Bridging the dangerous revenue gap

Turning around the UK economy in the face of the national debt burden, cash-starved public services and infrastructure, expensive and poorly performing privatised services, and damaged trading relations with our biggest market, Europe, is an immense task. Then, of course, there is Russia's nonsensical war on Ukraine and political turbulence and trade disruption coming across the Atlantic.

But with the new Trump administration now in place, we can start to see an increasingly transactional framework in which the UK and its businesses could prosper, if we rise to the challenge. Besides the obvious example of defence, there are opportunities which could be grasped quickly: In trade, our erstwhile European partners are keen to rebuild links with us and increase trade in sectors such as renewable energy, automotive manufacture and agriculture. In digital tech, increased US emphasis on AI and other tools will provide the means of modernising and cutting costs in the UK public and private sectors. In government administration, modernisation to manage procurement better, get value for money, and raise service levels particularly for technology projects, could cut costs and improve decision-making. Such changes would also provide more exciting career opportunities for civil servants, and help prevent the government being ripped off by strong deal-oriented companies. In healthcare, AI can undoubtedly help with diagnosis and drug development; there is also, however, the much more mundane work of cleaning up the poor state of NHS patient data and digital communications. This would quickly pay dividends, by saving time and improving patient experience, without major investment. Finally, the UK is awash with talent. There are sectors in which we are truly world-leading and have growth potential, which don't get a lot of attention from government, e.g. architecture, the creative arts, consultancy, design, education, entertainment, tourism and more.

Of course, the government is aware of many of these opportunities, but is held back by the financial situation. Businesses understand the revenue gap which inevitably occurs early on in all turnarounds. The measures already put in place, and the excellent work the Treasury and DSIT are doing on cross-departmental and multi-year planning and systems integration will, as the IMF seems to have seen, lead to growth. But, in the interim, the priority is for government and business to work together to iron out problems, spotting opportunities where, for example, clearer goals or minor regulatory changes could take effect quickly and increase business and government revenues.

Our next events will focus on the government's growth mission and policy towards the vital Middle East. Our spring reception will provide more opportunities for members to meet people in the new administration.