The pre-Budget Report submission of the British Chambers of Commerce focuses on urging the Chancellor to create the right infrastructure to allow the UK to remain competitive on a global scale. Small and medium sized businesses account for a significant proportion of foreign trade yet they are feeling the pinch due to high tax levels and the ever upwards creep of red tape and regulation. In addition they are suffering because of a crumbling transport infrastructure and education system that does not properly prepare school leavers to achieve in the global market place.


The pre-Budget report submission highlights four policy areas that are crucial for the Government to focus upon to provide the right climate for business.


TAX


The priority is still for a lower tax burden and a simpler tax system. In particular:

 

The UK's corporate tax rate of 30 per cent needs to be brought into line with the EU average of around 25 per cent.

National Insurance needs to be significantly reformed. Rules relating to NI should be aligned with those that govern PAYE income tax and placed on a cumulative basis.

 

TRANSPORT

 

Roads. Strategic roads need to be identified and then improved to a uniform specification - e.g. remove pinch points and the improvement of intersections/

Rail. The development of strategic rail freight terminals is essential if the Government is to maximise the opportunity for freight to be undertaken by road.

Air. The Aviation White Paper should be implemented in full. Air capacity must be substantially increased, both in the South East and across the regions to respond to current and future demands.

Sea. The last 'five miles' to our ports demand considerable attention. Where possible the use of EU funding should be used to develop our ports to cope with rapidly growing international demand.

 

SKILLS

 

BCC would like to see reform of the education system so that young people are better prepared for the world of work when they leave school. There should be a particular focus on:

 

Functional basics with all students getting experience of work-based and vocational learning.

The mainstreaming of enterprise through the curriculum.

More young people studying subjects that are in the interests of the economy.

Broad-based programme of study for all young people so that their options are not restricted too early.

The stretching of the very brightest students.

 

Regulation and red tape

 

Our research has demonstrated that regulation continues to inhibit the competitiveness of British business with the 2006 Burdens Barometer measuring a cumulative burden of £50.27bn.

 

David Frost, Director General of the British Chambers of Commerce, said:

 

"Whilst business in the UK is still highly competitive on the World stage it is crucial that the government does not take our position for granted.

 

"There is growing consensus that Corporation Tax needs to be cut whilst the poor state of our transport infrastructure is hardly a secret.

 

"We are in a period whereby economic growth has been sustained over the long term and we urge the Chancellor to take measures to ensure this continues into the future. We are calling on him to address our four key areas of concern in order to ensure that Britain remains a competitive and attractive place to do business"