Q1 2012 growth weaker than originally reported

Friday 25 May 2012

Business

The UK economy slowed by more than previously thought during the first three months of 2012, it has been reported.

Latest figures from the Office for National Statistics - which has revised its preliminary growth estimate - indicate gross domestic product fell by 0.3 per cent between January and March.

John Longworth, director general of the British Chambers of Commerce (BCC), said the GDP revision underlines the need for the government to implement a bold, long-term strategy for growth.

"Over the past quarter, business surveys have shown that companies are more optimistic than many of the economic indicators suggest," he stated.

"Many of our members tell us they don’t identify with such pessimistic statistics and are cautiously optimistic."

Mr Longworth claimed that deficit reduction is crucial to the UK economy, but there are measures that the government can take to free up business to grow.

"Firms need to see real deregulation, improved access to finance through the creation of a state-backed business bank, robust infrastructure like transport and energy networks, and ways to help them take on more staff," he stated.

"Reforms to planning rules promised in Westminster must make it out to the real world so businesses can expand."

The BCC director general said that now is not the time for short-term politics - the UK needs a bold, enterprise-friendly government to enable business to grow in the long-term.

"Without this, the economy will continue to bump along the bottom rather than returning to growth," Mr Longworth stated.

He said that businesses do not require hand-outs, they need a government that will facilitate growth and address market failures where they exist, for example in access to finance.

"If the government wants businesses to invest and grow at a time of global uncertainty, it needs to generate stability and a better business environment at home by setting business free," Mr Longworth added.

Posted by Dan Smith