Food firms to Osborne: ‘give us dedicated strategy’

The Food and Drink Federation (FDF) said the strategy was “fundamental” to the food and drink industry’s success in an open letter to George Osborne.

The strategy would help food and drink manufacturers make a “significant contribution” to the government’s productivity plan, the FDF claimed.

“It would underpin and sustain our sector’s economic growth, so we achieve our goal to grow by 20% by 2020,” the FDF’s director general Ian Wright wrote.

The food and drink sector was in a “prime position” to help drive British productivity and regional growth, as it has 400,000 employees, is worth £21.5bn to the UK economy and contributes almost 16% of total manufacturing turnover, the FDF claimed.

The manufacturers’ organisation EEF said Osborne should set measures that would boost growth and productivity, targeted on infrastructure, skills and taxes.

Critical in tackling skills gap

Manufacturing will be critical in tackling the UK’s productivity and skills gaps and the government needed an overall industrial strategy aimed at rebalancing the economy, EEF chief executive Terry Scuoler said.

“The challenge for this government is to take the economy from recovery to sustainable growth,” he added.

“That requires stable policy with an eye to building the skills, infrastructure and technological innovation which will allow internationally competitive, high productivity companies to succeed in the UK.”

EEF supported the need to reduce fiscal deficit but warned by ring-fencing budgets for some departments the government had unnecessarily tied its hands.

“Instead of an across-the-board tariff cut for all unprotected departments, this week’s announcement should prioritise reforms to business taxation and investment in future technology, infrastructure, skills and other contributors to productivity growth.”

Instead, EEF is urging the government to use the current economic growth to carry on backing the successful industrial policy of recent years.

Sabotage economic growth

The Freight Transport Association (FTA) said failing to freeze or cut fuel duty in today’s Budget could sabotage the country’s economic growth.

The Association, which has 14,700 members in the logistics industry, claimed falling fuel prices had been a major factor in the country’s recovery.  But high taxes meant transport operators haven’t benefited, with only a 13% cut in prices at the pump despite a 43% drop in world oil prices, the FTA claimed.

Its chief executive David Wells wrote to Osborne urging him not to break previous promises to hold current levels until September. 

“Cash flow pressures will cause many businesses to implement cuts if the Chancellor raises fuel duty, and that would be detrimental not only to the businesses themselves but also to the economic growth of the country as a whole,” Wells wrote.

Meanwhile the Confederation of British Industry (CBI) called for a five-point plan to boost productivity through: supporting medium-sized businesses, investing in talent, improving infrastructure, encouraging innovation and supporting exports.