Articles

What is the Government doing?

In Uncategorized on March 15, 2010 by Tim Aikens

The Singapore Government is looking for a ‘quantum leap’ in productivity. In Australia they have Australian Institute for Productivity. In India they have the National Productivity Council.  All are bodies seeking to make a dramatic improvement in their countries’ productivity. What do we have in the UK – the Treasury!!!!  Since 2,000 HM Treasury have published a series of papers on productivity.  They are mostly very intellectual analyses of data and comparisons.  There are a lot of comments about what the government has done – reduce tax, increase employment, set policies etc.  But little if anything specific on productivity itself. It’s as if the government wants to let the business world get on with it. Which is laudable. I’m all for hands off government.  But is this a case where they need to focus more?  The two pillars of the government strategy – stated in 2,000 and reiterated in 2,007 are:

–  Promote macroeconomic stability
–  Introduce microeconomic reforms to ensure that market failures are overcome.

I have an idea of what they mean and how they could help productivity. But it’s not exactly what you would call front line stuff!  And just how many senior executives either really understand or believe in what these policies will do for productivity in UK plc.

Whilst I am adamant that the last thing the UK needs is yet another quango, the government does need to do several things:

–  stop dancing around the handbags and be very clear and public about the nation’s weak productivity performance (as a whole and accepting
that there are quite a few really good organisations out there) and the implications for everyone in terms quality and quantity of life
–  recognise that full employment is an outcome of high productivity and not a cause of it!
–  be more specifically proactive about productivity. By this I mean acting closer to businesses. Offer incentives for productivity training, or
productivity technology (Mind you a lot of technology does not increase productivity!),  support an industry group as opposed to saying that
the CBI and the TUC should work together
–  reward good performance. At present higher productivity means better margins, more sales and better profits – and then more tax!  The
incentive is not there.

I am sure there are lots more things the government could and should be doing. What do you think?

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