Neil Garratt: London needs a Mayor who believes in enterprise

Neil Garratt is the London Assembly member for Croydon and Sutton.

In 1959, Winston Churchill observed to his Woodford constituents:

“Among our Socialist opponents there is great confusion. Some of them regard private enterprise as a predatory tiger to be shot. Others look on it as a cow they can milk. Only a handful see it for what it really is: the strong and willing horse that pulls the whole cart along.”

Seventy years on, we find the tiger shooters have taken over the Green Party while the milkers fill the Labour Cabinet but the essential truth remains: employers feel drained, people are losing their jobs, and the economy is sadly going nowhere. What is to be done about all this?

I decided to get the facts straight from the horse’s mouth by convening a roundtable discussion of London business: what’s working, what’s not, and where do we go from here? What I heard shocked me.

What stood out most was a common theme that cut across every sector and every size of business: a sense that London has lost its oomph. There is a lack of ambition and zest that attendees felt was the single biggest force holding the city back. From City Hall to Whitehall, Labour is light on business experience and it shows. To them, successful companies are just another source of tax.

The biggest alarm bell is the brain drain. London is packed with talent and an impressive list of unicorn startups; every year dozens of companies reaching a $1 billion value. But the story behind the story is that these ambitious companies are increasingly lured abroad, where financial backing is easier to find. US funders then insist companies make plans to relocate, taking future British wealth and jobs to America.

Retail theft is another big worry and it’s up despite the Mayor’s selective stats on crime. Staff safety, profitability, and wages all suffer when brazen shoplifters march out the door with an armful of stock. Some businesses are even weighing up whether to continue trading in a city where not only is retail crime increasingly common but seemingly legalised. It is hard to maintain confidence in a city when the basic compact that the law will be enforced is visibly failing.

Tax and bureaucracy came up repeatedly. Labour’s jobs tax is predictably cutting firms’ willingness to hire, as it now costs nearly £30k to employ someone on minimum wage. Business Rates are crippling what remains of profitability for some hospitality businesses, a cruel gut-punch after Chancellor Reeves trumpeted a cut to hospitality Business Rates in her Budget speech. People were stunned when the Treasury website told them their tax bill would double. And now Khan is delighted to announce a holiday tax on top of everything else, an overnight charge on every visitor. There’s only so much people can afford to pay for a meal, a drink, or an overnight stay, at which point businesses will just go pop.

The short-termism is glaring. By trying to pump as much tax as possible from the private sector, from the point of sale to the back office costs, Labour are blocking companies from achieving the long-term success that would generate natural increases in tax revenue. Not to mention creating jobs, selling goods and services to willing buyers, and inventing the products of the future we’ve barely dreamed of. Churchill’s willing horse can pull the cart a long way, but not if you keep loading it with rocks.

The capital deserves a Mayor who knows in their bones that prosperity does not come from slicing the pie ever-more finely, but from letting people bake more and bigger pies. A Mayor who sees that when businesses succeed, the benefits flow to everyone: to the companies in their supply chains, to the employees who see their pay rise, to the wider economy that benefits from their spending. My report, which you can read here, shows how Sadiq Khan could be more pro-business and unlock the abundant potential in London. Or, on the off-chance he chooses not to listen, how a future Conservative Mayor can bring London galloping back.