CBI calls for parties to set out priorities for growth ahead of General Election

Alpesh Paleja

The CBI has called for all parties to set out their clear priorities for businesses ahead of the General Election on July 4.

The call comes as new CBI figures show that private sector activity was flat in the three months to May, according to its latest Growth Indicator. The balance of +2% compared with a figure of -14% for the three months to April.

The improvement in activity was driven partly by a stabilisation in services business volumes (-1% from -21% in April), reflecting marginal growth in business & professional services (+4%), offset by a continued decline in consumer services (-23%). Distribution sales were also flat (+1% from -10%) – the firmest result in over a year – while manufacturing output rose for the first time since November 2022 (+14% from +3%).

Firms’ expectations for growth over the next three months remain positive (+7%), albeit easing a little on the two months prior. Expectations are for modest but broad-based growth, with activity anticipated to rise across all sub-sectors: distribution (+9%); manufacturing (+7%); and services (+7%).

Alpesh Paleja, CBI lead economist, said: “After such a prolonged period of subdued activity, it’s encouraging to see things start to stabilise across the private sector. That expectations for growth remain positive should give further reassurance that things are heading in the right direction, alongside our survey data showing that hiring intentions are holding up.

“But the recovery remains in its early stages, and firms in some sectors – particularly consumer-facing ones – continue to struggle. With a date now set for a General Election, we need all parties setting out clear policies to reduce business costs, attract investment and deliver a return to long-term sustainable growth.”