Member Article

Government needs to do more to promote growth

The Chancellor must introduce policies to encourage growth, but that do not endanger plans to achieve medium term deficit targets, say the Construction Products Organisation.

Between 2010/11 and 2013/14 public sector capital investment will fall by 26%, despite announcements made for additional capital spending in gousing, education and infrastructure.

According to Michael Ankers, chief executive of the Construction Products Association, the Government must now focus on sustainable investment for growth to give the UK economy the best possible chance for recovery.

He commented: “The 2012 Budget provides the Chancellor with the opportunity to introduce a package of measures to stimulate the economy and deliver growth.

“This should include a further re-balancing of public spending away from current expenditure and into capital investment, as this will not only generate economic activity and employment but will increase long term productivity as a result of improving the infrastructure of this country.”

He called on the government to consider purchasing bonds through its asset purchase scheme in a company that buys homes, as this could increase housing provision and prevent the gap between housing supply and housing from increasing any further.

This would also ensure that quantitative easing is implemented in a manner which will fully benefit the UK economy.

He added: “Key to delivering the infrastructure that the country needs is the attraction of additional private finance to compensate for the shortfall in public capital investment and the use of additional quantitative easing to raise levels of housing supply.”

Other key budget proposals include doing more to promote the Green Deal by reducing VAT to 5% and delivering a support package for Energy Intensive Industries.

This was posted in Bdaily's Members' News section by Ruth Mitchell .