M&S Chief Urges Labour to "Take Handcuffs Off Business"

Stuart Machin, the chief executive of Marks & Spencer, has called on the current Labour government to reverse fiscal policies he describes as "mistakes" that have hindered economic growth. In a public address, Machin characterized Labour's previous budgetary decisions as "disasters" and a "crushing disappointment" to consumers, employees, and businesses alike.

Machin urged the new Chancellor, John Healey, to "restore hope" within the business sector and foster economic growth by removing what he termed "handcuffs" from businesses and returning purchasing power to the public. His remarks, published in the Daily Mail, precede Chancellor Healey's first budget, expected in late October.

He warned that rising taxes and increased operational costs have escalated the cost of doing business, leading to higher prices for consumers. Machin specifically cited the National Insurance tax increase on employers and potential new worker rights legislation as detrimental to businesses. He also criticized new recycling regulations, a packaging tax, and the existing business rates system as burdensome.

Other business leaders have echoed Machin's sentiments, calling for a budget that prioritizes job creation. Sir Martin Sorrell, a prominent figure in the advertising industry, emphasized the need for concrete growth policies rather than mere discussions of growth. He also noted a trend of high-net-worth individuals leaving the UK, suggesting that a perceived "dislike of wealth creation" and high taxation discourage business investment.

Jason Tarry, the boss of John Lewis, cautioned that tax increases on large retail stores could lead to high street closures. He advocated for a clear commitment in the upcoming budget to ensure that shops do not face higher taxes.

The interventions coincide with global economic pressures, including a significant increase in the UK government's borrowing costs, which have reached a 28-year high and are higher than other G7 nations. Bank of England Governor Andrew Bailey has also issued a warning about the need to balance the books to maintain investor confidence.

Machin outlined six specific proposals for Chancellor Healey:

• Scrapping the upcoming Deposit Return Scheme, which he described as "patently ridiculous" and estimated would cost retailers tens of millions to implement.
• Ensuring the Employment Rights Act does not inadvertently penalize entry-level positions, using the example of "Saturday jobs."
• Finalizing a food and drink trade deal with the European Union to reduce import costs and boost British exports.
• Reversing the cut to the National Insurance threshold for employers, which he stated disproportionately affected businesses with a large number of part-time and entry-level employees.
• Reforming the business rates system, arguing that the current structure places an unsustainable burden on the retail sector.
• Eliminating the packaging tax, which he characterized as a tax on food and drink suppliers and consumers, citing a £40 million charge M&S incurred.

Machin stressed that these changes are necessary to "unravel the mistakes of the past two Budgets" and to foster a business environment where companies can invest, employ, and expand. He concluded by expressing hope that the new Chancellor will provide a clear plan to restore confidence among British businesses.