Brown's breakfast with business

Gordon Brown regularly delivers thundering speeches on how the economy needs to become more competitive to meet the challenges of globalisation. Yesterday, however, the chancellor was mainly in listening mode when he hosted a two-hour seminar at 11 Downing Street attended by leading figures from international business.

As they sat down to breakfast, Mr Brown had one broad question for this eight-person group, which he calls his International Business Advisory Council: what does the UK need to do to meet the globalisation challenge? What is it doing right and what is it doing wrong?

As a group, this one is in a good position to provide some answers. Its members comprise Bernard Arnault of LVMH; Jean-Pierre Garnier of GlaxoSmithKline; Sir Ka-Shing Li of Hutchison Whampoa; Sir John Rose of Rolls Royce; Robert Rubin of Citigroup; Ratan Tata of the Tata Group; and Meg Whitman of Ebay. James Wolfensohn, the former World Bank chief, was also in attendance.

The meeting was closed to the press but according to one person present, the group started with plenty of praise for the UK's generally open economic environment.

"The message was that the UK doesn't realise how unusual it has become. Both in the US and Europe there have been big political rows this year about foreign takeovers of national companies. Markets in India, meanwhile, remain impenetrable to outsiders. So there was a lot of praise for the openness of the UK economy."

However, several concerns were soon raised. The longest and sharpest discussion of the morning is said to have been on the UK's skills base. Some of the business leaders reportedly raised doubts about whether the UK is generating enough science and maths graduates and whether enough people are being trained in basic skills.

There was questioning, too, about what the UK was achieving on cutting regulation. Mr Brown was applauded by some for moving the UK regulatory system to a more risk-based approach. But the widespread view was that the government, like others, had to work hard to deliver real results when trying to cut red tape.

Several of the participants reportedly questioned Mr Brown on whether British companies were sufficiently bold and imaginative about doing business in India and China. One noted, for example, that to get Corus, the Anglo-Dutch steel company, to enter the Indian market, it first had to be bought by Tata Steel, its Indian rival.

There were questions, too, on the immigration policy. An aide to the chancellor said: "One of the points made was that it was a good thing that the UK is receiving so many foreign students in its universities. But there was a warning that Britain can't just rely on foreign talent to retain competitiveness. It has to train its own."

Mr Brown and his guests later moved on to the Treasury building where they shared their thoughts with 80 leading figures from British business. Cynics might say the entire event, the highlight of "enterprise week", was one more charm offensive with a British business community that is fed up with high tax rates.

However, the Treasury would argue that Mr Brown is genuinely trying to build a consensus with business on the right economic agenda.