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Mon, 26 October 2020

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New government must back UK business, company leaders urge

New government must back UK business, company leaders urge

KPMG LLP | KPMG LLP

3 min read Partner content

UK business leaders call for stability and an end to demonisation in pre-election survey.

New research by KPMG has found that business leaders would like to see MPs championing companies for the role they play in driving economic growth and providing employment. 

The survey included over 600 UK companies, together employing more than one million people and with a combined turnover in excess of £200 billion.

Respondents said that they expected a Conservative-led coalition to form the next administration (43% compared to 26% for a Labour-led coalition).

The business leaders also expressed their concerns about instability and uncertainty, and said they feared Government intervention in different sectors of the economy.

They were much more optimistic, however, about the prospects of growth (both in turnover and jobs) under a Conservative regime than under Labour.

But uncertainty over the EU counted against the Conservatives, as those surveyed would prefer to avoid a referendum.

Simon Collins, UK Chairman of KPMG, said: “Our survey finds that businesses expect, and would prefer, a Conservative-led Government. But managers are worried about uncertainty and the potential for intervention and even demonisation from politicians.

“What they are calling for are balanced measures focused on careful management of the deficit, fair and stable taxation, and an immigration policy that allows companies to retain UK university educated skilled migrants.

“What they do not want is uncertainty; 64% say any delay in forming a new Government would harm their business, 57% that the prospect of an EU referendum is harming their industry and 74% agree that talk of state intervention in some industries is undermining business confidence. This cannot be good news for the economy."

Based on a Conservative win, the research found that business confidence would be double (52%) than with a Labour victory (28%). In addition 61% said the prospects for turnover growth were positive compared to 38% for a Labour victory. In addition, 24% expected corporate tax to be more positive under the Conservatives (14% for Labour) but only 21% agreed that the numbers of skilled individuals would improve (19% for Labour).

The data also suggested that business is strongly supportive of responsible immigration with 76% of those surveyed saying it was important to retain skilled migrants who had been educated in the UK.

One of the most concerning issues uncovered by the research was the prospect for exports, however, where 43% of respondents said they did not currently export and were not planning to.

Mr Collins added: “The UK's strength on the world stage relies in no small part on our companies being able to export. This figure is therefore particularly alarming. Companies need encouragement, support and certainty at home to enable them to make this important step. This has to be a top priority for business leaders, and for the next Government.”

Read the most recent article written by KPMG LLP - KPMG - 2015 party conferences

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