CBI Director-General Tony Dunker said he believed the UK could avoid a recession in the coming months. But he warned: “There is a very simple chain of events, which is when business confidence is high, businesses invest and grow, recession is avoided. “When business confidence falls, investment falls and is the only thing that is holding us back from the recession right now. Therefore, anything that can be done to boost business confidence, to prove that the government is in fact incredibly serious and purposeful for growth will work. “But if we have a summer with politics like we had last week, it will undermine confidence.” The prime minister said economic growth was his top priority as he sought to reshuffle his government after four in 10 lawmakers voted to oust him from Downing Street last week. Mr Johnson is also facing a growing outcry from Tory lawmakers announcing large-scale tax cuts following allegations that his government is not conservative enough. But Mr Danker also warned that “huge” tax cuts or huge wage payments would “overheat” the economy. NI Secretary Brandon Lewis said he would support promoting the Chancellor’s planned income tax cut “when we can afford it”. The 1p cut is committed in 2024, but many Tory MPs fear the party cannot afford to leave it for so long. The CBI downgraded its economic growth prospects and called on the prime minister and chancellor to take “vital” steps to avoid a recession, including holding a Cobra summit as usual for things like terrorist attacks. The group also believes that inflation will remain high in the autumn, leading to a “historic squeeze” on household incomes and affecting consumer spending. The Labor Party would reject the recent rise in national insurance “right now” if it were in government instead of focusing on income tax cuts, said shadow Chancellor Rachel Reeves. He told the BBC’s Sunday Morning Show: “What we need to do right now is reverse this increase in national security. “That would be my priority if I were chancellor today because it takes money out of people’s pockets.” He added: “The government has this kind of hockey-hockey where it increases national insurance, but says it will reduce income tax. “National insurance is a tax only on the income you receive when you go to work, which is why it is such a harmful tax increase right in the middle of a cost of living crisis.”
