CBI chiefs call for an increase in public spending
Chancellor urged to commit to investment to offset Brexit impact
BUSINESS leaders will urge the Chancellor to commit to public investment worth billions of pounds to offset the financial impact of Britain leaving the EU.
The Confederation of British Industry (CBI), which speaks for 190,000 businesses, also called on the UK Government to push ahead with large-scale infrastructure projects, including the dualling of the A1 from Scotland to Newcastle.
The organisation warns that the UK faces an “uncertain economic outlook” following the vote to leave the European Union and insisted there has rarely been a more important Autumn Statement, the yearly event seen as a mini-Budget.
It comes as the Prime Minister was accused of ignoring her own “dire warnings” about the consequences of a so-called hard Brexit, after a secret recording emerged of her setting out her fears for the economy a month before the EU referendum.
She told investment bankers in May she was concerned businesses would have to leave the UK if Britain quit the EU.
In recent weeks, however, she has argued the UK’s freedom to trade in the EU Single Market should not come at the expense of immigration controls.
Mrs May, who was Home Secretary at the time, was recorded saying: “If we were not in Europe, I think there would be firms and companies who would be looking to say, do they need to develop a mainland Europe presence rather than a UK presence? So I think there are definite benefits for us in economic terms.”
Today, the CBI will make the case for an average annual increase of £6 billion in public investment.
CarolynFairbairn,theCBIdirectorgeneral, will implore Chancellor Philip Hammond to set out a “pro-enterprise agenda that instils confidence and kick-starts investment”.
She warned: “With huge variations in productivity between different parts of the country, the top priority must be to set out a programme that will get our regions firing on all cylinders and supports businesses to innovate, invest and create jobs in the years ahead.”
It was time to “incentivise businesses to invest today, rather than postpone until tomorrow,” she warned.
Earlier this week the CBI welcomed the decision to build a third runway at Heathrow, a move the Scottish Government estimates could create an extra 16,000 jobs in Scotland.
But the CBI warns ministers have to do much more to create business confidence and encourage industry to invest in the UK.
The CBI believes with interest rates at rock bottom now is the time to improve infrastructure.
Economists have warned that the UK could be headed for a combination of an economic slowdown coupled with rising inflation, after the value of the pound plunged in the wake of the Brexit result.
Mr Hammond was warned earlier this week that the fall in the value of sterling means he faces an £84 billion “black hole” in the Autumn Statement, which will be delivered on Novembet 23.
‘‘ If we were not in Europe, I think there would be firms and companies who would be looking to say, do they need to develop a mainland Europe presence