I often sit on the front bench listening to debates on business and economic policy, irked by the way politicians talk about how we grow our economy.
The consensus across almost all parties in the House of Commons seems to be that the government and the government alone creates growth by spending more.
The dissenting voice to that consensus, I am glad to say, comes from the Conservative Party. We know that it is not governments that create growth but businesses. It’s the ambition and hard work of the risk-takers of the private sector which creates jobs and prosperity.
Of course, governments can create the conditions for growth, but that is seldom done through greater regulation and taxation for which other parties and government ministers so often clamour.
Labour’s most egregious anti-growth measure was in train even before they got their hands on the levers of the Treasury. Prior to the election, Labour published the blueprint for what has now become the Employment Rights Act.
When Labour came to power, this was heralded by Angela Rayner as “central to achieving our growth mission”. It has achieved the exact opposite.
In fact, taken together with Labour’s decision to increase employers’ national insurance contributions at their first budget, as well as their stealth rises in business rates, they have stifled growth. That is why businesses confidence is falling, and with it jobs, opportunities and investment.
But it is not just higher taxes and regulation that have British business in a stranglehold. Our industrial electricity prices are the highest in the developed world based on price per kWh.
These costs have been crippling for manufacturing and other energy-intensive industries with little to no help from the government, who seem hellbent on driving costs up further by increasing our dependence on unreliable renewables.
It doesn’t have to be this way. The Conservatives have been doing the hard yards in opposition, not just holding the government to account on its anti-business, anti-growth policies but also setting out a sensible, pragmatic, fully costed alternative.
Take, for example, energy costs. Not only have we constantly been making the case to “Get Britain Drilling” for our own oil and gas in the North Sea but we have also put forward our “Cheap Power Plan”, which will cut electricity bills by 20 per cent for households and businesses alike. That is the equivalent of £1,100 for the average pub or £5,500 for the average restaurant.
On businesses rates, which have become an increasing burden for businesses since Labour’s changes to multipliers, we have set out a plan to abolish business rates for thousands of high street businesses.
We will cut red tape too by reversing the most anti-growth measures in the Employment Rights Act, and as we have set out recently, we will cut the regulations that make it more difficult to employ young people for seasonal and evening work – giving more young people the chance of their first job.
The current government seems blind to the role that businesses play in economic growth, but the Conservatives are not. We understand that growth only comes when government steps off businesses’ feet and lets them do what they do best: grow.
This article first appeared in Spotlight on Economic Growth: Rethinking New Paths to Prosperity
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