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14 May 2010 Business urges new Government to reduce the deficit

As the newly appointed Prime Minister David Cameron began the process of shaping his Cabinet, business leaders called on the new Government to concentrate its efforts on reducing the deficit.

The Confederation of British Industry (CBI) welcomed the news of a coalition agreement between the Conservatives and Liberal Democrats.

CBI Director-General Richard Lambert commented, 'Business wants to see a stable Government with the authority to take the tough decisions that will be required to keep the economic recovery on track and to get a grip on the fiscal deficit'.

Meanwhile, the British Chambers of Commerce (BCC) echoed the CBI's call for the Government to make restoring fiscal stability its top priority.

Reiterating the BCC's request for the Government to deliver a 'clear and achievable plan for business' within 90 days, BCC Director-General David Frost said, 'The Conservative-led coalition must be absolutely clear about where spending cuts will fall, and about the need to curb relentless growth in the size and cost of the public sector'.

Among the key plans understood to have been agreed by the new Government are:

£6bn of spending reductions set to take place this year
plans to recognise marriage in the tax system
the scrapping of part of the planned rise in national insurance contributions
plans to work towards raising the lower income tax threshold
the scrapping of plans to increase the inheritance tax threshold to £1m
the scrapping of plans to introduce a 'mansion tax'

Incoming Chancellor George Osborne will hold an emergency Budget within 50 days.