ICAEW sets out vision for sustainable post-COVID recovery
4 August: ICAEW identifies priorities for policymakers looking to deliver an environmentally and economically sustainable recovery.
While policymakers across government continue to grapple with the health crisis while protecting livelihoods, eyes are beginning to turn to delivering our economic recovery.
In June, the Business, Energy and Industrial Strategy Committee launched a new wide-ranging inquiry, Post-Pandemic Economic Growth. The Committee – a cross-party group of MPs appointed by their colleagues in Parliament to scrutinise the work of the Department for Business, Energy and Industrial Strategy – called on business and wider society to set out their views on what a sustainable recovery would look like.
For ICAEW, this was an opportunity to reach out to members working in, leading and advising businesses across all sectors and regions of the UK. It wanted to understand the challenges faced during this crisis and where the opportunities were to support businesses during the recovery.
For them, support is essential in two priority areas: helping businesses to make the transition to a green economy, underpinned by investment in new skills and technologies; and addressing long-standing regional inequalities through equipping local government and local enterprise partnerships (LEPs) with the means to deliver economic growth in their communities.
Based on these insights, ICAEW proposed the following framework for policymakers to deliver a sustainable recovery:
- the recovery needs to be environmentally sustainable with transparent evidencing of progress toward delivering the UK’s UN Sustainable Development Goal (SDG) commitments;
- it should be investment-led, with a focus on business growth and innovation, skills, and infrastructure (social and economic) to build regional resilience across the whole of the UK;
- there must remain a focus on existing work to promote social mobility, diversity and intergenerational fairness;
- delivering a sustainable recovery requires a business tax system that encourages enterprise and maintains international competitiveness; and,
- the recovery needs to include a long-term fiscal strategy to put the public finances onto a sustainable path.
Immediate steps ministers could take to deliver on these priorities include helping businesses to better measure their dependencies on people and the planet, and the Government finalising the Infrastructure Strategy to set out what their priorities are for spending. This would catalyse investment in innovation, skills and both social and economic infrastructure.
Most importantly, ICAEW stressed that economically and environmentally sustainable growth must be underpinned by businesses having confidence in government’s willingness to invest in infrastructure, skills, and in regional and local economies.
Iain Wright, Director for Business and Industrial Strategy at ICAEW, commented: “As we look to build back better following the impact which coronavirus has had on our economy, it is vital that the Government takes action now to build a more resilient, prosperous, sustainable and regionally equitable economy to secure our long-term success. Top of the list must be accelerating the process of meeting our SDG commitments, especially around supporting businesses in making the transition towards a green economy.
Yet with two ‘once-in-a-century’ economic shocks in the past dozen years, the Government also needs to be looking to build economic and social resilience into the economy. Trying to minimise the economic damage arising from Coronavirus, especially the viability of our country’s small business base, is essential. This will require collaborative efforts by government and business in investment in jobs, skills and infrastructure across all regions and nations of the UK. Putting the public finances back onto a sustainable path, after the biggest shock outside of wartime, is vital for ensuring our economy’s ability to weather future challenges.”