British Chambers of Commerce: PM speech

David Cameron discussed the long term economic plan, Britain in the world, Start-Up Loans and government working in partnership with business.

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

British Chambers of Commerce: PM speech

Five years ago we came into office with one task that ranked above all the others – to help engineer a private sector revival, and get Britain back to living within its means again.

For 5 years we have been working in partnership with you and today, when you look at all the central questions facing our country – whether Britain can compete, and grow, and create jobs, and pay its way in the world the answer is a resounding “yes”.

It’s thanks to you – and businesses like you – that last year we were the fastest-growing major economy. It’s thanks to you there are 1.75 million more people in work in our country. It’s thanks to you that this recovery is taking root not just here in London but right across our country.

And let me say this. When I see businesses on the move – expanding, succeeding – it quickens the pulse. Yes, of course, I like what it all means – but I also deeply admire the people who make it happen. As I go up and down the country – you may have seen me in the odd high vis jacket – I am inspired by what I see. I see the ups and downs. I see the sacrifices it takes to succeed; the risks and rewards – the joy and the frustration.

Every time I lay a foundation stone, cut a ribbon, unveil a plaque, shake a hand, present an award, I see Britain coming back and it fills my heart with pride to see what you have achieved these last 5 years.

This recovery has been firmly business-led – but I hope you will agree that this government has played its part. If you look at all those things you asked for – with our long-term economic plan, we have delivered.

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The economy

You asked for a stable framework to do business in – and we have delivered. Inflation low. Interest rates low. Stability locked in. The UK economy is now seen as a safe bet – attracting investment from around the world. This didn’t happen by accident. It is the result of difficult, long-term decisions taken by this government.

So far we’ve cut the deficit in half.

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You asked that while we got Britain back living within her means, we should invest in the things that really matter: science, superfast broadband, our railways and roads. That is what we’ve done. The science budget – protected. 40,000 homes and business connected to superfast broadband every week. Crossrail – Europe’s largest construction project – almost complete. There’s High Speed 2 – the first new railway line north of London since the Victorian times and Hinkley Point – the first nuclear power station for a generation.

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You asked for lower taxes – we’ve delivered up to £2000 cut off National Insurance bills and corporation tax slashed to 20p this April – the lowest in the G20 – and by far the lowest rate in the G7.

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We guarantee to have the most competitive corporate tax regime in the G20, more competitive than the US, India, Germany, China, Canada, Brazil – all of them. You asked for cuts to regulation – we have delivered. The first government in 40 years to have less regulation than when we started. Domestic regulation has been cut by £10 billion over the past 4 years.

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Britain in the world

You said “help us sell to the world” – and we have backed you. We went into the Foreign Office and completely changed the mind-set. No more squeamishness about mixing trade and diplomacy - our ambassadors are now trade envoys whose job is to sell Britain. I have loaded up planes with business people; we’ve had ayran in Ankara, teh-tarik in Kuala Lumpur, tea in Beijing.

The GREAT Britain campaign we started is our nation’s most ambitious international marketing campaign ever flying the flag – literally – in 144 countries. And all of this is working. UK goods exports are up to China by 110%; to South Korea by 145%.

In the next Parliament we have an ambition for 1 trillion exports. Yes, this is challenging, but we will aim high.

And we will drive forward the first EU-US trade deal as well as leading the charge on trade deals with China, India and Japan, so that we can expand the horizons of the whole EU. And we heard some other things from you.

Building Britain

You said: “Get Britain building”: this has taken time, but we have done what is necessary to take the brakes off. We unblocked the planning system, slashed the bureaucratic guidance from 1000 pages to 50 and introduced Help to Buy, which has had a profound effect on house-building right across the country – indeed in the past year alone, planning permission has been granted for 240,000 new homes.

As an added incentive to councils, we introduced the New Homes Bonus and we said: keep 50% of the business rates raised.

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You said “Get Britain learning” and we have seen record numbers of apprenticeships - 2 million already.

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You said “Get Britain working” because no nation can succeed with a bloated welfare system that paid people not to work. So we have done some difficult things. Capping benefits; checking whether anyone on incapacity benefit is capable of work; setting up the largest welfare-to-work programme in our history. Today there are 900,000 fewer people on the main out of work benefits than in 2010. Our plan is working.

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Start-Up Loans

You asked us to “Get Britain lending” too because frankly, a lot of businesses were desperate. The credit had dried up, the banks weren’t listening and good businesses were in danger of going to the wall. So we did a number of things. Funding for Lending has pumped £47 billion into the economy. The British Business Bank has supported over 21,000 businesses.

We introduced Start-up Loans – up to £25,000 for a great business idea – and these have been a huge success: 25,000 already issued - with more to come.

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Growing your business

But I know, and you know, that more needs to be done. Too many fast-growing businesses still find it hard to access finance. I’m thinking particularly of those wanting to grow, who have established themselves and want to take that next step to becoming a medium-sized business, but cannot. But as we see in countries like Germany, with their Mittelstand of strong, well-financed, medium-sized businesses – this is where a lot of the growth and jobs comes from. Indeed here in the UK, 45% of the job growth has come from our fastest growing medium-sized businesses.

Their businesses – your business – are the country’s job engine. But they often struggle to get the finance they need to grow. We need to think strategically about helping those small firms over the ‘valley of death’ funding gap so they can become medium firms and the medium firms can become larger firms.

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Accessing finance

Our ambition is to help 500 of our fastest growing firms annually - giving entrepreneurs the access to the kind of finance their German equivalent would get. The Business Bank I set up has found the finance gap is likely to be up to £1 billion per year. One billion of opportunities – lost. One billion of new investment – missed. We will plug this billion-pound gap by using the government’s balance sheet to guarantee loans by private lenders, or by co-investing public money alongside private money. To test the best model for the Help to Grow scheme, I can announce that the British Business Bank will start a pilot scheme at the Budget with at least £100 million of new lending. This will allow us to get the best possible programme up and running [Party political content].

I want Britain to have its own version of the German ‘Mittelstand’ – a backbone of medium-sized firms which export, innovate and generate new jobs; and with our Help to Grow scheme, we will be there to back you.

So this is what we’re delivering. A stable economy, massive investment in our roads and railways, lower taxes, less red tape, record apprenticeships, real planning reform, vital welfare reform, new ideas on finance and a commitment to double down on all of it next time around.

And I have another message for you today.

Long term economic plan

Now that our long-term economic plan is truly working together, we’ve got to make sure it works for everyone in our country. Economic success can’t just be shown in the GDP figures or on the balance sheets of British businesses but in people’s pay packets and bank accounts and lifestyles.

The most recent figures show that wages are already growing faster than inflation, and as the economy continues to grow it’s important this continues and that everyone benefits. Put simply – it’s time Britain had a pay rise. This recovery has been marked by astounding job creation. One thousand more people in work, on average, every single day since the election.

To make sure more of those workers feel the effects of this recovery, this government has already delivered the first real-terms increase in the minimum wage since the crisis.

I want that to go further – indeed we are on a trajectory to over £8 an hour by 2020.

As for business – the conditions have not been this good for a long time. We’ve got the strongest growth for 7 years. We are seeing falling oil prices, meaning businesses up and down the country have lower prices on their inputs. Inflation is at 0.5%.

Now that your costs are falling and it’s cheaper to do business – I’m confident that more businesses will pass on that good economic news to their workers, in rising pay cheques and higher earnings.

That’s good for your employees; it’s good for you to have happier and more productive staff and frankly it’s good for anyone who wants to make the argument for business.

Because for us business is not a conspiracy of runaway profits, depressed wages, inequality and unfairness – it is the best generator of growth, wealth, work and opportunity there is, and there would be no better way to demonstrate that right now than to give Britain a pay rise.

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Partnership between government and business

This is a great British partnership between government and business. Together we are not just pushing up those GDP figures – we are improving people’s lives. This recovery is being felt in the young person who feels the pride of getting their first pay cheque, in the mother who is now working and can provide for her family.

It’s about our children and grandchildren not heading into the future saddled with more debt than they can ever hope to repay but looking ahead with hope – because this is a nation with opportunities for them to seize, jobs for them to take and homes for them to buy.

Our long-term plan is quite simply about securing a better future for you, your family, and our country so together – let’s see this through.

Published 10 February 2015