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Productivity is Key to the Future Success of the Black Country

Responding to the publication of the HM Treasury report ‘Fixing the foundations: Creating a more prosperous nation,’ Johnathan Dudley, Managing Partner and Head of Manufacturing Business at Crowe Clark Whitehill LLP and Chair of the Alliance for the Black Country (which drives the Black Country Chamber of Commerce Competitiveness agenda), said: “There is much in this report to praise: recognition of the need to improve productivity, an infrastructure for business and the need for more companies to explore overseas markets.

“In my business manifesto, published before the budget, I asked for three things that would unleash the potential of the manufacturing sector: we have seen the Annual Investment Allowance remain at a reasonable level but we have seen nothing in the way of incentives for businesses to invest in training or invest in trade missions across the world.

“The Annual Investment Allowance will go some way towards incentivising businesses to invest in new, more productive machinery. However, without the wherewithal to create a great case for investment to take to a bank or alternative financier, our manufacturing companies may not take advantage of the allowance. Schemes such as Funding for Lending and the Enterprise Funding Guarantee are not working. We need to revisit how this money is being spent and enable the professional services sector to contribute to business growth by lifting the quality of investment plans. Unless we do this productivity will stagnate and I have written to the Secretary of State for Business, Innovation and Skills urging him to come and talk to us about how we can double the size of the Black Country economy using an investment readiness methodology.

“The Black Country Chamber of Commerce is helping SMEs to develop their strategic leadership skills and this will certainly help with some of the cultural aspects behind low productivity. It is an area that our American cousins seem to understand better than we do. Nevertheless, an enlightened and productive culture may not be able to make the step change in productivity that some state of the art tooling machines can manage. They can achieve in hours what takes older machines two or three days.”

Commenting on the need for a modern transport system, another one of the fifteen points in the ‘Fixing the Foundations’ report, Colin Leighfield, Director of B.E. Wedge and Chair of the Black Country Chamber of Commerce’s Transport Group said: “We have been asking for an integrated and coherent transport strategy for some time, one that will attract private investment and one that overcomes the ridiculous dissonance between the UK’s airport and High Speed Rail strategies. The UK will only become truly productive when our businesses can transport their products by road, rail, air and sea in the shortest possible time. In the Black Country our precision engineers are ready to supply to the world. It is very disappointing therefore when the first two hours of that journey is being stuck on the local road and motorway system and when managers are having to waste valuable time travelling to Heathrow or Manchester for international flights that Birmingham Airport is perfectly capable of providing now that it has the longer runway.

“We will be watching closely to see how revenue generated from the new Vehicle Excise Duty proposals is invested and also for a realisation that the conclusions of the Davies Commission which focus attention on the South East and Heathrow are short-sighted and not in our best interests.”

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