Weekly Policy Report 19th – 23rd September 2022
Welcome back to our weekly policy reports. Things have changed somewhat since the last one. Following the period of mourning that concluded on Monday, politics is back with a bang. As well as a new monarch, we have a new Prime Minister, Liz Truss, who is keen to shake up economic policy to foster a climate of growth.
However what has not changed is her full-on brief: high inflation, high energy costs, and very low business confidence.
Now parliament is back in full swing, we’ve had a busy week in policy here at the IoD, something else that hasn’t changed!
A policy win – The government has confirmed it will reverse the recent hike in employers’ National Insurance contributions, something we have consistently called for. This is welcome news to our members, many of whom told us as a result of the tax they either had to push prices up further, fuelling inflation, or think twice about taking on new staff.
Peaking interest – On Thursday the Monetary Policy Committee of the Bank of England increased interest rates to 2.25%. With inflation expectations still high, the key question for the months ahead is whether inflation can be tamed without entering recession.
What a relief – On Wednesday the government published details of its Energy Bills Relief Scheme. This is an important intervention by the government and provides much needed short-term reassurance for the numerous firms that are facing soaring energy bills.
Growth planning – Today, Chancellor Kwasi Kwarteng released a statement on the new government’s growth plan in which he revealed huge tax cuts, the biggest in a generation he claims. This ‘mini-budget’ is an impressive package for business. But we still feel there’s a few things missing.
Next week watch out for…
The Labour Party Conference will begin on Sunday 25th September in Liverpool. It will finish on Wednesday 28th. Key events for your calendar include:
Our Chief Economist, Kitty Ussher, will participate in a panel discussion on how Labour can get voters to trust them on the economy on Sunday at 3.30pm. If you find yourself in Liverpool, you can book tickets here.
Shadow Chancellor Rachel Reeves will give a speech at midday on Monday.
Leader Kier Starmer will give a speech at 2pm on Tuesday.
Deputy Leader Angela Rayner will give a speech at 2pm on Wednesday.