The head of the UK’s leading business organisation is to call for Rishi Sunak to show more ambition on the economy, warning that the country risks being left behind on green growth and that a cull of EU laws could scupper a recovery.
While stressing that he did not want to be seen as a “doomster or gloomster”, Tony Danker, director general of the Confederation of British Industry (CBI), is to use what the organisation is billing as a “major” speech to call for action on several fronts.
The comments, while carefully worded and pitched by the CBI as a positive set of ideas rather than direct criticism, will nonetheless be widely seen as a rebuke to No 10 and the Treasury.
Speaking at University College London on Monday, Danker will praise Sunak and the chancellor, Jeremy Hunt, for stabilising the economy after the impact of Liz Truss’s disastrous autumn mini-budget, but will add that both now need to be more proactive.
Public services like the NHS, schools and transport require more investment, Danker will say, according to extracts of the speech briefed in advance, adding: “But there isn’t any more money, because there isn’t any growth.”
He will say there is a “denial of where our economy is right now compared to our international competitors” which risked the UK suffering through limited ambition. “The current CBI forecast is that the prime minister should comfortably hit his pledge of getting the economy growing by the end of the year, by 0.1%. But my argument is that if our policies today aim for 0.1% growth, it’s the most we’ll ever achieve.”
The speech is particularly damning on green-based growth, with Danker saying that “the UK is falling behind rapidly to the Americans and the Europeans, who are outspending and outsmarting us”.
While Sunak has talked up his desire to invest in green technology and renewable energy sources, there is resistance among some Tory MPs to areas such as onshore wind and solar power. In contrast, Labour has promised to invest £28bn a year in climate measures.
Inaction means the country is “leaving huge amounts of money on the table”, Danker is to argue, saying that in two years the UK lost a potential £4.3bn in green market share.
“While our competitors across Europe, Asia and the US are making their move, and going hell for leather, we seem to be second guessing ourselves and hoping for the best.” He will add: “It’s time for us to take those hard decisions, generating the forward momentum not only to limit recession this year but also get us really growing next.”
Another strongly worded section sees Danker argue that while there is a good argument for the UK to diverge from EU regulations after Brexit, scrapping up to 4,000 EU-derived laws by the end of 2023, as promised under the retained EU law bill, was “creating huge uncertainty for UK firms”.
He will say: “On the UK’s regulatory divergence from Europe, the government is convinced this is a major opportunity for growth. I agree it can be too. But it’s a bit more complicated than scrapping overnight many of the terms of trade we’ve used for decades.
“Do we really want to subject the public – and industry – to another round of mass confusion and disruption, just when we’re trying to exit recession?”
EU laws should be reviewed and, where needed, repealed as part of a wider strategy, Danker is to say: “Smartly, not the retained EU law bill’s way – foolishly.”
Other concerns to be raised by Danker included the imminent demise of the “super deduction” tax incentive for business investment, and a lack of action over issues affecting employees, including expensive childcare and the need for higher skills.
