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10 February 2020

256: There is nowhere to hide for business

The government may be new but the expectations of business are increasing further. Without proper engagement to shape policy; businesses will be blamed if things go wrong.

The Conservative (and coalition) governments under David Cameron and Theresa May both took quite interventionist approaches when it came to business. The new Johnson led government appears to be a more hands-off approach, instead favouring a low tax, low regulation approach to shape the country for its post-Brexit future.

But that reality is already starting to crack. Take Priti Patel MP’s recent comments regarding post-Brexit migration (Sky, 26 January 2020). The home secretary suggested that businesses had been:

‘Partly reliant on low skilled and frankly cheap labour from the EU’.

She went on to say:

‘We think it’s about time that businesses started to invest in people across the whole of the UK.’

The inference of a lack of investment by business, and therefore blame, is clear.

Then take the recent letter by Sajid Javid MP, chancellor, and Andrea Leadsom MP, secretary of state for BEIS, to the Competition and Markets Authority.

‘We are therefore commissioning the CMA to prepare and publish a regular state of competition report to raise our collective understanding of the level and nature of competition across the UK economy…’
‘…The ambition is that these reports will also provide both the CMA and Government with information to better target our respective resources and tools towards raising competition in particular sectors or national, regional or local markets that may be found to be of potential concern.’

This is a sweeping approach which seems to line-up, potentially sweeping actions by the government or the CMA to tackle anything that is hindering competition, all based on evidence. So we can look forward to regular reports, across sectors, with real impacts and consequences.

The chancellor is also outsourcing his post Brexit red tape challenge to the public as well. As reported in the Financial Times, he will use to the budget to invite:

 ‘Members of the public to propose ways in which Britain might diverge from the EU rule book.’

The environment too is another area where the government is lacking in real ideas to help deliver to commitment to net zero by 2050. A read of the PM’s speech to launch COP 26 reveals how little in the way of future policy the government has despite the firm commitment being in place.

It will doubtless be the case that the government will look to business for the ideas to secure delivery, especially as many businesses have announced similar commitments but with even tighter timescales.

Not only will the government want to hear ideas but they may also look to put a series of plans or clear milestones in place so they can demonstrate progression towards their goal. They may even choose to intervene directly themselves as well to push progress along (as they have already done by moving forward the ban on sales of diesel and petrol cars to 2035). But as the sector has commented, the new date is not accompanied by a plan on how it can be achieved.

So the emphasis is on business solving the challenges faced by government.

That is a huge opportunity for effective engagement with the real prospect of impact on policy development. It is an opportunity that has to be grasped.

However, businesses should also be aware of the flip side – direct attacks on them for a failure to help government deliver when their policy objectives are not met. There are risks and rewards which need to be considered and managed.

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