Miliband and Osborne BCC speeches in full
Read Labour leader Ed Miliband and chancellor George Osborne’s speeches to the British Chamber of Commerce (BCC) in full:
Ed Miliband’s speech in full
Let me start by thanking you for inviting me here to speak to you today.
It is a privilege to meet, and hear from, such a large and diverse group of Britain’s leading businesses.
And I want to pay tribute to your departing director-general David Frost who has been such an eloquent champion of the work your chambers do.
I come here as a leader of the opposition who knows that the things that brought me into politics, the wish for a fairer, more prosperous country, can only be achieved if the businesses represented by the BCC are able to thrive.
As befits a party that lost an election less than a year ago I’m here to listen to you, and say how important that dialogue is for us.
I recently spent time with one of your members, Gordon Yates, who runs a firm in my constituency called Sentry Doors, employing over 60 people.
And what I know most of all is that he, and the people in this room, are doing what they do not just to make a living.
But because of the pride you have in your work.
The sense of responsibility you feel to your employees.
And your commitment to your local communities.
It is you who represent the best of businesses in Britain.
Success based not on short term speculation, but on hard work, productive investment and enterprise.
In the 1990s New Labour’s core insight was that a successful and dynamic market economy is the foundation on which a strong and just society must be built.
I am determined that Labour will be continue to be a pro-business party, celebrating enterprise and wealth creation.
Being pro-business today means confronting challenges very different from the ones we faced in the 1990s.
My argument is that we must learn the right lessons from before and after the financial crisis.
Three stand out:
First we need an economic policy that sustains growth and cuts the deficit.
Second, a narrow economy is not a healthy economy – we need a more balanced industrial base in the future.
Third we need a new, safer, banking system, but also one that will support not hinder the changed economy we need.
First let me talk about growth and cutting the deficit.
Clearly attention today is focused on events in Portugal.
And we are right to be concerned about problems in parts of Europe, our largest trading partner, at a time when growth is so important here at home.
What we know from across the world is that all economies need a credible plan to cut the deficit, but also a plan which means the economy can grow and pay its way.
If we were in government we would have halved the deficit over four years.
Let me say plainly to you, that would have meant some difficult cuts to public spending.
The government have set out a different approach to cutting the deficit.
I will not rehearse today the details of that argument.
I want to make just one point.
Our argument with the government is about the scale and pace of their plans, and the implications for the health of the UK economy.
It is driven by a different view about how we can achieve the strong growth and lower deficit we need as a country.
Let me put it this way.
The lower growth forecasts and higher inflation presented in the Budget mean an extra £12bn spent on social security over the next five years.
They mean borrowing being £46 billion higher in total over the same period.
And why is our economy suffering from sluggish growth?
Underneath the headlines is the reality of squeezed living standards and weakened consumer confidence.
And we saw the impact of that on business confidence in this week’s BCC’s survey.
I know it is smaller businesses that get hit first and worst when growth slows.
I hope that the economy will return to strong growth this year, but I hope also that the Government will show flexibility if circumstances require it.
But if we are to build the economy we need for the future, we need to do a lot more than get the macro-economic policy right.
Being pro-business in this decade means learning the deeper lessons of the crisis.
So second, we need growth rooted in a much more diverse economic base.
That means a broader range of sectors, in every part of Britain.
And it means understanding the contribution of small and medium sized businesses to the future of our economy.
The financial services industry will always be important.
But what we discovered at the end of the financial crisis is that we were too exposed as an economy to the instability of that industry.
With Labour having been in government I take our share of responsibility for that.
Part of the answer is of course better bank regulation.
But part of it is also broadening the sectors which succeed in our country.
In many of these there is a global race, and the danger for us is that we find ourselves left behind.
Take the green economy as an example.
I saw as energy secretary the potential this sector had to be a source of jobs and growth for Britain.
But that won’t happen by accident.
It will happen because private and public sector together establish a coherent vision for success.
And government needs to do its bit.
Creating a stable domestic market.
Providing the right incentives.
And giving business the assurance it needs that we will have the skilled workforce it can rely upon.
Nearly one year on from our period in government, as I look at the green sector in particular I see warning signals.
When a pioneering company at the cutting-edge of electric vehicle production like Modec in Coventry goes into administration we need to ask, is the right support in place to ensure we succeed as a country?
In particular I urge the government to provide as much certainty as it can to you about the incentives and support that are available.
And just as succeeding in green industry requires this vision, focus, and certainty, so too in other key sectors.
Biotech, higher education, advanced manufacturing and the creative industries – in all these areas we need to seize the opportunities that the global market provides.
That means a coherent and active approach across government policy.
Just as we need to diversify the sectors in which we succeed, so too in ensuring balanced growth across our country.
My local experience as a member of parliament was that Yorkshire Forward, our RDA, did make a difference in bringing together businesses, universities, local government together to help businesses start and grow.
We need to ensure that local enterprise partnerships are able to continue that work:
In our view they should be able to take over the RDAs assets to drive economic development, should have the right influence over local skill and planning decisions so they can be properly matched to business needs.
I believe that broadening our economic base, must not simply mean success in more sector and regions, but also recognising that growth for the future will come not from a small number of large businesses but from a large number of small and medium sized enterprises.
That it why, in our Budget representations, we urged the government to use funds from repeating the bank bonus tax to expand the regional growth fund so that it could be opened to small businesses, which are currently locked out.
I also know that for you to succeed, government must be a better partner with you.
We have a shared commitment to fairness in our country.
And you want to do the best for your employees.
But we also know that regulation places the greatest burden on small rather than large businesses.
I’m not going to make you promises I cannot keep, or pretend there are easy answers.
But I do want to say that we understand the need for balance, because of the costs that change can impose upon you.
That applies both to the number of regulations that are introduced, and the way they are implemented.
We also need a competitive, simple, tax environment.
And an approach to procurement which supports your success.
To give one practical example, government was right to promise that suppliers would be paid within five days – because cash flow matters.
But we need to recognise that these suppliers are too often our very largest firms.
As well as giving SMEs more access to government procurement, we should go further and require those large firms to pass five-day prompt payment terms down the supply chain.
So we need to see a broader economy in all respects, more able to withstand the shocks the world economy brings.
A banking sector that works for business
And that takes me to the third lesson we must learn.
It’s about the deal you get from the banking system.
Next Monday the Banking Commission will set out its interim findings.
The issue with the banks goes much deeper than regulation.
Particularly for small and medium sized business.
British industry has been failed by the banking system for too long.
When everybody up to and including Mervyn King says that banks are exploiting their customers, there clearly is a problem.
We all know of sound businesses that have had credit withdrawn- despite being loyal customers for years.
We need to restore the primary role of banks as intermediaries between savers and productive investment i n the economy, rather than as institutions that derive massive profits from speculation.
Britain’s banking sector has become just too disconnected from the communities and businesses it serves.
We are seeing too much evidence that the banks are simply going back to business as usual before the crisis hit.
We see it for example in the complaints from small businesses about their banks.
That isn’t good enough for our businesses.
We need to move from call centre banking to relationship banking.
It just doesn’t make sense that hugely important decisions about credit, that can make the difference between a business succeeding or failing, are taken by someone hundreds of miles away who knows nothing about the business involved.
The owner of a small music industry business recently told about applying for a loan from his own bank.
It took a year for the head office to say no to that loan application – an application which an other bank approved after just two weeks.
Just as you believe in your responsibility to the communities you serve, Britain’s banks need to take seriously their responsibilities to you, their customers.
A small business is not and should not be treated as a set of numbers on a spreadsheet.
Key to changing the way our banks work with businesses is the greater competition we need in the banking sector.
I urge the government to be bold in implementing the recommendations of the Banking Commission.
We also need to ensure there is proper funding in place for businesses at every stage of their growth – from bank loans, to export finance, to equity.
To do that we can’t leave financing of businesses simply to the banks to do it on their own.
I think here Britain can learn lessons from abroad.
The Small Business Investment Company in the US has used government-backed guarantees to provide critical, early stage finance to some phenomenal business success stories, like Apple and Intel.
And in both France and Germany firms have long been able to access state-backed finance for exports – an area in which I know the Chamber have done a substantial amount of work.
As part of our policy review I want us to look at whether we can make public-private financing models work here, building on schemes we introduced like the Enterprise Finance Guarantee and the Working Capital Scheme for exporters.
So I believe we need to learn the right lessons from the financial crisis.
Cutting the deficit at the same time as understanding that growth matters.
Building a new economy which is more broadly based than what went before.
And reforming our banking sector.
As we look ahead to our next manifesto, our relationship with business is hugely important to me.
To get policy right we need your input.
It is why our shadow business secretary has written to every chamber to ask for their views on our policy review.
I am very grateful for the response we have had so far.
We all believe in a more prosperous and fairer country.
I look forward to working with you to help make that happen.
George Osborne’s speech in full
Good morning.
Let me start by thanking Sue for the very kind introduction and also David Frost for inviting me to speak at your annual conference today.
David is a great advocate for Britain’s businesses community and a tireless campaigner for the issues that matter to your members.
In fact, this is the third time I have addressed this annual conference.
I know just how important the network of local Chambers of Commerce is in providing support and advice to so many small and medium businesses.
My message to all of you today is simple – this Government is unashamedly pro-enterprise, pro-business and pro-aspiration.
We are going to put you – the job creators of Britain – centre-stage.
It is also a message of optimism, tempered with realism.
Let’s start with a dose of the realism.
We are recovering from the biggest banking crisis in the entire history of our country.
We have been through the longest and deepest recession since the 1930s.
And next week, when I go to the G7 meetings in Washington, I will represent the country with the single biggest structural budget deficit – indeed the largest deficit in the peacetime history of Britain.
This is the new Government’s inheritance.
So it is no surprise, as both the Bank of England Governor and I warned last year, that the recovery is proving choppy.
But that realism comes now with optimism that Britain is putting its house in order.
We have put in place a credible deficit reduction plan which is now taking effect.
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That has provided a crucial bedrock of stability at home and commanded near universal confidence abroad.
I say this to people in Britain.
If you hear the stories about the cuts and still wonder why our country needs to take these difficult decisions, then look at what is happening around us.
First Greece, then Ireland, today Portugal.
All of them countries that did not convince the world they could pay their debts.
Two of them countries with smaller budget deficits than Britain.
Now all of them being bailed out, at huge costs to their populations.
Today of all days we can see the risks that would face Britain, if we were not dealing with our debts and paying off our national credit card.
These risks are not imaginary – they are very, very real.
Those in our country who deny the urgent need to deal with our deficit are playing Russian roulette with Britain’s national sovereignty.
I will not do that.
We have brought credibility where there was doubt – and stability where there was none.
The real practical economic benefits of this Government’s policy are there for businesses and families every day.
We now have almost the same market interest rates as Germany, despite having a bigger budget deficit than Portugal, Greece and Spain.
And I want to thank the British Chambers of Commerce for their steadfast support.
You are absolutely right, David, when you say that our “decisive moves to cut the deficit will have positive effects on business and investor confidence”.
So the measures we have taken to rescue our economy from the financial danger-zone should give us grounds for optimism.
But stability on its own is not enough, we have to do more.
You and other business organisations welcomed our plan to deal with the deficit, but you rightly asked “where is your plan for growth?”
In this year’s Budget we have answered those questions – and the response to our plan for growth has been very positive.
Let me remind you why we had to act.
Over the past decade Britain fell behind, our economy became too unbalanced, while other countries made themselves more competitive.
Too much debt, not enough savings. In many regions, too big a public sector and too small a private sector. Too many imports compared to too few exports.
The household savings ratio plummeted.
Manufacturing halved as a share of our economy.
Between 2000 and 2009 Britain’s share of world exports fell by a third, while Germany’s share actually rose.
We need to step up a gear.
Britain needs to out-compete, out-smart and out-pace the rest of the world.
That is now a central objective of this Government.
And so in the Budget we set four economic ambitions for Britain.
The first ambition is that we should have the most competitive tax system in the G20.
In the late 1990s, we had the third lowest corporate tax rate in Europe. By last year, we had the sixth highest.
That had to change – and in last year’s Budget and this year’s, we took action.
On Friday, the UK’s main rate of corporation tax came down from 28% to 26%.
It will keep coming down each of the next three years to reach 23% in 2014 – the lowest rate ever and the lowest in the G7.
Instead of going through with the last government’s planned increase in the small companies rate to 22%, we have cut it to 20%.
Three years ago I announced to the BCC annual conference in Liverpool that we would do that – and we have delivered.
And let me tell you, when you’re a democratically elected politician with such a high budget deficit, the easiest thing is to increase taxes on business – because businesses don’t vote.
So not only have we avoided that temptation, we are actually cutting your taxes.
We have made our taxation of international profits more competitive too.
Instead of leaving Britain, businesses are moving back.
We’ve introduced a patent box.
And we have also started the enormous task of simplifying the tax system.
We’ve made a start by abolishing over 40 complex tax reliefs in the Budget.
But let me be honest, I am going to need your help to go further.
For other reforms – like merging the operation of income tax and national insurance – will need to be done in step with organisations like yours – so that we reduce the burdens on business instead of increasing them.
Our second ambition is that Britain should be the best place in Europe to start, finance and grow a business.
Over the last decade the UK sank in the Global Competitiveness Index from 4th in 1998 to 12th in 2010.
So what are we going to do about it?
On regulation, in the Budget we removed £350m of costly business regulations.
As Vince Cable will tell you later, we are imposing a moratorium on new domestic regulations for the smallest businesses.
But many new regulations still come from Europe.
So we are building new alliances.
Last week David Cameron and eight other European prime ministers wrote to the Commission asking for a reduction in the burden of EU regulation.
And I would urge all of you to make links with other Chambers of Commerce across Europe, so that together you can win the argument that we shouldn’t be pricing our continent out of the world economy.
On planning, one of the great obstacles to growth that no government has had the courage to tackle, we are now shifting the balance from delay and objection towards development and expansion – and I know this is something that the BCC has been campaigning for this year.
On research and development, we have just increased the support available to small companies through R&D tax credits from 175% to 200%. Next year it will go up again to 225%.
On finance for start-ups, I have made it easier to attract investment capital, including with an increase in income tax relief from 20% to 30%, which came into effect yesterday.
We have also delivered on our pre-election promise to scrap the most damaging part of the planned increase in employer’s National Insurance.
Since yesterday it has now actually become cheaper for businesses to employ anyone earning under £21,000 a year.
And when the day comes when you want to sell your business, we have doubled and then doubled again the level of entrepreneurs’ relief.
My third ambition is for Britain to become a more balanced economy, by encouraging exports and investment.
Here is one shocking fact. During the decade before the recession, private sector employment actually fell in a region as important as the West Midlands.
Our country needs to see growth across every region.
The BCC knows precisely how important this is, because your members cover the whole of the country – and I welcome your involvement in the new national network for local enterprise partnerships.
We are also going to need your help in making a success of the 21 new Enterprise Zones we are establishing to help parts of our country that need an extra boost.
Next week, we will launch the new £400m Regional Growth Fund, which will provide finance for regional capital projects and support private sector job creation.
But a more balanced economy also means more exports and investment across every sector of our economy.
In our Plan for Growth, published at the Budget, we set out a host of specific measures to do that in sectors like advanced manufacturing, tourism and life sciences.
Let me tell you today that that work does not stop.
I can announce that we are launching the next phase of our Growth Review, to be published at the time of the Autumn Statement, looking at new issues and new sectors.
Work with us through this year on new measures so that we can become more competitive still.
Our fourth ambition is to have a more educated workforce that can be the most flexible in Europe.
Between 2000 and 2009, Britain fell from 4th to 16th place in the world league tables of science, 8th to 28th place in mathematics. That is unacceptable.
So not only are we undertaking radical reforms to education – opening up schools, supporting poorer pupils, reforming the curriculum, and increasing the participation age to 18.
But we are now also addressing the long-standing issue of vocational training.
We will do that with 100,000 work experience places for young people and at least 24 University Technical Colleges.
And also 250,000 new apprenticeships over the next four years – the largest apprenticeship programme ever.
More competitive taxes. More support for businesses. More balanced growth. And a better educated workforce.
That is our Plan for Growth.
But let me tell you – as I have said before – there are forces out there who will try to stand in our way.
Forces of stagnation who will try to stop the forces of enterprise.
And let me give you just one example.
Over the years one of the issues that businesses keep raising with me is the burdensome effect of our employment tribunal regime.
And all those years no Minister has been willing to stand up and say – yes, employees have rights and they should be protected, but what about the right to get a job and not be priced out of the market?
What about the right to start a business and not be sued out of existence by vexatious claims and unreasonable costs?
Well, this Government has had the courage to answer those questions.
We’ve said that there will be fees to deter vexatious claims; compulsory arbitration; and the right to seek redress only after two years of employment, rather than one year.
These are controversial measures. The unions and others oppose them.
So I say to you – to the business community – don’t stand on the sidelines.
Get involved and help us make the argument for enterprise.
An enterprising Britain cannot be built by government alone.
An enterprising Britain comes about when its businesses say ‘we won’t be held back any more’.
An enterprising Britain comes when its business people believe that their aspirations in life are shaped by the fruits of their labours.
An enterprising Britain is a Britain open for business.
That is what I want to build.
And I need your help to do it.
Thank you.
