Businesses need support to boost GDP, says Cowcher
By Stephanie Bartup, Midlands Correspondent
The government must “scale back the current quagmire of employment legislation”, focus on boosting exports and keep pressure on the banks after it was forecasted that UK GDP is set to grow by just 1.4 per cent in 2011. That's the view of George Cowcher, chief executive of the Derbyshire and Nottinghamshire Chamber of Commerce, who spoke to Insider.
UK GDP is set to grow by just 1.4 per cent over the next year, according to the British Chambers of Commerce’s (BCC’s) quarterly economic forecast. The BCC has lowered its forecast for the year from a previous estimate in December of 1.9 per cent.
The BCC said the downward revision to 2011 growth is mainly due to the unexpected fall in GDP in the fourth quarter of 2010. An additional factor leading to lower 2011 growth is the likelihood of an increase in interest rates in the second quarter – this was originally expected in December.
Cowcher said that the government had “not yet matched its promises to promote business growth with any real action”.
He added: “Business is more than willing to drive the recovery, but it needs government to create a climate in which firms can invest, create jobs and grow. That means cutting through red tape and scaling back the current quagmire of employment legislation, placing greater focus on boosting British exports and keeping pressure on the banks to ensure that businesses can get access to finance.
"What we need now is for the Chancellor to deliver a Budget for growth to restore business confidence, encourage investment and rekindle the spirit of enterprise and innovation in the private sector.”
Despite the bleak outlook for growth for 2011, the BCC has raised its prediction for 2012 growth to 2.3 per cent – from 2.1 per cent in December.
The BCC also increased its predictions of unemployment for early 2012 to 2.65 million, from the December forecast of 2.6 million. The organisation said that two main factors accounted for a higher jobless forecast - the larger than expected increase in unemployment in the fourth quarter of 2010 and the significant rise in economic inactivity, which increased the likelihood of more people looking to return to the workforce.
An expected interest rate increase as early as May 2011 could also add to the jobless total, it said.
