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Monday, November 1, 1999 Published at 15:44 GMT

Business: The Economy

CBI denies 'rip-off' claims

Sir Clive Thompson: calling for a balanced policy

The government has been urged not to impose more burdens on British business as it pushes ahead with its consumer-focused 'rip-off Britain' campaign.

Sir Clive Thompson, president of the CBI talking to the BBC's Today programme
Sir Clive Thompson, president of the Confederation of British Industry, told the CBI conference there had to be the right balance between helping business and protecting consumers.

Sir Clive gave a warning that: "It is possible - theoretically at least - to be too pro-business.

"Too hot towards business produces high prices, complacent monopolies and low productivity, with companies protected from international competition.

"But too hot towards the consumer and too cold towards business produces declining and unprofitable companies. It will lead to our markets being progressively dominated by overseas firms, creating high unemployment on our doorstep."

"Look at costs"

Sir Clive said that the jury was still out on the current government: "Maybe we've been sold a dummy here. The government shimmies to the right with business in support.

"Then it dances to the left, leaving us grabbing for air. And then it's away, imposing burdens on business. Before half-time, the Jonah Lomu treatment - we get bashed for 'rip-off Britain'.

"They say our prices are too high. What about the cost of rents, rates, pensions, people, the inadequacy of roads, the cost of fuel, the restrictions on buildings, the high level of the pound and the increasing costs of regulation and business taxes?"

Sir Clive's speech on the first full day of the CBI conference in Birmingham came ahead of the Chancellor Gordon Brown and Trade Secretary Stephen Byers.

Pay cut

Mr Byers said he aimed to press ahead with the campaign against high prices: "When the consumer gets ripped off, which does happen, I will be among those who criticise companies or the industry concerned."

The trade secretary also said that shareholders had a greater opportunity to vote on executive pay rates, with closer links between pay and performance.

That was the subject of a question put on the eve of the conference to Sir Clive, who received a £1.45m pay package as chief executive of Rentokil in 1998.

He responded by revealing that he is expecting to suffer a £500,000 fall in his pay and perks package this year because Rentokil has not exceeded earnings per share targets.

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