Shadow business secretary Chuka Umunna has criticised the Government for “rigging” the rules against businesses which want to make long-term investments in future growth areas.
The Labour MP claimed the Government is taking “precisely the wrong approach” to helping Britain’s economy recover at a speech in London. Science funding has been reduced by 15 per cent in real terms, showing how “out of touch” ministers are with the needs of cutting-edge sectors, Umunna claimed.
Umunna also slated the Government for cutting capital allowances, failing to use government procurement power effectively and delivering mixed messages on green measures.
In his first set-piece address since being handed a shadow cabinet role, Umunna said: “The challenge is more than restoring the economy to growth in the next year – as vital as that is.
“We also need to confront head-on some of the longer-term issues exposed by the global financial crisis if we are to take full advantage of the opportunities of tomorrow. What is the Government doing? It has adopted precisely the wrong approach. It is making the wrong choices for our economy in the short term, choking off the recovery. But it is also making the wrong choices for Britain in the long term too.”
Science funding faces a 15 per cent real-terms cut according to figures from the House of Commons library and Umunna believes this undermines the Government’s claim it is protecting the sector. He added that delays to a Green Investment Bank, “wrecking” of incentives to fit solar panels and scrapping the carbon capture and storage project had also deterred investment.
The UK has dropped from third to 13th place in the global green investment rankings, according to Umunna, who claimed that experts believe uncertainly over the Government’s approach to the environment was to blame.
However, a spokesman for the Department for Business said the Government was working to drive growth and rebalance the economy. He said: “£950m from the Regional Growth Fund will enable businesses to safeguard more than 200,000 jobs across England. The £500m Growing Places Fund will kick start local infrastructure projects.
“Our £140m investment in a high value manufacturing technology and innovation centre will enable the UK to to stay at the forefront of world-class manufacturing. And despite enormous pressure on public spending, the £4.6bn per annum funding for science and research programmes has also been protected in cash terms and ring-fenced against future pressures during the spending review period.
“But we know there is still more to do and further action can be expected in the coming weeks.”