4 Nov 2013

British business seen as ‘enemy’, CBI told

Business in the UK is suffering a crisis of public confidence and is seen by some as the “enemy”, an industry leader tells the CBI conference.

The president of the CBI, Sir Mike Rake, told the employers’ group’s annual conference in London that Britain can only thrive with strong, productive businesses in all sectors.

He claimed that the banking and energy industries had damaged the public perception of business.

“Business is undoubtedly suffering a crisis in public confidence – as we have seen in banking, and now in the current debate around energy,” Mr Rake stated.

“Some of the rhetoric we’ve heard recently suggests that business is somehow the enemy – we are not, and this could not be further from the truth.

“We want to be, we can be, and we are partners in building prosperity.

Sir Mike, who is chairman of BT, claimed “over simplistic” statements on price controls, or possible windfall taxes on energy firms, were just playing to public opinion.

“They will not address the complex problems that need to be resolved – indeed, they are very likely to have the opposite effect.”

Transforming the energy market will come at a cost, he warned: “The obvious issue is how to balance long-term investment with the short-term pressures on household budgets.

“People are of course concerned about rising prices. They feel, rightly or wrongly, that they’re being unfairly treated.

“There are no easy answers, but the public deserves better than politicians playing the blame game.”

Losing faith

Shadow chancellor Ed Balls defended Labour’s proposed energy bill freeze, claiming governments had to step in “when markets fail” or risk losing public faith.

“Markets promote growth and innovation and reward entrepreneurship – and when they are competitive they should set prices, not Government or anyone else,” he told the conference.

“But being pro-market and pro-competition also means acting when markets fail and competition does not operate otherwise we risk public support.

He said big business – as much as politicians – had to confront the reality of a damaged public image.

“That is why we believe it is so vital that government works closely with all businesses, large and small, to promote open markets, competition and long-term wealth creation, and to reform our economy.

No bonus

The head of British Gas owner Centrica said he will not take his bonus this year amid anger over soaring household bills.

Speaking at the CBI conference, Sam Laidlaw said trust in the energy sector is at an “all time low”.

“Just to continue in this world where households are under pressure, and assume it is business as normal, is not the way thoughtful remuneration committees think about it.”

“We are listening – we get it, absolutely. We know there is a problem.”

Mr Laidlaw added that there was no scope for switching profits from one part of the business to another.