Business leaders urge politicians to resolve crisis

BUSINESS leaders in the West Midlands and across the UK have demanded that politicians resolve the uncertainty created by the result of the General Election.

Voicing fears that action to tackle the deficit could be delayed, business lobby groups also said they were concerned that horse-trading between the parties could be bad for the region.

However, Birmingham Chamber chief executive Jerry Blackett warned West Midlands businesses to avoid a ‘victim’ mindset and urged them to come together to lobby for the region’s economic development.

He said: “: “The prospect of a coalition government must not force the region into a ‘where do we go now’ mindset. I am confident regional leaders from both the public and private sectors can step up to the plate and drive forward the West Midlands despite national government uncertainty.

“Sorting out regional issues, like the future role of local government and the Regional Development Agency, Advantage West Midlands, will probably take longer than we would wish. So we must all unite to form our own local coalition to get the job done. We must push the boundaries of what is possible; take good decisions and seek approval later if necessary, rather than wait for permission.”

Johnathan Dudley, managing partner at accountants and business advisers Horwath Clark Whitehill, said: “Businesses who were looking for certainty after the election will be disappointed. Whatever happens, there will be a lot more politics in the coming weeks and months, including the prospect of another General Election.

“If Labour are to stay in power there is a strong possibility they will have to do a deal with the nationalists. The price for that may be that necessary spending cuts in Wales and Scotland will be toned down. That could cause real destabilisation in the nation. We are facing the issue that England is clearly Tory, while the devolved regions will wield disproportionate power.

“In the meantime, business cannot continue to sit on its hands. We all know what happens if you hold your breath for too long.”

Paul Fleetham, executive director of Wolverhamption-based Tarmac National Contracting, said: “The lack of clarity is clearly bad news for UK plc and the tough economic decisions that need to be made.

“Transport has already been the great ignored issue of this Election and, when it has been discussed, it was disappointing to see all three main parties focus purely on ‘big ticket’ public transport infrastructure schemes.

“There has been a lack of clarity from all parties as to how a high-speed rail network will be funded, and to what extent their successful delivery rests at the expense of our other transport infrastructure.  Adopting a single mode approach which diverts funding away from the already chronically under-funded highways sector is not the answer.”

James Watkins, executive director of Business Voice WM, said: “What West Midlands business needs now is a stable economy and a stable future. That means MPs cannot spend all their time squabbling in Westminster while businesses struggle to get on with the day job of securing employment and improving the bottom line.”
 
EEF, the manufacturers’ urged all political parties to come to agreement to remove political uncertainty and reassure markets and business there is a clear plan to reduce the deficit.  

EEF Chief Executive, Terry Scuoler, said: “The clock is now ticking on action to get our economy going again and tackle the crisis in our public finances. Manufacturers will fear that a political impasse and a failure by all parties to come together will stall this and risk damaging our economy.”
 
“We need to see political maturity and courage to face up to the tough decisions which are necessary. Business and the markets will be looking for immediate and decisive action. This must include a clear plan for how and when we will reduce the public deficit and the modernisation of our tax system to rebalance the economy and promote investment.

John Rider, chairman of the IoD West Midlands, said: “Politicians now need to show some leadership in the interests of business and the recovery.

“Whatever shade of government we end up with, there must be support for private enterprise to get us out of the current mess, create jobs and generate wealth. We need an environment in which business can flourish and an end to the uncertainty that is damaging progress.”

Mr Blackett added: “The region unites when it needs to – witness High Speed Rail and New Street Station – so let’s seize the opportunity to show a London-centric national political system what good coalition government can look like.

“We have worked within the Conservative/Lib-Dem coalition in Birmingham for five years so it is possible to do.

“Nationally, our experience is only about single party dominance but we know that coalitions can work, like those in New Zealand and Germany.

“We need to take a few days to think through the issues and find a shared solution and then rapidly get comfortable with the concept of coalition government.

“We cannot afford to stagger from one patched-up coalition to another. Any prolonged uncertainty would be the worst thing for markets.

“While hung parliaments and coalitions are not the end of the world, the parties must avoid knee-jerk deals driven by the lust for power. At least two parties need to work together to give some certainty of longevity.
 
“The UK needs to demonstrate determination to deal with the deficit and create economic growth. Stability is vitally important and whoever gains power must set out a clear plan to deal with it in the national interest.

“In the West Midlands we need to know soon what the big decisions are with regard to public sector spending on things like infrastructure, the Metro and, of course, the  future of the Regional Development Agency, Advantage West Midlands.

“There are also big calls to be made about business taxation. Business needs to feel confident about the future for the region, especially in the light of the latest survey which says confidence is still fragile.

“Any prolonged uncertainty about the regional economy will depress the chances of investment and job creation. The markets are already jittery with the problem in Greece and the state of the pound.”

The Coventry and Warwickshire Chamber of Commerce said that whatever happened, the new Government had to focus on the primary issue of repairing the economy by cutting the deficit, improving access to finance and reversing the National Insurance increase.

Louise Bennett, chief executive of the CWCC, said the organisation was apolitical but wanted the best for its near 2,000 members across the region.

She said: “The most important thing now is that business is given the freedom and support to grow, take on new staff and help drive forward the economy.

“Reducing the national debt is going to be crucial and, at times, difficult, unpopular decisions are going to be made. Political point scoring has to be put aside because it’s vital for the good of the economy and keeping interest rates low that the huge black hole is dealt with.”