CBI: Infrastructure investment will drive private sector growth

Paul Wynn said the UK would avoid a double-dip recession, despite concerns raised by some that public sector spending cuts will tip the economy back into recession with parts of the North hit especially hard.

He welcomed the Government's commitment to funding transport projects in the region – such as the widening of parts of the M62 – and said other vital improvements required in the waste, energy and water industries would help create jobs.

"There are important areas of pent-up demand that will help drive private sector growth," he told the Yorkshire Post.

Mr Wynn, managing director of Kelda Water Services, said Yorkshire Water's 3.5bn investment in the region would have "a ripple effect and trickle down through a whole raft of subcontract companies, including SMEs that will benefit from that".

He also said that water companies could play a bigger role in flood management, which would lead to hundreds of millions of pounds of new investment across the region.

"We are guardians of water generally – that's at the heart of our business – and we also have access to finance. Potentially, these are things that could be provided by the private sector."

Water companies had some responsibilities for flood management prior to privatisation.

In his first interview since becoming chairman of the CBI council for Yorkshire and the Humber, Mr Wynn said: "What we need to do is to help the country grow through private sector activity to make up for cuts in the public sector.

"In order to do that, what the CBI has been doing is lobbying for policies that make the UK a better place to invest. There are some areas we have dropped back in. There are some areas where we are good.

"But there's still more to be done in terms of personal taxation. What you want to do is attract headquarters to the UK and personal taxation and regulation potentially detract from people wanting to relocate to the UK."

He confirmed that availability of finance remains the main obstacle to growth, but said accessibility is improving. He said that while the Government was doing what it could to encourage banks to fund SMEs, "there's always more that can be done".

Mr Wynn said the coalition Government had made a good start. He added: "We have got ourselves into the position of living beyond our means and we need to rein that back in to enable us to have an investment-friendly environment that gives companies the space to grow and generate jobs and employment. We are on the right track so far."

Asked if he agreed with the speed of the cuts, he said: "It's important that you get on with the job. Tak ing time to pick around the edges I don't think usually is a good approach."

However, he was critical of plans to allow local councils to set their own business rates, which could lead to differential rates across the country, amounting to an additional business tax in some places.

He was encouraged by the success of the Leeds and Sheffield bids to form public-private local enterprise partnerships, but said some functions, such as tourism, are best promoted at a regional level.

On the economic outlook, Mr Wynn said: "I don't see a double dip. There was spurt of activity post the recession. There was a bit of a rebound. There's been a bit more stabilisation in terms of growth subsequently. The construction sector really pushed forward over the last quarter, which is good news. The general consensus is that economic growth will continue but it's not going to be taking off like a rocket."

He added: "What I would like to see is growth in the Yorkshire economy. We will do whatever we can as a local organisation to influence central Government in terms of getting the right policies to support growth in the region."

BACKGROUND OF A CAPTAIN OF INDUSTREY

Paul Wynn grew up in Brighton and Cheshire. The grammar school boy started his career as a petro-chemical engineer and worked abroad for several years in the United States and Holland before moving to Yorkshire 17 years ago to join Kelda Group.

He is now managing director of 100m-turnover Kelda Water Services, which manages Kelda Group's non-regulated water and waste water contract operations across the UK.

Mr Wynn is enjoying his role at the CBI. He said: "I have learnt a lot about business and Government and the workings of that. It's an interesting insight into how the economy operates and how business operates beyond your own area."