Environment Affairs
As a key stakeholder with DEFRA we were invited to attend a Business Sounding Board meeting hosted by Justin Johnson, Special Adviser to the Rt Hon Hilary Benn MP, Secretary of State for Environment Food and Rural Affairs. As well as discussing key priorities for DEFRA, the meeting gave us the opportunity to brief him on the findings of our Environment Survey, the need to fund business support on energy and resource efficiency and, encourage technological innovation and demand for innovative products and services through its own purchasing powers.
Separately, we stressed the need to step up awareness amongst business of the REACH requirements to ensure companies don’t miss the pre-registration deadline as well as a more proportionate approach for SMEs under the WEEE Regulations.
Skills
We met with officials from Commission on Employment and Skills to discuss the forthcoming re-licensing of the Sector Skills Council (SSC) network. The process of re-licensing the 25 SSCs will run from now until December 2009 with each SSC needing to show they have the strategies in place to fulfil a revised remit.
This will include raising employer engagement, providing authoritative labour market information and ensuring qualifications meet employer needs. As a major stakeholder, we will be consulted as the process progresses as well as how the SSCs representing manufacturing are performing and what they might do differently in future.
Procurement
We have made our submission to the Glover Review into Public Procurement, announced by the Chancellor of the Exchequer during the Budget statement. Although we welcome the review, we believe that neither the problems nor the potential solutions are novel as improving public procurement practice has been the subject of a number of previous reviews.
Our assessment of the issue has identified four priority areas for government action, a more outcome-based procurement, greater transparency for SMEs, better risk management and understanding of the private sector and, greater skills and incentives to procure goods and services that provide value for money over the long run. In order to achieve these objectives, we believe government must not shy away from making the changes that are widely recognised as necessary.
Furthermore, it should avoid the temptation of loading other objectives such as pay equality onto public procurement. The government is expected to respond to the consultation process ahead of the autumn pre-budget statement and we will remain close contact with Treasury officials on this topic until then.
Interest rates
We accepted the decision to leave interest rates on hold in the face of on-going worries about inflation, but warned that a cut in interest rates may only be matter of time amid further signs of a weakening UK economy. We understand the Bank of England continues to be pulled in opposing directions by rising inflation and slowing growth and that many companies would prefer stability rather than a cut now that has to be reversed later.
However, the balance of risk appears to be shifting more rapidly and we will examine the findings of our third quarter engineering outlook survey, due at the end of this month, before deciding if we need to change our stance.