A year on from the Kwarteng catastrophe, it’s time we took a different view on growth
Britain needs growth. We have a wealth of business leaders, with proven track records of success, ready and waiting, writes Chris Blackhurst. So why is the government reluctant to listen to their ideas?
One year ago, the plans for Kwasi Kwarteng’s mini-Budget were in full swing.
Kwarteng had been made chancellor in Liz Truss’s new government, which began on 6 September. A little more than two weeks later, he delivered what was billed as “the growth plan” to the House of Commons.
It was a disaster. Kwarteng and Truss were promising too much too soon, without the underpinning of funding. What they proposed was not fully costed and tested. To cap it all, in terms of public perception, some of their measures were skewed towards favouring the better off.
Kwarteng was toast and soon after, Truss. Her successor also stressed the importance of growth. Subsequently, Rishi Sunak ordered a memo to be sent around Whitehall, seeking ideas to boost the economy. There was one proviso: they could not include steps suggested by the discredited Truss regime.
We were reflecting on this on Thursday evening in the House of Lords. E2E, the business networking and mentoring organisation (24,000 members and growing), founded by the champion of Britain’s smaller and medium enterprises, Shalini Khemka, held a dinner to launch E2E Dynamic 100, tracking Britain’s 100 fastest-growing private companies. It’s the fifth such track to be produced in association with The Independent, coming after the E2E Female 100, E2E Tech 100, E2E International 100 and E2E Job Creation 100. “Profit” is next.
Those on the list had to have a minimum turnover of £25m and to have achieved absolute growth over the last two years. Top was Iceland Foods, now run by Richard Walker, son of the founder, Sir Malcolm Walker. Richard’s best piece of advice from his father? “Never, ever, ever, ever give up.”
The frozen food chain specialises in providing value and basks in the title of ‘Britain’s Budget Supermarket’. Shoppers are listened to, and they can take up an array of loyalty offers.
This was a recurring theme of the night: the importance of engaging with customers, supplying them with what they want. Hotelier Surinder Arora spoke of the need “to keep it simple”. Arora, whose business encompasses 6,500 bedrooms and rising, stressed the importance of engaging with all stakeholders, treating them well and securing the best staff. “I can build a building with gold bricks but there’s no point if I don’t have the right people to run it.”
What was telling was that all those present had known tough times. They’d bounced back from the pandemic, rolling up their sleeves and getting on with it. Joe Hemani of tech distributor Westcoast said they had to demonstrate “flexibility and agility”.
E2E chairman Darryl Eales said that in the UK we had to learn to embrace setback, same as they do in the US. “Just because you fail does not make you a failure,” he said.
Everyone nodded. They’d experienced dips, but they’d learned from their mistakes and moved on, to great success. Arora recalled how he almost went under completely but came back stronger.
There was a crackling energy in the room, reflected in what Bev White, CEO of recruiter Nash Squared, defined in her tips for achieving, as always maintaining a “common shared purpose” and possessing “restless curiosity”.
That was reflected in AI. Instead of fearing it, said James Day of Cisco Systems, we should appreciate the coming technology and understand how to get the best from it.
On two issues, there was virtual unanimity. Brexit had dealt a terrible blow to British business. To ringing applause, Hemani said it straight: “We must get back into the EU.” Sitting alongside him, Dhaval Patel from cross-border payments and foreign exchange specialists, Universal Partners, said the same.
Hemani told how he’d recently invested “£200m in a new facility within the EU, rather than in somewhere like Milton Keynes – because the EU afforded more potential.” Britain was in danger of being left behind.
The other was hybrid or flexible working, which they agreed – except for one respect, stressed by Kirsten Hughes of holiday organiser, Travel Counsellors, which was to enable more women to enter or re-enter the workplace – did not, well, work.
Nothing, said Lord Bilimoria, founder of Cobra Beer and chair of the E2E Dynamic 100 celebration, could beat face-to-face collaboration. “People need to be together, like we are right now.”
Really, you wanted Sunak and his colleagues to drop by, to put their heads round the door. There and then they would have been informed in no uncertain terms as to what was required to lift the UK. Lower taxes, less regulation, encouraging immigration of skilled workers and overseas students, a complete return to the office and, if not fully rejoining, at the very least, much closer relations with the EU – these were just some of the items on the wishlist.
Politicians, declared Bilimoria, “should be prepared to change their minds”. Facts alter and if they no longer fit, policy must shift. Our leaders are too stuck in their ways, too wedded to fixed ideas. They ought to be unafraid of moving.
This was the irony of what was mapped out by Bilimoria’s friend, Kwarteng. What the then chancellor put forward made a lot of sense. It was, as Kwarteng said, a plan for growth. It was the execution that was lamentable. And, because it had been advanced by Kwarteng and Truss and the ensuing hostile reception from the markets cost them their jobs, Sunak was reluctant to revisit what they broached. It was crazy.
Britain needs growth. The E2E Dynamic 100 would be an ideal sounding board.
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