CITY INTERVIEW: BCC boss John Longworth calls for Government to get a grip on economy

| August 30, 2012 | 0 Comments

By
Hugo Duncan

16:30 EST, 29 August 2012


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01:53 EST, 30 August 2012

‘There’s no question that we are in a bad place as an economy but it doesn’t have to be that way and that’s the frustrating thing about it,’ says John Longworth, the director general of the British Chambers of Commerce.

And it is a frustration that the affable Northerner cannot hide, whether it is over the Government’s ‘scandalous’ aviation policy, ‘utterly mad’ green taxes, or an infrastructure plan he dismisses as ‘hot air’.

After 30 years in business large and small – as a senior executive at Asda and Tesco, a non-executive of the Co-Operative Food Group and drinks maker Nichols, and founder of science research firm SVA – he has little time for ‘professional politicians’ and even less for the ‘self-serving’ Sir Humphreys in Whitehall holding back the economy.

Call to action: British Chambers of Commerce boss John Longworth

Call to action: British Chambers of Commerce boss John Longworth

‘Britain dithers while others do,’ is the 54-year-old’s withering verdict over lunch near the BCC’s offices in Westminster.

‘There is a matter of urgency in all
this and everybody in the country should be relentlessly focusing on
just economic growth. It is not that nothing else matters – it is that
nothing else is possible without it. For the foreseeable future we have
got to put everything else on the backburner and focus on one thing
only. This does require a level of boldness and leadership.

‘But the longer it goes on the bigger the gap will become between where we should be and where we are and that gap becomes increasingly unrecoverable.’

Having succeeded David Frost as head
of the BCC in September last year, he is now charged with lobbying the
government on behalf of British business.

With the economy trapped in the worst
double-dip recession for more than 50 years and the longest downturn
for a century, it is a role he is passionate about.

In his first 11 months in the job, he
has met ‘hundreds and hundreds’ of businessmen and women and been
‘on-site’ at around 200 firms across the country to see what makes them
tick.

‘Businesses have been pulling out all
the stops to make things right and what we want to see from Government
is the same level of commitment,’ he says.

‘We cannot carry on as we are. If we
want a bright future for our children and grandchildren we need radical
action and soon. Otherwise at best the economy will stagnate and bump
along the bottom for years to come.’

Longworth laments ‘a political class that can’t manage because they are professional politicians’.

He says: ‘I would give the key
politicians seven out of 10 for wanting to do the right thing and three
out of 10 for delivery. The gap is created by lack of imagination, lack
of bold leadership and Whitehall inertia.’

A trained scientist, he worries that
only 150 MPs out of 650 have any business experience and only 30 have a
science degree. But worse still is the attitude of the civil service.

‘What it really requires is for
people in Whitehall to put their very intelligent minds to finding one
way to make things happen rather than finding 100 reasons why they
can’t.’

He adds: ‘They are genius in
Whitehall at advising governments about how difficult it is or why it
can’t be done. They don’t seem to put any thought into making it happen.
We desperately need for us all to orientate our minds towards economic
growth. We need bold leadership and some creative ideas and for the
Government to get a grip and stop planning and start doing.’

Longworth remains supportive of
George Osborne’s plan to repair the mess in the public finances created
by the last Labour government – but he is adamant that deficit-reduction
on its own is not enough.

‘We are just as much in danger in the
UK of losing our credit rating from lack of growth as we are now from
the deficit,’ he warns.

‘We could easily lose our credit
rating simply because the Government deficit is going to increase as a
consequence of tax revenues falling because growth is falling.

‘We believe that it is very important
that the Government continues to do spending cuts in the public sector.
Maintaining market credibility by cutting government debt is really
important because government debt is a dead weight on the economy. So we
completely support the Government doing that. But we have got to get
growth as well.’

With the Chancellor under increasing
pressure to act this autumn, Longworth’s top priorities are a British
Business Bank and investment in infrastructure.

A business bank, he says, would be
the ‘cornerstone’ of a more competitive and dynamic economy by lending
to companies that are less than five years old, on the verge of a
‘growth-spurt’, but unable to get the credit they need from high street
banks.

‘Fast-growing and relatively new
businesses need access to finance,’ says Longworth. ‘The commercial
banks are not in a position to provide it. They have been asked to
recapitalise and they are risk averse so they can’t do it. Only the
Government can act.’

He insists that ‘this is not a
Left-wing plot’ but necessary to deal with ‘market failure’ – and he
points to business banks operating in the United States, Germany and
South Korea. ‘So why not us?’ he says.

But is the creation of a British
Business Bank likely? ‘If you had asked me four months ago I would have
said no. Asking me today, I’m much more optimistic.’

When it comes to infrastructure, and
the Government’s infrastructure plan, Longworth is scathing, and he
wants an end to the Government’s ‘scandalous’ opposition to a third
runway at Heathrow.

‘What we need right now is an
aviation policy. I cannot foresee any aviation policy that will resolve
the problem in the short and medium term that doesn’t involve expansion
at Heathrow. We have just got to get a grip, the Government has got to
be brave, put the national interest first, and stop pussy-footing
around.

‘There is a complete vacuum of
political will around something that is fundamental to the UK economy.
They have boxed themselves into a corner on Heathrow.’

He argues that the fuel surcharge and air passenger duty amount to ‘double taxation all in the name of the environment’.

‘But does it actually do any good?’
he asks dismissively. ‘We are mad, utterly mad.’ The situation is little
better when it comes to roads where the Government’s plans are woefully
out of date, he says.

‘Whitehall stopped planning for road
building around the country 15 years ago. They actually haven’t got any
idea of what is even required. As a consequence, chambers have sent a
submission to the Government which is a long list of all the roads
around the country which chambers of commerce have identified that need
improvement.’

But it does not stop there. The BCC
is calling for a ‘massive’ increase in rail capacity, upgrades to
Britain’s ‘woefully inadequate’ digital infrastructure, a ‘strategic
energy policy that actually deals with energy security’ rather than ‘a
green energy policy’, and a renewed focus on education to ensure Brits
have the skills required to prosper in the modern world.

Longworth says:
‘We are a great country. We have demonstrated that throughout history.
We are quite capable of being a wealthy prosperous society making our
own way in the world. We have got all the talent and the energy. We just
need to create a truly enterprise friendly environment and release it.’

Ministers, he argues, will be rewarded if they take the tough decisions required to return Britain to top table.

‘Politicians tend to look at short
term electoral prospects which to some extent makes them less brave than
they ought to be. But people aren’t stupid and if politicians do the
right things for the country they will be rewarded for it in the end.
You can’t have the NHS, or schools or pensions if we haven’t got wealth
creation and enterprise.’

It is a point that politicians and voters of every hue would do well to remember.

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