The coalition: Business speaks

Image caption,
Business groups have lots of advice for the new Prime Minister and his Deputy

Like everyone else, the UK's business lobby groups are trying to work out what this new and unfamiliar form of government could actually deliver.

Here is a round-up of some of the key groups' reactions to the new coalition of Conservatives and Liberal Democrats - and their policy requests.

"Fixing the public finances must be at the top of the agenda. The Conservative-led coalition must be absolutely clear about where spending cuts will fall, and about the need to curb relentless growth in the size and cost of the public sector. They must also follow through on their promise to roll back the planned employer National Insurance rise in any emergency Budget.

"The next 90 days are crucial for recovery. We need concrete proposals to reduce red tape and tax burdens on business; action to move the economy away from consumption and the public sector and towards exports; and commitments to improve Britain's key business infrastructure."

"The agreement between the Conservative and Liberal Democrats to form the next Government is welcome news. Business wants to see a stable government with the authority to take the tough decisions that will be required to keep the economic recovery on track and to get a grip on the fiscal deficit. This coalition should have the votes and the mandate to get on with the job.

"In the past few days, leaders of all three of the main political parties have emphasised their commitment to restoring fiscal stability in the national interest. That must be their overriding priority in the months to come."

"The Forum has already set out what it thinks the priorities for the new Government should be in its election manifesto, which has been circulated among prospective MPs and policymakers.

Those priorities are: free enterprise, fiscal responsibility, stability, new technologies, new markets and a scrapping of the planned rise in National Insurance contributions.

"Britain's manufacturers have urged the new coalition government to move swiftly to set out a credible plan for reducing the public sector deficit and a vision for creating a new economic model and a more balanced economy with a stronger role for manufacturing.

"This new model of government gives it a great opportunity to think and act differently in how it approaches these major challenges. It is vital that it now grasps it."

"The increase in the wider measure of unemployment is a strong reminder to the new chancellor that economic recovery remains fragile. But this does not mean that we should avoid public spending cuts.

"On the contrary, the sooner decisive action is taken to bring expenditure under control, the greater the possibility of acceleration in the recovery. The way to reduce the deficit is by lower spending, not higher taxation.

Evidence from around the world shows that raising taxation risks killing the recovery, but at times of fiscal crisis, squeezing spending actually works to strengthen the economy. This is a difficult message to sell, but it is nonetheless the right one."

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