Cameron reassures business and pledges UK growth

In a bid to refocus the political debate away from the spending cuts unveiled last week, David Cameron promised to create a “new economic dynamism” in Britain.

Addressing delegates at the CBI’s annual conference the Prime Minister tried to reassure business while announcing the creation of a £200m network of technology innovation centres, linking university researchers with business.

In a speech aimed at offering new hope for Britain’s economic future, Mr Cameron set out plans for a forthcoming national infrastructure aimed at levering in £200bn of long-term investment from the public and private sectors.

Work with me to return this country to prosperity. David Cameron

With ministers banking on rapid private sector growth to replace the estimated 490,000 public sector jobs expected to be lost, the Prime Minister backed a world of “unprecedented economic change” in which small start-up companies can become global giants in a matter of years. Mr Cameron faces a warning from CBI business leaders that Britain cannot “cut its way to prosperity”.

“Over the course of this Parliament – and the next – I believe we can transform our fortunes,” the Prime Minister said.

"The Government lacks an economic plan and is gambling with the British economy." Ed Miliband speaks to Channel 4 News.

“This is an incredible opportunity for Britain, for new start-ups to flourish, for innovations to drive growth and create jobs.

“To build that new dynamism in our economy, to create the growth, jobs and opportunities Britain needs, we’ve got to back the big businesses of tomorrow, not just the big businesses of today.

“That means opening up access to finance, creating an attractive environment for venture capital funding, getting banks lending to small businesses again.”

He concluded: “Work with me to return this country to prosperity. I want to make the years ahead the most entrepreneurial and dynamic in our country’s history.”

Innovation
Mr Cameron said the new technology and innovation centres – based on a model by James Dyson – will help convert innovation into commercial success by bringing universities and business together.

He also highlighted the need to boost competitiveness, with the merger of the Office of Fair Trading and the Competition Commission in and a “more streamlined” competition regime.

I am worried about the government’s failure to provide a wider economic policy. Ed Miliband

“Some industries are too uncompetitive, with significant barriers to entry and obstacles to growth. We’re going to challenge the status quo,” he said.

“We want to reduce the uncertainty and the length of time it takes to make a decision in the current system. Above all, we want to help new companies break into existing markets.”

Labour leader speaks
The Prime Minister’s speech pitched him head-to-head with new Labour leader Ed Miliband who told CBI delegates the government lacks an economic plan to rebuild growth.

“As much as I am worried about the job cuts and pace of retrenchment in the government’s deficit reduction plan, I am equally worried about its failure to provide any sort of wider economic policy,” the Labour leader said.

“Without profound change in the way we manage our economy, we are at risk of, at best, sleepwalking back to an economy riddled with the same risks as we saw before the recession hit.”

Also speaking at the one-day conference, Business Secretary Vince Cable said Britain needs to focus on “growing” out of the financial crisis.

Rules overhaul
The Business Secretary said he was considering an overhaul of the rules on corporate governance, which could make it harder for hostile takeovers to take place in the wake of the Kraft buyout of Cadbury.

Mr Cable launched a wide-ranging consultation at the CBI as part of a review which will ask directors and investors how to change the rules to encourage companies to be run for long-term rather than short-term gain.

The consultation document suggests that a “rebalancing” of the rules is required because they are too much in favour of the offerer