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Boris Johnson should act now to ensure his successor can manage cost of living crisis
CBI chief proposes four actions to end the August power vacuum
The CBI Director-General, Tony Danker, has urged the Prime Minister and Chancellor to not allow for a Summer of drift in the middle of a cost-of-living crisis. Recognising that a new Prime Minister and Chancellor will have their own thinking, the UK’s leading business group has set out four clear actions for the Government to undertake, allowing the next No 10 occupant to make an immediate impact.
Those actions include:
- Cost of Living Pledge - The PM must bring together both leadership candidates in the next two weeks to agree a way forward to support people and businesses with energy bills once the OFGEM price cap is announced on 26th August. This will allow the current Prime Minister to issue reassurances on 26th that people will be significantly supported – not waiting until 5 September or later
- Put the Office for Budget Responsibility on official notice that an emergency budget is likely in September, whoever wins, and they must prepare their forecast immediately and with haste
- Direct the Cabinet Secretary to prepare options - a package of choices that can be proposed to the leadership candidates now on how to support the most vulnerable people and firms through the autumn and winter. The Cabinet Secretary should also make officials available to both camps to support preparation
- Take overdue, pro-growth decisions now - Government should keep making the decisions and delivering to help build business confidence over the next 4 weeks. For example:
- Clarifying the status of key projects, such as the planned investment commitments to the Ox-Cam Arc, among others;
- Adding immediate flexibility to the Apprenticeship Levy for one year;
- Getting going on a new shortage occupations list and add sectors with obvious shortages, like aviation, until that review can be completed;
- Cutting approval times for new offshore wind farms from four years to one.
Tony Danker, CBI Director-General, recently said:
“The economic situation people and businesses are facing requires all hands to the pump this summer. We simply cannot afford a summer of Government inactivity while the leadership contest plays out followed by a slow start from a new Prime Minister and Cabinet.
“The Prime Minister and Chancellor should be taking the next few weeks to grip the emerging crisis and the planning required to tackle it. This will also give their successor – whomever that may be – the very best chance of getting quickly out of the blocks.
“That means whirring the Whitehall machine into action to prepare for day one of a new premiership, allowing the candidates to interact now with officials on what can be done to help the most vulnerable people and businesses as inflation continues to rise.
“Crucially, there is going to be a great deal of worry for many over how they will pay their energy bills after the next price cap. It makes no sense to wait an agonising 10 days or so from the price cap announcement to ‘day one’ of a new leader. That means the Prime Minister and the candidates should come together to agree a common pledge to support people and help quell fears.”
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