The Confederation of British Industry (CBI) has urged the Chancellor to reform the apprenticeship levy, immigration system and the Shortage Occupation List in his Autumn Statement later this week.
CBI director-general Tony Danker said Jeremy Hunt should match cuts to government spending and tax rises with measures to tackle labour shortages and increase productivity, stating that not doing so would damage the UK economy in the short and long term.
Danker said: “The Chancellor has said he will set out a plan for growth on Thursday. But if this is only warm words and aspirations it won’t stop businesses pulling back from investment. It must tackle the real barriers we face right now.
“A desperate lack of workers is inflating wages and stopping firms growing. Our planning rules allow local officials to hamper major projects we need. Our regulatory regime doesn’t do enough to incentivise investment and innovation and it is far more important to change that than partisan efforts to simply repeal EU laws – which won’t make any positive difference to most firms.”
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He noted that many international investors have chosen not to invest in the UK following the mini-Budget that was announced by former Chancellor Kwasi Kwarteng in September, and many UK employers need to decide this month whether to invest for next year or “go into hibernation”.
“There are real opportunities for growth in Britain next year. These obviously can’t now be achieved from a major stimulus package, but nor can government believe that warm words alone will give firms confidence,” Danker said.
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The CBI urged the Chancellor to:
- use flexibility in the immigration system to allow firms to access the people and skills they need from abroad
- update the Shortage Occupation List so that it introduces flexibility to skill level eligibility where salary thresholds are met. The government should also add student and graduate visa routes and introduce visas linked to specific economic projects
- reform the apprenticeship levy into a flexible skills challenge fund
- set out a tax roadmap that outlines how business tax rates will remain globally competitive and meet decarbonisation, digitisation and compliant priorities
- use regulation as a lever for growth
- reduce uncertainty around the Retained EU Law Bill by changing the focus to an ‘opt-out’ approach. It should also prioritise maintaining access to established markets, remove genuine red tape and use outcomes-based regulation to outcompete rivals in emerging industries.
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