City Matters: Business needs bold action from the chancellor to safeguard UK prosperity
IN TWO weeks’ time, the chancellor will deliver his Autumn Statement, following the first few months of consistently good economic news for several years. The strong positive signs across several areas of the economy make it safe to say that the “recovery has finally taken hold”, as Bank of England governor Mark Carney noted last week.
Now is the time to see what can be done to accelerate this trend, creating a strong, outward-looking economy that will add real value for the whole country. I believe there are three key areas which need attention to give the economy the best possible chance of success.
First, the government must commit to a pipeline of infrastructure projects which will help keep the UK moving and encourage internationally-connected businesses to locate in London. There is a clear need to improve rail and Tube infrastructure, but the challenges go far beyond this. We need greater airport capacity: City firms need the security of knowing that they can easily access key growth markets. We also need to improve our road network to tackle the long-acknowledged problems of gridlocked traffic. There are many projects that need money and we cannot afford to build them all at once. But crucially, we must manage this pipeline more effectively if we are to retain the confidence of the international business community.
Secondly, more must be done to ensure that children in London’s schools receive the right, skills-based education to not only lead them into their first job, but also to propel them up the ladder into rewarding and challenging employment in the long term. London’s schools have been a major success story in recent years. But two-thirds of employers say young people do not have the right skills for work, and there is a chronic shortage of young people with science, technology, engineering, and maths (STEM) qualifications, and too few alternative pathways for people without university degrees. A number of City businesses do a great job working with schools to better prepare young people for working life; there is scope for much more to be done.
Thirdly, the government must take practical steps to ensure Britain remains open for business. Some progress has already been made on business visas, although the situation remains unsatisfactory, and the recent news that some foreign banks will be able to operate as branches and not as subsidiaries is very welcome. We need more bold steps like these – and more events like the World Islamic Economic Forum held in London last month – if we are to remain the world’s leading financial centre, pioneering new markets. The City is at its strongest at its most open, and sensible action by the government on visas will encourage investment by serious players in emerging economies.
Just last week, reports showed London remains the world’s number one city for financial services, culture and digital media, and that the City is the most competitive place to do business in the UK. We are still at the top of our game, but strong leadership by the government in the Autumn Statement will determine our long-term success.
Mark Boleat is policy chairman at Canada Corporation.