Kennedy: Euro will benefit business

BCC conference: last gathering before the election is called?

The Liberal Democrat leader Charles Kennedy has said his party will put joining the euro at the heart of its agenda for business.

Speaking at the British Chambers of Commerce (BCC) conference in London, he said the benefits of joining the euro were "potentially enormous" for exporters, manufacturers and consumers.

But he said people wanted the government to give them a lead and "the certainty they require to plan for their businesses".

The UK's three main business groups had earlier called on political leaders to promote a stronger enterprise culture.

Sideline risk

Mr Kennedy said any government in which the LibDems had influence or involvement would ensure that it supported business.

He conceded politicians sometimes interfered unnecessarily in business - something not helped by the fact that many of them had not been in business themselves - but said government had an important role to play in business.

Mr Kennedy said that besides joining the euro, the LibDem business agenda included greater deregulation and strong public services, which would ensure a flexible and well-trained workforce.

He said that with UK membership of the euro, exporters would no longer be disadvantaged by the high pound, manufacturers would not be undercut by foreign imports and consumers would be able to compare prices better, leading to greater competition.

"All British business risks being sidelined unless Europe is put at the top of the agenda," he said.

Too much contracting out

On regulation, Mr Kennedy said he favoured government setting the direction and tone of change but leaving implementation to "experts".

He said some good ideas, such as the working families tax credit, had had the unwelcome effect of increasing red tape for business.

"We would ensure that the burden of all such schemes fell on government, not business.

"There's too much contracting out of these issues by government."

Mr Kennedy said he also wanted a "sunset clause" on all new regulations, under which regulations would go out of force by a certain date unless specifically renewed.

"This will go some way to tackling the backlog of obsolete legislation which dogs British business."

Training incentive

He said the LibDems wanted to cut business rates for small businesses.

"[These businesses] are the guarantor of economic diversity and true competition but they are being taxed out of the market," he said.

In other comments, Mr Kennedy reaffirmed his party's wish for another one penny on income tax for education, saying better schooling would provide lifelong learning and the training for the workplace that business needed.

He also said the LibDems wanted tax incentives for smaller businesses that offered employees training.

Simplified tax

Trade & Industry Secretary Stephen Byers had earlier told the conference the government wanted to simplify tax and regulations, in moves particularly aimed at smaller companies.

Among several modest measures, he said the government would shortly announce a new initiative on payroll administration and would also relieve burdens on employers associated with employment tribunals and scrap merger fees for small companies.

The Conservative party leader William Hague said a Tory government would "set business free" from government.

"At the moment in this country we are going in the wrong direction," he said.

"We are increasing tax and regulation."

Crippling problems

BCC director general Chris Humphries said five issues headed the business agenda: Skills, transport, red tape, tax and e-business.

He said the government needed to take action to ensure the right skills were available in the right place while 30 years of under investment in transport had created "crippling problems" for business.

Mr Humphries was joined in a presentation by Confederation of British Industry boss Digby Jones and George Cox from the Institute of Directors - the first time leaders of the three groups have shared a platform.

Mr Jones had earlier said he was "very optimistic about the future of business Britain" but that business needed more freedom.

"All regulation distracts from the real business of doing business," he said.

Massive task

Mr Cox said that although British businesses had a slight advantage on tax over their European competitors this was being eroded.

He said enterprise needed to be "valued and understood" but that this was a "massive task".

"We're not getting across to young people what business is really about."

The conference is expected to be the last major business event before the general election.

Home Secretary Jack Straw is due to speak on Wednesday while the Prime Minister, Tony Blair, is rumoured to be considering making an impromptu appearance at the two-day meet on Wednesday morning.