Andrew Griffith: The gap between what business needs and what this Labour government is doing to them grows every day

Andrew Griffith is Shadow Secretary of State for Business and Trade and was a business executive for more than 25 years before entering Parliament in 2019.

 To have a single billion-pound fiscal blackhole may be regarded as a misfortune. To have multiple in your first year as Chancellor looks like carelessness. The recent news about the latest Rachel Reeves’ black hole ripped in our nation’s finances – whether £20 billion or £50 billion – now makes the question of more tax rises in the autumn one of when rather than if. It has left businesses paralysed in fear.

Like a spoiled undergraduate away from home for the first time, the Chancellor’s financial discipline is appalling. Entrepreneurs worry that that rather than cut spending, her summer nights are fever dreams of where next to crush business with tax hikes. Britain is funding her failure which only seems to be getting more expensive by the minute.

Like fresher’s week friends, the useful idiots from the business community queuing up to support Labour before the last election have all melted away. Not a single business has endorsed all the measures in their flagship 300-page, job destroying, Employment Rights Bill – the clue is not in the name.

Along with Labour’s loveless landslide last year came hopes from the business community for the stability which a Covid pandemic and then Russia’s invasion of Ukraine during the former Conservative government had denied them. In taking risks to invest or to hire, businesses want as much certainty about the future as possible. But projecting that desire onto a socialist party whose uniting philosophy is a larger, high tax and more interfering role for the state was always deeply naïve.

With each passing week comes news of fresh tax grab plans – this week it was a new inheritance tax punishment.

The only thing certain now is uncertainty.

In their first year in office Labour imposed huge headwinds on Britain’s business. The tone was set early with the manifesto-breaking £25 billion jobs tax that punishes aspiration and hits those on the lowest incomes the most. As we and groups like UK Hospitality and the British Retail Consortium told them, taxing jobs is one of the most destructive ways to raise revenues. It reduces employment, pushes people into welfare, and creates a two-tier economy – weighing down the most productive parts of the economy to support the least productive. We warned them not to go ahead with it, but they ploughed on regardless, cheered by the large body of left-wing backbenchers in the Labour Party who are at best indifferent to wrecking the private sector and hungry for a swollen state.

And that isn’t all.

Breaking yet another promise, Labour’s ‘death tax’ on family businesses is already starting to impact on the incentives to grow or continue the nation’s millions of family business. This punishing change would bring a small chain of family butchers, bakers or hairdressers into scope with most having no prospect of finding the cash to pay a large and unexpected tax bill without selling the business. Just like the Jobs Tax, it will syphon money away from wages, investment and the profits which fuel growth in the UK.

Other anti-business measures include higher business rates, imposing ‘green’ packaging levies and extra tax on air travellers. It is no wonder that unemployment has been higher every single month that Labour have been in charge. Or that business confidence is at the lowest levels recorded since many of the surveys began.

And don’t forget that this is just the start.

Already announced but yet to bite are Labour’s carbon tariff which will add to the cost of almost every imported item, higher energy costs through yoking the UK to the EU Emissions Trading Scheme and an Audit Reform and Corporate Governance Bill which will be another volley of red tape and legally imposed wokery which no business ever asked for.

And then, when Parliament returns in a few weeks, passing new laws for the biggest expansion of trade union power for half a century with rights to make strikes easier and more damaging.

Those who can are understandably voting with their feet.

Even in a notoriously discrete sector, survey after survey has shown wealth creators fleeing the UK since this government came to office. The fact that 4,000 company directors have upped sticks shows we are witnessing quite possibly the largest ‘brain drain’ in British history with hugely damaging erosion of the tax base as the consequence. It is estimated a further 16,000 millionaires are set to leave this year – Keir Starmer beating even communist China to the top spot of this unenviable league this year.

Unlike this Labour government, my own background is in business. Also, unlike Labour ministers, I spend a lot of time listening to real businesses around the country. Their number one ask is for a ceasefire in this war on private enterprise, and for the Chancellor to now rule out further tax raids – something she was happy to do once but is now suspiciously loath to repeat.

Ultimately, this is a government that doesn’t understand business. What’s worse is it has no apparent interest in finding out what they need. No wonder the UK now languishes at 29^th place of the ranking of global competitiveness whilst unemployment has risen consistently in the ten months they have been in charge.

As ever, those who will pay the price of Labour’s economic vandalism are the hard-working families left paying more tax to cover those who’ve left; ‘generation jobless’ – the young people struggling to get their first job after school or college; and our decaying high streets.

The next Conservative government will reverse this decline and take a chainsaw to many of Labour’s worst policies such as the family business ‘death tax’ or the return to 1970’s style trade unionism in the Employment Rights Bill but business need action now, not in four years’ time.

Sadly, I’m sure there will be many more anti-business laws that will desperately need to be repealed before Keir Starmer, Angela Rayner and Rachel Reeves are consigned to the rubbish bin of history.

As the gulf between what businesses need and what they are getting grows by the day, it’s a shame our Prime Minister doesn’t seem to recognise this.