Economic Growth in the UK - Government Policies

The UK government stated in its 2011 Plan for Growth that it would aim to 'rebalance' the economy by encouraging growth in UK exports and FDI.

This was one of four priorities for achieving growth. The others were:

1. Reforms to the tax system
2. Measures intended to make the UK a more attractive place to start a business
3. Measures intended to create a more educated and a more flexible workforce.

The Plan for Growth was centered around supply-side reforms and policy interventions designed to improve business competitiveness and labour market flexibility

Business taxation:

• Corporation tax cut to a new level of 20% from 2015
• Patent box (lower taxes on patented products) to stimulate innovation
• New tax reliefs for animation, high-end television and games industries
• Reductions in national insurance contributions for businesses employing long-term unemployed / youth unemployed

Other policies

• Creation of Green Investment Bank for renewable energy investment
• Funding for Lending Scheme in association with the Bank of England
• 24 new Enterprise Zones established in areas of high unemployment
• Qualifying period for unfair dismissal increased from one year to two

Education reforms:

• Expansion of free schools and academies
• Large rise in the number of apprenticeships available under Youth Contract
• 14 science and innovation capital projects