Matt Johnson: Government takes away entrepreneurs’ wish list at its peril

Nov 28 2007 by Matt Johnson, Liverpool Daily Post

AS A former Member of Parliament for the old Huyton constituency once said, a week is a long time in politics.

It’s a view Gordon Brown may well agree with following recent events.

Politics has always given its participants a roller-coaster ride taking in highs and lows.

In these days of relentless scrutiny, our politicians and the parties they represent, find everything they say and do analysed and pored over.

Picking through the last week’s headlines, it’s hard to decide which issues have caused Mr Brown and his Government the most grief.

Hot on the heels of an alarming crop of weekend opinion polls came a broadside from the Confederation of British industry.

Years ago, when beer and sandwiches were famously served to those who used to gather round the Downing Street desk to thrash out issues of the day, the CBI was often referred to in media shorthand as “the bosses’ organisation”. In the same way, reporters always seemed to call the Advisory, Conciliation and Arbitration Service (ACAS) “industrial peacemakers”.

Peacemakers may need to intervene between Number 10 and the CBI.

The confederation claims the Government’s enterprise strategy is “shot to pieces”. Its assertion is based on a survey of 500 CBI Members polled for their views on the changes to capital gains tax proposed in the recent Pre Budget Speech.

For many SMEs (and the many risk-taking entrepreneurs who have created the businesses in the sector) it’s the proposal to replace capital gains tax taper relief with a flat 18% rate that has caused most alarm and dismay.

In its assessment of the plan, the CBI pulls no punches.

“The Government is going to have to start again, and it has a lot to do to convince the small business community that it understands their contribution to the seedbed of the economy – that this is where jobs and growth come from,” says the CBI’s second in command John Cridland.

Here in Liverpool and surrounding areas, we have been trying for years to promote the idea of enterprise.

Improved business start-up rates, growth in specific sectors and better business links to our universities and colleges have all played their part.

But an even bigger part of the story has been the attitude of entrepreneurs willing to take a chance on their particular venture. Their motivations are undoubtedly varied. But the prospect of achieving success, financial and otherwise, is sure to feature in each entrepreneur’s wish list.

Any Government taking that incentive away does so at its own peril.

Our economy, our country, needs entrepreneurs. As other have said, it’s where jobs and growth come from.

MATT JOHNSON is chairman of Mando Group