Manifesto backs British industry

Britain’s manufacturers have launched their business manifesto, calling for a better quality of debate surrounding the future of manufacturing.

Britain’s manufacturers have launched their business manifesto ahead of the general election and called on all political parties to focus on a better quality of debate surrounding the future of manufacturing, rather than constantly blaming each other when job losses occur.

Publishing the manifesto, EEF – the manufacturers’ organisation – believes that, too often, politicians only take an interest in manufacturing when bad news occurs. Instead, they should focus on the importance of manufacturing in a high value, high skill economy and its value in creating wealth.

“We don’t hear nearly enough from the political parties about the future potential and importance of manufacturing. Too often we only hear a debate when bad news occurs and a national icon such as Rover is under threat,” said EEF Director-General, Martin Temple.

“It is in this context that the political and economic debate should be set as to how the UK can substantially increase its level of investment in technology and develop the people to use it,” continued Temple.

EEF also warned that business must not be seen as an easy target for any tax increases in the next Parliament, which would only serve to damage the competitiveness of the UK as a manufacturing location and accelerate the number of jobs being lost overseas.

EEF believes that the UK is losing its advantage as a low tax economy. It backed its view by releasing analysis of Organisation for Economic Co-operation and Development (OECD) figures showing that between 1997 and 2006, the revenue raised by government from the UK economy will have increased from 39.2% to 42.1%, while falling from 39.1% to 37.1% across the OECD. Only Iceland and Korea will have seen a larger increase in the tax burden. In addition, while the Euro area’s tax burden is still higher (45.3%), the UK‘s advantage will have narrowed by five percentage points between 1997 and 2006.

Business has borne more than its fair share of tax increases, with the total tax burden rising by £7.7 billion since 1997. Particularly worrying for manufacturers is that the bulk of these taxes have affected their cost base and are hard to pass on to customers. A combination of higher national insurance payments and environmental taxes mean cost based taxes have increased by £5.5 billion.

The manifesto, published together with five other major trade bodies across the manufacturing spectrum, comes ahead of the launch of the Labour and Conservative business manifestos.

According to the EEF, key priorities for the next Government should include supporting manufacturing investment by ensuring a competitive UK tax regime and by introducing a capital investment tax credit. Similarly, the EEF believes the next Government should drive forward a coherent energy strategy which addresses climate change whilst maintaining business competitiveness; and reduce the regulatory burden and put better regulation at the heart of policy development in the UK and Europe.