Business Confidence

David Pinto-Duschinsky Excerpts

Tuesday 15th October 2024 Westminster Hall

[Bradley Thomas]

In response, did the hon. Member not recognise the conditions that the Government inherited on their election in July? It has already been pointed out in this Chamber this afternoon that the Government have been rehashing billions of pounds’ worth of investment that the previous Government secured and are now passing it off as their own.

Returning to the points that I wish to make, the new Government have claimed that their election has positively impacted business confidence, but the Institute of Directors’ economic confidence index, which measures business leader optimism about the prospects for the UK economy, continued to fall in September to minus 38, having been minus 12 in August. According to the Office for National Statistics, 55% of respondents to a voluntary business survey about challenges facing the economy felt that their businesses’ performance would stay the same or decrease over the next year. The CBI’s industrial trends survey for September shows that more manufacturers think that output will fall over the next three months than think it will rise. Potentially most critically of all, GfK’s consumer confidence index fell to minus 20 in September, suggesting that consumers lack confidence in the vitality of our economy. In large part, that is due to concerns about tax rises—concerns shared by many businesses.

Instead of making the UK a hostile destination for investment, the Government should work to ensure that it is the most attractive destination possible for investment. To become an attractive destination for inward investment, we need to look urgently at the factors that will determine investment decisions. The tax burden, which rose following the global pandemic and the unprecedented level of support provided by the previous Government, is damaging business confidence through fear that there will be higher taxes after the Budget at the end of this month. We need to focus on incentives for businesses investing in large-scale capital projects, access to skills, a long-term industrial plan for the UK economy that will once again reward investment, and a concerted effort on skills development that will lead to a long-term uplift in industrial resilience. That is critical in a world in which our adversaries seek to gain advantage over us and blunt our economic edge.

We have a great opportunity to reduce our dependence on foreign imports and focus on the long term. That is particularly crucial to my constituency. I would like the Government to focus on small businesses and foster a greater sense of individual entrepreneurship at a grassroots level, which would be a massive benefit to constituencies across the country, town centres such as Bromsgrove’s, and rural businesses.

[David Pinto-Duschinsky (Hendon) (Lab)]

Will the hon. Gentleman give way?

--- Later in debate ---

[Jerome Mayhew (Broadland and Fakenham) (Con)]

Thank you, Mrs Harris, for chairing the debate, and well done to my hon. Friend the Member for East Grinstead and Uckfield (Mims Davies) for securing it. What a good debate it has been. It has been a debate of two halves. From this half of the room—the Opposition half—we have heard lots of interventions and lots of thoughts about business confidence, while the other half of the Chamber was entirely empty for the majority of the debate.

There have been some very interesting contributions. My hon. Friend the Member for East Grinstead and Uckfield rightly thanked businesses in all of our constituencies. She focused in particular on the role of family businesses as the thriving local hubs of our communities, as well on as the economic growth that they provide. She correctly identified the importance of animal spirits, which are vital for growing an economy. In the first half of this year, confidence was growing in our business community, but what a disastrous change we have had, with business confidence now falling as a result of tax fears.

[David Pinto-Duschinsky]

Will the hon. Member give way?

[Jerome Mayhew]

No, I am not going to take an intervention. I feel quite strongly that if an hon. Gentleman cannot make it to the start of a debate, wanders in halfway through and then seeks to make an intervention to ask a question—