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Programme highlights Friday, 16 February, 2001, 16:23 GMT
Brown defends Labour's business record
Gordon Brown and Tony Blair
Labour believes its prudence is good for business
Some of Britain's leading industrialists were entertained to breakfast at Chequers this morning.

Tony Blair and Gordon Brown are keen to demonstrate that their relations with big business are robust: that, after all, was supposed to be one of the defining features of new - as opposed to old - Labour.

Unhelpfully for the Government, the meeting coincides with the appearance of an article in the leading American business magazine, Forbes Global.

Under the headline Tony Blair's Red-Tape Factory, the magazine reports on complaints by entrepreneurs about the difficulty of doing business here.

In a Downing Street interview, the reporter, Richard C Morais, found the Prime Minister 'determined in a steely kind of way' to rebut the charges.

He went on: 'Eyes narrowing and face reddening, Mr Blair insisted, "I want Britain to be the Number One place to do business in the world."'


When those criticisms were put to the Chancellor, Gordon Brown, on the Today Programme, he said simply that the Forbes article was wrong.

He suggested that - by contrast - the true picture emerged in last month's report by the consultants, Arthur Andersen.

The firm's 'pan-European benchmark study' concluded that Britain was doing more to encourage entrepreneurial activty than most of its European neighbours - and even more than the United States.

The UK scored 49 points out of 60 on a test of key factors that matter to new and high-growth companies, in three categories - availability of funding, people and the business environment. The US total was 45.

The Forbes article told a very different story about life for business-people in Britain.

Strongly free-market

The magazine, an advocate of the free market with strong conservative instincts, produced the striking case-study of an American entrepreneur, Danielle Downing, struggling to develop a business in this country.

Ms Downing raised $1.8 billion to set up a chain of bagel stores in London: but she complained that she spent longer dealing with regulations and red-tape each week than in running the business.

Each of her delis required ten separate licenses to authorise everything from a curved wall to the level of odour emitted by the building.

Forbes' Europe Bureau Chief, Richard C. Morais, told the World at One that he was shocked by Tony Blair's attempt to convince him that there was no real problem.

And he drew attention to the way simple European regulations are 'gold-plated' by British civil servants.

Getting worse

Chris Humpries, Director-General of the British Chambers of Commerce, said that - if he was asked to choose between the views of Forbes and Arthur Andersen, he would side with Forbes.

His organisation represents 135,000 companies, and he told the programme that things were getting worse, rather than better, under Labour.

Even though we might still have the best entrepreneurial environment in Europe, we were moving in the wrong direction - while countries like Germany were improving all the time.

His views were echoed, rather more diplomatically, by Dr Martin Reid, Chief Executive of the computer firm, Logica, who attended this morning's Chequers breakfast.

He believed that there was still too much controlling and too little enabling by Whitehall, and that this could be blamed, in part, on the culture of the civil service.

Patricia Hewitt, the minister responsible for small business at the Department of Trade and Industry, insisted that Britain was still top of the European business league.

Having listened to the evidence, she conceded that there was still a problem in the way regulations were applied.

She offered to meet the bagel-entrepreneur, Danielle Downing, to discuss her problems. But her department, she said, still had work to do, in order to improve the current situation.

Mark Gillespie, a partner at Arthur Anderson
On how their survey found the UK pro-entrepreneur
Dr Martin Reid is Chief Executive, Logica
There is still too much controlling and too little enabling by Whitehall
Forbes magazine Europe Bureau Chief, Richard Morais
gives a case-study of an entrepreneur struggling to establish a business here
Links to more Programme highlights stories are at the foot of the page.

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