David Cameron set for tense meeting with business figures

David Cameron is meeting leading business figures today after ministers hit out at companies over their unwillingness to invest in the future.

Defence Secretary Philip Hammond accused company bosses over the weekend of “whingeing” while Foreign Secretary William Hague said they should stop complaining on get on with the business of wealth creation.

The angry spat erupted after business groups criticised the Government's failure to include any measures to stimulate the stagnant economy in last week's speech.

It sets the scene for a potentially tense meeting when the Prime Minister sees members of his business advisory group today - including some of the most senior business figures in the country.

Mr Hague opened the assault, dismissing the complaints about the lack of a growth strategy with a blunt message that the only answer to Britain's economic woes was to “work hard”.

Last night, Mr Hammond went accusing large firms of being unwilling to take risks to invest in the country's economic recovery.

“Large businesses are sitting on a pretty large pile of cash,” Mr Hammond told BBC Radio 5 Live's Pienaar's Politics.

“What we have got to try and do is persuade businesses to take the plunge, to just use some of their cash pile, to take a judgment about where demand is going, where the economy is going in the future, and be prepared to back their judgment with investment in British jobs and capacity in the British economy.

“That's what the private sector is about, that's why people in private business can legitimately say they should make profits because they do take risks - it is about persuading them to get out there and invest and take some risks.”

Asked if he was accusing businesses of whingeing, he replied: “They are, yes, I suppose in a way whingeing about it.”

Mr Hammond denied ministers were seeking a confrontation with business - traditionally seen as allies of the Conservative Party - insisting his words were no more than “gentle chiding”.

“These are grown up people with pretty robust words themselves occasionally. I think that they can take it and they can dish it out,” he said.

It was important, however, he said, that the Government's commitment to support business was reciprocated if the economy was to recover.

“The Government can't provide this stimulus because of the deficit situation, households can't provide this stimulus because they are still over-leveraged,” he said.

“The only part of the economy that has the ability to provide that stimulus is the larger corporate sector.”

Shadow business secretary Chuka Ummuna said that ministers should take responsibility for their mistakes and not try to put the blame on business.

“Business leaders have told ministers that this government has lost the plot and urgently needs to work with them to create the conditions to foster private sector growth and to provide a more certain policy environment to give business the confidence to invest,” he said.

“The truth is that this Tory-led government's disastrous policies have put Britain into recession when it inherited an economy that was growing and now they are seeking to dump the blame on business for their economic incompetence.”

Lord Digby Jones, the former CBI director general who was a business minister in Gordon Brown's government, said Mr Hague's comments were "a bit rich".

Ministers were urging action on firms at the same time as withdrawing support for building the "atmosphere" for selling overseas by undermining UK Trade and Investment (UKTI), he said.

"To absolutely decimate that and cut it and then stand up and say 'come on, get on and do it', that's a bit rich," the crossbench peer told BBC Radio 4's Today programme.

While there was justifiable criticism of some of the biggest firms, it was no surprise that others were reticent given the lack of confidence in the markets and in bank lending, he suggested.

Mr Cameron's official spokesman said: "The Prime Minister has been saying for a period of time that what we need is a private sector-led recovery.

"That is why we have been putting in place a number of measures to improve conditions for businesses in this country.

"We have been taking steps to encourage our banks to lend. We have been putting in place plans for boosting Britain's infrastructure. We are cutting red tape for businesses and reducing corporation tax year-on-year to take it to the lowest rate in the G7.

"We have just been through a very tough period, with a massive global financial crisis, a very large recession around the world, and it is going to take time to recover from that.

"We are doing what the Government should do and that is redoubling our efforts to make sure that we create the right environment to allow businesses to grow."

The spokesman added: "It is going to take time and it is going to take hard work - hard work from the Government and hard work from the private sector - to deal with it."

Deputy Prime Minister Nick Clegg joined criticism of business leaders who complained about a lack of action on the economy in the Queen's Speech.

"If passing a law could create a wonderful economy I suspect we would have done it a long time ago.

"You have this rather outdated notion that because 'x' is not in the Queen's Speech it is not going to happen.

"Actually the most important things we need to do for the economy are not things that we need played out in debate on the floor of the House of Commons."

Answering questions following a speech at a school in north London, he avoided any direct comment on the remarks by Mr Hague and his Tory Cabinet colleagues.

Getting the banks lending, boosting housebuilding and jobs for young people were "the really important things that actually oil the wheels of the economy", the Liberal Democrat leader said, accusing critics of engaging in "a bit of a displacement activity".

PA