Recovery in the balance says FPB

The Forum for Private Business wants to see politics put aside for the sake of economic recovery. Good luck...

Last Updated: 31 Aug 2010

The uncertain outcome of the general election is unlikely to come as a surprise to many – a hung parliament has been on the cards for weeks. But that doesn’t mean it's going to be popular: small business organisation the FPB said this morning that it had been hoping that one party would win an overall majority ‘in order to secure swift economic recovery’ (although it wouldn’t say which party as it claims to be ‘politically neutral’). It also called on the main three political parties to put their difference aside and create a functioning administration as soon as possible. Chance would be a fine thing…

The FPB’s point is simple: a hung parliament will produce more uncertainty and make it harder for small businesses to plan for the future – which could be bad news for all of us. And it may well have a point. We all know that the small business sector is the engine of the economy and key to dragging the UK out of the doldrums.

The FPB pointed to its recent research which found that almost three quarters of small businesses were already finding it difficult to plan for 2010, even before this morning’s (non) result. It also argued that a hung parliament could hold up tax reforms and public sector cuts aimed at tackling the UK’s massive budget deficit – thus causing even more anxiety among the small business community.

But while talk of cuts continues to hog the limelight during discussions of economic recovery, there has been little mention of the flipside of the coin: the even more vital business of creating wealth. Cuts are important for sure, but in the end its growth which is more important. You can spend as much as you like, after all, providing that your earnings cover it…

The FPB’s chief exec Phil Orford thinks he has the answer: he said this morning that newly-elected MP’s to put political allegiances aside and work together to nurse the country back to financial health. ‘With the economy still in a very precarious state and a mountain of public debt to be tackled, business owners need our elected representatives to move away from inter-party point scoring and show political responsibility.’

He has surely got a point, but whether the politicians will be able to see far enough past their partisan allegiances to make it happen is another matter entirely…

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