Anyone following the recent local elections could be forgiven for believing that a new powerful political force had emerged in the form of UKIP.

The BBC, Sky News, ITN and every other media outlet seemed determined to make a story out of the dullest of election campaigns for many a year and, in the absence of anything more interesting, lazy journalism led to a flurry of outrageous stories claiming that UKIP had made a major political breakthrough, with Nigel Farage and his band of merry men (and women) on the verge of smashing the traditional parties out of sight.

This myth was extolled by commentators who, quite frankly, should know better, and has continued in the aftermath of the May polls despite the fact that UKIP won only 14% of a low poll, and is still looking to secure its first parliamentary seat. Outside of its policies on immigration and Europe, UKIP have little or nothing to say on the issues that really matter to the electorate, the NHS, education and the economy.

It may suit Euro sceptic Tories and the Murdoch press to pretend that UKIP should be taken seriously. However, a glance back at recent history will tell you that UKIP are simply securing protest votes from the disaffected who are finding the mainstream parties and their leaders in need of a bit of a kicking – whilst most voters have decided to stay at home.

Back in the early eighties, as the Prime Minister who recently passed away with eulogies bordering on martyrdom was presiding over a country riven with division, experiencing high levels of community disorder, mass unemployment and inner city riots, voters were looking at how they could give her, and the Michal Foot led Labour Party, a kicking.

In 1981 Roy Jenkins was Nigel Farrage. He had, along with Labour defectors David Owen, Shirley Williams and Bill Rodgers, formed the Social Democratic Party. Jenkins, a Euro enthusiast who had served in a sixties Labour government as Chancellor, successfully courted Liberal leader David Steel, and an Alliance was established between the two parties.

Such was the fervour surrounding the launch of this new political movement Steel proclaimed to delegates at the Liberal conference of 1982 “Go back to your constituencies and prepare for government.”

He was not saying this for effect, nor had he taken leave of his senses. Jenkins had won a parliamentary by-election in Glasgow Hillhead. Shirley Williams had won Crosby, Merseyside. Polls showed that the SDP-Liberal Alliance commanded over 50% support of the British electorate. David Steel and his colleagues had every reason to believe a media circus that was peddling the notion that the end was nigh for the two ‘big’, traditional parties.

Twelve months later, in April 1983, Margaret Thatcher was re-elected as Prime Minister with a three digit parliamentary majority – a landslide victory over second placed Labour who secured just 204 seats. The Alliance returned with just 23 MP’s.

Their bubble had burst, the electorate had decided ‘better the devil you know. Of course there were other factors. The Falklands War, Thatcher’s new found confidence in its aftermath, an economic recovery of sorts to name but a few. Nonetheless, I have no doubt that in the General Election of 2015 UKIP will be buried and become the footnote in history that they deserve to be.

It is true that Cameron, nor Miliband, is Margaret Thatcher. But then again Farage is no Roy Jenkins, and look what happened to him!

Liverpool has worked hard in recent times to project a positive image of the city, and change the stereotypical perceptions that many hold of the place since the very high profile skirmishes between the Militant run council and the Thatcher government in the 8o’s. 

Innovative initiatives such as the Liverpool in London project, the adoption of a city mayor governance model at the council, the hosting of a very successful Global Entrepreneurship Congress last year to be followed by the International Festival of Business next, not to mention the city’s much enhanced reputation internationally have all gone a long way in helping Liverpool to become the best visited city in the UK outside of London and Edinburgh, and a place where private sector firms from all over the globe are considering the investment opportunities that are on offer.

It is therefore disappointing, to say the least, when a government minister decides to focus his fire on Liverpool simply to score a few cheap party political points and no doubt in his own mind help curry favour with fellow Conservative MP’s with an outburst that was unnecessary, unfair and inappropriate.

The Junior Minister for Local Government decided to use the pages of that well respected political publication The Sun to express his ‘outrage’ over Liverpool’s mayor taking trips to the US and China. He also slammed Liverpool City Council for hosting an ‘anti cuts’ conference at the huge cost of £4,500!

It seems to have escaped this particular minister’s mind that it is the mayor’s job to promote Liverpool across the globe, and the role Joe Anderson is fulfilling is the very one outlined by his own government’s, indeed his own departments, briefing paper on the benefits of elected mayors.

However what is even more odd, and why Liverpool have every right to be angry, is that in the very week that the minister made his attack, a whole host of towns and cities were at the annual south of France jamboree MIPIM – including the Tory mayor of London Boris Johnson.

If the minister was genuinely concerned about local government expenditure on foreign visits then why not hone in on this festival and give a good number of council’s a good kicking? Could it be that what this guy was interested in was a row with a city that he knows traditional Tories still consider hostile, and therefore an easy target for a rant that was meant to do no more than raise his profile and help him up the slippery political ladder to a promotion in the next cabinet reshuffle?

He wouldn’t be the first politician to try and pick a fight for no reason. But surely government ministers have a responsibility to help promote the UK’s core cities in a positive light, regardless of their political colour. This blatant attempt to undermine Liverpool’s efforts was disgraceful and rather than promoting the Muppet I hope the Prime Minister sacks him at the earliest opportunity.

The general view that I have picked up from Downtown members this week was that the chancellor’s latest budget was okay, although not earth shattering.

Among most there appears to be an acceptance that there is little room for manoeuvre for our politicians and decision makers as far as economic policy is concerned, and so we are relatively sanguine about the lack of any real radical proposals coming from government.

I have to say I take the opposite view, and believe that the continuing flat lining of the economy demands radical, risk taking, entrepreneurial measures from the chancellor and his treasury colleagues.

The announcement on National Insurance contributions was positive as far as it went. But why not scrap all NI fees for any new employees that a business takes on? The subsequent savings from the welfare bill would more than pay for such a move.

Boosting the housing market through the new mortgage guarantee scheme again appears attractive on the face of it. However, there is a danger that this initiative will simply inflate property prices – one of the main reasons we find ourselves in this mess in the first place.

The absence of any mention of the banks and business lending in his latest commons address signalled to me that the chancellor has given up on making demands from the financial sector that they clearly ignore anyway. But the problem of access to finance for small businesses, the life blood of UK Plc, continues to be the single biggest problem facing the business community.

The governments own Regional Growth Fund initiative, which should be helping at least in part to address this, has been massively bogged down in bureaucracy and red tape, whilst alternative sources of funding through venture capital funds and private equity are not being given enough coverage or support. The failure of Osborne to take any action in this area was hugely disappointing.

On tax, the cut to corporation tax to 20% should have been introduced immediately – and the top rate of tax needs to be reduced back to 40%. This would not cost the treasury a single penny according to the treasury’s own studies, which indicate that, at 40%, high net worth individuals are far more likely to pay up and not explore the tax avoidance loopholes that exist.  

The penny off beer duty was a political stunt not worthy of the joyous whooping coming from Westminster’s green benches on Wednesday afternoon, whilst the freezing of fuel duty was inevitable.

It was a low key budget from a low key chancellor. The politics of coalition may be the reason that we are not seeing bolder business friendly policies from the government. Or it may be that the chancellor is not a risk taker at any level.  The lack of imagination and radicalism from a Tory chancellor on the business agenda is both surprising and disappointing.

His one saving grace is that there is little coming from the opposition benches that would suggest they have any more of a clue either.    

Sir Howard

Downtown Manchester held its third annual City of Manchester Business Awards last night, and welcomed the city council’s chief executive Sir Howard Bernstein as the keynote speaker. I know of no other town hall boss who can inspire a business audience in the way that Bernstein can – and offer a valuable opinion on how his city has to react to the global challenges that it is facing. If we had 100 Bernstein’s then the country would be in a much better place. Nonetheless, Manchester does have him, and they rightly cherish him. Manchester has become the undisputed premier city on the UK outside of London, and that in no small part is because of the civic leadership the city has benefitted from for the best part of thirty years now.

‘High Growth businesses’ are flavour of the month at present with government ministers, leading decision makers and their mandarins. The need to accelerate the growth of companies that can potentially employ 50 people or more is top of the business support agenda, and many, if not all the eggs are being thrown into this basket.

The problem is that UK Plc’s business community is largely made up of what are commonly known as SME’s. Downtown has abandoned that term, as has the shadow business secretary Chuka Umunna, and replaced it with the more ambitious ‘growing enterprises’ .

These businesses are the backbone of our economy, and many are happy to continue to adopt a steady-as-she-goes attitude, employing two, three or maybe up to forty-three people, having concluded that they have a business model that works, and they don’t need more staff to deliver success.

Similarly there are an increasing number of ‘smart’ businesses, often operating in the technological and new media sector, who are hugely profitable, but who may need finance for research and development rather than more people; and an increasing number of firms who see the sense in outsourcing their HR, marketing, PR and other functions, negating the need for additional staff. 

Does this mean that they should be excluded from government thinking; abandoned in their efforts to continue to operate solid firms; have no access to business support programmes or financial help? I don’t think so.

Downtown loves working with ‘high growth’ companies, and we are fortunate enough to have many of them as members. We equally value our partnership with Downtown sponsor Winning Pitch (click through to Winning Pitch website) who are leading the government backed Growth Accelerator project in the North of England.

However, we have to accept that the vast majority of business owners will not, indeed do not want to grow any bigger than they are already – and they deserve to be supported too. 

The difficulties such businesses see often include the negative consequences of employing more people, namely farcical employment laws, a detrimental taxation system and other red tape and bureaucracy that would drive Mother Teresa to distraction. There will be much more on this from Downtown later in the year.

In the meantime, I hope to see a more balanced approach emerge for business support services in the coming months.

There has been much talk from the coalition government about decentralisation and localism. This agenda has led to the establishment of elected mayors, Local Enterprise Partnerships and even police commissioners.

Why then has the biggest challenge facing businesses for many a year, access to finance, never been subject to a genuine discussion about offering a regional solution to this perennial problem.

As I have said on many occasions, the banks are between a rock and a hard place – struggling to replenish their own balance sheets; inevitably airing on the side of caution with their lending in these uncertain times; and being pressurised by politicians to lend more.

The problem isn’t the banks. The problem is the chancellor believing that the banks are the solution.

He has continued to provide cash to institutions that are no longer fit for purpose as far as business finance is concerned, whilst many of the alternative funding initiatives are often hamstrung by bureaucracy and red tape.

It is time for regional banks. They can be funded by using a combination of local government pension schemes, private equity, and perhaps dome government money too. Such institutions would have greater local knowledge, have the support of its local economy as a core value and be more flexible in working with other funding partners such as VC’s to offer practical solutions to its business community.

That would be a radical approach to resolve a problem that is beginning to threaten any chance the coalition has of creating real growth before the next election. George Osborne needs to be bold and introduce localism into his autumn budget statement on Wednesday.