Page last updated at 17:45 GMT, Friday, 3 October 2008 18:45 UK

Business backs Mandelson's return

Peter Mandelson
Mandelson speaks to reporters outside Downing Street about his return

Business leaders have welcomed Peter Mandelson's appointment as business secretary in Gordon Brown's reshuffle.

Mr Mandelson is being recalled from his post as European Trade Commissioner to replace business secretary John Hutton.

The CBI, Engineering Employers Federation, and the Federation of Small Businesses welcomed his appointment.

A new National Economic Committee will also be created to bring together ministers from different departments to deal with the economic downturn.

The committee is to be set up in response to the overall economic situation and not just the recent markets crash, a government sources told the BBC.

Downing Street said the National Economic Council would work to help people and businesses to deal with the current economic uncertainties.

"It will coordinate efforts to help families deal with higher food and energy prices as we work with our international partners in managing the world's scarce natural resources," a government statement said.

'Strong voice'

Mr Mandelson said: "Our economy, like every other, is facing a very hard challenge as a result of the global financial crisis. In a sense it's all hands on deck."

Various UK business groups have backed the return of Mr Mandelson - who is not a Member of Parliament - while praising his predecessor John Hutton.

Hutton moves to replace Defence Secretary Des Browne, overseeing Britain's troops in Iraq and Afghanistan. Sir John Bond, the chairman of Vodafone, has been appointed a business ambassador as part of the shake-up.

Martin Temple, chairman of the Engineering Employers Federation, said: "John Hutton was a good advocate fighting for business across Whitehall and it was important that they replaced him with a big hitter - which Mr Mandelson certainly is.

We will be seeking an early meeting with him[Mandelson] in order to convey some very easy-to-implement measures to safeguard the future of small businesses during these difficult times
John Wright, chairman of the Federation of Small Businesses

"His experience as EU Trade Commissioner, and having previously been at the old DTI, should be invaluable in ensuring that business continues to have a strong voice at the cabinet table."

John Wright, chairman of the Federation of Small Businesses, also welcomed the appointment of Mr Mandelson.

"This shock return is no surprise to us given Mr Mandelson's previous tenure at the DTI and his current position as Britain's European Commissioner for Trade.

"Mr Mandelson's experience will mean that he can do away with the probationary period and get straight into the business of dealing with the current credit crunch.

"We will be seeking an early meeting with him in order to convey some very easy-to-implement measures to safeguard the future of small businesses during these difficult times."

'Big hitter'

John Cridland, Deputy Director-General of the CBI, praised Mr Hutton for giving the Department for Business Enterprise and Regulatory Reform (BERR) a sense of mission and drive lacking at its predecessor, the DTI.

"In particular, he has taken decisive action to try to deliver energy security of supply in the future," Mr Cridland added.

"The Department for Business must have a heavyweight political big hitter at the Cabinet table, and we are encouraged that Peter Mandelson is returning to this role."

The Communication Workers Union said: "He again faces many big challenges and we look forward to working with him."

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