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Fri, 10 July 2020

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Philip Hammond: An uplift in productivity would 'put right' many of the challenges facing the country

Philip Hammond: An uplift in productivity would 'put right' many of the challenges facing the country

Federation of Master Builders

3 min read

Monday evening at the Conservative Party Conference the Chancellor addressed the audience at the Enterprise Forum.

Last night at the rammed Enterprise Forum reception the attendees were welcomed by the Chancellor Philip Hammond.

“Business is a vital part of our social economy, a vital part of our communities, and for us conservatives, a vital part of our reflection of our values.”

He recognised the productivity challenge as a priority for everyone, saying it causes low wages and sluggish growth.

“Much of the disaffection with our politics and our society, I believe, is simply a reflection of the fact that, for many people, ten years have gone past now without a decent real wage increase.”

He said that if that problem could be tackled by an uplift in productivity, “we could put right many of the challenges that we are facing across our society.”

Brian Berry, Chief Executive of the Federation of Master Builders (FMB), agreed, saying that the key to solving the productivity puzzle is innovation and welcomed the £31 billion set aside for the National Productivity Fund as a “huge step in the right direction.”

However more needed to be done on securing the future workforce, remarked the FMB’s Chief Executive.

“Growing labour shortages in the economy means there is a keen interest in what the Government’s new immigration policy will look like.”

Brian Berry also said that the recent report by the Migration Advisory Committee was not reassuring in its finding that the UK did not need low skilled workers.

“This, in our, opinion is a misguided view because of the army of people in the retail, hospitality, nursing, and construction sectors - there is a real possibility that the economy will stop working.”

He urged the Government to engage with the business community in its discussions.

In an effort to ensure a skilled workforce, the Chancellor said that his previously announced reforms to how the Apprenticeship Levy works will give businesses more flexibility in how they use the levy.

He concluded: “I hope what I have been able to do today is to set out a clear agenda for engagement between government and the business community. A commitment of our value that we place on business in our community.

“In exchange, I need something from you...we have to go out once again and sell to ordinary people in this country, including people who in many cases feel that the system isn’t working for them, we have to sell the advantages of the market economy to them.”

“People trust the opinion of business.”

Reacting to the Chancellor’s speech, Simon McVicker from IPSE said, “I was pleased to hear him make his commitment to business and obviously he is sincere in what he is saying but I do believe he needs to turn his words into action.”