Unions and business leaders make last-ditch Chancellor appeal

The two sides of industry today made last-ditch appeals to the Chancellor to help business and boost job creation when he unveils the pre-budget report tomorrow.

The British Chambers of Commerce (BCC) and the TUC had different ideas on how to aid the recovery from recession, but both groups agreed that measures were urgently needed to stimulate economic growth.

The BCC called for a freeze in the public sector pay bill and said pensions should be reformed to be brought into line with private firms.

Whitehall budgets should be scrutinised to pave the way for spending cuts which should go further than efficiency savings, the group argued.

Director general David Frost said: "These sensible and realistic proposals are the views of thousands of companies from across the country - they must not be ignored when the Chancellor rises to present his pre-budget report.

"When you break it down, the solutions to the UK's current problems are quite obvious - allow the private sector to generate investment, growth and jobs by reducing the red tape and tax burden, provide support and incentives where needed and rebalance the economy away from debt and the public sector."

TUC general secretary Brendan Barber said the Chancellor should do nothing to endanger economic recovery, adding: "Unemployment is still rising and the economy remains fragile. He must do more to help the jobless, particularly action to prevent this generation of school and college leavers being scarred for life.

"He must show that those who brought about the crash and did so well out of the boom years will pay the price of putting it right. A windfall tax on bank bonuses should just be the start of building a fair tax system and reforming finance.

"We need a finance system that once again serves the rest of the economy, not just itself."

The AA urged the Chancellor to resist the temptation to introduce an immediate fuel duty increase ahead of the expected rise of 1p a litre from April 2010.

The AA said that, since the autumn 2008 Pre-Budget Report, fuel duty had risen by 5.84p a litre.

AA president Edmund King said: "Petrol and diesel in the UK are already heavily taxed so we don't want to see the Chancellor pulling any tricks out of his box to hammer the motorist."

The Society of Motor Manufacturers and Traders (SMMT) called on the Government to use the Pre-Budget Report to "sustain the recovery and support the long-term future of the motor industry".

The SMMT said more than 250,000 new cars had been sold through the Government's car scrappage scheme which was introduced in May this year.

It added that the average CO2 emissions of a car bought through the scheme was 133g per kilometre - 10% below the overall new car market average and 27% below a scrapped car's emissions.