10 ways to promote growth
A plan for growth should start by identifying what is needed for the economy to grow. The 10 measures set out here would represent a start, but more will need to be done to promote growth and ensure that the UK returns to full employment as soon as possible.
Growth in the short-term requires additional demand and only the government is in a position to provide it. Growth in the medium term requires increasing supplies of capital, labour and land, and better ways of utilising them. It will not be easy.
The government has published a Growth Review and a Plan for Growth, which it is now reviewing. But the economy is barely growing. Each of these documents suffered from the same basic weakness. Each started from a set of measures agreed between the coalition partners - cuts in corporate tax rates, an increase in the personal tax allowance, aggressive budget deficit reduction - and attempted to build a growth plan around them. This is the wrong approach.
A longer companion piece to this paper - The state of the economy - discusses the outlook for the economy, its strengths and weaknesses, and the opportunities and threats that it faces.