Speech

Fixing the foundations: boosting Britain바카라 사이트™s productivity

The Business Secretary launches the government바카라 사이트™s plan for tackling the economic challenge of our time: increasing Britain바카라 사이트™s productivity.

This was published under the 2015 to 2016 Cameron Conservative government
The Rt Hon Sajid Javid

Introduction: the progress we바카라 사이트™ve made

Birmingham is an incredibly diverse city in so many ways, not least the huge range of businesses that call England바카라 사이트™s second city their home. Whether it바카라 사이트™s in automotive, the creative industries, or of course jewellery, there바카라 사이트™s an incredible breadth of entrepreneurial talent in this city and this room today.

But for all the diversity you all have one thing in common. You all saw the scale of the challenge that British businesses faced in 2010.

The worst recession in almost a century. The biggest budget deficit since the Second World War. The world바카라 사이트™s largest bank bailout. A nation saddled with debt and an economy struggling to grow.

Five years on, the picture is very different. Our long-term economic plan is working, and Britain is working. Or economy is growing faster than that of any other G7 nation, and we바카라 사이트™ve gone from a record-breaking recession to record employment. Last year, Birmingham alone created more new jobs than the whole of France.

But we바카라 사이트™re not about to stop now. I want to take British business to the next level. And the best way to do that is to boost our productivity.

Productivity: why it matters

Productivity is something we바카라 사이트™ve been hearing a lot about recently, and that바카라 사이트™s because it바카라 사이트™s one of the few areas of the economy where Britain is struggling.

Britain is home to some of the world바카라 사이트™s most innovative and dynamic businesses, staffed by incredibly talented, hardworking individuals. Yet our productivity 바카라 사이트“ the rate of output per hour worked 바카라 사이트“ is well below its potential. In stark terms, it now takes a worker in the UK 5 days to produce what his or her counterparts in Germany can deliver in 4.

The picture바카라 사이트™s not entirely bleak. Standing here in Longbridge a decade ago you could have been forgiven for thinking that Britain바카라 사이트™s car industry was in terminal decline. Yet today, the UK is home to the world바카라 사이트™s most productive automotive sector. And if one sector can solve the productivity puzzle in such spectacular fashion, there바카라 사이트™s no reason why others can바카라 사이트™t too.

It바카라 사이트™s crucial that they do, because productivity isn바카라 사이트™t just some obscure measure, of interest only to economists. It matters to each and every one of us. If we could match USA for productivity, it would boost our GDP by 31% 바카라 사이트“ that바카라 사이트™s equivalent to £21,000 a year for every household in the UK.

And higher productivity means higher incomes. When productivity rises, standards of living rise too. So today I바카라 사이트™m proud to publish 바카라 사이트˜Fixing the foundations바카라 사이트™. It바카라 사이트™s our plan for productivity, and our blueprint for creating a more prosperous nation.

Let me talk about 3 elements that are particularly close to my heart.

Transport

The first is transport. The internet has revolutionised the way many of us work, but you just had to look at the disruption caused by this week바카라 사이트™s strikes to see that reliable transport links are still a vital part of any serious, growing economy.

Yet for decades, successive governments have not invested enough in maintaining and developing the arteries of British business. Congestion on our roads is getting so bad that by 2040 we could lose more than 100 million working days to traffic jams. 100 million days! If we don바카라 사이트™t fix this problem British business will, quite literally, get stuck in the slow lane of Europe.

So over the next 5 years we바카라 사이트™re going to invest £100 billion in infrastructure. We바카라 사이트™re going to create a new roads fund to ensure continued high and stable investment in the strategic road network for generations to come. We바카라 사이트™re going to get the rail investment programme back onto a sustainable footing, and change the way we provide public money so that Network Rail focusses firmly on the needs of train operators and passengers.

And, unlike previous governments, we바카라 사이트™re going to grasp the nettle of airport capacity in the south east, taking a decision by the end of this year.

Planning

Of course, we haven바카라 사이트™t just lagged behind on transport infrastructure. The UK has long been incapable of building enough homes to keep up with growing demand. This doesn바카라 사이트™t just frustrate the ambitious of hardworking people who want to own their own home 바카라 사이트“ it also harms productivity and restricts flexibility in the labour market.

So we바카라 사이트™re going to introduce a new zonal system, which will effectively give automatic planning permission on suitable brownfield sites like the one behind me. We바카라 사이트™ll make sure the homes that are needed get built 바카라 사이트“ if a council fails to produce a suitable local plan, we바카라 사이트™ll have it done it for them. And we바카라 사이트™ll be devolving major new planning powers to London and Greater Manchester.

Too many homeowners are frustrated by red tape that stops them extending their homes to accommodate growing families. It바카라 사이트™s a particular problem in our crowded capital city. So today I can announce that the government will be working with the Mayor of London to make life easier for people who want a little extra space. We바카라 사이트™re going to remove the need for Londoners to seek planning permission for upwards extensions up to the height of an adjoining building, provided your neighbours don바카라 사이트™t object. It바카라 사이트™s a simple step that, at a stroke, will take layers of bureaucracy and cost out of the planning system.

Education

But productivity isn바카라 사이트™t just about buildings and roads and infrastructure. It바카라 사이트™s also about people. About making sure British workers have the skills they need to compete. And right now, too many of young people are missing out. We바카라 사이트™re one of the only advanced countries where the skills of our 16 to 24-year-olds are no better than those of our 55 to 64-year-olds. It바카라 사이트™s simply not good enough, and it바카라 사이트™s storing up problems for the future.

Part of the problem lies in our system of training. Enter the professional and technical education system today and you바카라 사이트™ll be faced with a blizzard of complicated and overlapping qualifications, often with no obvious pathway to a decent job. So we바카라 사이트™re going to simplify and streamline the system, replacing thousands qualifications with clear set of routes that allow for progression to high level skills.

And that high-level, sector-specific skills training will be provided, in part, by prestigious new institutes of technology. As is the case in some of the world바카라 사이트™s most productive nations, these institutes will be sponsored by employers, registered with professional bodies, and aligned with apprenticeship standards.

The role of business

So our plan for productivity is clear. We바카라 사이트™ll get Britain moving, we바카라 사이트™ll get Britain building, and we바카라 사이트™ll get Britain learning. We바카라 사이트™ll deliver the infrastructure and skills this country needs to become the world바카라 사이트™s richest major economy.

But there is one thing missing from the plan. You. Because the government cannot do this alone. The plan I바카라 사이트™m launching today will create an open, competitive economy and deliver much-needed investment in skills and infrastructure. But only the private sector can produce sustainable growth, create long-term jobs and make the economy as productive as it can be.

Boosting productivity is the economic challenge of our age, and there바카라 사이트™s a long way to go. But together we can get there.

On Wednesday the Chancellor talked about fixing the roof while the sun was shining. Today, the sun is shining once more. And, together, we바카라 사이트™re fixing the foundations.

Thank you.

Updates to this page

Published 10 July 2015