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CBI: UK businesses finished 2015 with strong growth

The UK economy has finished the year strongly according to a CBI survey. Credit: Nick Ansell / PA Wire/Press Association Images

Economic growth picked up in the final quarter of 2015 despite continuing problems for manufacturers, according to a survey of more than 750 private companies by the CBI.

The survey revealed a strong end of year for business and professional services and an improving picture for retail and wholesale sectors despite continuing problems for exporters struggling with the strength of sterling.

The UK economy has finished the year strongly, with business services acting as a lightning rod for growth.

Nonetheless, there is no room for complacency in 2016 as significant challenges to global growth remain.

Ultimately, employers want relief from the cumulative burden that could harm the UK's competitiveness, as the combined effect of the introduction of the apprenticeship levy and the national living wage begins to bite against the backdrop of unreformed business rates and the administrative challenge of pensions enrolment.

– Carolyn Fairbairn, CB Director general

The balance of firms reporting rising output in the past three months was 20%, well up on the long run average of 5%, with a similar pace of growth expected in the next quarter, said the CBI.

Osborne's plans for biggest sell-off of public assets

George Osborne has set out his plans to help restore Britain's economy by staging the biggest ever sell-off of government and public owned corporate and financial assets this year.

The Chancellor will create a new government-owned company who will be in charge of the sales, which are expected to be worth £23 billion.

UK Government Investments (UKGI) will sell shares in Lloyds Banking Group, UK Asset Resolution assets, Eurostar and the pre-2012 income contingent repayment student loan book.

ITV News Political Editor Tom Bradby reports:

It is part of plans to cut spending by £13 billion by 2017/18.

Speaking at the Confederation of British Industry (CBI), Osborne said: "If we want a more productive economy, let's get the government out of the business of owning great chunks of our banking system - and indeed other assets that should be in the private sector."

A "plan to make Britain work better" will be published over the next few weeks, setting out proposals to improve transport, broadband, planning, skills, ownership, childcare, red tape, science and innovation.

Osborne also addressed the issue of the EU referendum saying he will be "fighting to be in Europe but not run by Europe".

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Business leaders urge David Cameron to 'be ambitious'

A leading independent employers' organisation has called for the Prime Minister to be "ambitious with business".

The CBI called for action within the first 100 days Credit: PA

The Confederation of British Industry urged the new Government to set out clear plans for the country's economic growth and to take action within the first 100 days.

It said that business will take an active role in "arguing the case for the UK to remain inside a reformed EU" and argued that it is "vital" for the Government to set the bar for that EU reform at an "ambitious and achievable" level.

The new Government must get into its stride quickly. It should set out clear plans for the next parliament within the first 100 days, and have a laser-like focus on delivery.

The Prime Minister should prioritise building on the progress made to get the deficit down, finding more innovative ways to deliver public services and backing the final decision from the Airports Commission so we get diggers in the ground by 2020.

– CBI deputy director general Katja Hall

CBI: Election uncertainty is 'major risk to the recovery'

Business leaders have said political uncertainty about the outcome of the next General Election remains a "major risk to the recovery".

The Confederation of British Industry (CBI) urged politicians to push ahead with boosting the supply of homes and taking decisions on major infrastructure projects.

The CBI warned the political leaders not to give "pre-election pledges" which could hinder investment or limit future prosperity. Credit: Oli Scarff/PA Wire

The major parties need to show they would "stick with what is working" after next year's election, the CBI's chief policy director Katja Hall said, urging them against costly "political positioning".

She added: "(Positioning) must not be allowed to stifle investment, whether it's an unrealistic immigration target, unjustified interventions into specific markets, flirting with leaving the European Union, delaying vital long-term infrastructure projects or restricting labour market flexibility."

CBI predicts early rate rise amid house price warning

Business leaders have predicted interest rates will need to rise early next year as they issued a warning about "unsustainable" house prices.

The Confederation of British Industry (CBI) expects a rise of 0.25 per cent in the first three months of 2015, from 0.5% to 0.75%.

The CBI said it was crucial for governments to focus on increasing housing supply. Credit: Yui Mok/PA Wire

The business lobby group previously predicted the Bank of England would have to start raising rates in the third quarter of next year - but has now brought that forward to the first quarter.

The CBI also raised its forecast for the UK's gross domestic product forecast for this year from 2.6% to 3%.

Director-general John Cridland said property values were expected to rise by 8.2% this year, and 5.1% next.

But he warned: "We have to remain alert to the risks posed by unsustainable house price inflation, and the (Bank's) Financial Policy Committee is poised to act when necessary."

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