ensure a better alignment between learning and the workplace.
Vocational education will play a key part in the creation of a multi-skilled and flexible workforce, and it is therefore vital that vocational career pathways – such as apprenticeships – include core transferrable skills that benefit both individuals and employers.
A return to the basics of the tax system
The government should revisit key tenets of the tax system such as business rates, and ensure they are conducting a root and branch review of current systems, with consideration of the changing post-Brexit business landscape.
It may be time, for example, to detach business rates from property values.
The deferment of Making Tax Digital following its removal from the Finance Bill in the previous Parliament is a sensible move, allowing government and stakeholders to reassess the current plan post-election.
This gives time to take a constructive and close look at the Finance Bill, and then the delayed MTD can be later scrutinised alongside potential accelerated tax payments.
The next government should also avoid the temptation to tamper with tax plans, and instead conduct a thorough review of existing systems to lay the foundation for long-term planning.
A holistic and prioritised approach to public sector funding
Government should adopt a holistic outlook when considering funding for public services.
A cross-governmental system would promote greater collaboration, reduce doubling of efforts, and ensure the best funding is in the right area to make sure people receive the public services needed. Equally, stability is important and a long-term funding framework in place would most likely deliver greater value for taxpayers.
The public sector landscape is ever-changing, and while the previous government’s position on regional control over public services finances is practical and commendable, more needs to be done to make this a reality. This would give local public sector bodies more control over budget allocation.
Vast improvement is also needed to bring the public sector into the digital age – as the recent vulnerability of the NHS to malware attacks showed – and to run public services more effectively, including up-skilling staff to adopt change.
Avoid overly prescriptive solutions to corporate governance concerns
Government needs to support voluntary measures to improve the culture of corporate governance in the work place. ACCA advises against unnecessary additional regulation, for both listed and privately-held companies, believing that a one-size-fits-all approach will not work and that positive reinforcement of culture-led solutions will be more effective.
To improve current guidance on corporate governance, we need to look at how corporate leadership can involve and engage its stakeholders effectively, from employees to shareholders. Bottom-up solutions that obtain the buy-in of employees, for example, are becoming as important as top-down solutions and shareholder engagement.
The government must also be mindful of pay trends for UK companies, which could intensify due to global economic uncertainty on issues such as Brexit, which increases competition for talent.
ACCA supports measures to increase the transparency of company pay policies through a voluntary approach. This will enable companies to demonstrate their commitment to accountability and facilitates their engagement with relevant stakeholders.
Alongside the clear challenges, the next government will have new opportunities it can seize on behalf of business and the public. It will need to show bold, considered leadership to secure Britain’s place in the world and drive prosperity in the post-Brexit era.
Helen Brand is chief executive of ACCA.