It has been just two-and-a-half years since the previous election, but the political environment has shifted from bad to worse.
Everything and nothing has happened in politics.
Businesses in the South West are holding back on investment, concerned about cash flow and, in many cases, unable and/or unwilling to plan ahead or push forward with growth.
Business communities are frustrated - and exhausted.
Economic performance depends on business confidence - and the next UK government must bring back that confidence.
Countries with the best growth rates and highest levels of investment and exporting success are those whose leadership has backed businesses to the hilt.
No political party can rebuild and transform the economy without a partnership with businesses - small, medium and large.
The next UK government must renew the partnership between government and businesses by delivering an ambitious programme of reform aimed at boosting business growth.
From Brexit, people and infrastructure to international trade, business investment and costs, the next UK government must refocus on business priorities.
These priorities must be acted on as we work together to achieve the transition to net-zero greenhouse gas emissions by 2050.
Some will only be achieved through more decentralised decision-making, with choices made together by local government and business, closer to home.
Businesses of all sizes create jobs and boost receipts to the Exchequer.
Millions of people in the South West and across the UK hold shares in businesses, whether directly or through their pensions.
Millions of business people in our region pay their taxes diligently every quarter and care deeply about people, places and the environment.
The contribution of businesses to our communities and prosperity in the region must be recognised.
They will lead the way in helping the UK rise to new challenges, seize new opportunities and shape what comes next.
But, if we want businesses to thrive and take on the risks needed to help solve these challenges, we need the right conditions in place.
For 2020 and beyond, these are the key priorities of the South West community for the next UK government.
Brexit
On Brexit, we call on the next government to:
• Avoid leaving the European Union without a deal.
• Close remaining information gaps for all Brexit scenarios.
• Ensure the smoothest possible shift from a transition period to the future UK-European Union relationship, allowing enough time for businesses to plan.
• Clarify the future direction of devolution to the nations and regions, as each stand to be affected as powers and regional development funding return to the UK.
• Introduce a simple, fast, flexible and affordable immigration system that minimises the administrative burden on businesses.
• Allow access within the immigration system to all skill levels – including temporary, seasonal and permanent roles - with recognition of professional qualifications.
• Clarify the UK Shared Prosperity Fund - and how it will deliver a UK regional funding system that has maximum local autonomy when European structural and investment funds cease in the UK.
• Secure the future of the UK-European Union trading relationship, minimising cross-border trade frictions and avoiding a hard border with lreland.
• Ensure continuity of trading conditions with third countries so that businesses can continue to benefit from the levels of market access that they have had under European Union free trade agreements.
• Introduce a temporary SME Brexit tax credit to support businesses that need to undertake specific activity to adjust to changes in trading conditions.
• Upscale HMRC Time To Pay arrangements to deal with the expected increase in applications.
People
To tackle the skills gaps holding businesses back, government must:
• Increase funding for apprenticeships to ensure SMEs can access training, at all skill levels, in their local area.
• Ensure businesses have access to relevant apprenticeship qualifications and reform the Apprenticeship Levy in England to allow businesses to use all forms of accredited training.
• Raise the base rate of funding for further education among 16 to 18 year olds in England, commit long-term funding for T Levels and increase flexibility and financial support for businesses delivering high-quality T Level work placements.
• Increase the budget for adult education in England to fully fund economically valuable entry-level courses.
• Set out a long-term strategy and funding for lifelong learning, enabling people to upskill, retrain and adapt to technological changes in the workplace.
• Deliver career advice services for all ages and incentivise schools to promote vocational and technical routes.
• Reform and simplify family policies to reduce complexity and help businesses manage the costs, without compromising the support provided.
• Help bridge the gap between parental leave and children starting school by simplifying access to childcare funding and providing a flexible and universal childcare entitlement.
• Fund workplace adaptations to help employers retain and support employees experiencing ill health.
Infrastructure
Government needs to invest in infrastructure to:
• Deliver a UK-wide high-speed rail network as soon as possible.
• Bring local roads back up to scratch - quickly.
• Reform planning rules to support the deployment of 5G mobile signal infrastructure.
• Attract more private investment into public infrastructure by introducing a replacement for the Private Finance Initiative.
• Strengthen national planning guidelines in England to protect land for business and employment.
International trade
Ensure the continued economic success of this region by:
• Committing to working with Chambers to link UK businesses to customers and opportunities worldwide, leveraging the BCC's rapidly growing Global Business Network.
• Revitalise trade support programmes, develop an expanded trade mission and trade show programme and fund long-term frontline, practical and face-to-face support for exporters.
• Introduce a tax credit for exporters to help them manage the costs and risks of entering new markets, covering a limited range of activities including research, setup, trade missions and shows.
• Establish a true partnership between government and business for the development of future trade policy, including a ‘room-next-door’ mechanism in trade negotiations to ensure the immediate inclusion of high-quality business expertise.
Business investment and costs
In order to stimulate investment and reduce the burden of costs on businesses, we ask government to:
• Extend the £1 million Annual Investment Allowance for a further two years and widen its scope.
• Commit to protecting tax relief schemes that incentivise investment - the Seed Enterprise Investment Scheme (SEIS) and the Enterprise Investment Scheme (EIS).
• Reverse the 2017 reduction in the dividend allowance, which is hurting small businesses and sole traders.
• Launch a business-led review of the business rates system.
• Introduce a moratorium on measures that increase business costs for the next term of parliament, excluding only evidence-based changes to the National Living Wage.
• Enable the British Business Bank to play a greater role in the provision of patient capital by upscaling the British Patient Capital programme to enable long-term investment in businesses across the region.
Summary
The future success of this region depends not just on Brexit negotiations, but also on the big economic decisions that must be made here in the UK. It is time for government to set out a compelling, pro-enterprise and pro-sustainable growth vision for the future, and a bold set of domestic policies to make it happen.
It is time to stabilise the faltering training and apprenticeship system and give clarity on migration rules, as businesses face unprecedented labour and skills shortages all across the country.
It is time for visible action to rebuild our rutted and potholed roads, to use the resources of the state to build more homes, and to speed up the delivery of airport, rail and energy upgrades.
It is time to eliminate the significant gaps in mobile and digital connectivity that continue to strangle business productivity and UK competitiveness. It is time to set a new mandate for HMRC and economic regulators to support, rather than pursue and punish, the small and medium-sized firms that can drive future growth, and focus their enforcement activities on the small number of companies pursuing questionable practices that are ultimately paid for by the rest.
After decades of delay and incremental change, it is time to tackle the huge costs and complexities of the UK tax system, which actively discourage investment, risk-taking, and the stronger export performance we all want to see.
And it is time for your government to deliver a far more explicit blueprint to support economic growth in all regions and nations – including greater local decision-making, away from the centralising instincts of Westminster.
The many thousands of firms we represent are clear: business as usual is not good enough at a time of significant uncertainty. A concerted drive to act upon these 5 key business priorities would unlock business confidence and investment – and set the UK on a path to long-term growth, alongside a comprehensive settlement between the UK and EU.
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