Insider Media Limited

Businesses might have cash to invest but they are in "unchartered territory" and unsure about how to move forward. That's what John Rider, chairman of the West Midlands Institute of Directors (IoD), told Insider. He criticised the coalition government and its predecessor for a lack of understanding and action.

Speaking at an Insider round table event, Rider said that the previous Labour government did not grasp the full extent of the financial crisis of 2008.

"I remember Peter Mandelson used to come to Birmingham – I think he breathed through his skin, because all he did was talk and talk and never listen," he said.

"Businesses were going through dreadful experiences, but he didn't accept anything."

Rider also blamed the current coalition government for a lack of action.

He said: "When they say they’re going to do something, nothing happens. Take the Regional Growth Fund, for example – only two small amounts of money have been paid out on that. The same with enterprise zones; if the government thinks hundreds of businesses are going to up sticks and move just to save a few thousand pounds on rates, then it's wrong.

"My real concern is that politicians don’t do austerity very well."

Asked whether he could see any light at the end of the recessionary tunnel, Rider said that exports were a hope for the future, but that to be successful you have to be "a niche manufacturer".

"There really aren’t a lot of reasons to be happy at the moment," he said. "The main issue is a lack of confidence; we’re in very strange, unchartered territory right now."

Talking about opportunities overseas, he said: "There is a push to towards the BRIC countries, but it's very difficult to do business from a standing start. Also, I think there are problems in many of these countries."