It was really encouraging that such an important influence on the UK economy as the Chancellor was prepared to come along and listen to businessmen and women about what is affecting them on-the-ground, and what ideas they have for the future. Frankly, there isn’t enough of this.
Talking to business people who are already running their own firms must be beneficial in bringing to life the real issues that are being faced daily across the UK; it is personal and heart-felt commentary. No one or group of businesses is ever going to change policy, but they can bring the reality to life for decision makers. The more that can be done in similar forums, the better.
At Friday’s meeting there was a good deal of openness about the decisions that a chancellor has to take. It was refreshing these explanations were made without any attempt to overly politicise them too. For example, the debate around business tax reductions through Employers NI vs business rates, was informative and very helpful.
Every business will have different preferences for tax cuts, usually where they are most beneficial to their circumstances, but each will also generally accept other approaches if they can understand the rationale. More needs to be done by the government to communicate with the business world to explain why decisions are being taken. Too much is focussed on media messaging for wider consumption. This can only help and engage businesses in driving the economy forward, if business people all understand what as a country we are working towards.
The discussion on encouraging bank lending was worrying. It is clear that the flagship Funding for Lending scheme is not having the impact expected, and I certainly didn’t understand the relative quantum of amounts involved compared to other approaches. There was recognition of the excess complexity and process when businesses are looking to secure funding, and also the plethora of government initiatives, which I would describe as initiative overload, but there wasn’t much in the way of new ideas and approaches.
Ways need to be sought to simplify the lending process, and support a return to lending by understanding the business, not spreadsheet checking and checklist ticking. Banks didn’t fail by getting mainstream business banking wrong, and they need to return to supporting businesses in achieving growth.
On Friday George Osborne visited the Forum’s Cheshire HQ in Knutsford for a round-table event with a small number of members. Head of Professional Partnerships at Funding Store, David Grundy, was on the panel and in this blog talks about the meeting.