UK Business Leaders Want Watchdog Created To Monitor Productivity
UK business leaders have called for tougher targets to be set in order to improve the productivity in the country’s industrial sector and make it more competitive. They have also asked that an independent watchdog be created to monitor overall progress. The suggestions came on the final day of public consultation on the government’s industrial strategy discussion paper.
Providing their inputs, the Confederation of British Industry (CBI) and the EEF industrial federation have urged the government to develop an industrial strategy that would improve living standards and reduces the current productivity gap between the best and worst performing regions by 15 percentage points by 2030
Under the strategy, the Government would set new targets for employment rates, income levels, as well as income distribution and dispersion of economic activity across the country. British workers currently take nearly five days on an average to produce what workers in Germany, France and the U.S. complete in four. Additionally, regional disparities are now starker than what is being observed in other parts of Western Europe.
According to recent data, London’s per person output is 72 percent higher than that of the national average, a sharp jump from being 59 percent higher in 1997. Export performance has also been below par with just 11 percent of businesses in the UK having international sales. The share of exports in Gross Domestic Product (GDP) has doubled in the UK, since 1970 on a constant currency basis, but in France and the U.S. they have tripled while in Germany it has jumped fourfold.
In a statement, Carolyn Fairbairn, head of the CBI said
The UK is at the foothills of extraordinary change as we look to redefine our role in the world and adapt to rapid technological advances in the workplace. A new industrial strategy must aim to make the UK economy the most competitive in the world by 2030.
Fairbairn added that the country must focus on further building available knowledge and revitalize traditional manufacturing bases within the UK and make the country the easiest place to set up and grow businesses. The EEF industrial federation has also asked that a few key measurable targets be set to address the existing productivity gap.
EEF chief executive Terry Scuoler recommended that the government create a strategic framework to ensure all policy decisions are geared towards taking the UK economy towards higher productivity, increased exports and higher investment into innovation.
The CBI has also suggested the creation of an independent monitoring agency, like the Office for Budget Responsibility to measure progress against targets, as well as providing necessary support and advice to the government.
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