1. Torpedo our obsession with home ownership
The ludicrous proportions of take-home salaries that go on mortgage payments for the average British worker do neither individuals nor the country any good. The days when a surplus from the monthly wage packet could be put aside for a rainy day are a distant memory.
This mortgage money could be far more productively saved or spent elsewhere rather than being locked up in bricks and mortar. The destructive cycles of boom and bust in the property market have been one of the major factors dragging the UK and US economies to their knees. It was madness to offer 110% mortgages and it is highly suspicious that foreclosure rates by banks and building societies have not been higher since the crash in 2007-08. And home ownership makes workers less mobile which damages growth and increases unemployment.
In 1953 the proportion of UK home ownership was 32%. The figure for 2010 is 68%. (Comparable figures are: Austria 56%, Denmark 51%, Germany 40%. Spain is 82% and look where that has got them.) Margaret Thatcher was a great believer that selling tenants their council houses was a sure-fire way to turn them into lifelong Tory voters. But it leads to serious imbalances in our economy. There is nothing wrong with renting, and yet we've completely given up building decent social housing which is not available for purchase.
UK governments have already withdrawn tax relief on mortgage interest but should go further. They should risk unpopularity and make it harder to buy domestic property and they should also tax empty property hard to encourage owners to rent it out. There will be inevitable short-term pain here as house prices fall because of reduced demand, but in the long run it will be worth it.
2. Make banks work for everyone
Before those of you who work in this much maligned but vitally important sector reach for the green ink, we're absolutely not of the hang 'em and flog 'em school of banking reform at MT. But we believe reform is needed - financial services represent some 15% of the UK economy and that is probably a bit too much. For while we recognise that a) banking and financial services are crucial to modern global commerce and b) that here in the UK we're rather good at them, we also believe that an economy which was less heavily skewed in that direction would be more stable and better for the nation in the longer term. It would free talent and resources to concentrate on the high tech sector (see five), for example. It is also unarguable that the banking lobby has a disproportionately influential voice, and that it would be a good and democratic thing were its grip on the agents of power and policy to be loosened.
So, retail and investment banks should be split, not simply separated by Chinese walls, and all banks should be required to hold greater capital reserves. The days of banks leveraging their reserves to the tune of 30 times or more must be well and truly over.
But regulation alone is not the answer - banks and bankers themselves need to recognise that prudent governance is their responsibility, not just that of the regulators, and that simply because something is within the rules, it doesn't make it OK.
3. Get our kids ready for work
The biggest threat to the UK's long-term competitiveness is the failure of our education system to produce young people who are ready for work. Academic exam results may be improving every year, but most employers will tell you that the calibre of school leavers is actually getting worse, not better. In a recent CBI survey of more than 500 employers, 44% of them said they'd had to invest in some sort of remedial training for school or college leavers to address basic skills deficiencies.
So what's the answer? The Government wants to make maths compulsory until the age of 18, which would be a good start. But this isn't just about numeracy, or literacy for that matter. It's also about building closer ties between education and work. It's time to introduce a compulsory employability qualification for 16-year-olds, designed and taught in partnership by schools and local businesses. Like a driving test, but for jobs.
The course would incorporate the best bits of the current business studies GCSE, so young people can learn how a business works. It would draw upon elements of enterprise education (which seven out of 10 teachers would like to do more of, according to a recent report by the Aldridge Foundation), including case studies of inspiring entrepreneurs. It would cover practical basics, like how to apply for jobs and conduct yourself at interview. And, crucially, it would involve a compulsory practical component - either a work experience placement in a local firm or a Young Enterprise-style project.
Schools will (not unreasonably) claim that there's no room for this in an already-crowded curriculum. In which case, we say the Government needs to make room. Because if the education system is not producing work-ready young people, it's not fulfilling one of its most important roles. How can UK businesses compete and win internationally without the right raw materials?
4. Staggering income tax
You might say that income tax is already pretty staggering, but stop cracking jokes at the back and listen up. Income is currently banded, as we all know, by income - the more you earn, the more you pay.
But how about income tax bands that rise and fall according to how old you are? Starting at a low base of say 10% for those under 25 and increasing to a peak of maybe 60% for those aged 60 to 65.
The idea is to tackle the huge imbalance in wealth created by the property boom of the 1990s and noughties, which has resulted in a glut of wealthy empty nesters sitting on a fortune in bricks and mortar simply because they happened to be born at the right time. Their children, by contrast, are the first generation to be poorer than their parents in living memory.
By in effect borrowing from their silverhaired older colleagues, the younger generation would be better placed to play a more active role in the consumer economy, get on the property ladder, start investing in a pension and all those grown-up things which they say they simply cannot afford to do now.
A sort of state-sponsored bank of Mum and Dad, if you will. It could make a difference, not least by making it economically feasible for the very young - those under 20 - to get a job, leave home and be properly supporting themselves much more quickly than they do now. We can't help wondering if they might just take the money and still try to tap their parents anyway ...
5. Find a British Bill Gates or Steve Jobs
Alan Sugar could have been our Bill Gates but he flunked it, preferring the easier world of property to make his real stash. What Steve Jobs thinks of the Amstrad emailer phone isn't worth thinking about.
The UK's future is not going to be found in a revival of traditional heavy manufacturing. That game is up. What we need is high-value-added technology operations.
The digital economy is going full tilt in the UK. We spend more online per capita than any other country, according to the Boston Consulting Group. This is a sector where we should really score and become a global contender.
Although there are small clusters of tech companies in places such as Cambridge (Silicon Fen), Bristol (Silicon Gorge) and even London's Old Street (Silicon Roundabout), we have nothing to compare with the size and power of Silicon Valley in the United States, with its hundreds of hot start-ups fuelled by willing and eager VCs.
These UK clusters attract smart techies from all over the world and illustrate the ludicrous nature of immigration controls that limit the import of highly skilled brainy people. But one maddening problem for British tech firms is that after years of sweat and toil to get them established and profitable their founders lose faith, cash in the chips and get out before they can become proper, big international companies with all the advantages that brings.
So the good ones - such as Icera, the Bristol-based microchip maker - end up being sold, in its case to the Americans for $367m earlier this year. The government has got to introduce a capital gains system that encourages those sorts of windfalls to be reinvested in new projects.
Two of our truly world class technology companies are Autonomy and ARM. Now he has sold Autonomy to HP for £7.1bn, Michael Lynch can lead the charge. A tough, smart operator, we should get him on Question Time, get him into Number 10 and give him a government investment pot. Make him our Bill. Lord Sugar need not apply.
6. Build another London airport, fast
Heathrow airport is a) full, b) in the wrong place and c) holding back the UK's economic growth. In July Heathrow broke all records, moving over 6.9 million people, but operating an airport at 98% capacity is a disaster waiting to happen, as we saw last winter when the snow brought our nation's premier transport hub to a standstill.
The misery caused to millions of Londoners by the near-incessant droning and roaring of aircraft over their heads from 5am until midnight is completely unnecessary. In a country where the prevailing winds come from the south-west you do not put an airport handling 67 million passengers in 480,000 annual aircraft movements 12 miles to the west of the homes of eight million people.
Another runway appears out of the question and expansion at Gatwick and Stansted is virtually impossible due to planning restrictions. So, the only answer is a brand new site in the Thames estuary. This has been on the cards ever since the proposal to build an airport on Maplin Sands in Essex was mooted back in the early 1970s.
Several sites have been suggested and there is even a private consortium attempting to raise the £15bn building costs for a site at Cliffe, in Kent, at no expense to the UK taxpayer. A rival scheme designed by Lord Foster and championed by London's mayor, Boris Johnson, would cost £50bn. Such a grand projet would stimulate the economy, provide vast numbers of semi and highly skilled jobs in its construction and begin the fightback against rival airports in France and Germany. A few of our feathered friends in the Thames estuary won't be too chuffed but we cannot afford to dither on this any longer.
7. Turn on the tourism taps
We Brits may moan about the weather but for overseas visitors it's just part of the attraction. The so-called visitor economy provides 2.6 million jobs and is worth £115bn annually to the UK - and visitor numbers are rising. In June, there were 2.9 million visits to the UK and overseas visitors spent £1.7bn here - both figures are records for the month.
With the weak pound and the Olympics just around the corner, boosting tourism is a no brainer. The UK is packed to the gunwales with historic sites, from the Highlands and islands of Scotland through to the cradle of the Industrial Revolution in the north and midlands to the seaside playgrounds of the south and south-west. And there's always East Anglia if you are really desperate.
Those coming to take in the Olympics should be incentivised to spend a few days in another part of the country, enjoying the regional delights on offer and spreading their much needed cash about our beleaguered economy. VAT exemption should be extended to all visitors from abroad, not just those from beyond the EU, as should preferential rates for accommodation and visitor attractions.
There are even opportunities for some good old-fashioned private enterprise here - like the £50m indoor ski centre planned for Weston-super-Mare, which when built will be the longest in the country. Sun, sea, sand and skiing - plus ice creams and kiss me quick hats. What's not to like about that? Admittedly the recent outbreaks of rioting won't have helped our image overseas all that much, but such temporary setbacks soon blow over. And who's to say there is no money in riot tourism, anyway?
8. Light a real red tape bonfire
An oldie but a goody, every business owner in the land will tell you how red tape has been tying the nation's economy in knots for decades. The Forum of Private Business recently estimated that complying with bureaucracy costs the nation's small businesses some £16.8bn annually. That's all money which could be invested in innovation and growth instead. And 84% of FPB members said they were spending more time complying with legislation since 2009.
Even business secretary Vince Cable - for all his estimable virtues he's hardly the most entrepreneurial individual in government - has picked up on this one, vowing a review of the 21,000 rules and regulations which apply to businesses, with the aim of scrapping as many as possible. Favourites for the axe include ditching alcohol licences for selling chocolate liqueurs and the requirements for TV retailers to identify their customers to the licensing authorities.
Such efforts amount to little more than tinkering, however. Making any real difference to GDP requires something with a lot more wallop. How about tackling the regulatory burdens which really weigh down enterprise? Reducing employer's national insurance contributions, for example, not to mention simplifying the minefield of employment law, to make it cheaper and less terrifying for small businesses to hire more staff. And fire them, when necessary. Or looking at a lighter, more SME-friendly regime for parental leave and flexible working statutes?
For while we're all in favour of progressive workplaces and a good family life, it's not always possible for those who work for small firms to enjoy the same kind of perks that their oppo's at blue-chip plcs do.
You don't join a start-up for the free gym membership or company credit card, the rewards of doing something from scratch are more profound, and of vital importance to the prosperity of the economy.
Facts and figures: how to get Britain in order
- 1953: UK home ownership was 32%
- 2010: UK home ownership was 68%
- 40%:German home ownership
- 44% of employers said they'd had to invest in some sort of remedial training for school or college leavers
- 10%: the new income tax rate for under 25s
- £16.8bn: the cost to small business of complying with bureaucracy
- 84% of SMEs spend more time complying with legislation than in 2009
- 98% the capacity of Heathrow: how much longer can it cope?
- £50bn: the cost of the new London airport championed by Boris Johnson
- 21,000: the number of rules and regulations applying to business, which should be culled
- £115bn the value of the visitor economy to the UK