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CBI claims private sector can replace lost public sector jobs

CBI director general Richard Lambert has said that private industry can create new jobs to replace those lost in the public sector cutbacks announced in the Government’s Comprehensive Spending Review.

Some 490,000 civil service posts are expected to be lost, but the Coalition has long argued that the cuts will allow the private sector to grow and fill the gap with new employment opportunities.

Lambert told BBC Radio 4's Today programme: ‘I'm confident it will do. There's a question about timing. A great deal will depend on the pace at which business investment recovers from this recession.’

His comments came as the country’s leading political figures prepared to address the CBI’s annual conference.

Prime Minister David Cameron said: ‘This is an incredible opportunity for Britain, for new start-ups to flourish, for innovations to drive growth and create jobs. To build that new dynamism in our economy, to create the growth, jobs and opportunities Britain needs, we've got to back the big businesses of tomorrow, not just the big businesses of today.’

Meanwhile, in his speech Business Secretary Vince Cable called for a comprehensive rethink about how UK companies are run and how they should be bought and sold in future. He asked the CBI conference how corporate governance should be reformed without discouraging investment and will also question the process for the acquisition of other companies.