SHORT-TERM politics should not be allowed to trump prosperity, according to the director-general of the CBI.
Carolyn Fairbairn also warned that the new apprenticeship levy risks failure “through poor design”, although the CBI backs the Government’s long term aim of creating more apprenticeships.
Ms Fairbairn said: “2016 starts out with an enviable inheritance and plenty of promise. The UK economy has delivered a 2.8 per cent growth rate, almost no inflation and, best of all, the highest rate of employment since records began in 1971. In the last year alone, British-based businesses created more than 400,000 jobs, despite heavy global headwinds and a rising pound. These are extraordinary achievements and a great springboard from which to start the New Year.”
However, Ms Fairbairn warned that skills shortages exist across many industries.
She added: “The Government understands this challenge well and is seeking to address it through a new 0.5 per cent apprenticeship levy on all businesses with over £3m payroll. Though the ambition is welcome, the scheme doesn’t yet have a clear delivery system and risks failure due to chasing blunt targets. Business and government will need to collaborate closely to make it work for our young people and for firms – the CBI stands ready to do so.
“This will be particularly important for smaller scale-up firms, which have been such an important driver of UK growth and have a pressing need for skilled people.
“While there are public concerns around immigration, with pressures on some public services, 2016 must be the year we reform the UK’s wrong-headed visa policies that are keeping global talent from our growing firms and global students from our world-class universities. The risk is that the situation could get worse, not better.
We stand ready to help the Government shape a modern, fit-for-purpose immigration system.”
Ms Fairbairn said that big decisions must be made about infrastructure, especially in aviation and energy. She said the UK needed to start building roads, rail and more homes.
She added: “Good business needs good infrastructure – yet the UK currently ranks 24th in the world, according to the World Economic Forum.”