Piling more tax on firms will be ‘road to ruin’, business chief warns Burnham
Piling more taxes onto UK firms will be the ‘road to ruin’, Andy Burnham has been warned by the head of one of Britain’s leading business groups.
As fears grow of a lurch to the Left under a Burnham premiership, British Chambers of Commerce (BCC) director general Shevaun Haviland said business cannot take any more.
Labour has already hammered firms with a £25 billion rise in employer national insurance and a raft of new workers’ rights.
And writing for dailymail.co.uk, Ms Haviland said: ‘There is nothing left in the tank.’
The comments come ahead of the BCC holding its annual conference in Westminster today amid growing speculation over Mr Burnham’s plans for government should he – as widely expected – take over as Prime Minister from Sir Keir Starmer.
Speaking at the conference, Tory shadow chancellor Sir Mel Stride will urge Mr Burnham to give businesses the certainty they need by ruling out further tax raids on business – to avoid uncertainty that risks holding back investment and hiring.
BCC chief Shevaun Haviland said: ‘There is nothing left in the tank’
It comes after bosses reacted with horror this week to the prospect that Ed Miliband could be named Chancellor in a Burnham Cabinet, an appointment many fear could see him wreak havoc with the economy.
And Ms Haviland sounded the alarm over the prospect that business will pay the price.
While giving credit to Labour for some achievements from transport projects to trade deals, she said ‘that good work risks being wiped out by the relentless piling-on of cost’.
She said that government-imposed costs on business have risen by more than 70 per cent in a decade, making it harder to employ people and to turn a profit.
Ms Haviland added: ‘That is no way to grow an economy, and it points to one unavoidable conclusion before the Autumn Budget. Taxing business any further is a road to ruin.
‘It is the surest way to destroy the fragile confidence firms have left, and you cannot tax a company that has already closed its doors.
‘Employer National Insurance is still working through payrolls, the Employment Rights Act is layering on more, and the talks we were promised on its detail have gone oddly quiet. There is nothing left in the tank.’
Ms Haviland also took aim at Labour over U-turns and in-fighting that are making it impossible for firms to make plans.
‘A firm weighing a new factory, or a hundred new jobs, is making a ten-year bet, and it will not place that bet in a country that changes direction with every reshuffle. If we want to be taken seriously abroad, we have to stop arguing with ourselves at home’ she said.
And speaking at the conference today, Sir Mel Stride will say: ‘If Andy Burnham does not rule out coming back for yet more tax rises on business, there is a clear risk that investment and hiring decisions are put on hold once again as the budget approaches later this year.’
The shadow chancellor will say any new PM must show that he ‘gets’ the need to reassure firms and that he will not repeat the mistakes Labour has already made.
‘If Andy Burnham chooses not to do that – if he is seriously thinking about doing more of the same, of taxing and regulating business and thinking that will solve our problems – then he will ultimately suffer the same fate as Keir Starmer,’ Sir Mel will add.
‘Government needs to start treating business as the solution to the problems we face – not as a part of those problems.
‘Because the only way we are going to dig ourselves out of our current economic hole is through the investment, the innovation, the ingenuity and the dynamism of British business.’
Governments have made it harder to turn a profit and harder to employ people: it’s no way to run an economy
By Shevaun Haviland, director general, British Chambers of Commerce
British business has two demands of whoever leads Britain next. Neither is money.
Keir Starmer has announced he’s leaving Downing Street and Andy Burnham is back at Westminster. Politicians have talked of little else in recent days: who leads Labour, and who leads the country. I will leave the politics to them. But I will say this, business stands ready to help them deliver growth.
I represent tens of thousands of firms through the British Chambers of Commerce, and in my five years leading it, one word has defined the world they work in. Instability. Economic shock, policy churn, and political change, one after another. Our members have proved resilient through all of it. But they want to do more than weather the next shock. They want the confidence to build.
Let me be clear about where we start from, because the gloom is overdone. This is an extraordinary country. We invented modern commerce, and we are home to firms that have shrugged off Covid, Brexit, tax increases, and a tariff war without losing their nerve. The ingredients for growth are all here.
Something, however, has gone wrong with the mix. Growth this year will come in under one per cent, and next year looks much the same. Capital that ought to be building modern production lines and data centres is sitting in deposit accounts, and bosses who ought to be hiring are waiting to see what gets thrown at them next.
Fixing this is not complicated. Business asks two things of Government, and only two. First, good policy. Second, policy that lasts.
On the first, credit where it is due. The Chancellor has worked hard to get big projects moving, from a third runway at Heathrow to Northern Powerhouse Rail. Ministers have rebuilt relations with the EU and struck trade deals from the United States to India. Cutting the friction our exporters face is exactly the right instinct, and we have backed them for it.
But that good work risks being wiped out by the relentless piling-on of cost. By our estimate, Government-imposed costs on business have risen by more than 70% in a decade. Let that sink in. Through every shock and headwind, successive Governments have made it harder to employ people, and harder to turn a profit.
That is no way to grow an economy, and it points to one unavoidable conclusion before the Autumn Budget. Taxing business any further is a road to ruin. It is the surest way to destroy the fragile confidence firms have left, and you cannot tax a company that has already closed its doors. Employer National Insurance is still working through payrolls, the Employment Rights Act is layering on more, and the talks we were promised on its detail have gone oddly quiet. There is nothing left in the tank.
Which brings me to the second ask. Whatever a government decides, it has to hold its nerve and stick to it.
Nobody commits serious money when they cannot see round the next corner. A firm weighing a new factory, or a hundred new jobs, is making a ten-year bet, and it will not place that bet in a country that changes direction with every reshuffle. If we want to be taken seriously abroad, we have to stop arguing with ourselves at home.
This Thursday, for the first time at any business conference, all five major parties will take our stage, the Chancellor included. Each will hear the same thing. We are not interested in their slogans. We want to know whether they grasp the truth that decides everything else: almost nothing they want is possible unless business is free to grow.
Because growth is not made in Whitehall. It is made in firms like the Summer Berry Company in Sussex, which has invested in new technology to grow British strawberries all year round. Or Sensoteq, a Northern Irish firm whose monitoring technology now sells into more than fifty countries.
Nobody handed them that success. They built it in spite of the conditions, not because of them. That is what this country can do when we let it. We do not lack the talent or the ambition; we lack the conditions. Get those right and hold them steady, and business will do the rest.