Never mind the spin - what's the real election promise to business?
Posted by admin in on Tue, 30/03/2010 - 16:58
As expected, last week’s Budget fulfilled expectations as the damp squib almost all were anticipating. Despite a few political flourishes, it did little to excite business, certainly those at the larger end of the scale. The only question it really left people pondering was just how long we have to wait before the “real” Budget is sprung on us after the election.
Ah, the election. The next opportunity for politicians to dazzle the business world with promises of economic reform/prosperity/empty promises (delete as applicable).
Voters were given a sneak preview of things to come courtesy of a debate on the BBC between the chancellors (one real, two would-be) on Monday night.
I’ll have to be honest. I’d certainly planned my evening’s entertainment around the prospect of Messrs Darling, Osborne and Cable going head to head. But despite having bought into the trailers and feeling a genuine tinge of excitement about the debate, come Monday night and the event completely slipped my mind.
Could it be that, despite the BBC hype, the prospect on an hour of debate on economic policy had failed to set my world on fire? Still, by all accounts it was a ‘spirited’ debate, with arguably more meat on the bones that Darling’s monologue the week before.
Mud-slinging highlights include the chancellor branding the Tory’s plan to cancel the National Insurance rise as "irresponsible". Osborne said it would penalise hard-pressed families and businesses at a time when the economy was "not working".
Even Vince Cable could resist putting the boot it, with his comments that Labour had done "real damage" to the economy but that if elected, the Conservatives would "get their noses in the trough and reward their rich backers".
Interestingly though, it’s what has been said by politicians outside of the TV studio this week that makes for more interesting reading for the business community.
Take, for example Alistair Darling’s assertion that banks will leave the UK and relocate abroad if there is not international co-operation on tougher financial regulation. Facing question from the Commons Treasury Committee on Tuesday following last week’s Budget, he said he did not want to risk London’s strength as a financial centre by acting unilaterally.
Nick Clegg, meanwhile, waited until Tuesday to launch the Lib Dem manifesto for businesses ‘Enterprise in a Fair Society’, calling for a change to the rules governing corporate takeovers in the wake of Kraft’s takeover of Cadbury to ensure that they serve the UK economy.
The Lib Dems also want to ensure affordable access to credit for businesses by creating new mechanisms to provide equity finance to smaller businesses. They would also incorporate a ‘sunset’ clause into every new business regulation so that it is time limited unless renewed by Parliament.
TV debates make for an entertaining interlude, but are less about enlightening than spin, puff and rhetoric.
The Bottom Line:If Mr Cable has his way...
"If Mr Cable had his way, all the big banks would be broken up and bonuses would be virtually eliminated - a sure-fire way in my view of guaranteeing an end to the UK’s ability to compete as an international financial centre. Let’s not forget that this is a man who is on record as saying that everyone who works in a bank has an ‘aristocratic lifestyle’ clearly demonstrating his lack of understanding of the sector." A tough line on bankers’ bonuses could make a brain drain of financial talent a distinct possibility, warns Paul Marsden. Read more