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Thursday, 6 August 2009

President's Blog: The last thing we need is a fandango of quangos

by Peter Heginbotham, President of Greater Manchester Chamber

Let me be absolutely clear, as I have said many times before, that we will do everything that is necessary to assist hardworking businesses to get over the current difficulties which began in America and in particular to deal with the effects of swine flu which began somewhere near America. We will not be cutting public spending except where it is essential to do so.

Does that paraphrase reassure you? No, nor me. Businesses are facing higher taxes with the prospect of even more to come, and the certain knowledge that we will be paying more national insurance and charging more VAT. And, remember, it is business that generates the wealth for UK plc.

For me, the issue in this recession is more about delivery and implementation and not so much about policy. The last thing to do is pour more resource into a fandango of quangos. It’s notable that some are still recruiting in large numbers. When the Chamber visited Westminster last autumn, I put a pound coin on the table. I asked Ministers to imagine that coin as it left the Treasury and went through various ministries, departments and agencies, navigating strategic plans, allocations, tenders, audits and all the rest of it, and ask themselves two questions: How much of that pound gets to the front line, and how long does it take? I don’t know if they found the answer or even if they cared to ask. Half of them are already in new jobs or no jobs in the perpetual Cabinet carousel.
No Government is going to throw hordes of civil servants onto the unemployment register, nor do I suggest it. We could stop recruiting for newly created posts though. There is only one way out and that is to put the resources into the right place urgently so that businesses can begin to thrive, turn the corner and create new job opportunities. The private or business sector must be made as free as possible to grow and where it needs help, the resource should come straight to the front line and not be used in cumbersome and generally pointless process management. The focus should be on two things: direct investment in long-term assets, which create immediate jobs and leave us with facilities we need anyway, whether they be schools, better transport links, houses and so on and, second, in developing skills training, re-training and apprenticeship.

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