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DERMOT MURNAGHAN: So, as you heard there, political wrangling well underway ahead of the budget in ten days’ but what do businesses want to see and hear from the Chancellor on March 20^th? Well the British Chambers of Commerce represents thousands of businesses across the UK and they are calling on Mr Osborne to go all out in the name of growth. The head of the British Chambers of Commerce, the BCC, John Longworth, joins me now, very good to see you Mr Longworth. Well you know what I’m going to say to you, the Chancellor if he is watching would say what do you think I’m trying to do? They want growth as much as anyone else, do you think they are going about it in the wrong way?

JOHN LONGWORTH: Well the stuff that they’ve done already, much of which we support, they haven’t actually landed and delivered and that’s one of the biggest problems. It’s a matter of scale, urgency and delivery, those are the three things that the government is missing out on at the moment but we think that …

DM: Well that’s pretty damning.

JL: Well it is a sad state of affairs. They have developed the policies that we agree with but many of them have not landed. Road building for example, airports, have all been pushed out really until after the next election and that’s not really good enough. What we’re saying is while it is very, very important to have deficit reduction, the government do need to stick to their cuts plan, it’s hugely important also that we get growth. In fact it’s equally important and we’ve been saying for quite a long while now, if the government doesn’t get growth, the rating agencies would react badly to it and they have, the markets will begin to react badly to it and so on. So growth is absolutely essential, it is no longer important just for the economy but it is also important to create confidence in business so that the businesses that have cash can start to invest.

DM: Have you found something that the Treasury have missed, have you found the seed corn, the seed capital, the billions required to kick start some of those big infrastructural projects you talk about, that don’t add to the deficit?

JL: Absolutely. I mean we’ve been very careful to cost it out so as to say to the Chancellor, look, there is no excuse for not doing this because indicatively we can identify savings you can make. Now it doesn’t mean the government have to use those particular things for savings but we’re saying don’t use the excuse …

DM: Well share some of them with us.

JL: What we’re saying is that it is quite possible for example to find double the amount of money that we are asking for, for infrastructure development, for access to finance, with the Business Bank for example that we believe ought to be ramped up considerably and the short term stimulus for infrastructure, for example we are asking for 100,000 new social housing homes to be built, we are asking for road maintenance to be invested in. We know there is £9 billion worth of backlog of road maintenance to be dealt with and we think that those things can be ramped up in the short term and …

DM: I don’t quite understand where that money comes from.

JL The money we are saying could for example come from universal benefits, we are saying it is much more important at this stage of the economic cycle to get growth for everybody’s sake and particularly our children and grandchildren, because the economy is going to go along in a very slow growth phase for a very long time if we’re not careful.

DM: So on child welfare, they’ve been looking at those, and then move on to what, pensioners, rich pensioners?

JL: What we are actually saying is that welfare was designed to provide for those people who are in trouble and we should be looking at pension credit beneficiaries and tax credit beneficiaries for certain universal benefits that currently are provided to everybody so for example that is a way in which the money could be found to stimulate economic growth. Now it doesn’t have to be that, you could look at other things, you could look at overseas aid, you could look at other ring-fenced areas such as healthcare but what we’re saying is that indicatively it is possible to do this and there is no excuse for not doing it.

DM: Okay and just briefly on the issue of the banks, we saw those funding for lending numbers, the banks seem to be getting a lot of cheap money from the Bank of England and they’re not pushing it out to businesses like yours. Would you like to see them kicked a bit harder by the government?

JL: Well we would like to see it done in a completely different way. The banks are in a bind, they are being asked by the regulators to build their balance sheets, they’ve still got problems with their balance sheets, in any event they are very risk averse as a consequence and not prepared to take risks. Most banks are running at a business failure rate of one in twenty and we know from Chambers of Commerce that themselves provide loans to fast growing businesses that they ought to be looking at a rate of more like ten in a hundred, 10% failure rate is a much higher rate and a big gap between what the banks are looking at and what the Chambers are looking at. We believe there ought to be a business bank created that is directly funded, we believe that the government ought to put an additional £9 billion into that business bank so that it has a capitalisation of £10 billion. It could leverage £100 billion in the end by using market funds and provide direct loans to businesses that are fast growing.

DM: Well, real food for thought for the Chancellor ahead of the budget. John Longworth, thank you very much indeed from the British Chambers of Commerce.