Taking office in the wake of the Global Financial Crisis, one of the Coalition’s greatest challenges has been to re-ignite economic growth. Alongside reducing the deficit, the handling of this issue is likely to be one which helps determine whether the Coalition is viewed as a success or a failure.
So what exactly is the Government’s growth strategy? The 2011 Plan for Growth outlined four ambitions:
1. Creating the most competitive tax system in the G20;
2. Encouraging investment and exports as a route to a more balanced economy;
3. Making the UK the best place in Europe to start, finance and grow a business;
4. Creating a more educated workforce that is the most flexible in Europe.
There have been plenty of critics of this strategy, with many across the left and right of the political spectrum arguing that it lacks coherence. For instance, Sir Richard Lambert used his final speech as Director General of the CBI in January 2011 to criticise the Coalition for not applying the same rigour it has shown with spending cuts to policies that support growth. Similarly, the British Chambers of Commerce told the Government to get ‘some backbone’ on growth, and the Institute of Directors has described the Chancellor’s strategy as ‘ineffective’ and ‘too slow’. Even the Secretary of State for Business, Innovation and Skills, Vince Cable, has said that the Government ‘lacks a compelling vision of where the country is heading beyond sorting out the fiscal mess’.