Member Article

TUC call for Osborne to address £50 billion ‘investment gap’, in Budget

The Chancellor must address a £50 billion investment gap in the UK in today’s Budget, the Trade Union Congress has said.

The TUC suggest investment has actually fallen as a share of GDP since mid-2010, while the gap between planned and actual investment levels continues to rise.

Suggestions detailed in the TUC report include: increasing the scope of the UK Guarantees scheme to match the scale of Help to Buy (which could also be scaled back by being limited to first-time buyers); bringing forward infrastructure projects scheduled for the next Parliament so projects could start in the next year or two, and; cancelling scheduled cuts to corporation tax and reinvesting the money into capital allowances to promote business investment.

TUC general secretary Frances O’Grady said: “For decades our economy has suffered from over-consumption and under-investment.

“The Chancellor promised to address this failure but instead has presided over a growing investment gap that has held back growth and which risks causing permanent economic damage. He has the chance to put things right.

“George Osborne can start to undo the damage caused by slashing capital spending by giving greater financial guarantees to infrastructure projects. This should encourage firms to crack on with the construction of much-needed homes, schools and transport routes.

“The Chancellor should also admit that the billions given away in corporation tax cuts have failed to spur investment. Future cuts should be cancelled and reinvested in more generous capital allowances.

“After four years of ineffective initiatives, now is the time to start making good on the government’s promise to rebalance the economy.”

This was posted in Bdaily's Members' News section by Tom Keighley .