The UK’s Engineering Employers Federation (EEF) urged the UK government to use this month’s Spending Review to prioritise investment in sectors key for future growth.
“With government increasingly relying on business to drive growth, next month’s Spending Review must prioritise the actions to help to deliver it. This means getting behind the firms which are innovating and investing in skills and which will deliver the exports to meet the UK’s £1trillion target“, said Terry Scuoler, EEF’s Chief Executive. “We also need to see a step change in investment in our transport system, particularly in our over-stretched road network“, he added.
The current approach of the government to protect large sections of its spending is, according to the EEF, delaying the growth. The organisation therefore expressed its belief that the government should end its ring-fencing of the health budget.
Outlining the key priorities for stimulating the growth, the EEF stated that the government should improve support for applied research by putting science and innovation spending in a combined ring-fence. Support for employers investing in apprenticeships and continuing the efforts to transform UK’s export performance were also mentioned among the recommendations.
The manufacturers are further concerned about rising energy prices, which is increasing the costs not only for energy-intensive industries but also for a growing range of other businesses that struggle to remain competitive.
“The government needs to rethink its unilateral tax on energy through the Carbon Price Floor. It must also make a longer-term commitment to compensate energy intensive firms, who have long investment cycles and who can see rising electricity prices continually increasing over the coming decades”, Scuoler said.
According to the EEF the government should scrap the Carbon Price Support scheme at this Spending Review in order to align efforts and costs in the UK with its European competitors and rethink its current linear cost accelerator aimed at achieving a price of £30 per tonne of carbon dioxide by 2030.
A significant proportion of the annual £3bn capital spending, committed from 2015 at the 2013 Budget, should be targeted at road projects that would give the economy a significant and timely boost.