The UK shadow chancellor has accused the government of failing to give businesses the certainty needed to operate, saying chancellor Rishi Sunak has acted too slowly and flip-flopped on key decisions.
In a virtual keynote speech at TheCityUK conference on Tuesday, Labour’s Anneliese Dodds MP urged the chancellor to use next week’s government spending review to deliver more long-term guidance to Britain’s businesses.
“I know from speaking to businesses up and down the country that they’ve been crying out for certainty, for a strategy to see us through to the spring,” Dodds said.
“Instead we’ve had four iterations of the winter economy plan in just six weeks, each one changing the circumstances in which businesses are expected to operate.”
Dodds blamed the government’s failure to get to grips with the COVID-19 virus and “chopping and changing” on economic policy for the UK’s severe recession. Britain has suffered the biggest fall in output of any developed nation as a result of the pandemic.
The shadow chancellor said her counterpart in government should use next week’s government spending review to “provide more certainty” and demonstrate a “commitment to long-term planning.”
Sunak is set to deliver a spending review next Wednesday, setting out the budget and priorities for government departments for the next 12 months.
Dodds said the government should “recover jobs, retrain workers, and rebuild business.” She called for the prime minister to bring forward £30bn-worth of capital expenditure, training schemes for the unemployed and launch a national investment bank to support the economy.
Dodds said the chancellor must also urgently address the looming corporate debt crisis facing the UK. Businesses have borrowed tens of billions during the pandemic to help support operations. Banks estimate that £35bn-worth of loans could prove to be unsustainable. The industry has called on the government to create a new national body to manage the debt.
“We’ve not heard enough about how this problem will be tackled,” Dodds said. “We can’t afford for the chancellor to leave this to the last minute again.”
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