Pictured above: Will Rogers

The government must urgently provide businesses with the incentive to expand, Birmingham Chamber of Commerce Group (BCCG) warned today after shock figures revealed that the gross domestic product (GDP) declined by 0.5 per cent in the fourth quarter of 2010.

BCCG policy adviser Will Rogers said the fall was well below everyone's expectations and added that the figures were in keeping with the Chamber's quarter economic survey for the period which depicted a beleaguered manufacturing sector.

He said: "We are confident that the services sector is picking up and this needs to be sustained in the first three months of this year. 

"Unemployment, investment intentions and cash flow all remain significant issues. Less than a week ago, it was revealed that the jobless rate in this region had increased to 9.9 per cent. 

"This demonstrates the acute need for government support. The government needs to tackle the obstacles, such as damaging employment legislation and regulatory burdens, which prevent small- and medium-sized companies from getting ahead. Among them are the proposed changes to paternity leave, which need to be reconsidered.

"Companies need to be incentivised to expand and given the freedom to create jobs and wealth. 

"Regulation, planning and taxation are just some of the policy areas that need reviewing as they clearly need to be more business friendly.  World class infrastructure will help re-balance the economy so initiatives such as the high speed rail link between Birmingham and London (HS2) must go ahead."