It’s Cameron, Osborne and Cable who are the enemies of enterprise

by Hugh Golbourne

The small to medium sized businesses that I work with around the UK will have been more than a little confused to hear about David Cameron’s declaration of war last weekend on civil servants within his own government departments. The so called “enemies of enterprise” who are holding back entrepreneurs through red tape – for example, long winded procurement and planning processes.

It is not that Cameron is wrong to have pointed the finger at his civil servants. He is certainly right to identify them as the people who are holding back the economy. However, he is pointing the finger in the wrong direction. It is well known to all – except, it seems, to the man who lives next door – that the treasury has been captured by its senior civil servants. Graduates of the Chicago school of economics and the very product of the baby boomer generation, they assume that the British economy can continue to grow exponentially, regardless of global competition and Britain’s slide down the table of world powers over the past 60 years.

The reality is that all businesses, especially SMEs, are experiencing the bleakest economic environment since the second world war: crushing VAT price rises are destroying the retail and services industries; recovery in the property sector is being stifled by the premature end to rates relief for vacant offices; caution in bank lending due to a lack of policy direction from government in terms of key housing, energy or transport infrastructure. The list goes on.

And the bad news just keeps arriving in waves. In addition to the Tory-Lib Dem government’s poor domestic management, many of our most enterprising businesses are now also being hit by huge rises in petrol, public transport and energy. Essential commodities such as metals or cotton are at an all time high and Cameron’s reforms to retirement age are making it even more difficult for the 24-45 age group to find its own voice and release its innovation and energy on the commercial sector.

Taken together, it is no wonder that all of the independent businesses that I work with in around the country are confused by Cameron’s call for entrepreneurship and see this as yet another example of the empty rhetoric that they have become accustomed to since May 2010. As the chief executive of a local social enterprise that works with start up businesses in the creative industries said to me last week, “where is the sense of adding costs to businesses at a time of dwindling demand for our services”?

So where next if Cameron really does mean what he says and wants to champion the cause of Britain’s beleaguered small to medium sized enterprises?

The businesses that I work with in the new energy sector want to see a clear policy direction and the institutions – regional, national and local – that will ensure investor confidence. The independent businesses – retailers, designers, graphic designers and sports and leisure companies – want to see investments in university places and a return of schemes such as the future jobs fund which enable them to take on and train university graduates so that they can build their businesses. Graduates would like to see policies which remove the barriers to their progression and offer opportunities for entry in the workforce. Medium sized businesses would like to see the baby-boomers supported in retirement so that they can be given an opportunity to drive the economy.

So if Cameron really wants us to believe that he is on the side of entrepreneurs and “go-getters” then he must show his spark of initiative and put in place the package of policies and institutions that are needed to support the growth of small to medium sized business. He should start by finding a chancellor and a business secretary who understand the real barriers to growth and have the capacity critically to examine the outdated non-interventionist economics of their advisers.

Unqualified and unprepared for the role of chancellor, George Osborne should have been removed from his post a long time ago allowing someone with serious commercial experience and political acumen to take on the role. The same could be said of Vince Cable, the business secretary. His ineffective handling of the BSkyB affair has already marked him out as unsuitable for cabinet office and while so many of the chaotic cuts can be blamed on Osborne and co, the removal of the regional development agencies and destruction of universities lie entirely in the hands of the business secretary.

Hugh Goulbourne is a commercial solicitor and a social entrepreneur.

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One Response to “It’s Cameron, Osborne and Cable who are the enemies of enterprise”

  1. Dan says:

    Good article, I feel this subject is something that Labour High Command struggle to articulate our position on, never mind producing an effective critique of Government policy.

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