Tax and spending
Britain faces the most turbulent economic conditions in generations and the prospect of a record fiscal deficit. The next Government will face major challenges in designing policies that will both enable a return to a balanced budget and support sustainable long-term economic growth.
Our new report - Supporting UK growth while balancing the budget - summarises an approach to reconciling these two objectives from the perspective of business in London.
Key themes:
Efficiency gains should be the starting point for reducing government spending. By involving more private sector experience and expertise in delivery, substantial savings should be possible.
A framework for decision-making, based on robust and consistently-applied cost benefit analysis, will enhance the credibility of choices and decisions being made, where expenditure cuts prove necessary.
Maintaining planned investment in London’s transport infrastructure is critical to the country’s future growth. The committed public expenditure is substantial – but modest compared with the scale of London’s economy and the benefits it will bring to the UK as a whole.
Tax policy - a crucial element of London and the UK’s competitiveness - must take account of the factors that underpin the capital’s success, including the highly mobile nature of money and people in and out of London and London’s role as a global business centre. Raising Income Tax, National Insurance or Corporation Tax rates is likely to damage the strength and speed of the economic recovery and undermine long-term competitiveness.
Our report represents the views of a steering group comprising members of London First and the City of London Corporation, co-chaired by Stuart Fraser, Chairman of Policy and Resources of the City of London, and Ian Powell, Chairman and Senior Partner of PricewaterhouseCoopers LLP.
The steering group report draws on a longer report, commissioned by London First and prepared by LECG, a global expert services and consulting firm.
Supporting UK growth while balancing the budget
Partner Perspective Ian Powell - co-Chair of steering group
Contact John Dickie
