British business led the recovery

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It doesn’t seem like five years since David Cameron and Nick Clegg came together in the Downing Street rose garden to form a coalition, but in just a few months the fixed-term parliament will end and the parties will be ripping chunks out of each other in an effort to win your votes. Before campaigning reaches fever pitch, it’s worth reflecting on how far we’ve come since 2010. Job creation has been impressive, GDP growth healthy and real earnings are starting to rise.

With polling day in mind, politicians will be looking for the credit but the truth is that our economic recovery has been forged through the hard work, risk and innovation of British business. Government can set the right conditions but it’s individual businesses that ultimately make the decision to invest, to hire staff or to expand. Indeed, the tenacity of UK business has been nothing short of remarkable, with one new company born every minute during 2014 alone.

The spirit of enterprise is thriving after the shock of 2008 and the hardships of the years that followed. Unfortunately, there is no guarantee that politicians will embrace and celebrate the vitality and success of business. An election requires politicians to differentiate themselves and some will seek to do this by attacking and undermining free markets and private enterprise. Right now the country is flirting with an anti-enterprise mood, encouraged by populist politicians and a handful of celebrities.

We must ensure that the successes and the benefits of UK business are sung from the rooftops. Leading that charge will be one of our responsibilities in the coming months.

Don’t shut the door on overseas graduates
I was appalled by Theresa May’s suggestion just before Christmas that international students should be ejected from the UK as soon as they finish their university courses. Sir James Dyson put it well when he said this policy of “train ’em up, kick ’em out” was short-sighted.

The government is right to crack down on people using student visas as a backdoor into the country, facilitated by bogus language colleges. But this loophole has already been closed, and it’s different to the legitimate students who contribute billions in fees in addition to the skills and fresh ideas they bring. Fortunately, the home secretary’s ideas weren’t shared across her party, and those who understood how badly businesses would have reacted blocked the idea. In rejecting the proposal, we saw an example of mainstream politicians talking up the benefits of immigration. Sadly, I don’t expect to see too much of this over the coming months.

Late payment culture still hurting SMEs
Large companies may be having a relatively good time of things, but an IoD survey at the end of last year reminded us that SMEs still have plenty to worry about. Perhaps the most worrying finding was that two-thirds of members have been affected by late payment of invoices. Many said that big firms were delaying simply because they could.

Getting finance is another issue for SMEs, with just one in five saying it is easy. Bank loans are particularly tricky, with most members not bothering to apply in the last three years. Many have turned to credit cards and family or friends for funding. Both findings show a split in the business community. Banks, large companies and small firms are all part of the same system and must pull together to boost UK growth.

‘Negative’ Brand
He may simply be envious of Russell Brand’s popularity, but Tony Blair was surely speaking for many people when, asked by the BBC about the multimillionaire comedian’s plans for a “revolution”, he confessed: “I literally don’t know what it means.” Disillusionment with politics, maybe? Voters are justified in being disappointed with the level of debate on subjects such as immigration, airports or the deficit. Claims fly back and forth, but often our leaders refuse to be honest with the electorate about the tough choices we face. But what alternative does Brand offer? His regular media appearances tell me one thing only – he has no ideas beyond telling people not to vote. We need a better prophet than this. Luckily, the voters agree. In a YouGov poll, Brand’s additions to the political debate were labelled the most negative of any celebrity.

About author

Simon Walker

Simon Walker

Simon Walker served as director general of the IoD from September 2011 until January 2017, having enjoyed a career spanning business, politics and public service. From 2007 to 2011 he was chief executive of the BVCA, the organisation that represents British private equity and venture capital. Walker has previously held senior roles at 10 Downing Street, Buckingham Palace, British Airways and Reuters.

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