Chancellor hopes slashing business red tape will boost stuttering growth
Rachel Reeves has said plans to scrap paperwork and “arbitrary rules” for thousands of UK businesses would save firms almost £6bn a year by the time of the next election.
The Chancellor set out a package of measures aimed at boosting lacklustre economic growth at the first Regional Investment Summit in Birmingham yesterday.
The gathering of business leaders and investors came after more gloomy news emerged for the Chancellor as Government borrowing in September hit the highest level for the month in five years.
The data from the Office for National Statistics (ONS) piles more pressure on Ms Reeves ahead of the November 26 Budget, in which she will have to fill a black hole estimated at around £50bn by some economists.
Nick Ridpath, research economist at the Institute for Fiscal Studies, said: “This data will be revised and revised again, and we should avoid jumping to firm conclusions based on noisy monthly data releases.
“But if this pattern persists - and economic growth delivers less tax revenue than we’d otherwise expect - it could worsen the fiscal arithmetic facing the Chancellor at November’s Budget, and beyond.”
In Birmingham, Ms Reeves acknowledged the economy is “not working as it should” as she vowed to use next month’s statement to “take the necessary steps” to secure stability.
Addressing the summit at the Edgbaston Cricket Ground, she detailed measures to reform the company merger process, regulations for drones and reforms for artificial intelligence (AI).
She said a cross-economy AI “sandbox” would allow firms to develop new products “under supervision by regulators”.
This would speed up the approval of AI for use in areas including “legal services, planning assessments and advanced manufacturing”.
The Civil Aviation Authority will set out steps towards launching commercial drone operations which could allow unmanned aerial vehicles to be widely used for tasks from “surveying sites for development to delivering blood supplies for the NHS”.
Panels reviewing company mergers will be reformed to “provide greater certainty on whether transactions will be subject to merger control”.
Ms Reeves confirmed plans to create simpler corporate reporting rules for more than 100,000 businesses, including removing the need for small business owners to submit lengthy director reports to Companies House.
She said: “Our mission is clear, to create the right environment for investment through our regulatory reforms, to crowd in capital through our public financial institutions, and to break down silos to collaboration on local projects, supporting innovation and growth throughout the UK.”
The investment committed as part of the regional summit would lead to the creation of “thousands of jobs” and “homes and services for people in their daily lives”, the Chancellor said.
“I do not and I will not take for granted the confidence put in Britain by investors,” she said.
“I will not squander that trust.
“I know that there is further to go until we have delivered economic growth in every part of Britain. Growth that is felt in every part of Britain. We will go further to boldly regulate for growth, not to hold business back with arbitrary rules.”