Britain's businesses aren't a 'piggy bank' to be raided: Iceland boss's warning to Burnham ahead of Budget
The boss of Iceland supermarket has sent a message to Andy Burnham and the Chancellor ahead of next month's Budget.
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Labour peer and Iceland executive chairman Lord Richard Walker told LBC this morning that ministers must not keep businesses tied up with more taxes and red tape and said that the cost of employing staff needs to come down or more businesses will fail.
He told Nick Ferrari: "Tough choices are now needed. We cannot, for the sake of all of us, keep taxing business and view it as some piggy bank that can constantly be raided, because as I said, it's only business that, that creates growth.
"And therefore, we have to now start reducing spending, or at least cutting the rate of increase of spending.
"The real crunch time is coming up now. You know, the nights are drawing in, it's getting colder, and it's time to make some hard choices.
"So let's see how the next month plays out, and especially the budget in October."
"It is business that pays for everything, and I think that is worth repeating to politicians. It is only business that invests, creates jobs, and pays tax. And a growing private sector can do more to alleviate poverty than any government subsidy or handout.
"We have to reduce the cost of employing people, and clearly the National Insurance employers' tax was a bitter pill there, and the numbers are now flowing through in terms of the cost of all of that.
"We've got 1 million 16 to 24-year-olds not in education, employment, or training. That is a moral as well as a financial crisis for this country.
"And we've got a benefits bill that is out of control. You know, you can sign on for PIP untested far too easily. And I think we need to get a grip on that.
He also said that the pensions triple lock should be changed because it is "mathematically impossible."
"Why not just peg it to earnings? And call it the earnings lock, because it will go up at 3.9% this year, way ahead of inflation.
"And guess what? Next year it'll go up again because the wage inflation will follow through to general inflation. So we just cannot afford it anymore as a country.
"I think the triple lock cost is now £150 billion as a nation. It's—I think it's profoundly unfair and it's mathematically impossible."
The shadow chancellor warned yesterday that “Labour are squeezing small businesses dry."
Andrew Griffith said in a speech: "They are taxing them too much and crushing them with a complex tax system that is working against them.
“Labour’s jobs tax and business rates raid have done immense damage, and their employer red tape has placed yet another burden on the shoulders of businesses.
“In addition to these costs, the average small business now spends more than a working week every year doing the Government’s paperwork.
“We need to cut taxes and make the tax system easier to navigate. Andy Burnham and John Healey must rule out tax rises at the Budget and pledge not to increase an exit tax or any other new taxes.
“Unlike Labour, the Conservatives are listening to business, and we are committed to making tax lower and simpler.”
Mr Griffith is to commission a taskforce to investigate how to reform the tax compliance system, with a view to reduce the burden faced by small businesses.
It will be led by Tory peer Lord Mackinlay of Richborough, the former South Thanet MP, and Robert Colvile, the outgoing director of the Centre for Policy Studies think tank.
Small businesses face a combined cost of £25 billion a year because of tax compliance, and business owners spend 44 hours a year on tax paperwork, the Federation of Small Businesses has previously estimated.
Lord Mackinlay said: “Small businesses and the self-employed are the backbone of the nation but have spent far too long being penalised by the state simply for wanting to just get things done.
“I’m honoured to work with the shadow chancellor to put this right for the millions of people up and down the country who are the main drivers of growth in the economy.”
Reform UK Treasury spokesman Robert Jenrick took aim at his former colleague Mr Griffith, and suggested his tenure as a Treasury minister under then-chancellor Kwasi Kwarteng in 2023 had led to tax administration becoming more complicated for small businesses.
Mr Jenrick said: “Andrew Griffith was the very person who abolished the office for tax simplification after the tax code ballooned to 23,000 pages – why on earth would anyone believe him now? After making IR35 worse, freezing VAT thresholds and imposing reams of red tape, businesses won’t forget the Tories’ betrayal.
“While the Tories still refuse to acknowledge the damage they caused, Reform UK has a fully costed plan to back Britain’s small businesses. We will raise the VAT registration threshold to £150,000, reverse Rachel Reeves’s jobs tax and strip away unnecessary EU regulations like GDPR that choke growth.
“Simply asking Labour not to raise taxes isn’t enough. Britain needs a radical change in direction not more hollow talk from a stale Tory opposition that had every opportunity to fix the system and failed.”
A Labour spokesperson said: “We won’t take any lectures from the Tories on the economy – not least when it was only last week that Andrew Griffith was praising the ‘lots of good things’ in Liz Truss’s disastrous mini-budget.
“The Chancellor is fully focused on his priorities: giving families and businesses breathing space, backing British jobs, and driving growth in every postcode, underpinned by a commitment to meet the fiscal rules.”