Over the past week, the nuts and bolts of the UK main political parties’ promises were finally welded into place with the publication of their full manifestos.
The CBI was ahead of the game following the recent launch of our business manifesto. It provides a roadmap for the next government– one which called for long-term solutions, not short-term headlines, to unlock the UK’s long-term potential, redefine our growth trajectory and put us firmly on a sustainable path.
We want to see leadership from whichever party forms the next government to tackle some of the pressing issues businesses in Northern Ireland face from the moment it enters office and to develop a long-term plan for stability, growth, economic ambition, and prosperity.
The incoming government will face tough decisions against the backdrop of the public spending squeeze, something we have seen in Northern Ireland with the recent Budget, and monetary policy is likely to remain tight. The latest labour market statistics showed pressures remain, with pay continuing to rise significantly faster than inflation, pushing up the cost of goods and services for Northern Ireland businesses and consumers.
Sadly, economic inactivity is on the rise, partly due to long-term sickness, but our manifesto calls on the new government to expand tax-free occupational health support to incentivise business investment in early workforce health interventions to help prevent people leaving the jobs market.
The CBI manifesto is very honest about the issues businesses face – from sluggish productivity and persistent labour and skills shortages, to under-performing business investment. Challenges I see all too clearly in Northern Ireland, with the impact of skills shortages being felt particularly across engineering, accounting, and finance sectors.
But we’re also calling for a more honest conversation about immigration to tackle labour shortages. Demand for migration is a symptom of labour shortages and further restricting visas won’t deliver growth or public services, so we want a cross-Whitehall review of the effectiveness of the immigration system to help the UK make the shift to a higher investment economy and reform of the Migration Advisory Committee to make it a truly representative body with representatives from all the regions and nations of the UK. We are also calling for the next government, in its first fiscal statement, to announce a new remit for the Low Pay Commission. This body needs an open-ended objective to ensure the minimum wages allows firm to invest in the productivity aims for affordable pay rises.
The first fiscal event of the new Westminster parliament must also see an announcement of a new UK Business Tax Roadmap that utilises the latest digital technology to create a world-leading regime that is designed with international competitiveness at its centre. The CBI has set out a series of tax roadmap principles that should be adhered to as part of an industry-informed framework.
Northern Ireland firms with their unique access to both the GB and EU markets could also benefit from a new UK government driven trade and investment strategy that’s geared to growing the goods, services and technologies Northern Ireland needs to compete internationally.
To help reignite the UK’s competitiveness, we also need to meet our climate commitments and secure green growth, with the CBI calling for the creation of a Cabinet Office-level Office for Net Zero Delivery to ensure strategic and coordinated delivery of net zero in the devolved administrations, as well as the UK overall.
For example, this would help with the coordinated roll-out of electric vehicle infrastructure, a key priority for some CBI NI members. We also need net zero ‘champions’ in our most strategically important industries to show UK leadership on vital decarbonisation technologies and sectoral roadmaps to push the transition to greener outcomes.
On the tax front, we want a UK White Paper would allow people and businesses to be fully consulted about the impact of declining fossil fuel tax receipts on government revenues. We also need vital investment in our electricity grid, socialisation of grid connection costs and greater collaboration on an All-Island basis, particularly on energy and decarbonisation, and to improve better transport infrastructure. To stay ahead on technology and innovation. And to find new ways to work together to transform public service delivery.
With the campaign past the mid-way point, now is exactly the right time to make sure the business voice cuts through in Northern Ireland and across the whole of the UK. It’s time to take the politics out of the conversations surrounding the issues firms face every day – it’s our chance to seize the real growth opportunities up for grabs.
Northern Ireland firms have suffered a whole host of shocks in recent years; from the post-Brexit uncertainty for businesses to the pandemic and the impact of higher energy costs after the Ukraine conflict – as well as the uncertainty caused by the recent suspension of the Executive and devolved assembly.
This means the economy has tended to be more focussed on absorbing these shocks than boosting growth, but the businesses I speak to say there are some bright spots emerging to tackle the persistent challenges the Northern Ireland economy faces. Locally, the right action can deliver big results and prosperity for our region.
Government needs to take bold decisions in the national economic interest. And business needs to work with them. The economy is at its best when politicians and businesses work together. And the general election on July 4 gives us the opportunity to reshape our economy together and deliver on our shared ambitions for the benefit of everyone.
- Angela McGowan is director of CBI Northern Ireland