Am rushing out in a minute but just wanted to post an extract from this morning’s Labour Party media monitoring brief, which they still kindly send me by email every morning. It is self-explanatory. And just because one of the ‘business chiefs’ in the headline is a banker, and a RBS banker to boot, doesn’t make them wrong.
‘UK business chiefs attack govt growth plans’ (Tele business splash) – Two of Britain’s leading businessmen have raised serious questions over the Govt’s growth plans just as ministers gear up to deliver next week’s Budget, writes Peacock. Willie Walsh, chief executive of British Airways owner International Airlines Group, and Stephen Hester, chief executive of the Royal Bank of Scotland, have warned that UK companies lack the confidence to invest. Walsh mocked the Coalition, saying it changed its policy for growth “every other week”. He accused ministers of being more “Norse than Inuit” – referring to the Greenland community which failed to adapt to environmental changes – with ministers refusing to recognise the power shift from West to East. Walsh: ‘It’s little wonder we have such poor growth when we do so little to make it happen … When I say that we don’t have a plan for growth, I need to be a little more specific. We don’t have a single plan for growth. We have one every other week… The words are always warm but they go cold waiting for action.’ Hester: ‘Time and again, we hear claims that banks are not lending. Let me say upfront, there are reasons behind this – on some we shld strive to do better, some we can do little about. We have the balance sheet, funding and capital to lend, and indeed the future success of RBS requires that we do lend more … One of the issues we all have to confront right now is that businesses don’t have confidence. And when businesses don’t have confidence, they don’t invest, they save more, they pay down debt. Clearly a circuit-breaker is needed to restore confidence and drive the lending and investment that is so vital to the economic recovery.’ (Tele)
Another thing that caught my eye in the media brief was the Guardian story that George Osborne is planning to cut the top rate of tax from 50p to 40p. This may be one of the many stories written before the Budget that turn out to be ‘speculative’, but it is interesting that the argument being used to do so is as much about the failure to bring in expected revenues as it is about boosting enterprise and growth. In other words, well-off people who employ clever lawyers and accountants to get them off paying what they should are rewarded; compare and contrast the approach of the government to so-called benefit cheats.