Balancing growth and austerity measures is always going to be a challenge. The two, if not incompatible, are not easy bedfellows: avoiding sovereign debt problems, which would derail the economy, while investing in growth seems contradictory.

The government’s austerity plans have barely begun but are an important factor in future growth concerns. Tax rises, which could shore up the UK’s balance sheet, are unpopular and drive high-net-worth individuals and companies to seek tax havens.

This leaves monetary policy, such as quantitative easing, as the only real option, but this carries inflationary risks and potential capital exoduses as sterling devalues.

I would love to see the government investing further to boost economic growth areas, but it’s difficult to see where they can get the money.

There are a few initiatives, such as Enterprise Capital Funds and the UK Innovation Fund, which are channelling money into early-stage company investment – a key engine for growth and, as such, very important at a time when capital is otherwise scarce.

The government cannot completely back off on its austerity plans, as they need to reassure the markets there will not be a return to the profligacy of the Labour years. However, plans could be implemented more slowly and focus heavily on areas with negligible effects on growth.

The chancellor is missing a trick by not taking the huge opportunities to simplify tax legislation and get rid of those that don’t really add to the public coffers. A reduction in red tape and bureaucracy here could have a very positive impact on how attractive the UK is for businesses and high-net-worths.