The unrelenting rising cost of doing business is damaging investment here at home. During this election campaign, we’ve heard a lot of ambitious talk about the future shape of our economy.
In their own very different ways, all the major parties have acknowledged that uncertainty over Brexit has held back productivity and confidence, and that major steps are needed to get the economy growing again.
Whether promising to boost spending on our transport and digital infrastructure, transform the training system or reform the rules around state aid, the pledges have come thick and fast — and with varying degrees of credibility.
Notwithstanding the merits or otherwise of the parties’ grand schemes for our economy, the businesspeople I talk to are most concerned about the huge number of less eye-catching — but very real — upfront costs that weaken cashflow, deter risk-taking and act as a brake on investment.
And unfortunately, the compliance costs and admin around doing business in the UK continue to rise.
All this would be made infinitely worse by a messy and disorderly departure from the EU, which would present many businesses with new challenges around tariffs, rules of origin, customs compliance, and potential transport delays.
Whoever wins this week should commit to avoiding that un-wanted scenario right away. Yet it’s the UK’s own ministers that have piled on the costs here at home over the past decade.
The cumulative price tag for home-grown policies, including higher business rates, the apprenticeship levy, the immigration skills charge, insurance premium tax, pensions auto-enrolment, Making Tax Digital and so many others has grown higher and higher.
It is unacceptable that companies of all sizes continue to face ever more these sorts of stealth taxes and administrative costs, which weigh heavily no matter the stage of the economic cycle, company performance or ability to pay.
This is why the British Chambers of Commerce (BCC) is calling on the next government to introduce an immediate moratorium on new measures that place additional upfront cost burdens on small and medium-sized businesses — and stick to this policy for the lifetime of the next parliament.
Action to cut existing costs should likewise be at the top of ministerial to-do lists.
Businesses have raised the alarm about our outdated and punitive business rates system for years, but successive governments have done little more than tinker around at the edges.
This week’s winners should quickly turn campaign promises into action and initiate a root-and-branch review of the broken rates system, with a clear deadline for implementing a fairer and less burdensome approach.
They must work closely with business to make sure we get it right this time: future investment is at stake.
BCC research shows that 35 per cent of businesses said they were likely to reduce or completely cancel investment as a direct result of business rates increasing this year.
Businesses of every size are investing in the skills of their workforce — but the apprenticeship levy in its current form acts more like an employment tax than a proper training levy.
It has resulted in many businesses cancelling other investment plans just to pay their levy bills and displaces other essential forms of workplace training.
Furthermore, too many firms simply can’t make use of their own levy funds quickly and easily.
There are many examples of businesses across the country working hard to use or share their levy funding, but in other areas the money is simply running dry. We must get funding for training flowing more quickly to where it is needed.
The Immigration Skills Charge is currently paid by businesses for each migrant worker hired from outside of the EU — and is real bone of contention for enterprises right across the UK.
Recent BCC research found that more than a third of businesses would be negatively impacted if the immigration skills charge was extended to EU nationals, a move that some political parties are actively considering.
Given that two-thirds of firms are struggling to fill skills gaps, and companies tell us they do all they can to hire and train people locally first, the last thing we need is to see yet more upfront charges when firms have no choice but to seek skills outside the UK.
The next government should ditch the charge —and quickly adopt a flexible immigration system that
allows quick and cost-effective access to the skills we need when the UK leaves the EU.
When the dust settles on the election, the incoming government must remember that the costs imposed by Westminster, year after year, are making it harder for so many companies to raise wages and invest — which in turn means less revenue to pay for the public services we all want to see.
These issues aren’t necessarily the most eye-catching, but they matter. Most could be tackled without placing an excessive burden on parliament or the public purse — and would give an immediate shot in the arm to business confidence and investment across the UK.
Adam Marshall is director general of the British Chambers of Commerce
Main image: Getty