CBI president Sir Mike Rake says business is not the enemy

Sir Mike Rake, president of the CBI, said Britain could only thrive with strong, productive businesses, large and small, in all sectors

Business is suffering a crisis in public confidence and is seen by some as the "enemy", an industry leader has said.

Sir Mike Rake, president of the CBI, said Britain could only thrive with strong, productive businesses, large and small, in all sectors.

He told the employers’ group’s annual conference in London: “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. Business is undoubtedly suffering a crisis in public confidence – as we have seen in banking, and now in the current debate around energy.” The comments by Sir Mike, chairman of BT, follows increasing anger over soaring energy bills and political debate on how they can be reduced.

Sir Mike said “over simplistic” statements on price controls, or possible windfall taxes on energy firms, played to public opinion.

“But 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 be costly, he warned, adding: “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.”

Defending Labour’s proposed energy bill freeze, shadow chancellor Ed Balls said 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. That is why I believe the CBI has been right to back tough bank regulation. It is why the CBI has rightly urged long-termism and transparency on executive pay-setting. It is why the CBI was right to urge your members to sign up to your code of good tax practice.

“Our task is to show that a dynamic and open market economy can work to raise living standards for all.

But when it doesn’t because competition or regulation or tax law fails, then business and government must work together to solve the problem and win back public trust.”

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

“At a time when politicians and business leaders often seem to compete with each other for bad headlines - be it MPs’ expenses, tax avoidance schemes or rising energy prices – none of us can afford to bury our heads in the sand and ignore the legitimate and mainstream concerns of people across our country that our economy is not currently working for them and their families.

“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 so that, by using and investing in the talents of all, we can deliver rising living standards not just for a few but for everyone in every part of the country.”

 

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