Boost immigration to grow the economy, CBI to tell Rishi Sunak
In his speech at the CBI’s annual conference in Birmingham, which will be attended by the Prime Minister, Rishi Sunak, Tony Danker is expected to praise some “incredibly welcome” announcements in last week’s budget, but warn that the UK needs to go further to solve stagnating growth.
He is also due to call on the Government to “stay the course” over projects which will get the economy back on track, such as HS2 and the new nuclear power plant at Sizewell C.
It comes only days after Chancellor Jeremy Hunt unveiled £25 billion of tax rises in a budget designed to restore market confidence in the UK after Liz Truss’s own disastrous mini-budget.
The pivot from massive tax cuts to steep tax rises has been criticised by some on the Tory backbenches, raising speculation of a rebellion by MPs over some of the measures.
With the UK forecast to be already in recession, Mr Danker will tell the conference: “The painful reality about growth is that it can’t be stimulated overnight. That’s what the mini-budget got wrong.
“Across-the-board tax cuts. Immediate demand stimulus. Relying on the old British strength − consumption − at the expense of the perennial British weakness − investment − has given growth a bad name.”
Pointing to ongoing “barriers” to growth, Mr Danker will call on politicians to be “practical” about immigration.
“Let’s have economic migration in areas where we aren’t going to get the people and skills at home any time soon. In return, let’s make those visas fixed term.”
He will also urge reform of regulations and red tape, telling the audience: “I know that some Conservative politicians today feel that this issue is the fault of Europe. But the biggest regulatory barriers facing businesses today are based on British laws, created by a British parliament, and administered by British regulators.”
Mr Danker is also expected to flag concerns over Brexit, namely the as-yet unresolved row with the EU about the Northern Ireland Protocol.
“Boris Johnson achieved a deal with the EU that allows us to continue to trade tariff and quota free with our biggest trading partner. There’s some good stuff in there. Currently locked up.
“But, still, we argue over the Northern Ireland Protocol. Still, we argue over sovereignty. Get round the table, do the deal, unlock the Trade and Co-operation Agreement. I say to Brexiteers, the best guarantor of Brexit is an economy that grows.
“Its biggest risk is one that doesn’t.
“Now I know that some of these things will not be popular with politicians. But while, I have no problem with Government taking tough choices to bring stability, I want them to also take tough choices for growth. ”
It comes as the Government faced further warnings over the impact of record tax levels and low growth rates.
New analysis from the TaxPayers Alliance suggests that the current state of the economy costs almost £25,000 per person per year.
Compared to a scenario designed to maximise growth, the think tank argued that the true scale of the tax burden on the public is some £1.7 trillion.
Duncan Simpson, chief economist of the TaxPayers' Alliance, said: “The direct and indirect impact of record tax levels is enormous.
“The chancellor’s plans for ever-higher taxes, to fund sustained excessive spending, will create an almost unmanageable burden that permeates through to our economic performance.
“The real burden on taxpayers remains far too high and robs Britain of the growth it sorely needs.”