Cameron launches growth plan – but says deficit is top priority
Dealing with deficit is ‘line one, clause one, part one’, prime minister tells CBI Annual Conference
Read the prime minister's speech in full (pdf)
Press release: CBI comments on prime minister's speech to CBI Annual Conference
The prime minister today unveiled a strategy to stimulate economic growth at the CBI Annual Conference - but insisted that the Government's first priority was to tackle the UK deficit.
David Cameron said the Government's strategy for growth would include measures to boost the housebuilding industry, expand super-fast broadband, build new power stations, and increased lending to businesses.
But he insisted that dealing with the government deficits was "line one, clause one, part one" of the plan for economic recovery.
In his keynote address to conference, Mr Cameron said the "paralysis" in the eurozone was having a "chilling effect" on the UK economy and showed why the priority was to "overcome the crisis of debt".
"I am absolutely clear about the right answer for the UK economy," he said. "It can be summed up in one sentence - we need to deal with our debts and go for growth."
He told delegates the previous model of a debt-driven consumer boom was "broken". "We need a fundamental rebalancing of the economy - more investment, more exports, and a broader base to an economic future. If policy is not directed towards this goal it will fail."
The Prime Minister said the Government was determined to "get credit flowing" to businesses, highlighting the Project Merlin, Business Growth Fund and Regional Growth Fund initiatives.
He indicated that Chancellor George Osborne would use next week's Autumn Statement to unveil a new credit easing scheme that would "pump billions of pounds" into reduce lending costs for SMEs.
Mr Cameron said the housing strategy he announced today with Deputy Prime Minister Nick Clegg to support new mortgages for up to 100,000 people would combine with plans for council house sales and reforms to the planning system. "We will restart the housing market and get the nation building again," he said.
The Prime Minister said the Chancellor would also use next week's statement to set out the next stage in the Government's plans to improve the country's infrastructure, building on investment in transport, energy and superfast broadband networks.
Mr Cameron pledged to deliver reform of unemployment laws to encourage high-growth firms to hire new workers. He said the Government would also use its "huge" purchasing power to strengthen the SME sector.
Asked during a Q&A session what the Government was doing to deliver short-term growth, the Prime Minister said: "I don't think there is one silver bullet that will make British business say 'this is it'.
"I think there is a clear agenda across all those agendas: employment laws, infrastructure, and housing. Do those things while sticking to your plan A and will get the right answer.
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