A pre-Budget statement by the Treasury last November gave the
Confederation of British Industry a taste of the real thing this March.
Among other things, the statement outlined plans to change corporation
tax from the current payment in arrears system to a US-style quarterly
instalments system. The CBI made a wish list including rethinking
corporation tax and used an intense lobbying campaign to drive it home
to the Government.
To urge Chancellor Gordon Brown to make medium-sized firms exempt from
paying corporation tax in instalments rather than just the very
The Chancellor’s proposals to exempt only firms with profits under
pounds 300,000 could increase tax on businesses by up to pounds 22
billion, the CBI warned.
The CBI has long-established influence in Whitehall, Parliament and the
national press. It built on these relationships for a campaign of
’public pronouncement and private persuasion’, it says. A Budget report
of CBI recommendations marked its launch in late January.
PR staff alerted national media to the launch press conference. They
briefed a few of the most influential newspaper journalists on its tax
concerns. The CBI ensured its regional officers led with corporation tax
issues in media interviews to prevent mixed messages confusing its
Two weeks later CBI director-general Adair Turner used a conference by
3i, the business investor, to ram home the confederation’s worries. This
kept the issue in the spotlight, but it did not overdo it with leaks to
’We have a reputation for straightforwardness and that would be
compromised by permanent leaks,’ said Tim Hollingsworth, head of media
relations at CBI.
A report was sent to all MPs with a letter stating why the CBI was
pressing for changes. Hollingsworth’s team of five followed up by
contacting politicians to arrange meetings. This proactive approach was
part of its strategy of making opportunities happen rather than waiting
for them to appear, he says.
One of the campaign’s biggest strengths was the unity of purpose. ’We
were very clear what our members wanted. We had a round of regional
consultations so we knew our members backed us all the way.’
The campaign helped to win the CBI a meeting with the Chancellor before
the Budget. ’It was largely on the CBI’s reputation but the campaign
ensured that he knew we had a very valid point to make,’ says
Hollingsworth. The Chancellor changed his Budget proposal to extend
pre-payment exemption to a wider band of small firms. The press hailed
this as a climbdown, caused by the CBI.
The campaign attracted a flurry of media attention with BBC radio and
TV, Channel 4 and independent stations covering the CBI’s Budget day
build-up. This was underscored by several reports in the Financial
Times, the Daily Telegraph, the Times and the Guardian. The Express and
the Sun also picked up on the pounds 22 billion tax threat.
The five-month campaign won sustained media coverage and highlighted the
fact that the CBI comprised active and powerful business leaders.
Budget concessions reinforced its standing and the success of its
But its lobbying fell short of total victory - the CBI also wanted tax
help for larger businesses and, it said, Gordon Brown failed to
PR Team: In-house
Campaign: Lobbying to change Budget proposals for corporation tax
Timescale: November 1997 to March 1998