BUSINESS lobby group the CBI has written to chancellor George Osborne and business secretary Vince Cable to call for further action to stimulate short term economic growth, in order to offset the effects of the government’s £80bn spending cuts.
CBI director-general Richard Lambert said the UK economy needs a “fundamental rebalancing” in order to achieve that growth, with exports and investment playing a greater part than in the past.
He identified four separate potential sources of growth in the letter.
These included supporting vibrant and growing SMEs by extending the Enterprise Finance Guarantee scheme and promoting non-bank and equity financing to the sector with support services refocused.
Lambert said the government should also make it easier for businesses to export their goods and services, including by providing information, contacts and financial backing and removing constraints to trade.
Lambert’s third suggestion was exploiting pent-up demand for crucial domestic infrastructure projects, particularly where the private sector sees opportunities in areas such as energy, transport, waste and water.
Lambert also called for the reform of public service delivery by increasing competition among providers.
“There is a need for a policy focus on those measures that can have the greatest impact on growth performance in a relatively short timeframe,” Lambert says in the letter.
The CBI’s submission comes ahead of the publication of a government white paper on growth.